Clause 11 - Maximum rate
Tax Credits Bill
4:15 pm
Ms Dawn Primarolo (Paymaster General, HM Treasury; Bristol South, Labour)
The amendment would ensure that couples who are awarded working tax credit always receive a higher award than single people in similar financial circumstances. I do not disagree in principle with such a proposition. However, the amendment is unnecessary because clause 11 provides under subsection (6)(b) for a second adult element in addition to the basic element that all recipients of the working tax credit will receive.
As we have discussed at length, the working tax credit is a work incentive measure. We are well aware that both lone parents and couples are likely to face greater barriers to work than single people with no children. The living costs of couples, whether or not they are responsible for children, will be greater than those of single persons. If the hon. Members who support the amendment are angling for a commitment on the relative rates of the second adult element and the lone parent element, what a surprise, I cannot give them one. However, I do not believe that they are.
Setting the rates of all the elements of both the new tax credits is a matter for the Budget, and we shall not debate it today. However, I assure hon. Members that we fully intend to include in the working tax credit all the elements in clause 11.
Work is already well under way on the regulations to be made under the clause, which will provide for an additional element for claims in respect of both lone parents and couples. The maximum rate of the working tax credit payable to those categories of households that claim will, therefore, always be higher than the maximum for the single. That covers the point made by the hon. Members for Northavon and for Arundel and South Downs. Now that I have made it absolutely clear that we intend to use all the elements in the clause, I hope that they will appreciate that the amendment is unnecessary and that, rather than making the Bill longer, the hon. Member for Arundel and South Downs will agree to withdraw it.