Only a few days to go: We’re raising £25,000 to keep TheyWorkForYou running and make sure people across the UK can hold their elected representatives to account.

Donate to our crowdfunder

Clause 11 - Changes to child tax credit

Part of Welfare Reform and Work Bill – in a Public Bill Committee at 10:15 am on 13th October 2015.

Alert me about debates like this

Photo of Emily Thornberry Emily Thornberry Shadow Minister (Work and Pensions) 10:15 am, 13th October 2015

Amendment 83 exempts households from the limit on the number of children for whom the individual element of tax credits can be claimed where one or more of the children in the household is disabled. Amendment 84, which would amend clause 12, would carry the same requirement on to universal credit.

Any legislation that amends our current social security structure must have attached to its leg the aspirational legislation of universal credit, which I know that the Government hope will someday apply across the board. They have rolled it out for some of the simpler cases and they claim they will continue to roll it out, but we have been waiting for several years. However, we are told that it will happen, but we do not know when; it is not clear. We hear lots of stories about extraordinary overspends, computer systems that do not work and the Treasury tearing its hair out. We hear about all kinds of things going on behind the scenes, and we keep hearing that the implementation date has been pushed back. We will wait and see what happens. We appreciate that in the meantime we have to continue to produce two-legged administration with one leg in the current situation, and the second leg being the aspirational universal credit that at some stage in the future will apply to all of us. Good luck with it.

The purpose of the amendments is to ensure that the proposed changes to tax credits also apply to universal credit, and we are concerned about some of the dates. The amendments seek to test further some of the arguments that Ministers have made in their attempt to defend the proposals. Amendments 83 and 84 provide an exemption to the two child limit for any household where one child is disabled. The disability element, which is £3,140 a  year, is paid on top of the £2,780 a year that a family currently receives for a child. The Government claim in their impact assessment:

“In order to protect vulnerable households the support provided to families with disabled children through the disability elements” of child tax credits

“will not be affected by the changes”.

However, that is not correct because a family with a disabled child would see their entitlement reduced by more than half as a result of these changes, even before taking into account other changes such as the reduction of income thresholds, changes to taper rates and the four-year freeze of all-age benefits, which includes tax credits. The disability element is currently paid on top of the individual child element for good reason. It reflects an acknowledgment of the fact that the costs associated with raising a disabled child can be considerably higher. To begin with, childcare costs for working parents are disproportionately high, with 77% of parents saying that childcare is more expensive for disabled children than for non-disabled children, and in some cases three to four times as expensive. In those circumstances, it is our view that it would be wrong to interfere with tax credits and it would be particularly wrong to interfere with the disability element to which I alluded earlier.

Major changes are proposed for families with disabled children—families that find it difficult enough to cope as it is. They do an extraordinary job as parents and, frankly, not just as parents but for the sake of society, for all of us. These children are all our children, and the additional work that those parents put in and the additional support that they provide should be acknowledged and properly supported. The Opposition will not accept any attacks on the income that is necessary for those parents just to make ends make, so that George Osborne—[Hon. Members: “The Chancellor”]—so that the Chancellor can continue to slash taxes such as inheritance tax.