Tax Credits

Debate between Lord Ashton of Hyde and Lord McKenzie of Luton

Wednesday 4th November 2015 Lords Chamber

[Lord Ashton of Hyde]

It is interesting that since we took over as the Government in 2010, 800,000 fewer people are in relative low income before housing costs and 300,000 fewer children are in relative low income.

[Lord McKenzie of Luton (Lab)]

My Lords, is the Minister aware that, following an exchange in the debate we had last week, his noble friend, the noble Earl, Lord Howe, sent a communication to my noble friend Lord Campbell-Savours? I have permission to quote that communication, in which the noble Earl says:

“The plans in the draft regulations would mean that, from April 2016, a family with children who are in receipt of child tax credits would receive those tax credits elements at the same rate of payment as currently applies in respect of those children”.

How does the Minister justify that as a true and fair view? What is paid in terms of tax credits reflects not only the various elements—the building blocks—but the net effect of applying the income threshold and the taper. The former has been dramatically lowered and the taper accelerated. So why will the Government not come clean? This does mean that there will be reductions in child tax credits and working tax credits.