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Tax Credits Up-rating Regulations 2008

My Lords, I do not propose to follow the noble Baroness, Lady Noakes, in her detailed questions, many of which we support and look forward to hearing the Minister’s reply to, but I want to ask one specific question about the method of uprating or calculating the uprating and then ask some wider questions and point to wider problems on the Government’s overall record on fighting child poverty, of which tax credits are at the heart. I come first to the specific question. The Explanatory Memorandum shows that Section 150(1) of the Social Security Administration Act 1992 states that the Secretary of State shall in each tax year review the rates of child benefit, "““in order to determine whether they have retained their value in relation to the general level of prices obtaining in Great Britain estimated in such manner as the Secretary of State thinks fit””." Why does the Treasury think fit to estimate the general level of prices—a comprehensive description of retail prices in this country—for those purposes at the retail price index, when they use the much less generally representative consumer price index as their chosen method elsewhere? I turn to the Government’s failure on child poverty, and, as I say, tax benefits are the key stone of the policy. I have picked up from the Printed Paper Office a glossy document called the DWP Autumn Performance Report 2007. In particular I want to ask the Minister about the child poverty targets. In this wonderful Civil Service language one cannot fail on PSA targets. Ongoing targets can be met early, which means that there is no possibility of subsequent slippage during the target’s lifetime; we can be ahead, which means that progress is exceeding plans and expectations; we can be on course, which means that progress is in line with plans and expectations; or we can have slippage. Progress is slower than expected; for example, by reference to criteria set out in a target’s technical note. All four key child poverty and development targets—(1)(a), (1)(b), (1)(c) and (2)—three of which are DWP and one is joint with the Treasury, have slippage. The noble Baroness referred to the overall failure to make relevant progress towards the child poverty target, but let me ask one or two more detailed questions. On page 16, it is pointed out that the, "““baseline figure for the number of children in households with less than 60 per cent of contemporary median income is 3.4 million””," and to date, over the period from 1988-89 to 2005-06, there has only been a fall from 3.4 to 2.8 million. Last year, there was an increase of 100,000, which, in these charming words, "““while not specifically significant, represents slippage against the target””." It is certainly statistically significant if we are meant to be making significant reductions. I would not call that slippage; there is not so much as a snowball’s chance in hell of meeting the Government’s target. The second target is to reduce the proportion of children living in workless households by 5 per cent between spring 2005 and spring 2008. In whatever party, we all agree how vital reducing that proportion and increasing the number of working households with children is. It is again described as slippage. The baseline for the target is 1.7 million children. It is now 1.76 million children, so it has gone up. That is not slippage; it is steady movement in the wrong direction. In this charming language that only civil servants and Governments speak, they say that, "““The increase in the worklessness rate amongst lone parent households means than the achievement of a 5 per cent reduction by Quarter 2 2008 is now challenging””." It is very challenging. As the graph makes out, it clearly will not happen. There is a similar picture on the graph for the proportion of parents with care on income support/jobseeker’s allowance in receipt of maintenance, and, finally, perhaps even more worryingly, on the graph for the proportion of children reaching a good level of development. That has shown progress in the wrong direction recently—indeed, not progress at all but failure—and a widening of the gap between the most disadvantaged ““Super Output Areas””, as they are called, and the rest of England from 16 to 17 per cent. How the Government can claim that they are making progress when they are so clearly failing on all their own targets as regards helping children is beyond me.