Welfare Reform Bill

My Lords, as we come to the consideration of the cap on welfare benefits, the amendments in my name in the next two groupings concentrate on the needs of children. They are concerned not with the existence of the cap but with the way in which it operates for families with children. Amendment 99ZA in my name and that of the noble Baroness, Lady Tyler, makes families with children a specific category within Clause 93. The clause currently has no reference at all to children. The distinction that it makes is between single people and couples, yet children are most deeply affected by any restriction of benefits. My amendments are an attempt to find ways in which families with children can be helped to care for them where there is unemployment or circumstances which make the parents dependent on benefits. I am particularly indebted to the Children’s Society for its Good Childhood report on the condition of children and the pressures on them in this country. I am also indebted to it for its work to ensure that children in deprived families are protected from the effect of capping and that the capping arrangements do not damage the needs of children and the way in which they grow up in our society. As the Bill stands, children are disproportionately affected by the cap. The Children’s Society estimates that some 210,000 children will be affected by it compared with some 70,000 adults. The amendment promotes fairness because it compares like with like. If we are to set a cap for families with children, that should be compared with working families with children—probably those with someone working more than 16 hours a week, as suggested in Amendment 99ABB. That fits with, for example, the Chancellor of the Exchequer’s remarks at the 2010 Conservative Party conference that the cap should be at the level of the earnings of the average working family. I believe that most of us would see an average working family as meaning a family with children, whereas household earnings include those of childless single people, for example. This simple alteration in Amendment 99ZA could remove something like 25,000 children from the cap. Linked in this group of amendments are those seeking to produce a fair definition of income. Amendment 99ABB aims to relate the cap to the income of working families rather than simply to their earnings. The principle behind the cap is that households should not be better off living on benefits than they would be in work. Income, for a family that is in work, includes, for example, child benefit or council tax benefit. If we are looking for an equitable comparison, then it is the amount that comes in to the household which is relevant, and not simply that which is on the payslip. To replace earnings by income, as Amendment 99ABB suggests, could remove some 38,000 children from the effects of the cap. Again, the concern is with provision for the growth, development and support of children as they grow up within our culture, and those who need the support of a welfare system as they grow up. The last of the amendments in my name in this group concerns the maths by which ““average”” is calculated. The word ““average”” contains a studied ambiguity and I hope the Minister will be able to enlighten us as we look at this. At present, Clause 93(8) gives freedom to the Secretary of State to choose what he means by an average. That seems to me to be a slightly Humpty Dumpty-ish way of looking at the whole issue. It is unsatisfactory because it causes uncertainty. The mean, which is what is proposed by this amendment, is what, in my experience, is normally meant by an average. The figures are added up and then divided by the number of people concerned. It is like a cricket batting average, where the number of runs is divided by the number of dismissals to get the average. The other common so-called average is the median—the middle number. If you have a cohort of 1,000, it is number 500 in that 1,000. That is a remarkably arbitrary figure because it takes no account of the way in which there may be clustering at one end or the other of the total number of 1,000 in that particular example. However, it might well tempt future Secretaries of State, since at least, as figures are at the moment, it would be lower than the mean under current calculations. It may be that exploration could pursue a trimmed mean, which omits the highest paid 5 per cent and the lowest paid 5 per cent of working households when calculating the mean. We need some definition of average if this clause is going to make sense. These are simple amendments, which do not challenge the basis of the benefits cap. They acknowledge the cost of bringing up children, which is at the heart of the need for family income. They recognise the struggle of parents unable to find work as they seek to care for their families. They could be crucial in helping to avoid plunging children back into poverty. I hope that the Government and the Minister will be able to explore some of these possibilities. I beg to move.