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Tax and Benefits

4. Mrs. Betty Williams (Conwy) (Lab): What recent discussions he has had with Cabinet colleagues on financial support through the tax and benefits systems to parents in Wales. [12329]

The Parliamentary Under-Secretary of State for Wales (Nick Ainger): My right hon. Friend the Secretary of State and I regularly hold discussions with ministerial colleagues on a range of issues, including support to parents in Wales through the tax and benefits systems. Far more parents in Wales are benefiting from the financial support under the working tax credit and child tax credit than under any preceding income-related financial support system. In 2003–04, more than
 
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220,000 in-work families with children in Wales were benefiting from tax credits, with an average award of £2,792.

Mrs. Williams: My hon. Friend will be aware that families in Wales have widely welcomed the tax credit system, which has definitely been a contributory factor in lifting families out of poverty. However, many families are still experiencing hardship caused by errors made by Her Majesty's Revenue and Customs when calculating their entitlement. Will my hon. Friend undertake to have further discussions with his Treasury colleagues to ensure that a way is found to help those families out of their difficulties?

Nick Ainger: My hon. Friend is right to highlight the great benefit of the tax credit system to families in Wales. In her own constituency, 5,000 in-work families are in receipt of tax credits, and the average amount involved in her constituency is £3,080 per family. In relation to the problems caused by overpayment, the Government recognise the difficulties that have been caused by administrative problems in the tax credit system, but that should not detract from the fact that millions of families across Britain are much better off as a result of the system.

The Paymaster General has announced a series of measures to build on the reforms that we have already introduced, including measures to streamline the procedures for recipients to inform Her Majesty's Revenue and Customs of changes in their income, and to simplify the information provided to families. She has also announced a review of changes to the procedures for dealing with disputed awards, and I am sure that she will respond to the points raised by my hon. Friend the Member for Conwy (Mrs. Williams), which I shall draw to her attention.

Mr. Wayne David (Caerphilly) (Lab): Following what the Minister has just said, does he agree that, although there have been problems in the tax credit system, we have to keep things in perspective? We need to recognise that the tax credit system is probably the most effective means that we have of tackling child poverty.

Nick Ainger: Indeed. Before 1997, when this Government first came to power, one in every three babies in Britain was born into poverty. Under the previous Conservative Government, the number of children growing up in households in which no one had a job rose to almost 20 per cent. We have not only had great economic success in creating 2 million jobs since 1997; we have also made work pay, and taken more than 1 million children out of poverty. That is a success.

Bill Wiggin (Leominster) (Con): Wales has the highest rate of child poverty in the UK, affecting one in every three children. Yet Citizens Advice has recently condemned the tax credit system for being subject to "completely unacceptable errors". One in three recipients have been overpaid and pushed into deeper poverty when forced to repay the money. What will the Minister do to stop the failures of the tax credit system putting even more pressure on struggling Welsh families?

Nick Ainger: As I have already said in response to my hon. Friend the Member for Conwy (Mrs. Williams),
 
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the Government are already tackling those administrative problems. Moreover, it is worth noting what Citizens Advice said in its report:

"We firmly support tax credits as a vehicle for directing substantial extra money towards lower income families, and we want the system to work effectively for all who are entitled to the extra help."

That is something that those families are getting now, and that they never did when the hon. Gentleman's party was in power.

Bill Wiggin: A man from Bridgend reported that he had received a bill for £4,000 following overpayment of child tax credits, despite the fact that that tax credit agency admitted that he had provided the correct information at every point. Another man, from Abergele, was paid £400 too much each month, despite making numerous phone calls to query the amount that the family were being paid. Nearly 2 billion of the tax credits paid out over the past year were overpayments, and the Government are hounding people into a financial nightmare. How can the Minister expect to improve the standard of living for children in Wales if this continues?

Nick Ainger: As I said in response to an earlier question, it is clear that substantial errors have been made, and the Government do not deny that fact. The parliamentary ombudsman's report and the Citizens Advice report identified serious errors. The Government have a duty, however, to try to reclaim overpayments where it is reasonable to do so. Anyone who disputes whether they should repay such an overpayment has a procedure to follow. The Paymaster General has given assurances that she is considering those disputes procedures.

National Assembly (List Members)

5. Mark Tami (Alyn and Deeside) (Lab): What plans he has to introduce legislation affecting the position of list Members in the National Assembly for Wales. [12330]

The Secretary of State for Wales (Mr. Peter Hain): The White Paper "Better Governance for Wales", promises to prevent constituency candidates standing as list Members in line with our manifesto commitments.

Mark Tami: I thank my right hon. Friend for that answer. I am sure that he has seen the Leanne Wood guide to being a good Assembly list Member in today's Western Mail, in which she advocates avoiding casework but using the considerable budgets to employ staff only two to three days a week so that they can spend the rest of the time on political activity, and of course Leanne's golden rule:

"On receipt of every invitation, ask 'How can my attendance at this event further the aims of Plaid Cymru?' If the answer is 'very little' or 'not at all', then a pro forma letter of decline should be in order."

Is not it time that we had an urgent inquiry into the role of these list Members, who are unelected and unaccountable?

Mr. Hain: The answer is yes. Plaid Cymru list Members have now been caught red-handed abusing the
 
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system in the Assembly. The Presiding Officer should have a proper inquiry into the abuse of taxpayers' money by Plaid Cymru list Members. These instructions from Assembly Member Leanne Wood are a consistent abuse. I will read out another example—

Mr. Speaker: Order. Perhaps the Secretary of State can allow the Assembly to read about the matter.

Adam Price (Carmarthen, East and Dinefwr) (PC): As we all know, politics—[Hon. Members: "Apologise."] May I speak? Politics is a much-maligned profession, and it is usually other politicians who do the maligning. May I suggest to the Secretary of State that his constant disparaging remarks about Assembly Members will make it difficult for us to encourage people of calibre of all parties to put their names forward for the next Assembly elections? Is that what he wants?

Mr. Hain: I am absolutely astonished. The hon. Gentleman is defending the behaviour of Plaid Cymru list Assembly Members who have abused the system. I will read out another section from the advice:

"We need to be thinking much more creatively as to how we better use staff budgets for furthering the aims of the party."

Those are the equivalent of Commons staff budgets applied to the Assembly. I and my hon. Friend the Under-Secretary will be taking the Government of Wales Bill through the House in the next year or so, and if the Assembly does not to tighten the rules on the behaviour of list Members and the abuse of their allowances, I might have to take powers under the Bill to do so myself.

Nia Griffith (Llanelli) (Lab): Given the utter contempt that Leanne Wood is showing for constituents by describing casework that a Plaid Cymru regional Assembly Member did for 2,500 constituents as a waste of time, because canvassing returns showed that few of them were inclined to vote for Plaid Cymru, will the Secretary of State order a thorough investigation into the role of regional AMs, and seek to establish whether their offices and staff are a waste of public money?

Mr. Hain: I am tempted to read out even more damaging quotes, but I will spare the House. I agree very much with my hon. Friend that this is an abuse of the system. It vindicates exactly the Government's policy of banning list Members from standing in constituencies. They must make a choice. Taxpayers will want to know that list members are not abusing the Assembly's resources, because ultimately those resources are voted by the House of Commons. I think it is time that Plaid Cymru, Liberal Democrat and Conservative Members stopped defending this outrageous behaviour by Assembly list members.

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