HL Deb 22 January 1980 vol 404 cc423-8

5 p.m.

Lord CULLEN of ASHBOURNE

My Lords, I beg to move that the Child Benefit and Social Security (Fixing and Adjustment of Rates) Amendment Regulations 1980 be approved. The regulations are concerned with child benefit increase which is a weekly payment of £2.50 made to certain people bringing up children alone. The purpose of the regulations is two-fold. First, they seek to make the premium available to people who, single-handed, are bringing up children who are not their own. Secondly, they remove an anomaly underwhich someone cat, be excluded from entitlement if he is receiving a specified benefit now payable at a rate lower than child benefit increase.

At present only lone parents are eligible for the premium. There are, however, people other than parents who are bringing up children single-handed—for example, some grandparents are in this position. They have to cope with the same difficulties, financial and otherwise, as lone parents. In the fields of income tax, supplementary benefits and family income supplement, easements for what are generally termed "one-parent families" are alreadyextended to such people. The Government consider it is right and fair, therefore, that they should also be included within the scope of the help provided by the child benefit increase, and these regulations so extend eligibility to make their inclusion possible.

With regard to the second purpose of the regulations, someone is excluded from entitlement to the premium if he is receiving one of the benefits specified for this purpose in the main regulations. The specified benefits are all long-term, and initially all made provision for a child at a rate higher than that of child benefit increase. Among them are dependency allowances to industrial death benefit and industrial diseases benefit in respect of pre-1948 employment. Both dependency allowances are payable at a higher or a lower rate according to the circumstances of the case. The lower rate is now below the level of child benefit increase, which is now five times higher than when it was first introduced in 1977 at the rate of 50p. As long as the lower rate continues to be included in the specified benefits, someone can be denied the more substantial help that he would otherwise receive through the child benefit increase. The Government wish to remove this anomaly.

I am confident that your Lordships will accept the regulations before you. My Lords, I beg to move.

Moved, That the draft regulations laid before the House on 11th December 1979, be approved.—(Lord Cullen of Ashbourne.)

5.3 p.m.

Lord WELLS-PESTELL

My Lords, I am sure that the House will be grateful to the noble Lord the Minister for his explanation of the instrument now before your Lordships. Very briefly, I should like to raise a number of matters. I cannot resist the temptation to ask the noble Lord whether he has any information yet as to whether the child benefit will, in fact, be increased next November. I think I am right in saying that a decision has already been taken not to increase it this April.

Arising out of the position of single-parent families, I want to raise three small matters. The noble Lord has quite rightly said that in addition to the £4 given weekly by way of child benefit to single parents along with other parents, there is a premium of £2.50 per week for the first child. My understanding of the situation is that less than half the single parents entitled to that £2.50 in fact receive it because they have not taken it up. I am well aware that the department has spent a certain amount of money in trying to draw this entitlement to the attention of single parents. Perhaps the noble Lord will at some time let me know whether or not that campaign still exists and, if so, what steps are being taken? Secondly, if it does not exist, can the noble Lord say whether the Government are prepared to embark upon another campaign?

Having said that only half the single parents take this up, I think I am right in saying that about half single parents have more than one child—they have two children. I think that it has been the practice of Governments over some period of time to recognise that single parents are in a very difficult financial situation, notwithstanding the help they receive from the State. I wonder whether the Government have considered, or would be prepared to consider, making the £2.50 available to the second child. It may well be that there would be some other loss of benefit—I do not know. However, bearing in mind that over half single-parent families have two children, it would perhaps be a step in the right direction if the Government were to consider the £2.50 premium for the second child.

I turn to my second point, and in a sense I do not know whether it has been considered. However, in looking at the whole problem of single parents, as I have been doing recently, I am amazed to find the number of those who are single parents by virtue of the fact that the husband is in prison—I accept some for short terms and some for quite long terms. I wonder whether the Government will give consideration to regarding prisoners' wives as single parents, and whether they will feel able to extend the premium to them. That is all I want to say. Perhaps the noble Lord will answer my questions at some stage; I do not ask for a reply this afternoon because I appreciate that these points have to be thought out very carefully. We support this instrument.

5.7 p.m.

Lord BANKS

My Lords, I, too, should like to join in thanking the noble Lord for this careful explanation of these regulations. I welcome the extension of the child benefit increase to persons bringing up children who are not their own. I also welcome the removal of the anomaly whereby people in receipt of benefit lower than the child benefit increase were excluded. We on these Benches find these regulations to be non-controversial and unexceptionable, and I am happy to support their passage through the House.

Of course, single parents would be helped not only by an increase in the benefit provided specifically for them, but by any increase in child benefit. Therefore, can the noble Lord give any indication whether the Government will increase child benefit in the foreseeable future? After all, income tax allowances have been replaced by child benefit; when such allowances are raised the only way in which one can take account of children is, at the same time, by increasing child benefit. That was not done in the last Budget, so the position of people with children worsened as against those without children. Can the noble Lord give us any indication whether the Government intend to grant an increase in child benefit, particularly as that would be instrumental in reducing considerably the number of recipients of supplementary benefit at present. It seems to us on these Benches that the case for an uprating is overwhelming.

5.10 p.m.

Lord CULLEN of ASHBOURNE

My Lords, I am grateful to both noble Lords for their approval of this order. The main question that I was asked was whether there is likely to be an uprating in child benefits in November. I am extremely sorry that I am in no position to give an answer to that. It will obviously depend on the financial resources available at the time. As I think your Lordships know, we in the Government are just as keen on child benefits as the Labour Party and also the Liberal Party.

The noble Lord, Lord Wells-Pestell, asked me several questions to which I think I can give him some answers today. Regarding the take-up of the premium, I understand that it is now accepted that about 60 per cent. take-up occurs. We had initiated steps to improve take-up with child benefit increase posters, TV fillers, and so on. My right honourable friend will be reviewing the take-up situation in the summer to see what further steps are then needed and what are practicable. The noble Lord also asked whether the Government would consider the increase being payable for more than one child; say, for the second child. I understand the position is that, because child benefit increase is payable under the Child Benefit Act, it has to be related to a particular child. It is nevertheless regarded as a benefit for the family as a whole, but there are no plans for making it payable in respect of other individual children, anyhow at this time.

Regarding the rather controversial suggestion about prisoners' wives, there is a case for extending child benefit increase to the wives of longer-term prisoners, but the extension could only be achieved by abandoning for this group of families a fundamental feature of the benefit; that the separation is likely to be permanent. If that test is satisfied, then the child benefit increase is already payable. To make it payable even if the separation is not likely to be permanent would contrast unfavourably with the position of other families where the husband's employment provides no other option but to be away from home for long periods. Noble Lords will appreciate that the issue is a complicated one, and my right honourable friend is not considering making any change at present.

Baroness FAITHFULL

My Lords, before the Minister sits down, may I briefly intervene? May I ask the indulgence of the House to intervene on points slightly away from these regulations, but bearing in mind that there may be a change before next November? May I ask the Minister whether it is clearly appreciated that in this country there is still the poverty trap? I feel strongly over this, having made my maiden speech on it. The poverty trap means that a number of men and families are better off out of work than in work. This applies particularly to the low-paid workers. If the child benefits were to be raised, then the low paid workers would prefer—in fact, in any case they would prefer—to be in work. But many men who are out of work at the moment, having calculated that if they get certain low paid work they will have less coming into their house than if they stay out of work, opt, perhaps understandably, to stay out of work. If the child benefits were to be raised, then many men, I would submit, particularly the low paid workers, would get jobs, would be happier within themselves. This in fact at the end of the day would redound back on the Government, and there would not be so much money to be paid out in supplementary benefits.

Would the Minister not agree that child benefits should be treated as a personal tax allowance, so that as tax allowances for adults are increased, child benefits would be adjusted proportionately? Otherwise the position of married couples with children will continue to deteriorate. The aim should surely be to continue the simplification of the tax structure, and ensure that child benefits keep in step in the future, giving equal support to families in and out of work.

Finally, may I ask the Minister whether the financial return on giving particularly good child benefits to parents with children under five has ever been considered? Many parents at the moment are going out to work instead of staying at home. They are putting their children out to child-minders, or making other arrangements for them, because of the need for the money. If they were able to have the option and stay at home and look after their children, particularly those aged nought to five, I believe that in the long run there would be a good return. Research in the delinquency field has shown—though not always—that often a contributory factor has been that children have not been able to have an immensely satisfactory and satisfying life between nought and three. At the end of the day, it would pay this country to give good child benefits to enable the woman who is now going out to work to stay at home.

Lord CULLEN of ASHBOURNE

My Lords, I am grateful to my noble friend for her intervention. What she said is of great interest to the House. It was in point of fact, as she herself said, not particularly connected with the regulations that we were dealing with, but I am quite sure that my right honourable friend will be more than pleased to read what she has said.

Lord WELLS-PESTELL

My Lords, I understood from listening to the noble Baroness that at the beginning she asked a question. If the noble Lord, on reflection, feels that she did and he writes to her, may I please have a copy of the letter?

Lord CULLEN of ASHBOURNE

Certainly.

On Question, Motion agreed to.