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Paul Farrelly: Will the hon. Gentleman give way?

Mr. Prisk: I will not because I want to ensure that the Paymaster General has plenty of time to answer the questions.

What of the infamous telephone hotline? Four weeks before the credits were due to become available, no one could get through. Indeed, one man reportedly made 2,400 attempts, only to be put on hold and then told that the form he needed would take 15 days to arrive. When that hotline was clearly collapsing, why did the Paymaster General persist with an £11 million advertising campaign encouraging even more people to call?

In a written answer on 12 March the Paymaster General advised me that the Treasury had spent a staggering £53 million just to set up the hotline. That is an enormous amount of money for a telecentre, far more than most large commercial centres. Yet with all that money, it could cope with only 500,000 calls a week. [Interruption.] Let me tell the Parliamentary Private Secretaries, Tweedle-Dum and Tweedle-Dee, that 6.5 million families are eligible. Anyone, perhaps with the exception of the hon. Gentlemen, could have predicted that the majority would want to call in the last couple of weeks. Is it any wonder that the system broke down? Did the Minister think to ask why the capacity was so inadequate?

What makes things worse is that Ministers were warned of the risks right from the beginning. The right hon. Member for Birkenhead (Mr. Field) said as far back as 1998 that the whole tax credit system was "fraught with great dangers". At a practical level, even the Office of Government Commerce, the Government's IT procurement experts, cautioned that the project was very ambitious. Last December, it said that the project was of a large and complex nature and would require unprecedented co-operation between Departments, and we know that that does not happen in this Government. As such, it says that the new system ranks as

It was quite right, yet the Paymaster General turned a deaf ear to all the warnings.

What did the Paymaster General do to satisfy herself that those risks were being addressed prior to 6 April this year? What steps did she take to ensure that the unprecedented departmental co-operation would be forthcoming? Now, after all the stories that our constituents have told us about the difficulties that they have encountered, what steps has she taken to ensure that it will not happen again?

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For some people, insult has been added to the injury. Most people would expect that as they are out of pocket, the Revenue would pay them back in full, but that is not the case. Instead of a single cheque, people are paid in instalments. One family in the constituency of my hon. Friend the Member for Stratford-on-Avon (Mr. Maples) is reportedly owed nearly £1,500. Instead of a single cheque, the Government are generously going to give them £37.66 a week until they get the money back in total. Given that the family had to borrow to make up the shortfall, they are, not surprisingly, less than happy. Apparently, that is possible because of a little rule, tucked away in the details. As the family claimed on 28 April, the procedure is in order, but when we check that information, we discover that it has not been provided to the public. According to a member of the Revenue staff, the reason for the staged payments is that the computers and the giro system cannot cope with paying out such a large amount at once. That is the truth of the matter.

Did the Paymaster General sanction that rule? Will she now rescind it? Does she agree that bank charges and other penalties caused by the Revenue's incompetence are reasonable? Will she confirm that the Government will compensate such claims? Given the confusion over the deadline for making claims, will she scrap that arbitrary hurdle and let people continue to claim their money throughout the tax year?

In its manifesto for the 2001 general election, the Labour party said that the welfare state would help people but that Labour "demands responsibility in return." Well, that works both ways. We and those we represent demand that Ministers take responsibility for their policies and for the running of their Departments. Denying knowledge is not good enough, as the Chairman of the Treasury Committee told the Paymaster General only last week. Ministers have responsibility and Conservative Members intend to hold them to it.

The Paymaster General is responsible. She is responsible for the failure of a policy that clearly is not working, for the failure to listen when others warned, for the failure to act on those warnings and for the failure to lead on this issue rather than just follow. Above all, the Paymaster General is responsible to the millions of families who trusted this Government and who have been so badly let down. She has failed them; she has failed in her ministerial responsibilities; and it is now time that she answered for that failure.

9.50 pm

The Paymaster General (Dawn Primarolo): Until the last contribution, the debate, including the remarks of the hon. Member for Havant (Mr. Willetts), had been a thoughtful one. As my hon. Friends the Members for Aberdeen, South (Miss Begg) and for Glasgow, Cathcart (Mr. Harris) said, the tone of the debate needs to be carefully balanced. Until the last contribution, the tone in the Chamber was one of support for the tax credits scheme. There was an acknowledgement of the need for an anti-poverty strategy, and Opposition Members expressed their support for such a strategy. Suddenly, however, we had the synthetic anger of the hon. Member for Hertford and Stortford (Mr. Prisk),

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who simply confirms the thoughts of my right hon. and hon. Friends that the true intent of some Opposition Members is to undermine, and eventually destroy, tax credits.

Tax credits are being claimed by families in their millions, contrary to the predictions of Opposition Members before the system came into effect. We have about 4.5 million claims, in addition to the 1.3 million families who receive increased support for their children through income support and jobseeker's allowance. Each week, tens of thousands of claims are being made, and the number of claims in payment is steadily rising. We now have more than 4.2 million awards.

The take-up of tax credits is a huge success, and in their first three months we put 4.2 million claims into payment. This is a major achievement in enhanced family support, which reaches far more people than the old tax credit or the other systems did. The point of these reforms is to raise children out of poverty—a proposition that Opposition Members, or at least some of them, claimed to support. However, we can see that when they were in power, Britain had the fastest rising levels of child poverty in the European Union.

I come now to the points made during the debate. First, I want to say where we stand as of 7 July. So far, 4.5 million claims have been received. More than 4.25 million are in payment, and 186,000, awaiting further information, are still being worked on. Sixty per cent. of those claims have arrived since 1 June, and almost 50 per cent. arrived in the past two weeks. The hon. Member for Havant continues to make the accusation about the missing million. He knows full well that nine out of 10 families are eligible, which means that 5.7 million families can receive the child tax credit in 2003–04. That is no secret. The rest will receive the working tax credit, which gives us a figure of 6 million. There is no secret about the figure; it was in the Budget book—5.75 million families eligible for child tax credit and 250,000 for working tax credit only. Even if we accept the hon. Gentleman's figure of 6.5 million claims, 84 per cent. are in payment in three months.

The hon. Member for Havant said that he had played a modest part in the introduction of the family credit. It had a 57 per cent. take-up in its first 12 months. Let us be clear—on 28 April I said that more than 4 million claims had been received and 3.2 million claims were in payment. Today, there have been over 4.5 million claims and 4.25 million are in payment.

The hon. Gentleman also mentioned the most vulnerable groups. Let us be clear about that, too. The most vulnerable of those on income support and jobseeker's allowance are already receiving the benefit of the tax credit increases in their child premiums, and they will not be transferred to the new system until next year. There is no question of delay. Families previously claiming working families tax credit and disabled person's tax credit were all contacted to encourage them to apply. When they applied, their claims were given priority. Almost nine out of 10 of those receiving working families tax credit in March have already claimed and are being paid. Many others are among the more recent claims on which the Inland Revenue is working as fast as possible.

The hon. Member for Northavon (Mr. Webb) and the hon. Member for Havant referred to the new framework. Tax credits are an entirely new framework,

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building on tax and social security rules to create an integrated system of tax and benefit. Three months' backdating strikes the right balance between allowing time to claim and not requiring people to build their history over a longer period. That is the system that will remain in place. It is better than the working families tax credit, which allowed no backdating, and it is better because the new tax credits are more generous. They strike the right balance with child benefit and in the time allowed for people to claim.

The issue of compensation has repeatedly been raised, and rightly so. I have told the House the position. For those who have not received the service to which they were entitled on commitments from the Inland Revenue, the Inland Revenue has a process for dealing with the appropriate compensation.

The hon. Member for Northavon asked about families without children. We expect 250,000 families without children to claim during 2002–03, in addition to the 1.1 million families with children whom we expect to receive the working tax credit as well as the child tax credit. I cannot give the hon. Gentleman a breakdown of the 4.25 million claims in payment, but the figures will be available in late August or early September, as we start to publish the figures for claims and who receives them.

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