§ Mr. WebbTo ask the Chancellor of the Exchequer (1) how many and what proportion of claims for the child care tax credit have been subject to follow-up checks in each year since its introduction to establish whether the child or children are being cared for by(a) registered childminder, nursery, play scheme, or out of school club, (b) a child care scheme run on Crown property which does not need to be registered, (c) schools and other establishments exempt from registration, (d) providers of care for children aged eight years and over which is approved by specifically accredited organisations and (e) an approved home child care provider; and how many of those checks resulted in (i) investigations, (ii) penalties, (iii) prosecutions, (iv) convictions, (v) end of year overpayment recovery and (vi) cessation of the award; [152739]
(2) what assessment he has made of the level of fraud in the child care tax credit element of the working tax credit; [152740]
(3) how many allegations of non-compliant application for child care tax credit have been reported to (a) the childminder's hotline and (b) his Department; and how many of those allegations resulted in (i) investigations, (ii) penalties, (iii) prosecutions, (iv) convictions, (v) end-of-year overpayment recovery and (vi) cessation of the award; [152741]
(4) how many calls have been made to the childminder's hotline in each of the last 12 months; [152743]
(5) if he will estimate the cost of running the childminder's hotline in the last year; and how many full-time equivalent staff are employed to deal with calls. [152744]
§ Dawn PrimaroloThe child care tax credit was part of the working families and disabled person's tax credits (WFTC and DPTC), which were available between October 1999 and April 2003. It contributed to the cost of eligible child care for working families. It was replaced in April 2003 by the child care element of working tax credit (WTC).
Applications for WFTC and DPTC could be investigated for a number of reasons, including where there were concerns about claims for the child care tax credit within the applications. However, this was only one component part of the award. An inquiry may involve more than one element of non-compliance, and it is not possible to say how many investigations related only to this particular aspect. However, the Inland Revenue successfully prosecuted and convicted 14 cases where child care was a consideration. Of these, six were solely concerning child care.
For WTC, the Inland Revenue will be able to arrive at an error rate for the tax credit population when it is in a position to carry out a full random inquiry programme on a complete set of finalised awards for 2004–05.
A dedicated telephone line was set up in February 2000 for child care providers as a result of consultation with the National Child Minders Association. This gave child care providers the opportunity to tell the Inland Revenue about any concerns regarding claims for child care costs. Up until 31 March 2003, over 2,100 allegations were received in respect of WFTC and DPTC.
1004WWith the introduction of working tax credit (WTC) in April 2003, a new service, the Childcare Provider Helpline, was set up to deal with queries about the scheme and receive information about specific concerns relating to claims to child care costs. Between then and the end of January the helpline has handled over 3,800 calls. It is run as a very small part of the tax credits helpline and it is therefore not possible to isolate the number of staff handling these calls, or the cost.
It is not possible to identify the number of allegations that have been reported outside of the Childcare Provider Helpline. Every allegation received is given careful consideration and, where there is sufficient reason, steps are taken to examine the circumstances more closely.