§ Lords amendment: No. 4, to leave out clause 14 and insert the following new clause—Persons qualifying for disabled person's tax credit—
- (".—(1) Subject to subsection (6) below, section 129 of the Social Security Contributions and Benefits Act 1992 (disabled person's tax credit) and section 128 of the Social Security Contributions and Benefits (Northern Ireland) Act 1992 (equivalent provision for Northern Ireland) shall be amended in accordance with subsections (2) to (5) below.
- (2) In subsection (1), for "or (2A)" there shall be substituted (2A) or (2C)".
- (3) In subsection (2)(a), for "56 days" there shall be substituted "182 days".
- (4) After subsection (2B) there shall be inserted the following subsections—
- "(2C) A person qualifies under this subsection if—
- (a) the condition mentioned in subsection (2D) below is satisfied;
- (b) a medical practitioner (within the meaning of the Administration Act) certifies, not more than 14 days before the date when the claim for disabled person's tax credit is made—
- (i) that in his opinion the person will continue to have the disability in question for a period of at least six months; or
- (ii) that in his opinion the person will continue to have that disability for the remainder of his life; and
- (c) the level of the person's expected earnings is lower, by at least the required amount, than it would have been if he had not had the disability.
- (2D) The condition is that there are 140 qualifying days, the last falling within the period of 56 days immediately preceding the date when the claim for disabled person's tax credit is made, which are days in respect of which—
- (a) statutory sick pay has been payable to the person;
- (b) the lower rate of short—term incapacity benefit has been payable to him;
- (c) income support has been payable to him on grounds of incapacity; or
- (d) earnings have been credited to him under regulations made under section 22(5) above.
- (2E) For the purposes of subsections (2C) and (2D) above—
- (a) the required amount, in relation to a person's expected earnings, is—
- (i) 20 per cent of what those earnings would have been if he had not had the disability; or
- (ii) if the amount given by sub—paragraph (i) above is less than the prescribed amount, the prescribed amount;
- (b) qualifying days are days forming part of a single period of incapacity for work within the meaning of Part XI of this Act; and
- (c) income support is payable to a person on grounds of incapacity if and only if he satisfies the condition in section 124(1)(e) above by virtue of being a person who—
- (i) is, or is treated as, incapable of work for any purposes of this Act; or
- (ii) is treated as capable of work by virtue of regulations under section 171E below.
- (2F) Sections 3 and 112 above shall apply as if this section were included in Parts Ito V of this Act."
- (5) In subsection (8), after "allowance" there shall be substituted ", or the level of a person's expected earnings,".
- (6) In section 128(2E)(c) of the Social Security Contributions and Benefits (Northern Ireland) Act 1992, as inserted by subsection (4) above, for "124(1)(e)" there shall be substituted "123(1)(e)" and for "171E" there shall be substituted "167E".
- (7) In section 11(3)(b) of the Social Security Administration Act 1992 (repeat claims), for the words from "he" to "that paragraph" there shall be substituted—
- "(i) he qualified under subsection (2) of section 129 of the Contributions and Benefits Act by virtue of paragraph (a) of that subsection, or of there being payable to him a benefit under an enactment having effect in Northern Ireland and corresponding to a benefit mentioned in that paragraph; or
- (ii) he qualified under subsection (2C) of that section or of section 128 of the Northern Ireland Contributions and Benefits Act,".
- (8) In section 9(3)(b) of the Social Security Administration (Northern Ireland) Act 1992 (corresponding provision for Northern Ireland), for the words from "he" to "that paragraph" there shall be substituted—
- "(i) he qualified under subsection (2) of section 128 of the Contributions and Benefits Act by virtue of paragraph (a) of that subsection, or of there being payable to him a benefit under an enactment having effect in Great Britain and corresponding to a benefit mentioned in that paragraph; or
- (ii) he qualified under subsection (2C) of that section or of section 129 of the Great Britain Contributions and Benefits Act,".
- (9) This section, except subsection (3) above (and subsection (1) above so far as relating to that subsection), applies to claims made, or treated as made, on or after 1st October 2000.")
§ Mr. Deputy Speaker (Sir Alan Haselhurst)
With this, it will be convenient to take Lords amendment No. 7.
§ Dawn Primarolo
The Chancellor announced in his Budget statement in March a new fast-track gateway to the disabled persons tax credit to help people who become disabled while in work. Since then, work on the details of the fast track has been under way, and the Government were pleased to introduce the new clause on Report in the other place. It was warmly welcomed there and I am sure that the House will welcome it also.
The new fast-track gateway introduced by clause 14 aims to make it financially possible for newly disabled people to stay in work even if, because of their disability, they either have to move to a less demanding—and therefore less well-paid—job, or need to reduce their working hours in their old job. The fast-track gateway will be an additional route to the disability tax credit for people who are in work and who cannot meet the present qualifying conditions.
From October 2000, a person will be able to apply for the disabled persons tax credit if he or she has received, for 140 days, statutory sick pay, short-term incapacity benefit paid at the lower rate, income support paid on grounds of incapacity, national insurance credits only or occupational sick pay—linked periods of incapacity will count as long as together they add up to 140 days; if he or she has a condition that puts him or her at a disadvantage in getting a job; if a medical practitioner certifies that the illness or disability will last for at least six months, or for the rest of the applicant's life if that is 979 likely to be shorter than six months; and if, on returning to work, the applicant will receive earnings at least 20 per cent. less than would have been the case if there had been no disability. People who have made a successful initial application for the disabled persons tax credit will, of course, be able to make a repeat application if the illness or disability continues at the end of the 26-week award period.
The idea of the fast-track gateway emerged from informal discussions between the Government and the disability lobby about the problems faced by people who become disabled while in work. As I have said, the Chancellor announced the fast track in outline in his pre-Budget report in November 1998. A formal consultation followed and the proposals were warmly welcomed by the disability lobby, whose suggestions for improvements have been reflected in the final design. In particular, the Disablement Income Group described the proposed fast-track gateway as a "very welcome development", and the Royal Association for Disability and Rehabilitation praised the emphasis that the Government are placing on enabling disabled people to remain in work.
For completeness, I should remind the House that, since it last debated the Tax Credits Bill, the Government have taken two further steps to address the needs of disabled people. We announced on 17 May that, from October 2000, the working families tax credit would include an additional premium for each disabled child in a family receiving the tax credit. That additional premium of £21.90 per week is already payable under the disability working allowance and will continue under the disabled persons tax credit. The extension to the working families tax credit means that extra help will be available to working families with a disabled child, whether or not one of the parents is also disabled. That will no doubt be extremely welcome news to the disability groups who have long campaigned for the disabled child of an able-bodied person to be treated as generously as the disabled child of a disabled parent. I hope that I have explained the details of the new clause to the House. We welcome these changes and support the Lords amendment.
§ Mr. Pickles
I shall be brief. It would be churlish not to thank the Paymaster General for giving a brief explanation of the changes. She will recall that this matter concerned all political parties in Committee, and we are pleased that the Government have honoured their undertakings. While we oppose this measure, we have done our best to try to improve it. There was always a thin red line between our co-operation and opposition. If the hon. Lady has been good will hunting, she has certainly found it in this amendment. We recognise that and support the amendment.
Lords amendment agreed to [Special Entry].
Lords amendments Nos. 5 to 11 agreed to.
Committee appointed to draw up Reasons to be assigned to the Lords for disagreeing to certain of their amendments to the Bill: Ms Hazel Blears, Mr. Greg Pope, 980 Mrs. Eleanor Laing, Mr. Eric Pickles and Dawn Primarolo; Three to be the quorum of the Committee.— [Mrs. McGuire.]
§ To withdraw immediately.
§ Reasons for disagreeing to certain Lords amendments reported, and agreed to; to be communicated to the Lords.