Clause 3
11:30 am
Ian Pearson (Parliamentary Under-Secretary (Economic and Business), Department for Business, Enterprise & Regulatory Reform; Dudley South, Labour)
The amendment would remove the requirement that a person must have that connection with the UK to be eligible for the saving gateway account. As a result, any person entitled to a qualifying benefit or tax credits would be eligible. A person may, in certain circumstances, continue to be entitled to certain qualifying benefits and tax credits, even though they no longer live in the UK, provided they still satisfy all the other conditions for entitlement. While there are good reasons for them to be able to continue to claim their benefit or tax credit when they no longer live or work in the UK, we do not believe that that is the case for the saving gateway account. The connection with the UK that individuals need to be eligible for the saving gateway account will be set out in regulations. The relevant draft regulations have been published and I hope that they will be available shortly, if that is not already the case.
Very broadly, those who live or work in the UK, as well as being entitled to a qualifying benefit or tax credit, will be able to open a saving gateway account. That will also include Crown servants posted abroad and their partners, and people who are ordinarily resident in the UK but are temporarily absent. That is one reason why the legislation is phrased in that way. It will exclude, however, people claiming incapacity benefit, severe disablement allowance or contribution-based employment and support allowance who move out of the UK permanently, although they may still be able to claim the underlying benefit. It will also exclude people who are not ordinarily resident in the UK but who would otherwise be eligible for the saving gateway through a joint claim to one of the qualifying benefits or tax credits such as child tax credit.
I appreciate that this might be slightly complicated, but the key point is that that presents no problem for the vast majority of people who are ordinarily resident in the United Kingdom. We are trying to introduce a system that is as simple as possible. We think that Crown servants posted abroad should be entitled if they qualify, as should people who are ordinarily resident here but who are temporarily absent, perhaps because they are working or have activities abroad that take them there for a period of time. We do not think that people who are not ordinarily resident in the United Kingdom should be able to open a saving gateway account. That does not seem to us to be a very targeted use of taxpayers’ money. I hope that that clarifies the points that have emerged. The regulations, which I am sure we will consider in due course, explain this in more detail, and no doubt we will return to them later.