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Child Poverty

Volume 448: debated on Wednesday 5 July 2006

2. What assessment he has made of the impact of child tax credits on reducing child poverty in Cynon Valley and Wales. (81347)

Since 1997, an estimated 50,000 children have been lifted out of poverty in Wales, including in Cynon Valley, where more than 5,000 in-work families are benefiting from child tax credit.

As my right hon. Friend will no doubt acknowledge, child poverty is still a problem in Wales. However, the Conservatives opposed tax credits and the minimum wage, and oppose almost anything that helps the poorest families. Those families would have been far worse off if the Conservatives had been in power.

Not surprisingly, I completely agree with my right hon. Friend. We have seen 700,000 children lifted out of poverty right across the United Kingdom, but she is right: we still need to do more. We have increased child benefit by a record amount and we have improved entitlement to maternity and paternity leave for new parents—all measures opposed by the Conservative Opposition. We have also created extra places in nursery and child care. All those programmes would be put at risk by the Tories’ plans for public spending cuts in Wales and the rest of the United Kingdom.

What assessment has the Secretary of State made of the cost of administering those tax credits? Would that money not be better spent on reducing poverty among children in Wales?

Child tax credits, like the employment tax credits, have an administrative cost, but they target the resources on those most in need, including children in Wales and right across the United Kingdom—and, I dare say, also in the hon. Lady’s constituency. The Conservatives’ repeated attempts to sabotage the programme—they opposed it in the first place and they would like to scrap it—would leave thousands of children in Wales and hundreds of thousands of children across the United Kingdom destitute, as they were when the Tories were last in power.

I must say that for a Labour Member to raise the issue of tax credits is like the captain of the Titanic offering guided tours of the hole in his boat. Is the Secretary of State aware that in Powys alone last year one in three tax credits awarded were overpaid, leaving nearly 5,000 people to pay back £4.3 million to the Revenue? Those errors are seriously harming our most vulnerable families. When will the Government get to grips with this malfunctioning system?

Witty jousting is no substitute for a serious policy. As the hon. Gentleman knows, a serious policy of tax credits has helped families and people by the thousand in his constituency of Montgomeryshire and by the tens of thousands throughout Wales. The Liberal Democrats, the Conservative Opposition and Plaid Cymru have put forward no coherent alternative to that anti-poverty programme, which, as a Labour Government, we are proud to have led.