Breathing Space Scheme

Debate between Ruth George and John Glen

Wednesday 19th June 2019 Commons Chamber

[John Glen]

I acknowledge the hon. Lady’s deep interest in and work on this topic over several years. She has raised points to which it is difficult for me to respond because they are outwith my responsibilities. As she will know, in the Budget we announced a £1.7 billion package of additional financial support for universal credit. I acknowledge that the hon. Lady disagrees with one element, but that additional support did involve the reduction of the maximum deduction from the standard allowance, from 40% to 30%. I cannot speak for a policy area for which I do not have responsibility. I am delivering a breathing space scheme that covers a wide range of debts and reaches deep into public sector debts, which I was keen for it to do from the outset.

[Ruth George (High Peak) (Lab)]

As I set out in a recent Westminster Hall debate, the amounts being deducted from universal credit are a significant part of the reasons people fall into problem debt. I agree that a lot of that is down to Department for Work and Pensions policy, but I have seen many examples of people whose tax credit overpayments are being deducted from their universal credit, and of people being told that they have overpayments dating from 2006 or 2011, when they were supposed to have been written off. The average of £1,200 being deducted from people’s universal credit is contributing to their not having enough to get by or to pay their bills. Will the Minister and the Treasury please look into this issue as a matter of urgency and allow people to appeal against such deductions?

[John Glen]

The hon. Lady will know that, as I said in response to the previous question, that is an issue of the administration of benefits and is the responsibility of the DWP. I will certainly make her observations clear to my colleagues in Government. Universal credit over- payments will be included from day one. I will make sure that I fully address the hon. Lady’s points and write to her on the detail.

Oral Answers to Questions

Debate between Ruth George and John Glen

Tuesday 11th December 2018 Commons Chamber

[Ruth George (High Peak) (Lab)]

In the next two months, the Royal Bank of Scotland will close all but 56 branches in cities across England, leaving banking deserts in towns and rural areas like mine. What is the Chancellor doing to use the Government’s shareholding to exert public pressure on RBS and ensure that we have no banking deserts?

[John Glen]

The Government hold a 62.3% shareholding, but we do not run the bank. Decisions on the branch network are a matter for the bank.

Childcare Vouchers

Debate between Ruth George and John Glen

Monday 15th January 2018 Westminster Hall

[The Economic Secretary to the Treasury (John Glen)]

I am pleased to serve under your chairmanship, Mr Pritchard. I thank everyone who signed the petition and made their views heard. I understand that the petition has attracted more than 115,000 signatures, which goes to show the importance of the Government’s support for childcare costs. This is a key issue, and we have had a thorough debate. Seven Members made very full and thoughtful contributions, and I will respond to as many of their points as I can.

For many parents, being able to afford good-quality childcare is essential to working and supporting their families, so it is right that we have this debate. I am responding to the debate rather than the Minister with responsibility for childcare because tax-free childcare and childcare vouchers operate through the tax system. The Government have introduced tax-free childcare, which will benefit more than 1 million working households and mean that parents are eligible for up to £2,000 per child per year to help towards childcare costs.

[Ruth George]

Will the Minister give way?

[John Glen]

No, I want to make some progress. The hon. Lady can come in—

[Ruth George]

I have just a quick question.

[John Glen]

Let me make my introductory remarks, and then I will give way.

Let me draw Members’ attention to the three key reasons why we support the replacement of childcare vouchers with tax-free childcare. First, the Government believe that childcare vouchers are unfair. Tax-free childcare is fairer and better targeted than the voucher scheme. For example, only about 5% of employers offer vouchers, which limits their reach to about half of working parents, not to mention that self-employed parents are completely excluded from the scheme, which pays no regard to the number of children in each family and disadvantages lone-parent families.

Secondly, tax-free childcare has a broader reach. It is open to all working families with children aged under 12 that meet the earnings criteria. That ensures that families who were excluded from childcare vouchers can be brought into tax-free childcare, and benefits families with the highest childcare costs—namely, most of those with young children.

Thirdly, tax-free childcare is simpler to use—I will come to the IT issues that Members raised. Employers usually pay third-party providers to administer childcare voucher schemes. The Government do not believe that paying third-party providers is a good use of taxpayers’ money. Some £220 million has gone on such administration since the scheme began. A voucher scheme is therefore an ineffective way of delivering support to families. Under tax-free childcare, parents manage their own accounts online. The case for change is clear, as it was to the Labour party when it announced at its 2009 conference, when it was in government, that the existing system would be shut down.

I will now happily give way to the hon. Lady.

[Ruth George]

I thank the Minister for giving way. I was simply going to ask about his earlier comment that 1 million families will benefit from tax-free childcare. Is that the number who will benefit in comparison with having no support with childcare at all, or does it take into account the approximately 550,000 families who would actually be better off under vouchers than under tax-free childcare?

[John Glen]

Clearly, in any benefit system there will be those who are better off and those who are not better off, but the bottom line is that the current system prevents large numbers of parents from accessing childcare support. That is why we are making the change.