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Delegated Legislation Committee Debates

Draft Child Benefit and Guardian's Allowance (Decisions and Appeals) Regulations 2003

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Ninth Standing Committee

on Delegated Legislation

Thursday 20 March 2003

[Mr. Alan Hurst in the Chair]

Draft Child Benefit and Guardian's Allowance (Decisions and Appeals) Regulations 2003

2.30 pm

The Paymaster General (Dawn Primarolo): I beg to move,

    That the Committee has considered the draft Child Benefit and Guardian's Allowance (Decisions and Appeals) Regulations 2003.

What a pleasure it is to see you in the Chair, Mr. Hurst.

The regulations will transfer the responsibility for decision making on child benefit and the guardian's allowance to the Commissioners of Inland Revenue. That was provided for under section 50 of the Tax Credits Act 2002, which transferred responsibility for the administration of both child benefit and guardian's allowance to the Board—the Commissioners—of Inland Revenue.

In June 2001, the Prime Minister announced the transfer of the responsibility for child benefit and guardian's allowance in Great Britain. That was followed, in November 2001, with confirmation from the Northern Ireland Assembly that it was content to transfer responsibility for those benefits in Northern Ireland. The transfer to the Revenue will take place on 1 April.

Child benefit and guardian's allowance will remain social security benefits, and the rules that govern entitlement to them and how they should be administered will remain those set out in the existing Social Security Acts. The four sets of regulations on child benefit and guardian's allowance, which were laid on 3 March and of which this set forms a part, consolidate all the provisions in secondary legislation governing the two benefits throughout the UK. The new regulations are necessary as a result of the transfer of responsibility to the Inland Revenue.

The new sets of regulations will ensure that the Inland Revenue and those who are claiming, or advising claimants on, the benefits will need to refer to only a single set of up-to-date provisions that clearly set out the extent of the Revenue's powers. The draft regulations will replace the provisions on child benefit and guardian's allowance in the Social Security and Child Support (Decisions and Appeals) Regulations 1999, and the Northern Ireland equivalent. They will create a consolidated set of regulations governing all decisions made by the Board on child benefit and guardian's allowance, including when decisions can be changed, information requested, payments suspended or entitlement terminated, and when and how claimants can appeal against those decisions. Appeals will continue to be heard by the same appeal tribunals; they will be governed by the Social Security Act 1998, and we do not intend to change that.

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It is intended, a consequence of the transfer of responsibility, that the regulations should replace the existing regulations in Great Britain and Northern Ireland. They do not change the nature of any rights, responsibilities or powers provided for in the existing regulations—it was not intended that the transfer should change them. In practice, claimants will see no difference as a result of the new regulations. They will have the same rights and responsibilities as they have now, and they will be able to appeal against decisions in the same way and to the same appeal bodies. In Great Britain, that means an appeal tribunal of the Appeals Service. There is an equivalent service in Northern Ireland. Those who rely on understanding the precise powers that apply to decisions of the Inland Revenue in such cases—local advice groups, legal advisers and the Revenue's own decision makers, for example—will be able to rely on a single, clear set of provisions.

In line with the principles of the tax law rewrite, we have tried to ensure that the new regulations are written in simple, plain English, to make them as easy to follow as possible, given the complex situations that they cover. We also felt that taking the opportunity to consolidate the regulations was preferable to relying on ad hoc amendments to the existing regulations and would ensure maximum clarity and accessibility.

The regulations make no substantive changes to claimants' rights and responsibilities. I hope that the Committee will agree that we have achieved our aim of providing a clear set of regulations for child benefit and guardian's allowance following their move to the Inland Revenue. I am satisfied that the regulations are compatible with the European convention on human rights, and I commend them to the Committee. I am happy to answer any questions that Committee members might have.

2.36 pm

Mr. Mark Prisk (Hertford and Stortford): This is the first time that I have served under your chairmanship, Mr. Hurst. I am sure that you will keep us on the straight and narrow this afternoon.

I thank the Paymaster General for her explanation. She mentioned a couple of things that require clarification, and I shall return to them later on.

The instrument states that the regulations will come into force on 7 April, which is just 12 working days away, so I would like to express my concern about its late arrival. On collecting my copy from the Vote Office a week ago, I found that two pages were missing. It turned out that all of the copies supplied by the Treasury at that point had those pages missing. My concern was then compounded by the fact that there were spelling mistakes in the draft provided to the House.

I notice today that there is also a discrepancy about when the regulations come into force. I draw the Committee's attention to first page of the instrument and the opening paragraph of the explanatory memorandum. According to the order, the regulations come into force on 7 April, but the explanatory memorandum says that

    ''The transfer of functions is effective from 1st April''.

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I fully accept that minor errors occur, but given that there are only a few days remaining before the regulations become lawful, the errors raise a series of questions that I hope the Paymaster General will be able to answer.

Why are the regulations being presented to Parliament so late? Is this the originally intended timetable, or has something delayed their publication? If so, what is the cause of the delay? Given the short amount of time before they come into force—should we approve them today—is the Paymaster General satisfied that those affected are sufficiently aware of them? What steps will be taken to communicate them to those affected?

With the implementation of the rules in only 12 days, is the Paymaster General satisfied that the Inland Revenue is ready? Do the regulations represent a need for new resources? Has any training been provided to Revenue officers who will need to undertake the new administrative task of handling these important benefits and allowances?

The regulations put into effect much of part 2 of the Tax Credits Act 2002, to which the Paymaster General referred. That relates to the transfer of the administration of child benefit and guardian's allowance to the Treasury and Inland Revenue, and away from what we used to know as the Department of Social Security, now the Department for Work and Pensions. She will know that Opposition Members have many concerns about the tax credit system that the 2002 Act introduced, and about the Chancellor's ceaseless tinkering, which has led to a waste of much public money, as the Public Accounts Committee has said.

The regulations focus on child benefit and guardian's allowance, and Opposition Members welcome the principle, accurately outlined by the Paymaster General, of consolidating and updating the many and varied statutes that date back to 1975. After all, a complex welfare system neither helps those most in need nor provides genuine value for money for the taxpayer. However, the regulations and the explanatory memorandum leave certain questions unanswered. Paragraph 3 of the explanatory notes says:

    ''The new sets of regulations are very close to being a consolidation of the existing regulations.''

The notes go on to highlight some of the differences.

Could the Paymaster General explain the practical implications that the transfer to the Inland Revenue will have for applicants for the benefit or the allowance? She said that there would be no change in rights and responsibilities, but there may be practical issues in terms of the different agencies handling the matter. For example, there are different offices in various locations with which people might have to deal. Will there be a similar number, and a similarly expert range, of officers available to those affected? Applicants and appellants often struggle to keep to the notice periods given. Will the lengths of notice be the same, or will there be any material changes?

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The explanatory memorandum says that the regulations will make

    ''very few changes of real substance''.

The Paymaster General has said that there will be no changes to rights and responsibilities, but could she tell us what those few changes of substance will be, and what they will mean in practice? In particular, on the transfer of functions to the Inland Revenue, given the Revenue's special legal status, can she confirm that the rights of applicants or appellants will not be diminished in any way? I know that she made a general point on the subject, but I want to check on that point, because the Revenue has a different status from that of the agency currently dealing with the benefits.

For those of us with an electronic bent, I note that electronic communications are rightly mentioned in regulation. What plans does the Revenue have to extend the use of online information for applicants and appellants, and will that information be ready in just 12 working days—or eight, depending on which document one looks at? Perhaps I am not being very intelligent about this matter, but could the Paymaster General explain regulation 4(2)? It says:

    ''References in paragraph (1) to the delivery of information shall be construed in accordance with section 132(8) of the Finance Act 1999(f).''

I am afraid that the meaning is not clear to me, and I know that the purpose of the regulations is clarity, so it would be helpful if she could provide that.

Opposition Members are happy, in principle, to support the consolidation and updating of regulations, to which the Paymaster General rightly referred. Of course, we have concerns about the seeming wholesale transfer of the welfare state to the Treasury and the Revenue, and about the attendant costs, but subject to my earlier questions, we shall not oppose the regulations.

2.44 pm


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