Select Committee on Public Accounts Minutes of Evidence

Examination of Witnesses(Questions 160-169)


MONDAY 20 MAY 2002

  160. Is it going to remain a benefit?
  (Sir Nicholas Montagu) The Chancellor has in all utterances, when speaking of the new tax credits and what they would do for families, in particular the new children's credit, spoken of building on the foundation of child benefit.

  161. I am asking whether child benefit will remain a benefit.
  (Sir Nicholas Montagu) I hope it will be of great benefit.

  162. No. Is child benefit being abolished under these proposals?
  (Sir Nicholas Montagu) No, absolutely not. The Chancellor has spoken about building on the foundation of child benefit.

  163. I am not clear, because there is this new children's tax credit. Child benefit as a payment. Mr Osborne is newly a father.
  (Sir Nicholas Montagu) Congratulations. Boy or girl?

  Mr Osborne: Boy.
  (Sir Nicholas Montagu) Commiserations!

  164. Mrs Osborne currently receives child benefit and it is called child benefit. Will a thing called child benefit continue to be paid to Mrs Osborne but simply by your Department rather than by DWP?
  (Sir Nicholas Montagu) Exactly that. I am sorry, I did not quite understand the question. The point I was making was that the Chancellor is giving a strong `no-change' message where child benefit is concerned.

  165. So why did it have to be moved from DWP to Inland Revenue?
  (Sir Nicholas Montagu) On the machinery of Government you should ask the Prime Minister rather than me.

  166. Did Rachel ask you why it was being moved across?
  (Sir Nicholas Montagu) I suspect that probably communications between Permanent Secretaries are nearly as sacrosanct as those between Permanent Secretaries and Ministers.

  Chairman: That line of questioning is a tiny bit unfair.

  167. I was just curious that this new child tax credit arrangement seemed to imply that it was being turned into another form of tax credit. You are telling me that is not the case.
  (Sir Nicholas Montagu) No.

  168. It is child benefit, it remains child benefit, it will continue to be called child benefit and it will continue to be paid as a benefit not a tax credit.
  (Sir Nicholas Montagu) Yes. I am grateful for your protection, Chairman. I think, again going carefully, that you will find what the Prime Minister and the Chancellor and the Secretary of State have said is essentially in terms of streamlining and bringing together the different types of support for families with children. The new children's tax credit will subsume the children's element in job seeker's allowance and income support as well as that in working families' tax credit.

  169. It is merely the case that the organisation which is administering any tax credits is also the body which pays child benefit.
  (Sir Nicholas Montagu) That seems to be the emphasis which Ministers have given in their speeches.

   Chairman: Thank you very much, Mr Bacon and thank you Sir Nicholas and your colleagues. Once again your virtuoso performance has made even the Inland Revenue's Appropriation Accounts 2000-01 interesting.
  (Sir Nicholas Montagu) They are a riot every year.

  Chairman: Thank you very much. Order, order.

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