Working Tax Credits

Part of the debate – in Westminster Hall at 4:12 pm on 30th November 2011.

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Photo of Jonathan Reynolds Jonathan Reynolds Labour, Stalybridge and Hyde 4:12 pm, 30th November 2011

I agree with my hon. Friend. If we had had one of the longer slots for debate, perhaps we could have discussed in more detail the interaction between working tax credit, child’s tax credit and the child care allowance. The interconnection between them is crucial. I shall ask the Minister near the end of the debate what transitional arrangements could be considered for some of those who are most badly affected by the changes.

Working tax credit has played an important part in recent development of the welfare state. When working tax credit was introduced in 2003, it balanced the goal of eradicating child poverty with promoting work. It currently offers around £4,000 for families on lower incomes and aims to ensure that families will always be better off in work. Until it was introduced, too many families had complained that going out to work might leave them less well off financially. Working tax credit was introduced to ensure that work always paid. It did so much more. Encouraging people back into work concerns more than just the contents of their pay packet. Work is about skills.