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The Earl of Northesk: I am grateful for the response of the noble Baroness. I am also gratified that she congratulated me on introducing a new, if old, topic. Nonetheless, I am happy to beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 146 to 147 not moved.]

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[Amendment No. 148 had been withdrawn from the Marshalled List.

[Amendment No. 148A not moved.]

The schedule, as amended, agreed to.

[Amendments Nos. 149 and 150 not moved.]

In the Title:

[Amendment No. 151 not moved.]

Lord Weatherill moved Amendment No. 152:

Line 1, leave out ("End") and insert ("Restrict")

The noble Lord said: This amendment is consequential on the agreement of the Committee to the amendment in the name of my noble friends Lord Carnarvon and Lord Marsh and myself which was agreed on Tuesday of last week. I beg to move.

On Question, amendment agreed to.

[Amendments Nos. 153 to 160 not moved.]

House resumed; Bill reported with amendments.

Tax Credits Bill

8.44 p.m.

The Parliamentary Under-Secretary of State, Department of Social Security (Baroness Hollis of Heigham): My Lords, I beg to move that this Report be now received.

Moved, That the Report be now received.--(Baroness Hollis of Heigham.)

Lord Higgins rose to move, as an amendment to the Motion that the Report be now received, to leave out ("now") and at end insert ("only after Her Majesty's Government have announced their intentions in respect of passported benefits").

The noble Lord said: My Lords, the purpose of this amendment, for which there appears to be ample precedent in Erskine May, is, first, to register some protest at the way in which the Government have dealt with the House in regard to the question of passported benefits; secondly, to relate specifically to that issue; and, thirdly, to ask the Minister to state the Government's present position.

There has been some concern about the way in which the preparation of this Bill has been made. The child benefit clauses were not produced until the last day of the proceedings in the other place, thereby not allowing any discussion other than the last day of Report stage. We therefore find ourselves in a situation where an important issue arising from the changes which the Government are proposing to make in the social security arrangements has not been clarified.

The House may recall that I raised this issue in Committee. The noble Baroness responded at cols. 641 and 643 of the Official Report of 4th May. I urged the noble Baroness that a decision should be reached before Report stage with regard to the Government's intentions in relation to passported benefits. In the subsequent columns the Minister repeated time and again that we would return to the issue before the Bill left Parliament.

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It seemed a formula somehow ingrained in her thinking, but clearly it is not satisfactory, as I pointed out at the time. The reality is that the Government have had many months to work out the position in relation to passported benefits.

The change from family credit to the working families' tax credit creates a situation where entitlement to various passported benefits does not necessarily transfer from those entitled to one specific benefit to those entitled to the other. For that reason it is a matter of considerable importance. It covers a whole range of individual benefits; for example, prescription charges, exemption from the cost of dentures and dental treatment; free eye tests; vouchers for glasses, fares to and from hospitals; and much more. For that reason it is important that we know what the Government's position is. We ought to have known far earlier. If we wait until the period about which the noble Baroness is so concerned--before the Bill leaves Parliament--then this House will not have an opportunity of expressing a view on the way in which the new structure under the working families' tax credit should operate. Indeed, it is the case that unless we were to move an amendment to the Bill which covered this point, the House of Commons would have no opportunity to amend whatever the Government eventually propose.

The noble Baroness raised a number of reasons in Committee as to why it was difficult for the Government to reach a decision. In particular, she mentioned that seven or eight different government departments were involved. It is not acceptable that the House should be left in the dark and that Parliament should be prevented from considering the matter altogether because Ministers from seven or eight government departments have not managed to get together and decide an appropriate way of dealing with the problem.

Having said that, the noble Baroness will know that we are concerned about the way in which the Department of Social Security is being taken over-- I believe that that is the right expression--more and more by the Treasury. Indeed, not only is the Contributions Agency being transferred, but there are also a number of other important proposals in relation to this Bill. I believe it is true to say that the department is virtually being dismembered.

My own feeling is that it is very dangerous when the Treasury gets too much control over a particular government department. The system relies intrinsically on there being a conflict between the spending department and the Treasury. I well recollect many years ago when Sir Keith Joseph was responsible for social security. He thought that he was on the side of the Treasury, so instead of there being a balance between those conflicting forces the whole thing became unbalanced and the department's interests were not protected.

With the growing influence of the Treasury in all the social security matters, one fears that the tendency is for benefits not to be dealt with in the way in which the department itself would normally wish to deal with them. That applies especially as regards these passported benefits. The events during the past few days

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in the other place certainly suggest that it is not only the case in relation to this Bill, but also in relation to another Bill which is being dealt with in the other place at present and will no doubt arrive here soon.

There are many areas, especially with regard to the disabled, where we find that the tendency is for the influence of the Treasury to be more and more prevalent. For that reason it seemed to me that it might be helpful to the Minister, because we all recognise the deep concern that she has for the disabled, and others, to table such a Motion so as to put some pressure on the Government between the Committee and the Report stages to sort out the matter. It should have been sorted out months ago. The noble Baroness has had another two weeks in which to try to knock ministerial heads together. One very much hopes that she will be able to tell us this evening what progress has been made in that respect.

As I say, there are two aspects involved. First, we should know what the Government's intentions are; and, secondly, we should be in a position to decide whether or not this House, with its responsibility for examining the implications of legislation, does or does not wish to amend those particular proposals. In Committee, the noble Baroness pointed out that, at present, such matters are dealt with in regulations and that a series of different regulations operated to bring about the passporting of benefits across a series of departments. None the less, it is certainly not impossible to draft amendments to the Bill--or, more accurately, it is not impossible for the Government to put forward proposals in the Bill. That is their responsibility. That would enable the House to consider what they propose. Indeed, there is no reason why they should not put forward such proposals so that the House can consider them on their merits.

I see that the noble Baroness is shaking her head. If the Government are bringing forward legislation of the kind that we have in this Bill, the implications of which are very serious for the disabled and other groups, they have the responsibility to ensure that the House has an opportunity to express a view as to how such matters should be dealt with. We well know from our earlier debates that there are problems because the Government have extended the working families' tax credit up to levels of income way over £25,000 a year in some cases. We can understand that perhaps the Government do not feel it appropriate that those people should, for example, get free prescriptions. But that is a problem which the Government have created, unnecessarily in our view. Therefore, having created it, they ought to say what they intend to do to solve it. We can then consider whether or not we consider their solution to be appropriate.

However, as the matter stands, we do not even know whether they are proposing to have some arrangement whereby those receiving working families' tax credit, or the disabled allowance, will receive these passported benefits automatically, as is the case at present, or whether they will only receive them subject to a means test, which is certainly something that the Government have extended time and again. Indeed, they attempted to do so last night and have done so in many other ways. The extension of means testing is certainly something

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which gives us cause for concern. If the passported benefits, which are extremely important, are to be means tested in future rather than being given automatically, we ought to know. But up until now the noble Baroness has given us no indication of how she proposes to deal with the matter; indeed, she has given us no indication as to the way in which we can amend what the Government eventually propose.

In fact, to say that we shall return to the issue before the Bill leaves Parliament--indeed, I am not clear why the noble Baroness did not simply say before it receives Royal Assent--is not satisfactory. We gave her ample notice in Committee that we thought we ought to know about this before we proceeded to the Report stage. As I said, I have tabled my Motion in the hope that the noble Baroness will be able to reassure us this evening that the Government have finally got their act together and that the government departments have finally managed to spare the time on this issue to reach agreement among themselves. We will then be able to consider what the Government propose and, if necessary, debate and amend such proposals.

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