Parliamentary watchdog highlights Labour's tax credit failure

12.00.00am BST (GMT +0100) Tue 23rd Oct 2007

The Welsh Liberal Democrat Spokesperson on Communities, Housing and Social Justice, Peter Black has cited evidence provided by Parliament's watchdog to an influential parliamentary committee as further proof of the need for a fundamental review of the tax credit system.

Yesterday's evidence from the Parliamentary and Health Ombudsman to the Public Administration Committee saw a withering criticism of the government's policy of tax credits, highlighting the policy's adverse effects, including its reliance on means-testing and failed delivery, causing over-payments and disincentives to work.

Mr. Black said:

"The Labour Party's record is one of laudable intentions betrayed by over-complicated bureaucracy, an incomprehensible array of benefits, and the abject failure of organisations such as the Child Support Agency. Their own child poverty reduction targets stand in grave danger of not being met as a consequence. Gordon Brown needs to take personal responsibility for this failing system. It is clear from the ombudsman that even when it works as intended, the system is in many cases worsening child poverty and incentives to work.

"When the poorest families in Wales are forced into debt and some are choosing not to take up their benefits rather than endure the failings of tax credits, only the worst dogmatist would insist the policy was sound. "The Welsh Liberal Democrats want to see a return to fixed awards with a fairer appeals process, as well as a simplified benefit system that gets help to the people and families who need it without requiring them to wade through a morass of bureaucracy first."