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Child Benefit Up-rating Order 2010

My recollection is that the previous figure was 500,000. However, it would be wrong for me to mislead the House. I will therefore give the noble Baroness the precise answer that she seeks when I have the absolute data close to hand in order to inform her and Parliament on this matter. Rest assured, our commitment to the progressive eradication of child poverty is undiminished. One cannot help, therefore, but note the observation from the noble Lord, Lord Oakeshott—who pays such close attention to these matters and regularly writes to me seeking information—about the contrast between the Conservative Party's position on issues relating to child poverty and the issue of inheritance tax. I believe that the figures given by the noble Lord were correct. The Conservative proposals, on which we now hear very little, as the noble Lord noted, would have the effect of removing 3,000 of the wealthiest families in the country from inheritance tax, with a benefit of £250,000 each. That is quite an extraordinary act of generosity, largely to the people of Kensington and Chelsea and Notting Hill. It is quite an outrageous set of priorities. I am sure that we will have many further occasions to discuss this including, possibly, in the upcoming economics debate. The noble Baroness asked about the impact of the proposal that any increase in prices over and above the 1.5 per cent increase from September 2009 will be reflected in the 2011 rates of tax credit. These will lock in, in real terms, the increase of the rates of tax credits and child benefit. The RPI in January 2010 is still lower than the RPI for September 2008. Bringing forward this adjustment will be taken into account when setting the limits in 12 months’ time. The noble Lord, Lord Oakeshott, raised questions about HMRC and errors. I have information that the HMRC makes very few errors, but I have to say that it is an organisation which needs to constantly work to improve its user-friendliness and the accuracy of its processing. Many members of our population have suffered as a result of mistakes made by HMRC. I do not think anybody in HMRC should be content with its performance. I am sure that this is reflected in the urgency with which the senior management in HMRC addresses these matters. I myself have at times suffered from mistakes made by HMRC, so I fully understand the point that the noble Lord makes. Overpayments are too high. They cause great disturbance to those who receive overpayment and are then required to make adjustments, for which they have not made, or had an opportunity to make, appropriate plans. We must work hard to reduce that. The noble Lord also asked about tax credits to those earning over £50,000 a year. This in fact only represents 0.02% of the entitlement in 2007. The answer is that the line has to be drawn somewhere and the Government believe that it is appropriate that we provide support for those raising and caring for children. The vast majority of the benefit paid is to those on incomes below £20,000. The noble Lord, Lord Martin, asked about the Guardian’s Allowance. My understanding is that a couple or an individual eligible for the Guardian’s Allowance receives this allowance in addition to child tax credit. It is not either/or. Therefore, it is not a matter of the two necessarily being in line. Nor should one draw any great conclusion from the fact that one is higher than the other. I do not have information as to how long it takes between making the application and receiving the first payment. This is one of these dilemmas, however—we all believe that an honest and correctly completed application should lead to a fairly swift decision to start distributing payments. On the other hand, we have to have regard to the point made by the noble Lord, Lord Oakeshott, that we need to ensure that our processes are correct. There will always be a difficulty there. Some will say you are making too many mistakes, in part because you are rushing the process, on the other hand, an equally credible argument will be that an unreasonable delay can cause pain, stress and real financial distress to those entitled to the Guardian’s Allowance. I believe I have covered the majority of the points raised in the debate. If on reading Hansard I find others, I will of course write to those who participated in the debate. I commend these regulations and orders to the House. Motion agreed.