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Child Maintenance and Other Payments Bill

moved Amendment No. 10: 10: Clause 15, page 7, line 33, at beginning insert ““Subject to subsection (2),”” The noble Lord said: My Lords, I am very pleased to move the amendment, which stands in my name and that of my noble friend. Amendments Nos. 10, 11 and 12 bring us back to a familiar subject. I do not think that we need to spend a huge amount of time on it this evening, if for no other reason than that we have between now and 2011 or 2012 to persuade the Government that it is a good thing to do. Full maintenance disregards were part of our important discussion in Grand Committee; I looked again at the position that the Government took then. I just want to take the opportunity to say one or two things that I hope will persuade colleagues that this argument is still worth pursuing. First, it is absolutely excellent news that last autumn, in the Pre-Budget Statement, the Chancellor increased the amount of maintenance that parents with care on benefit will be able to keep. It was an absolutely splendid achievement. The £20 that parents with care on benefit will keep from 2008 was welcome enough but, privately, I did not believe that the department would get £40 for them out of the Treasury for 2010-11. I really pleased about that; I make no qualification about that. If that was not enough, the disregard for child tax benefit being added to working tax benefit disregard makes the whole thing an excellent piece of work and extremely well worth having. It will have a very positive effect on the reforms that we are considering today. However, helpful as that is, if Parliament is looking for ways between now and 2011 to bear down on child poverty even more directly, the amendment is one very effective way to do that. In parenthesis, before people start writing down the fact that I am making financial commitments on behalf of the Liberal Democrats—I understand from work done that it would cost an extra £40 million—the totality of the scheme introduced by the Chancellor comes in at about £140 million. If you allowed parents with care to keep all the benefit, my calculation is that it would cost an extra £40 million. I am not saying that that extra £40 million should be conjured out of fresh air; I am saying very clearly—I want this to be understood because I am sure the noble Lord, Lord Skelmersdale, has colleagues in the other place who are watching very carefully everything that we say—that I believe that the Government are committed to making further progress with child poverty between 2010 and 2020, by which time it will be abolished, if we are lucky. If the Government are looking for ways to deliver that extra support to achieve that end, this very effective mechanism is readily available to them to enable them to do that. The Chancellor’s changes in the Pre-Budget Statement in the autumn will take 50,000 children out of poverty. This mechanism would take an extra 30,000 or 40,000 more children out of the official definition of poverty. I take those figures from the report by Sir David Henshaw, who did some modelling, and I think they are pretty sound. Some difficulties will result from the £40 disregard when we get to 2010-11, because it risks becoming an established going rate. We have had these discussions before. Why should non-resident parents ask for more than £40 if their balance will go to the Government? Indeed, Professor Patrick Parkinson, who was the architect of the Australian system and to whom the noble Lord, Lord Skelmersdale, has already referred, made the point when he was across recently that a ceiling of that kind would advantage relatively well heeled non-residents because that would be the perverse impact of having an unofficial maximum at the £40 level. Perhaps more than any of that, what drove me to table this amendment yet again—I make no apologies for doing that—is that the administrative arrangements for Jobcentre Plus to dock benefit from the people who get more than the disregards are almost impossible to guarantee. That is not so much because only small numbers of people in the client group get more than £40 a week but because a lot of parents with care get intermittent payments, which are characterised as lump payments. That is, they do not get streams of weekly or monthly payments or other sensible systems of payment all the time. Very many parents with care get different amounts of money over different periods, and sometimes from different fathers into the same family. We are trying to put the onus on the parent with care to keep track of that and to report the fact that they might have had overpayments which they are entitled to keep under the new disregard levels. If they do not do that, they will end up in benefit arrears and Jobcentre Plus, as I understand the system, will have to dock the regular payment of benefit. That is the kiss of death. That is the thing that strikes fear into the hearts of parents with care, benefit recipients and other customers of the department who have a bad enough time trying to make ends meet on a week-to-week, cash budget basis. If benefits are withheld out of the blue, they may be driven into the category of ““can’t be bothered, too risky, won’t do that””, and the policy will not deliver the benefits that it might. There is also the Treasury fear that if you take the ceiling away altogether, you will get disincentives to work. I am still working my way through the Professor Alan Marsh paper. I am three-quarters of the way through it and I understand only 20 per cent of it now, not 10 per cent. There is a case somewhere to be made that the Treasury fear that parents with care and full maintenance disregard will be inclined not to take work is not well founded. I repeat that this is less a spending commitment and more a pointing in the direction of a mechanism that is efficient and that would be of enormous help to the child poverty agenda that the Government are bringing forward between now and 2010-11 when these £40 disregards come in. It is well worth keeping the pressure not just on the department, because I guess that its policymakers would be happy to live with this amendment. But there are problems of trying to justify that with the Treasury. If the department is looking for people to support its case, I am at the front of the queue. It is well worth doing and we should keep using every opportunity to make the case because it is sound. I beg to move.