Clause 10 - Entitlement
Tax Credits Bill
2:45 pm
Mr Howard Flight (Arundel and South Downs, Conservative)
The amendment is a drafting amendment designed to help the Government. The clause uses the phrase:
''responsible for one or more children or qualifying young persons''.
We suggest a sharper definition. That relates back to the question of whether credits might be divided between two separated families who are responsible for more than one person in their direct care. However, that is not the main reason for the amendments, which deal primarily with one of the more important aspects of critiquing the Bill.
The Government will be well aware of the arguments advanced by the Institute for Fiscal Studies against extending working tax credits to couples without children. There is no established evidence that such an incentive to work is needed for that group of the population. A considerable number of people will be brought into the net of tax credits, yet there is no logic in doing so. When various parties asked, ''Why are the Government are doing this?'', the
only answer they received was, ''Well, the French do it.'' The Government have not in any way justified why they are extending the scope of tax credits to a component of the population for which the pricing people into work argument is not valid.
This is not a desirable measure. That goes right back to the main theoretical objections to tax credits that were raised 25 years ago, when I was standing as a candidate for Parliament. Help should be focused on those in need. Although it does not appear explicitly in the Bill, I understand that the Government do not intend to include parents under 25 in the working tax credit system, yet they are among the poorest, and perhaps the most deserving of help, in the population. What is the logic of adding to the benefits of those who do not really need them, while failing to address the situation of a group that does need assistance?
I hope that the Paymaster General will be able to respond to those points. We would need a great deal of persuasion as to the merits of supporting the principle of extending tax credits to couples without children.