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Child Benefit Up-rating Order 2010

My Lords, as I said in my introduction, these regulations and orders increase certain rates and thresholds and are in line with the Government’s commitment to make work pay and to tackle child poverty. Tax credits provide financial support to nearly 20 million people. It is a responsive system designed to tailor financial support to reflect families’ current circumstances and to respond quickly to their changing needs, particularly in difficult times when income falls or needs increase. From April to October last year, the flexibility of the tax credits system has given extra help worth on average £37 a week to 400,000 families whose income has fallen. Tax credits, together with child benefit, deliver support to virtually all families with children in the United Kingdom. Where in the 1980s and early 1990s the number of children in poverty more than doubled, tax credits have helped to lift around 500,000 children out of relative poverty since 1998, and the number of children in absolute low-income poverty has halved, from 3.4 million to 1.7 million. The fight against child poverty is, of course, not over and will require continued effort on behalf of government. These regulations and orders, together with other measures announced in the Budget 2007, will help to lift 550,000 out of poverty. The noble Baroness, Lady Noakes, asked a number of questions relating to statistics on child poverty. I do not have the statistics available but I will, with great promptness, write to her with the information that she seeks, if such information exists. I will also copy that to the noble Lords, Lord Oakeshott and Lord Martin, who have participated in this debate. The noble Baroness mentioned the pathway of retail prices inflation. RPI is definitely not falling at the moment, but the Bank of England, which has a good record over the past 10 or 11 years in forecasting inflation, suggests that it will fall back quite sharply as the year progresses. The noble Lord, Lord Oakeshott, referred to the current experience being a spike in inflation. I believe that that is correct. However, I am not in a position to give the noble Lord forecasts for inflation by household income or to differentiate between households with and without children. We all know that the experience of inflation for different subgroups of society will be different because of their differing expenditure plans. That is one of the reasons why it is so important in the current year that we anticipate how we think inflation will develop in accordance with the Bank of England’s central projections and reflect that in some of the proposals that we are putting.