Savings Accounts and Health in Pregnancy Grant Bill

Baroness Hughes of Stretford Excerpts

Tuesday 7th December 2010 Lords Chamber

[Baroness Hughes of Stretford]

My Lords, we have had enormously powerful and very knowledgeable contributions this afternoon on the substance of the Bill before us and I shall not repeat them. I wish to make some brief comments on the process in which we find ourselves and on the substance of the Bill.

I should like to reflect on two broad issues. The contributions that we have heard from some Members opposite illustrate for me how deeply contradictory the approach adopted by the Government is to explaining the way in which they are conducting their deficit reduction strategy. The Minister has told us that, on the one hand, there was no alternative to measures such as these to abolish very important social policy measures but, on the other hand—here I agree with the noble Lord, Lord Northbourne—he asks us to believe that this will have no negative impact on inequality and child poverty in particular. That is simply inconceivable and deeply contradictory. In all of these debates about how to reduce the deficit, I can see no evidence of any clear criteria to explain which measures the Government have decided to abolish and which they have not. I should have thought that any important set of criteria should include something that attempts to retain, at least in part, measures such as these that will make a long-term positive difference to some of the most disadvantaged people in our community.

I take up a point raised by my noble friend Lady Drake. We heard from the noble Baroness, Lady Noakes, and the noble Lord, Lord Newby, that in principle they are very uncomfortable with universal measures, such as the child trust fund and the health in pregnancy grant. On that basis, and to take it to its logical conclusion, they may well be opposed to free schooling and the National Health Service. However, if they are so concerned that, at least in the present climate, a universal measure such as the child trust fund cannot be sustained, it is open to them to argue for the targeting that they say they support. Yet we have heard no such argument for targeting; instead we have a wholesale dismantling of these measures. These abolitions will affect the poorest people the most.

The second issue on which I wish to reflect is why these measures were introduced in the first place. All, in their way, are preventive measures. They are designed to help people avoid falling further into poverty or disadvantage. The child trust fund, in particular, and the saving gateway formed a radical new approach alongside the measures which the previous Government brought in to try to improve people's prospects in the here and now through the working tax credit, for example, and the national minimum wage. They were farsighted measures to try to help people to get into the habit of saving and to accumulate assets which they could use when they needed them. Long-term universal benefits help to achieve those long-term aims and they help people who, otherwise, would not have the opportunity to get the benefit of long-term savings, which many of us take for granted. It was also a very strategic approach to try to sustain, over the long-term, the improvements that we saw in the reduction of the number of children living in poverty over the lifetime of the previous Government: 600,000 fewer children living in poverty by the end.

It is worth reflecting on those issues because that brings me to the conclusion that, even in the current climate, the child trust fund, in particular, should be retained for those specific groups of children who are least likely to acquire long-term assets through their own families. While children in care are an obvious group for whom I support such a measure, there are others, such as disabled children, whose families find the cost of their disability an enormous burden on family resources. There is a very strong case for continuing the child trust fund for them and for children living in poor families, where there is no hope of such children acquiring the kind of back-up of a pot of capital assets that most parents want for their children. It is out of reach for children in those specific groups.

I shall focus briefly on the process that was clarified for us by the noble Baroness, Lady Howe. The Speaker has made a decision, although we do not know whether it was at the request of the Government or simply on advice, but the Minister knows the position and sees the concern of Members in both Houses of Parliament who would wish for an opportunity to amend this legislation. The Minister cannot hide behind the Speaker’s decision because, while he cannot challenge that decision, and nor do we, there are other routes open to him to bring forward other measures as outlined by my noble friend Lady Armstrong. He can give a commitment to the House today that he will do so.

On the merits of the argument, there is an overwhelming case for continuing the child trust fund, not some other measure. The child trust fund has many advantages over the junior ISA being proposed. We should continue it, at least for children in care. We have heard in great detail, which I shall not rehearse, the arguments relating to the still poor, although improving, outcomes for children in care. As Minister of State, I was responsible for developing the Green Paper Care Matters. Many Members of this House helped me with that and were very energetic in trying to take the boundaries of the policy as far as we could, and I was very grateful for their support. Through that process, I talked directly, as the noble Baroness, Lady Ritchie, does in her current position, to many children in care. I can say to your Lordships without any sentimentality that many of them constantly surprised me with their talent, ability and resilience in terms of what they had been through and the enormous hurdles that they had overcome.

Particularly at the point of transition out of care, whether at 16, 17 or 18, they have virtually no resources to fall back on. I talked to a number of young people who were in higher education, and many Members of this House will know from their experiences with their own children of the things that you have to buy for them when they go away to university or college or when they move into their own flat. There is an enormous bill for most parents. Young people who have been through the care system simply do not have the wherewithal to cope with that, so I think there is an unassailable case for continuing with a long-term savings mechanism, such as the trust fund, for children in care because we, the state, are the parents. I think there is also an equally strong case in terms of need for families with disabled children and for children in poor families. What we need from the Government today is not more warm words or promises but a firm promise from the Minister to bring forward in another Bill proposals to ensure that the child trust fund is either continued or replaced with a similar measure, at least for all children in care, and with a process that will enable Members of both Houses to amend those proposals.