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Child Benefit

Volume 979: debated on Tuesday 26 February 1980

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asked the Secretary of State for Social Services what recent representations he has received requesting an increase in child benefit.


asked the Secretary of State for Social Services when he expects to make an announcement on the increase of child benefit.


asked the Secretary of State for Social Services if he will make a statement on child benefit levels.


asked the Secretary of State for Social Services what representations he has had from organisations regarding the level of child benefit; and how many of these organisations requested that the indexation of this benefit be restored.


asked the Secretary of State for Social Services what representations he has received requesting an increase in child benefits.

I have had a number of representations. Any change in the levels of child benefit will be announced at the appropriate time.

Can the Secretary of State confirm that he has received many representations not only from Labour Members and Labour Party organisations, but from his own side? Will he take particular note of the Conservative Women's National Advisory Committee, which has also asked him to press for an increase in child benefit? Will he therefore give some assurance to the House that these representations will be taken note of?

I am grateful to the hon. Gentleman for his solicitude for Conservative women. I can assure him that I pay the greatest possible attention to what they say to me.

Order. I propose to call first those hon. Members whose questions are being answered.

is the Secretary of State aware that there will be considerable anger among my constituents who are suffering hardship from the inflation that has been caused by the Government's policies and who are failing to get the increase in child benefit that they require to keep up their standard of living? It is not good enough for the right hon. Gentleman to say that the announcement will come later. The announcement is required now.

The only way in which people in this country can maintain and improve their standard of living is by increasing the output which the country as a whole produces. There is no way in which any Government can guarantee for our people the maintenance, let alone the increase, of their standard of living.

Does my right hon. Friend agree that over the last few years the cost of living for families has gone up at least as rapidly as the cost of living index as a whole? Does he further agree that families are among the least well off groups within the community? Would he personally like to see child benefit go up so that it is at least in line with the rate of inflation?

I understand and applaud my hon. Friend's concern for the position of families. I can assure him that the Government have a lively concern for the relative position of families with and without children. However, he cannot expect me to announce, ahead of the due date, what we may be able to do about the increase in child benefit.

Does not the Secretary of State accept that it is his responsibility, not the responsibility of the Chancellor of the Exchequer, to state exactly by how much child benefit should be increased in order to restore its real value?

The hon. Gentleman may not be fully familiar with the procedure in relation to the announcement of the November upratings of social security benefits. He will know that for instance, for many years it has been the custom for the Chancellor in his Budget Statement to announce the increase in pensions. There will be an announcement at the due time about child benefit.

The right hon. Gentleman must surely appreciate that parents, who have already been burdened with VAT increases, are looking for an announcement as early as possible with regard to child benefit because they want to be able to budget for the rest of the year. Is there no assurance that can be given on this point at this time?

I have already made it clear in my letter to the right hon. Member for Salford, West (Mr. Orme) that the Government do not feel it right to make an increase in child benefit this April. Now that child tax allowances have been wholly phased out, and there is a direct interaction between the amount of child benefit and the amount of the child dependency additions for short-term benefits and for supplementary benefit, it makes every sense to increase the child benefit in November, at the same time as other social security benefits, and to make the consequential adjustments in the child dependency additions at the same time. I can assure the hon. Gentleman that an announcement will be made about the uprating of child benefit at the due time.

I welcome my right hon. Friend's announcement that the appropriate time for the increase in child benefit is in November. Will he bear in mind the pleas that have been made from both sides of the House that a substan- tial increase in child benefit can do much to help parents climb out of the poverty trap and also to encourage work and wealth production?

I can give my hon. Friend the assurance that the Government have both those considerations very firmly in mind.

Does my right hon. Friend agree that, with the amalgamation of child tax allowances and child benefit, child benefit is now part of the tax system just as much as it is part of social security? Will he ask the Chancellor, in considering his Budget Statement, to review the social priorities that apply in the selection of tax concessions, because there are certain classes of recipient of benefit in the income tax system which I believe society as a whole would not put ahead of mothers, given the present state of inflation?

My hon. Friend has pursued these matters with great tenacity over many years and has aroused the admiration of all his colleagues. I think that he would recognise that child benefit, whatever may have been its origins, is a cash transfer from the public to the private sector, whereas a tax allowance is a way of allowing a man to keep more of his own income. As to the decision which a Government face in making proposals to the House, the key question is that either would have an effect on the public sector borrowing requirement. Every 10p increase in child benefit costs £56 million in a full year and the Chancellor considering his tax allowances or the Government as a whole considering the level of child benefit must have regard to the requirement to keep the PSBR under control.

Is the right hon. Gentleman aware that the language that he has just used is not the same language that he used when in opposition, and neither is it the language of the Conservative Party manifesto before the general election? I should like to put a specific point to him. Does he agree that any increase in child benefit, presumably announced at Budget time, should at least allow for raging inflation? Does he agree that to do that there would have to be an increase next November of more than 25 per cent. on present trends? Is he aware that there has already been a net loss of about 20 per cent. in the real value of child benefit since it was last increased, and there will be a great deal more between now and next November?

I honestly do not believe that the right hon. Gentleman expects me to answer questions as to quantum of the child benefit now. That is an announcement which will have to be made at the appropriate time.

Will my right hon. Friend draw, and bring to the attention of his Cabinet colleagues, a graph showing the increase in earnings and pensions and the decrease in the level of child support—either combined child tax allowances and family allowances or child benefit—since 1955?

I shall certainly take careful note of what my hon. Friend says. However, it is fair to put on record that child benefit remains of greater value to most basic rate taxpayers than child support in recent years by way of child tax allowances and family allowances or child benefit.

Does the Secretary of State recall that the Royal Commission on income distribution said that there are more poor children than there are poor pensioners—4½ million as against 3¾ million—and that nearly 45 per cent. of families with three children or more are living in poverty? Is not that a reason for now paying a larger child benefit to large families rather than the case which he has put?

It all depends on what one means by poverty. The case that has been advanced by Professor Townsend and others is that poverty must always be looked at solely as relative poverty—

The hon. Gentleman says "Of course." But the implication of that is that if the standard of living in the country as a whole doubled over a period of years, with no relative change in the position of different groups, exactly the same number of people would be in poverty at the end of that period as there was at the beginning. I happen to regard that proposition as absurd.


asked the Secretary of State for Social Services what reply he has sent to the Conservative Women's National Advisory Committee regarding its request for an increase in child benefit.


asked the Secretary of State for Social Services what reply he has sent to the Conservative Women's National Advisory Committee on its request for an increase in child benefit.

My right hon. Friend has conveyed to the Conservative Women's National Advisory Committee his appreciation of its contribution to the discussion on the role of child benefit.

That is what I would call a dusty answer. I am sure that every Labour Member and obviously a lot of Conservative Members, judging from the previous question, must welcome the support of the Conservative Women's National Advisory Committee with regard to child benefit. Will the Secretary of State take time off, and take his right hon. Friend the Prime Minister by the hand, to meet the Conservative Women's National Advisory Committee so that, as women to women, it may try to persuade her of the necessity to raise this important benefit for the family?

I am sure that my right hon. Friend has noted the remarks of the hon. Member for Barking (Miss Richardson). He will no doubt act on them in his own special way.

Since the Government have always claimed to direct resources to those who need them most, how can the hon. Lady, or any member of the Government, defend the giving of enormous juicy carrots to those earning £22,000 a year while at the same time clobbering families with children whose situation has been made worse by the increase in school meal and school transport charges? How can the hon. Lady defend that inequity?

I assure the hon. Gentleman and other hon. Members that we have taken careful note of the needs of families. We are well aware of the needs of children. The House must await the statement of my right hon. and learned Friend the Chancellor of the Exchequer.

Does my hon. Friend accept that part of the Conservative Women's National Advisory Committee analysis which says that recent Governments, of whatever party, have so organised the benefits system that they have engineered a shift of resources away from families and towards single people?

We have taken careful note of that fact over a period of time. It has not only happened over the last year, but over a number of years. It will be brought to the attention of my right hon. and learned Friend the Chancellor of the Exchequer.

Will the right hon. Lady write to the Conservative Women's National Advisory Committee giving it her previous statements on child benefit detailing her support for an increase in child benefit, and will she state whether she has now changed her mind?

I assure the right hon. Gentleman that the Conservative Women's National Advisory Committee is well apprised of all statements made on this issue in the past. It is also aware of our views on the question of raising child benefit.