Clause 9 - Maximum rate
Tax Credits Bill
2:30 pm
Mr Howard Flight (Arundel and South Downs, Conservative)
I welcome you to the Chair, Mr. Beard. I only miss the opportunity of debating with you.
Amendment No. 31 is in essence the same as amendment No. 50, but termed slightly differently. I have to confess that my hon. Friend—the hon. Gentleman, I should perhaps say—has stolen the example that I was going to raise. It is clear that there is a potential for unfair treatment of couples under the existing children's tax credit and working families tax credit. I hope that the Government do not intend to continue that under the new arrangements, especially, as has been pointed out, because that is not the case with social security benefits.
Couples in work are now less likely to get themselves and their children out of poverty than are single parents. Couples with children still form the largest group of families in poverty—about two thirds of the total.
Martin Wolfe made an in-depth analysis of the working families tax credit three or four years ago and found another aspect of the same point: that it was financially disadvantageous for a lone parent to acquire a partner or spouse with two children unless their income was below about £350 a week. That cannot be the intention of the support and help. The main issue is that the arrangements do not recognise the income needs of the other adult for straightforward maintenance, clothing, food and so on. The argument that that is matched by the saving in child care is not valid. The issue concerns not just informal care but the help with child care that is now available.
Amendment No. 31 would open the door to deal with that, but my main point is to ask the Minister not for the amount to be specified but whether the Government intend to address the point concerning the new child tax credit and the child element of the working tax credit.