asked Her Majesty's Government:

Whether they are concerned about the level of inequality in the distribution of wealth in the United Kingdom.

My Lords, the Government aim to tackle poverty and asset exclusion by supporting the most vulnerable without blunting incentives for enterprise or penalising success. To spread wealth more widely, the Government seek to make saving and assets accessible to all: the child trust fund will ensure that all children enter adulthood with that financial asset; individual savings accounts have extended saving opportunities more widely; and the saving gateway is exploring ways to encourage saving further among low earners.

My Lords, I thank my noble friend for that Answer. Just before coming into your Lordships' Chamber, I trawled through some websites, many of which said, "Pay no tax at all! Transfer your wealth abroad". Does the Minister support the OECD's programme for regulating tax havens, especially those that the OECD calls "unco-operative"?

My Lords, I can certainly give my noble friend a positive response to that. The Government have played a full part in the OECD to tackle this problem. The House will recognise that it is an international issue, but there is a drive towards requiring some of these areas that my noble friend called tax havens to produce standards of transparency with regard to tax accounts that are held in their area. We are making progress, but not as quickly as the Government would wish.

My Lords, I may have overlooked it, but my noble friend asked a direct question: whether the Government are concerned about inequality. The Minister could have answered, "Yes", "No" or "Just a little bit", but he did not say any of those three. He has given a virtual assurance that he has no intention of taking any money from the wealthy, so, if he is going to help the poorest just a little bit, does that mean that he—or a future Chancellor—has it in mind to use any future economic growth to help primarily those without any wealth?

My Lords, I am sorry that my noble friend was not happy with my original Answer. I could certainly have answered, "Yes", but I thought that the House required the Government to demonstrate areas in which they are active, which is what I sought to do. As far as my noble friend's second question is concerned, the answer is, "Yes".

My Lords, the Minister's Answer gave a lot of examples of how the Government say that they are encouraging saving, but the plain fact is that the saving ratio has virtually halved since 1997. If anything, wealth inequality has increased in the past few years. Do the Government's policies have any credibility in this area?

My Lords, on the overall position on inequality, we have seen progress in its reduction. The noble Baroness is right to say that in 2003 there was a blip in progress, but we have made progress. The most crucial aspect of the Government's strategy is to give greatest support to those most in need. I enumerated ways in which we intend to pursue and are pursuing policies that help those people.

My Lords, is it not a fact that if you are to reduce inequality, as the Minister seeks to do, you must tackle the problem at both ends and deal with the wealthy as well as the poor? Will he consider abolishing some of the tax reliefs for the wealthy, such as capital gains tax taper relief?

My Lords, the Government review our position in every Budget but, as I said in my original reply, we must balance such measures against the obvious advantages of increased investment in our society, which supports the development of growth in wealth overall. The noble Lord will recognise that that is a balance that the Chancellor has struck with considerable success during the past decade.

My Lords, does my noble friend accept that the proportion of wealth held by the richest 10 per cent rose in the 1990s from 47 per cent to 54 per cent? What has happened is that home ownership has given a great deal of wealth to a number of people, so it is not just what you earn, but what you own.

My Lords, that is certainly an important factor, but my noble friend will recognise that an increase in home ownership has also occurred: it has risen from 67 per cent to 70 per cent. My noble friend is right. One of the striking factors has been the very rapid rise in house prices recently. Of course, there is no guarantee that the rate of rise in recent years will necessarily continue.

My Lords, does the Minister agree that by raising the status of those working in social care, the majority of whom by far are women—for instance, in early years care—as the Government are doing, and improving their pay and conditions, one is not only lifting them out of the poorest percentile of the nation but benefiting their children in the process?

My Lords, I agree with the noble Earl, but I also emphasise that the Government are concerned about the fact that women still earn less pay than men for comparable roles in our society. We need strategies to tackle that.

My Lords, is the Minister aware that many poor families in this country are having to pay money back which was given to them as tax credits in error—and, in many cases, under protest—and which they spent in good faith? Does he agree that it is disgraceful that the poorest people in our society are being penalised in that way?

My Lords, the noble Baroness will recognise that tax credits are designed to assist such groups in our society. She is right to say that there are problems with tax credits, not least because family circumstances change over the year and the Inland Revenue is not always informed of those changes—hence the necessity for elements of payback. We recognise that, for tax credits to be a success, the assessment must be as accurate as possible. We want a reduction in the level of payback, as the noble Baroness said.

My Lords—

My Lords, we must move on to the topical Question.