Guardian’s Allowance Up-rating Order 2014

Lord Newby Excerpts

Monday 17th March 2014 Grand Committee

Moved by

[Lord Newby]

That the Grand Committee do consider the Guardian’s Allowance Up-rating Order 2014.

Relevant document: 22nd Report from the Joint Committee on Statutory Instruments

[Lord Newby (LD)]

My Lords, as I begin, it is a requirement that I confirm that the provision contained in the three orders and regulations before the Committee today is compatible with the European Convention on Human Rights, and I so confirm.

The two orders that we are debating increase by CPI the rate of guardian’s allowance, the payment made to provide support to those who look after a child whose parents are deceased. The regulations increase the maximum rates of the disability elements of tax credits—that is, the disabled child and severely disabled child elements of child tax credit and the disabled worker and severely disabled worker elements of working tax credit—in line with CPI. This decision was taken to protect those benefits that help with the extra cost of disability. The regulations also increase the earnings threshold for those entitled to child tax credit only, after which payments begin to be tapered away.

The regulations and orders before the Committee today protect the most vulnerable by ensuring that the guardian’s allowance and the elements of working tax credits and child tax credits designed to assist with the extra costs of disability keep pace with the change in prices. This Government have ensured that these elements of financial support paid to low-income and vulnerable households have kept pace with inflation and will continue to do so until the end of this Parliament.

Alongside the broader steps that this Government are taking to support hard-working families with the costs of living, these regulations and orders make sure that support for the most vulnerable in the tax credit system is protected, even in the context of tough decisions elsewhere. The Government’s approach is helping to secure the recovery now and for the longer term. I commend these regulations and orders to the Committee.

[Lord Tunnicliffe (Lab)]

My Lords, I commend the Minister for not making the classic mini-Budget speech before introducing these orders, as has been done on previous anniversaries. I shall also put my mini-Budget speech to one side and save us all a great deal of time. The two orders reveal the difference between us on CPI and RPI and I will not rehearse that. The explanatory memorandum to the final instrument, the Tax Credits Up-rating Regulations 2014, says that they will go up 2.7%. I casually spoke to my computer about this and in Regulation 2, the amendment of the Child Tax Credit Regulations 2002, the figure of £5,735 goes up to £5,850. My computer says that this is 2%. The next figure, of £6,955, goes up to £7,105. Sheer curiosity demands that I ask why this is more like 2% than 2.7%. I am sure that there is a cunning answer.

[Lord Newby]

My Lords, I am sure that there is a cunning answer. I am equally sure that I do not know what it is, so I am afraid that I will have to write to the noble Lord with my cunning answer.

Motion agreed.