Clause 38 - Persons subject to immigration control

Tax Credits Bill – in a Public Bill Committee at 4:15 pm on 24 January 2002.

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Photo of Karen Buck Karen Buck Labour, Regent's Park and Kensington North 4:15, 24 January 2002

I beg to move amendment No. 88, in page 24, line 5, leave out

', child tax credit or working tax credit (or both),' and insert 'working tax credit (but such regulations shall not exclude entitlement to persons subject to immigration control who are entitled to take up or be engaged in employment in the United Kingdom)'.

Photo of Mr Nigel Beard Mr Nigel Beard Labour, Bexleyheath and Crayford

With this it will be convenient to take amendment No. 89, in schedule 4, page 52, line 1, leave out from 'section' to end of line 3 and insert

'115(1), the words ''(i) child benefit'' are omitted.'.

Photo of Karen Buck Karen Buck Labour, Regent's Park and Kensington North

I shall be brief. I should like my hon. Friend the Paymaster General to clarify her thinking on the implications of the new tax credits for people with immigration status. As an inner-city Member of

Parliament, I know that levels of poverty among black and ethnic minority families are significantly greater than among white families; there are an estimated three times as many Pakistani and Bangladeshi families in households of below-average income as white families. That is an important context for the discussion.

The amendment seeks to make immigration status irrelevant for entitlement to working tax credit and child tax credit, and a return to the 1996 status when child benefit was not dependent on the immigration status of the claimant. Those people who are entitled to work in this country, have a tax allowance and are protected by other Government legislation such as the minimum wage—I stress that I am not talking about people whose immigration status prevents them from taking employment in this country—should be able to draw upon the working tax credit and child tax credit. In some cases, such people will already be taxpayers and will have been making contributions through national insurance for many years before they fall into low-income status because of a change in situation or employment. It is by no means true that they will not have earned their entitlement. We are not talking about visitors to the country who will be prevented from drawing on benefits by the habitual residence test.

Perhaps, more importantly, a significant proportion of people who are prevented from drawing on working families tax credit and child benefit are families that are bringing up children who will remain in this country. A particularly important group are foreign spouses and their children, who come to join someone with settled status or British citizenship. They are not allowed to claim children's benefits and could live, for a significant period, on a single person's benefit. Such people, and particularly foreign spouses, will receive a decision on indefinite leave to remain possibly after a year or two, and during that time their children will have lived in extreme poverty. We have as much of an investment to make in those children as in any others. Our commitment to tackle child poverty in all its manifestations should apply to the children of people who do not yet have a settled immigration status that entitles them to draw on such benefits. They deserve the right to be lifted out of poverty as much as anyone else.

Photo of Mr Howard Flight Mr Howard Flight Conservative, Arundel and South Downs 4:30, 24 January 2002

This is an important amendment. I raised the same subject when we focused on European Union nationals. Other than EU nationals, some 600,000 people from the Commonwealth and other parts of the world have the right to work here. I also asked about it on Second Reading, and the Paymaster General still has not yet clarified the right or otherwise of such people to qualify for tax credits under clause 38. I hope that she will now do so.

Photo of Dawn Primarolo Dawn Primarolo Paymaster General (HM Treasury)

I am grateful to my hon. Friend for tabling the amendments, which seek to amend the Home Office legislation on the immigration status of certain people in this country. The Bill follows current practice with regard to Home Office requirements. Some people have a status whereby they are subject to immigration controls in the sense that they have

secured agreement to enter the UK for employment purposes, but on the condition that they do not have recourse to public funds. They are therefore excluded from working families tax credit. Clearly people who are here illegally are not subject to immigration controls. Bearing in mind that my right hon. Friend the Home Secretary is undertaking a review of asylum, instead of writing the current position into the Bill I have allowed that it should go into regulations. Consequently, if the review produces changes to the requirements placed on those who are subject to immigration and asylum rules we will be able to react strongly.

I shall give an example of an area of concern that I hope to address in the regulations. A mother and her children are UK residents, hold UK passports and could by no stretch of the imagination be subject to immigration controls. They may be in receipt of working families tax credit or the new tax credit. A partner who is subject to immigration controls joins the household. What then happens to the family? Why should they come within immigration controls? The solution that I am considering—although I shall have to take further advice from colleagues in the Home Office—is to protect the position of the mother and children because had she remained as a single parent household her claim would have proceeded. However, that is a matter for regulations.

I hope that my hon. Friend accepts that I am trying to be as sensitive as I can to the issues without venturing into policy that is not within my remit. I think that there have been some bad experiences around the type of scenario that I have described, which I hope that I will be able to address in regulations. I hope that my hon. Friend can accept my assurances and withdraw her amendment. Unfortunately, if she does not, I shall have to ask her to vote against it with the rest of our hon. Friends.

Photo of Karen Buck Karen Buck Labour, Regent's Park and Kensington North

I am grateful to my hon. Friend the Minister for her reassurance. This was very much a probing amendment, and I accept that we will have to look to the Home Secretary to find out whether the new provisions on asylum and immigration will allow us a little more latitude. I am especially grateful to her for drawing out a sub-group of people with particular difficulties.

I had a number of different illustrations, but shall be brief. I am grateful to the Child Poverty Action Group and I have been making representations on that point. We do need to address the matter in regulations, and there is some potential incompatibility between the tax credit legislation and section 115 of the 1999 Act. Depending on the time scale between this Bill being enacted and any new legislation being introduced, there will be a need to examine that incompatibility. I am grateful that the Minister is, in principle, sympathetic to the issue and on that basis I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 38 ordered to stand part of the Bill.