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Pre-Budget Report

I will send the figures to the hon. Gentleman. We are introducing a better system today so that there will be less overpayment. The issue is that we want to be as flexible as possible in responding to people’s situations. If their income goes up, their tax credit has been too high and therefore it is right to ask to recover it. We have arrangements in place whereby if the income change is reasonable, we will not ask for money back. The challenge is related to the difference between having a relatively inflexible system that cannot be adjusted during the year and a flexible system that enables us to respond to changes in the labour market. That is the challenge that we have always faced on tax credits. I believe that we were right to go for a flexible system, but obviously we must make sure that the figures for people who have to repay money are in order. That is why we are trying to reduce them with the change that we are making today.