Oral question asked in the House of Lords, by Baroness Hollis of Heigham (Labour). It was answered on Wednesday, 7 June 2006.

Tax Credits

Question: My Lords, I am sure that my noble friend would agree that if lone parents in particular experience changes in circumstances, perhaps as many as a dozen in the course of a year, and yet the tax credit sum is adjusted only at the end of the year—just as happens with taxpayers—then inevitably there will be overpayments and underpayments, which are not errors but part of the structure. Does my noble friend agree that a lone parent on a minimum wage of just over £5 an hour will, as a result of tax credits, now take home pay at a rate of £10 an hour—being paid a man's wage? Is that not transforming for two generations—both the parent and the child?

Secondary information