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Child Benefit

Volume 164: debated on Monday 8 January 1990

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To ask the Secretary of State for Social Security how many letters he has received supporting the decision not to uprate child benefit in the coming year.

The decision not to uprate child benefit does not appear to be terribly popular. Does my right hon. Friend agree that because of the low take-up of means-tested benefits compared to child benefit, the freezing of child benefit for a three-year period hits poorer families particularly hard?

No, I do not agree with that. It is well known that, because of the way in which the system works, an increase in child benefit does nothing for the least well-off families and for those on income-related benefits. What we have been able to do with some of the resources made available is to improve the benefit for the least well off, and for families that includes a quarter of the nation's children. We must recognise that no conceivable increase in child benefit could do as much for low-income families who are in work as family credit now does.

Does the Secretary of State agree that he was one of the supporters of child benefit? What has changed? How can he come to the Dispatch Box now and defend the freezing of child benefit?

The question whether one is a supporter of child benefit is different from the question whether to increase child benefit as opposed to the other steps that could be taken with the money available. What I was able to do, as I set out in the uprating statement, was to give far more help to the least well-off families than an increase in child benefit would have done, and it did far more for disabled people and families with disabled children.

I applaud my right hon. Friend's intention to help the least well off. Will he assure the House that more than 50 per cent. of those who are due to receive benefits under the new system are getting them?

I assure my hon. Friend that the take-up campaign that we waged last spring was extremely effective in raising the number of people receiving family credit, and I welcome that. The number increased by some 40,000 to about 320,000, and we are currently running a further advertising campaign, which I hope will contribute to making the benefit as effective as we would like it to be.

Does the Secretary of State accept that child benefit is a universal benefit, with almost 100 per cent. take-up, and that it is paid to the mother? It is often the only income that she has to herself, of right. Why does the right hon. Gentleman not say, even at this late stage, that he was wrong to cave in to the Prime Minister's Victorian attitude, and that he will uprate child benefit?

Family credit is also normally paid to the mother. The average payment of family credit is now £25 or £26 a week, and over a third of the payments are more than £30 a week. There is no doubt that family credit does more for low-income families in work than child benefit could.