HC Deb 16 July 1990 vol 176 cc798-800

Amendment proposed: No. 7, in page 11, line 20 leave out from '(1)' to end of line 25 and insert 'Where a benefit consists in the provision for the employee of care for a child, section 154 does not apply to the benefit to the extent that it is provided in qualifying circumstances. (1A) For the purposes of subsection (1) above the benefit is provided in qualifying circumstances if— (a) the child falls within subsection (1B) below.'.— [Mr. Lightbown.]

Madam Deputy Speaker

With this it will be convenient to consider also Government amendments Nos. 8 and 9.

Mr. Boateng

We welcome the amendment, but we wish it was part of a cluster of amendments that would make the proposal more attractive and more in keeping with the needs of enterprises that are concerned to take up the option of providing these facilities for their workers. We are conscious of the fact that the most comprehensive survey available—of women who can use employer-provided creches—shows that fewer than 0.2 per cent. of them, or 198 of the 1.1 million people surveyed, could take advantage of provision of this sort.

The amendments will at least provide for the category of person with parental responsibility for a child or with a child or stepchild whom he or she maintains and who is resident with the employee. That category of parent, at least, will be able to take advantage of the child care and of the associated tax relief.

However, other categories are not so fortunate. In the hope that the Government will in due course produce measures to improve on this scheme, we draw to the attention of the House the circumstances of, for instance, Sainsbury, which is a progressive employer in the retail sector seeking to provide child care for its employees. It finds itself falling foul of the requirement that the employer and employee trying to benefit from this provision have to show that the employer is involved in the management of the relevant nurseries. Sainsbury and a number of other employers in the same position find that because of the way in which their business is conducted —Sainsbury has about 300 retail outlets—it is just not possible to provide the space at all their outlets in which to establish a creche or workplace nursery. Inevitably, such companies fall foul of this restrictive condition unless they are able so to organise their affairs—and, being primarily concerned with the provision of retail services, they are not —in such a way as also to free staff to take part in the management of day nurseries and creches. It simply is not practical.

Therefore, while welcoming the amendment, we are disappointed that it is so limited in its scope and in the relief that it brings to those who seek to expand their provision in this sector. We draw attention to that, but we shall not seek to divide the House on it.

12 midnight

Mr. Beith

The amendments slightly modify the Government's proposals, but not in any of the ways that employers would seek to make them effective, such as some of those already listed. The prospect of large numbers of employers having to be part of the management of a day nursery so that one trading estate can have a day nursery on it is daunting. The Government have opened up the extraordinary prospect that many of the firms that wish to co-operate in opening day nurseries may have to create a cumbersome management structure simply to satisfy the Government's conditions.

I am especially mystified about the precise impact of amendment No. 8. What is the intention behind paragraph (c)? As I understand it, (a) and (b) taken together mean that the child for whom the benefit is payable has to be one for whom the employee has parental responsibility and who is resident with the employee. However, there is an alternative condition in (c), which refers to a child whom the employee maintains at his expense. I am not sure that I understand what the Government are getting at, and it would be helpful if the Minister could tell us.

Do the Government mean that a divorced or separated woman who does not have custody of her children and whose children are living with her former husband nevertheless can obtain the relief and have the children sent to the workplace nursery at her workplace? If that is the purpose, why? If the objective of the relief is to direct it towards those women who make use of workplace nurseries to enable themselves to go to work and to enter the labour market, it does not seem to make a great deal of sense, and is a variant on what is already a narrow provision.

I should be grateful if the Government could explain precisely what they mean. Although I do not really expect them to provide us, again, with reasoning about why they have not made the whole provision a great deal wider, this aspect certainly puzzles me.

Mr. Lilley

This is a technical triplet of amendments to ensure that the definition of "a child" in the original clauses is appropriate.

Following publication of the Bill, it was put to us in representations that the definition in the Bill might in certain respects be too narrow and could preclude relief in certain unusual but entirely worthy circumstances. These include, for example, a relative looking after an orphaned child where there is no formal adoption or guardianship, a step parent who has not formally adopted a child, and prospective adoptive parents before final adoption. In these cases, if the child attended a workplace nursery, strictly no exemption would have arisen for the employee. We seek to put that right.

Mr. Beith

I fully understand that that is the effect of paragraphs (a) and (b) and it is most welcome, but can the Minister please explain the purpose of paragraph (c)?

Mr. Lilley

We are adding to "parental responsibility" a wider category to encompass any children resident with the employee and any child of the employee, including a stepchild, whom he or she maintains. I believe that that includes all the categories.

Amendment agreed to.

Amendments made: No. 8, in page 11, line 32 at end insert—

'(1B) The child falls within this subsection if—

  1. (a) he is a child for whom the employee has parental responsibility,
  2. (b) he is resident with the employee, or
  3. (c) he is a child of the employee and maintained at his expense.'.

No. 9, in page 12 leave out lines 13 to 36 and insert— '(5)In subsection 1(B)(c) above the reference to a child of the employee includes a reference to a stepchild of his.'.—[Mr. Ryder.]

Amendment proposed: No. 6, in page 12, line 46 at end insert— '(1A) In section 154(2) of the Taxes Act 1988 for the words "section 155" there shall be substituted the words "sections 155 and 155A".'.—[Mr. Ryder.]

Mr. Boateng

We welcome the amendment. It follows a new course. It follows from amendment No. 40 which we tabled on the Floor of the House, when the matter last came before us. The Government accepted it in principle and we are glad to see that it has been worked through into the Bill.

Amendment agreed to.

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