Clause 8 - Initial contribution by Inland Revenue
Child Trust Funds Bill
2:30 pm
Mr George Osborne (Tatton, Conservative)
Welcome to the Chair, Mr. Amess. I am sure you have been waiting with eager anticipation for the return of this Committee over the past seven days—I see you nodding vigorously. I also welcome half of my army, who are joining me in battle for part of the afternoon.
The amendments tabled in my name—my Liberal Democrat colleague will speak to his amendments—are intended to do two things. I freely admit that some are contradictory, but they are probing and designed to write into the Bill what the Government say they will achieve by regulation. They will therefore allow us to debate about the amounts that the Government propose for initial supplementary contributions.
Amendment No. 127 is designed to write into the Bill what I suspect the Government will want to achieve by regulation. It would set the further contribution, which is payable at age seven at £50 or, for poorer families, £100. The Government have not said what the amounts will be, but they have said that the initial contribution will be £250 and the supplementary contribution £250. I want to press the Minister on how and why she came up with those figures. What was the rationale behind them?
The figure payable at age seven is more interesting. The Government have not said what it will be. The explanatory notes say:
''The Government has published its proposal that the first of these payments will be when eligible children turn seven. The first payments will be due in 2009 and the amounts will be published nearer the time.''
When the Minister answered a written question of mine on 4 December, she again made the position clear:
''Estimates are not available for the cost of any further Government contributions at age 7 as the value of these has yet to be decided.''—[Official Report, 4 December 2003; Vol. 415, c. 138W.]
One would assume that that was a prudent course of action for the Government to take; obviously seven years is some way off, and it would be wrong to anticipate what the sums will be—perhaps that is what the Government will say.
However, not everyone in the Government is as careful as the Minister. For example, there is someone called Mr. Gavin Kelly. I have never met him, but he is apparently a member of the Prime Minister's strategy unit. I closely followed a summit held by the Institute for Public Policy Research at 10 Downing street. I read its minutes and talked about it on Second Reading because I discovered that child trust funds were known as
''the third way within the third way''
in new Labour circles, which was an exciting discovery for me. On close reading of the minutes, I found that when Mr. Gavin Kelly made his contribution to the exciting seminar—the Financial Secretary will remember this because she was part of the audience—he said:
''The question was whether the figures which had been chosen by the government (of £500 for children from low income families at birth and £250 of those from wealthier families and £100 and £50 respectively as top ups) were appropriate. There was no science behind these figures, they simply felt intuitively correct.''