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Tax Credits

Volume 447: debated on Tuesday 20 June 2006

To ask the Chancellor of the Exchequer what assessment he has made of the merits of introducing six monthly fixed awards for tax credits; and if he will make a statement. (75758)

As the 2005 pre-Budget report stated (Para 5.23), the Government will continue to listen to the case for a system of fixed awards, but believe on balance that it is preferable to maintain the current system that flexibly responds to changing circumstances.

To ask the Chancellor of the Exchequer how many calls to the tax credits helpline were (a) received, (b) handled, (c) engaged and (d) abandoned in each month from December 2005 to May 2006; and if he will make a statement. (75770)

I have already provided much of this information and would refer the hon. Gentleman to the answer I gave him on 5 June 2006, Official Report, column 187W. Table 1 sets out the number of calls received and table 2 provides those figures for calls handled, engaged and abandoned that did not form part of my answer on 5 June.

Table 1

2005-06

Received1

December

1,306

January

1,825

February

1,489

March

1,551

April

1,592

May

2,356

1 Where the caller selected an option from the call steering menu and was put in a queue to speak to an adviser.

Table 2

2005-06

December

May

Handled1

1,271

2,284

Abandoned2

35

72

Engaged3

4

6

1 Where the caller spoke to an adviser. 2 Where the caller selected an option from the call steering menu and was put in a queue to speak to an adviser but the call was terminated before the caller spoke to an adviser. 3 Call attempts where the caller was played an engaged tone, before they were placed in a queue to speak to an adviser.

To ask the Chancellor of the Exchequer how many tax credit overpayments have been written off in each quarter since April 2003 because HM Revenue and Customs could not reliably match the payment of manual cheques to claimants; what the value was in each quarter; and if he will make a statement. (76490)

For 2003-04, I refer the hon. Member to NAO report, 2004-05. This represented an estimated 134,000 payments made during 2003-04. HM Revenue and Customs has not written off any such manual payments made in 2004-05 or 2005-06.

To ask the Chancellor of the Exchequer what representations (a) he and (b) the Paymaster General have received from the Citizens Advice Bureau about the complexity of tax credit award notices; and if he will make a statement. (78092)

Treasury Ministers regularly receive representations on various aspects of the administration of the tax credits system.

To ask the Chancellor of the Exchequer what assessment he has made of (a) the intra-year volatility of the incomes of low income households and (b) its implications for the design of the tax credits system; and if he will make a statement. (78150)

To improve its understanding of short-term changes in income, HMT and HMRC partly funded research on income variability by Professor John Hills and others at the Centre for Analysis of Social Exclusion at the London School of Economics. This was also part-funded by the Economic and Social Research Council. The report, “Tracking Income: How Working Families’ Incomes Vary Through the Year” was published in March 2006, and is available on the LSE and HMRC websites.

The research showed that many families experience instability in their incomes over time and, while recognising the challenges posed by administering a responsive annual system, said that basing tax credit payments solely on previous levels of income would be “rough justice”.

As the 2005 pre-Budget report stated (para. 5.23), the Government will continue to listen to the case for a system of fixed awards, but believe on balance that it is preferable to maintain the current system that flexibly responds to changing circumstances.

To ask the Chancellor of the Exchequer (1) whether overseas students, with the right to work for 20 hours a week, can claim tax credits; what guidance is given to tax credit staff to check that the limit of work is being observed; and if he will place in the Library copies of written guidance to staff on the eligibility of overseas students for tax credits and the checks to be carried out; (78276)

(2) whether asylum seekers with the right to work can claim tax credits; what guidance is given to tax credit staff on asylum seekers' eligibility; and if he will place in the Library copies of such guidance.

[holding answer 19 June 2006]: Apart from specified exceptions, set out in the Tax Credits (Immigration) Regulations 2003, persons subject to immigration control, including asylum seekers and overseas students, are not eligible for tax credits.

Guidance for staff on dealing with claims from people subject to immigration control is available on the HMRC website: www.hmrc.gov.uk/manuals/ntcmanual/eligibility_residency/ntc0350000.htm.