---

Welfare Reform Bill

I am running out of fingers to count on. I am sure that I shall make some dreadful mistakes and commit huge amounts of money if I am not very careful, so I shall now withdraw on this issue. I make the general point that we have found this money now. Let us hope that times are better in future; we are doing all we can to make them so, although I will not go into that. These are political decisions for the Government of the day to make about where one wants to put one’s money. We know from the current system that our proposals should enable parents to work full-time if they choose. Paying a higher proportion of the costs is simply unaffordable without significantly reducing the maximum limits. We had a balance between the percentage and the amount that we had to play with, and we took that decision. The cost of moving to 80 per cent, which was urged by the noble Baroness, Lady Hayter, is estimated to be £400 million on top of the £300 million that we have now injected into the system. I will not be unpleasant enough to ask where that money might be found, but that is the issue. The vast majority of claimants in the current tax credit system do not actually report costs at the current maximum limits. However, there are times when the costs are higher, such as school holidays, so the limits for universal credit are calculated as a monthly amount rather than a weekly one. That should provide considerable flexibility to smooth out over weeks that have different costs, whether higher or lower, for claimants to receive appropriate support.