BRIEFING PAPER Number 7935, 10 April 2017 The two child limit in tax By Steven Kennedy Alex Bate credits and Universal Richard Keen Credit

Contents: 1. Support for children in tax credits and Universal Credit 2. Announcement of the changes 3. Impact of the changes 4. Responses 5. Exceptions to the two child limit consultation 6. Social Security Advisory Committee 7. Lords Secondary Legislation Scrutiny Committee reports 8. The regulations 9. Media reports

www.parliament.uk/commons-library | intranet.parliament.uk/commons-library | [email protected] | @commonslibrary 2 The two child limit in tax credits and Universal Credit

Contents

Summary 3 1. Support for children in tax credits and Universal Credit 5 2. Announcement of the changes 7 2.1 Summer Budget 2015 7 2.2 Welfare Reform and Work Bill 2015-16 9 2.3 Responses from organisations 12 3. Impact of the changes 14 3.1 Savings 14 3.2 Number of people affected 15 3.3 Impact on awards 16 3.4 Further comment and analysis 18 Institute for Fiscal Studies 19 Policy in Practice 19 Child Poverty Action Group 20 Resolution Foundation 20 4. Responses 21 4.1 E-petition to Parliament 21 4.2 Campaign against the “rape clause” 23 5. Exceptions to the two child limit consultation 26 5.1 Submissions 27 5.2 Government response 27 6. Social Security Advisory Committee 29 7. Lords Secondary Legislation Scrutiny Committee reports 31 8. The regulations 37 8.1 Guidance on the two child limit and exceptions 37 8.2 Application for an emergency debate 37 8.3 What happens now? 39 9. Media reports 40

Cover page image copyright Toddler Train by Eric Peacock. Licensed under CC BY-NC- SA 2.0 / image cropped

3 Commons Library Briefing, 10 April 2017

Summary

Alongside universal Child Benefit, Child Tax Credit (CTC) provides means-tested support for low income families with children. Tax credits are being replaced by Universal Credit, but the new benefit is not expected to fully replace existing benefits until 2022. Summer Budget 2015 announced important changes to tax credits and to Universal Credit, as part of a wider package of welfare measures to yield additional savings of £13 billion a year by 2020-21. From April 2017, the family element in Child Tax Credit and the equivalent in Universal Credit – worth £545 a year to most families – will be abolished for new claims. The per child element in CTC and the equivalent element in UC – worth £2,780 a year – will also be limited to two children for new claims and births from 6 April 2017. The Government justifies this on the grounds that families in receipt of means- tested benefits “should face the same financial choices about having children as those supporting themselves solely through work.” The two measures will eventually yield savings of £5 billion a year, with the two child limit accounting for around £3 billion. Around 900,000 families with three or more children currently receive tax credits. Child Benefit will continue to be paid for all children. There will be protection for families already getting support for third and subsequent children born before April 2017. The disabled child premia in tax credits and UC will also continue to be paid to all children with a disability. Full support for third and subsequent children born after April 2017 will also be available in certain “exceptional circumstances.” This will include children cared for by family or close friends under “kinship care” arrangements, children adopted from local authority care, and multiple births. There will also be an exception for “non-consensual conceptions.” In October 2016 the Government launched a consultation “to inform the detailed design” of the exceptions, and their implementation. The Government’s response in the light of the consultation was published on 20 January 2017, and regulations to provide for the exceptions were laid before Parliament on 15 March. Both sets of regulations are subject to the negative resolution procedure. The two child limit – and the non-consensual conception exception category in particular – is highly controversial. The Government intends to use evidence from third party professionals – such as doctors and social workers – to determine eligibility for the exception on grounds of non-consensual conception. The Social Security Advisory Committee has commented that DWP faces “complex challenges in ensuring that the proposals are delivered in an effective, fair and safe way”, flagging up concerns about privacy, the requirement that the woman is not living with the alleged perpetrator, and how the third party decision model will work in practice. The House of Lords Secondary Legislation Scrutiny Committee questioned whether the Government had made adequate arrangements for assessing entitlement to the exception for non-consensual conception, noted financial and ethical concerns voiced by the local authorities and charities which DWP expects will be involved in third party assessments, and drew attention to particular issues relating to Northern Ireland. The Committee added that DWP’s responses to a number of its questions cast doubt on whether the system would be fully set up by 6 April, and on whether the exception for non-consensual conception can ever be made to work. The Secondary Legislation Scrutiny Committee published a second report on 6 April, relating to further correspondence with the Minister for Employment about the 4 The two child limit in tax credits and Universal Credit

Committees concerns. While the Committee had received a clear answer about the numbers likely to be affected and where the burden of proof would lie, it said that the Minister’s responses to its other questions were “simply stock phrases.” The Committee was not reassured about the availability and training of third party assessors. In addition, it was “disappointed by the Government’s insistence that their “high-level messaging” following the Budget in 2015 was sufficient to alert claimants to the change of law when the submissions we received indicated that this was clearly not the case.” The Committee also observed: “As a general rule we find that publishing claimant guidance only on the day that the policy comes into effect unhelpful: in this case, we think it particularly inappropriate.” 5 Commons Library Briefing, 10 April 2017

1. Support for children in tax credits and Universal Credit

Tax credits – the Child Tax Credit and the Working Tax Credit – were introduced in April 2003. They replaced Working Families Tax Credit and Disabled Persons Tax Credit, which had been introduced in 1999. At December 2016, 4.1 million individuals and families, and 7.1 million children, were benefiting from tax credits. 2.9 million tax credit recipients (72% of the total) were in-work families, of whom 2.5 million had children.1 Total expenditure on tax credits in the UK is forecast to be £27.5 billion in 2016-17.2 Tax credits comprise: • Child Tax Credit (CTC), payable to people with children.3 Along with universal Child Benefit, it provides a single system of financial support for families with children, whether in or out of work. It also replaced the additions for children that were payable with benefits such as Income Support and income-based Jobseeker’s Allowance. • Working Tax Credit (WTC), payable to people in low-paid work, including those without children. Those with children may be able to get help with childcare costs via the childcare element of the Working Tax Credit. People may receive the CTC, or the WTC, or both. Tax credits are claimed on a family rather than an individual basis, so that for couples the incomes and circumstances of both partners will be taken into account. How much a family receives from tax credits will depend on a number of factors including: • The number and ages of the children, and whether any are disabled. • The number of hours worked by the adults, and whether they are disabled • Whether the family is incurring childcare costs for eligible childcare • The family’s income from earnings and other sources Tax credits are means-tested; i.e. the amount received depends on income, so that in general the amount received tapers away as income increases. For families eligible for Working Tax Credit, the maximum tax credit award is withdrawn at the rate of 41p for every pound gross income in excess of the income threshold (currently £6,420 a year).4

1 HMRC, Personal tax credits: provisional statistics December 2016 2 DWP, Benefit expenditure and caseload tables 2017 3 CTC is payable in respect of children up to the age of 16 and “qualifying young persons” age 16-19 in full-time, non-advanced education 4 For further information on how awards are calculated see “What are tax credits?” in HMRC’s Personal tax credits: provisional statistics December 2016 6 The two child limit in tax credits and Universal Credit

For families with children, their maximum tax credit award (i.e. before taking account of any reduction due to the taper) is calculated by adding together different elements (together with WTC, if applicable): • A single family element, worth £545 a year; and • Individual elements for each child or qualifying young person (QYP) The standard amount of the individual element of CTC is currently £2,780 a year, but a higher rate of £2,780 plus either £3,175 or £4,465 is payable where the child or QYP is disabled or severely disabled respectively (2017-18 rates). The following chart illustrates how a tax credit award is structured, for a working family with three children for whom CTC is payable for each.

Universal Credit is replacing tax credits and means-tested social security benefits, although it is not expected to be introduced fully until 2022. Support for children in UC is structured in a similar way to tax credits, although instead of a family element a higher per child rate is payable for the first child. As with tax credits, a family’s maximum UC award is calculated by adding together the per child elements and other elements relating to the adults and the family’s needs. For every £1 of net earnings in excess of the “work allowance” (which varies according Caseload data Section 3.2 provides to the family’s circumstances), the maximum UC award is reduced by latest available 63p. As earnings increase, the UC award tapers off at a constant rate, Child Tax Credits eventually to zero. caseload data, for At December 2016 only around 50,000 families with children received December 2016 Universal Credit, but when it has been fully introduced around the same number of families with children will receive UC as currently receive tax credits.

7 Commons Library Briefing, 10 April 2017

2. Announcement of the changes 2.1 Summer Budget 2015 Summer Budget 2015 announced a package of measures aimed at “making Tax Credits and Universal Credit fairer.”5 In presenting the measures, the Red Book emphasised the growth in spending on tax credits, and the need to focus on the “root causes of low pay.” Four sets of changes were announced: • A reduction in the income threshold in tax credits, and an increase in the withdrawal rate (“taper”), from April 2016 • Reductions in the “work allowances” for most UC claimants, from April 2016 • Limiting the child element of tax credits and UC to two children for new claims and births from April 2017 • Removing the family element in tax credits (and the corresponding first child premium in UC) for new claims from April 2017 Following the Government’s defeat in the House of Lords on 26 October 2015, the Chancellor announced in Autumn Statement 2015 that the planned reduction in the tax credits income threshold and increase in the taper rate would not go ahead.6 The reductions in the Universal Credit work allowances, however, took effect from April 2016 as planned.7 Summer Budget 2015 presented the removal of the family element and the two child limit as measures to “reform tax credits to make them fairer and more affordable.” It added: On top of Child Benefit for every child, an out of work family with 5 children can currently claim over £14,000 a year in tax credits alone. The government believes that those in receipt of tax credits should face the same financial choices about having children as those supporting themselves solely through work.8 Child Benefit would continue to be paid at the same level for all children. The existing entitlement of families who remain in receipt of tax credits and Universal Credit would be unaffected by the two child limit and abolition of the family element, so that “those who already have larger families and have made plans on the basis of the current system will not lose out.” It also announced that the disabled child premia in tax credits and UC would continue to be paid to all children with a disability.9 From the start the Government said there would be “exceptional circumstances” where the individual element of CTC or the child element of UC would be paid in respect of more than two children.

5 HM Treasury, Summer Budget 2015, HC 264 105-16, July 2015, paras 1.141-1.150 6 For details of what was proposed see Commons Library briefing CBP-7300, Tax credit it changes from April 2016 7 See Commons Library briefing CBP-7446, Universal Credit changes from April 2016 8 Summer Budget 2015, HC 264 105-16, paras 1.145 9 Ibid. para 1.148 8 The two child limit in tax credits and Universal Credit

Regulations would set out the circumstances where this would be allowed. This would include instances of multiple births, but the Summer Budget Red Book also stated: The Department for Work and Pensions and HMRC will develop protections for women who have a third child as the result of rape, or other exceptional circumstances.10 In the Budget debate on 9 July, the then Secretary of State for Work and Pensions, Iain Duncan Smith, reiterated that the changes to Child Tax Credit and the child element of Universal Credit were “about getting fairness back into the system” and “ensuring that people on benefits face the same choices as those in work and not on benefits.”11 In its post-Budget briefing, the Institute for Fiscal Studies commented that limiting support to two children was a “significant step in weakening [the] relationship between need and entitlement in the benefit system,” adding that, along with caps on support for housing costs and total benefit income, this appeared to be an emerging theme in Government policy.12 Responding to the Budget, the Children’s Society’s Chief Executive, Matthew Reed, said that the announcement to limit child tax credits to two children was “effectively a two child policy for the poorest families.”13 Some suggested that the policy had more troubling undertones.14 In the Budget debate on 9 July, the SNP’s Social Justice and Welfare spokesperson Eilidh Whiteford said she was “appalled” at the Reference in the Budget Red Book to “protections for women who have a third child as the result of rape, or other exceptional circumstances,” and that its implications needed to be addressed more thoroughly. She added: How does the DWP intend to establish that a child has been born as a consequence of rape? Will there seriously be a box to tick on the form? Will a criminal conviction against a perpetrator be required? We know that rape is one of the most unreported and poorly prosecuted serious crimes in the UK, with most surveys suggesting that 85% of women who are raped do not report it—for a variety of reasons, not least because most victims know their assailants and know that securing a conviction is a very long shot under our criminal justice system. Many simply do not want to put themselves through another traumatic ordeal. I put it to Ministers that the women most likely to become pregnant as a result of rape are those in long-term abusive relationships who are being repeatedly assaulted. They are among those least likely to report rape, and those in the most extreme

10 Summer Budget 2015, HC 264 2015-16, para 2.103 11 HC Deb 9 Jul7 2015 cc485;488 12 Andrew Hood, Benefit changes and distributional analysis, IFS presentation, 9 July 2015 13 Children in poverty being left to carry budget’s burden, Children’s Society press release, 8 July 2015 14 Vicky Allan, “The shaming of big, poor families smacks of eugenics,” Sunday Herald, 12 July 2015; “Stephen Kinnock Says Limiting Tax Credits To Smaller Families 'Reminiscent Of Eugenics',” Huffington Post UK, 13 July 2015 9 Commons Library Briefing, 10 April 2017

danger if they do. So I ask again, what will this “protection” mean in practice? How will the DWP arbitrate? Will women be believed? What steps will be taken to preserve their dignity and privacy? I would like to hear some answers to those questions.15

2.2 Welfare Reform and Work Bill 2015-16 Provisions enabling the abolition of the family element and the two child limit were included in the Welfare Reform and Work Bill 2015-16 introduced following Summer Budget 2015-16. As a result of the provisions – now in the Welfare Reform and Work Act 2016 – • A family will only be entitled to an individual element for more than two children if they were claiming for more than two children who were born before 6 April 2017. New births after that date will not qualify for an individual element (with certain exceptions – see below). • Families with third or subsequent children born on or after 6 April 2017 who are disabled or severely disabled will still have the additional amount in respect of disability or severe disability (£3,175 or £4,465 – see section 1 above) included in their maximum CTC award, but will not receive the basic per child element for that child • The restriction on the individual element is on a “rolling basis” so that, for example, if the eldest child reaches the age where they no longer qualify for CTC, and there is a third child in the family born on or after 6 April 2017, that child will qualify for the individual element. • The £545 family element will not be included in new awards from 6 April 2017, but will continue to be included in awards for families entitled to CTC who are responsible for a child born before that date.

Corresponding changes are made to the child element of Universal Credit to achieve the same policy intent. During the Lords stages of the Bill, the then Minister for Welfare Reform, Lord Freud, set out the context for the changes: At the 2015 summer Budget, the Government announced their plans to move from a low-wage, high-tax and high-welfare economy to a higher-wage, lower-tax and lower-welfare society. This is part of the Government’s plan to deliver a new deal for working families, which also includes incentives to ensure that those who are in work are rewarded fairly. As part of this, we announced reforms to child tax credit and universal credit to help put welfare spending back on to a sustainable footing. The tax credits system has become too generous. As introduced by the last Labour Government, it was originally forecast to cost £11 billion in its first year. In fact, tax credit expenditure more than trebled in real terms between 1999 and 2010; and increased by £9.6 billion in real terms between 2004-05 and 2014-15. Currently, the benefit system adjusts automatically to family size, while many families supporting themselves solely through work

15 HC Deb 9 July 2015 cc495-6 10 The two child limit in tax credits and Universal Credit

do not see their budgets rise in the same way when they have more children. The average number of dependent children in families in the UK in 2012 was 1.7, so the Government feel that it is fair and proportionate to limit additional support provided by the taxpayer through child tax credit and the child element of universal credit to two children.16 Opposition parties were strongly against the changes. At Committee Stage in the Commons, Hannah Bardell said that the SNP wholeheartedly condemned the intentions behind the clause which, she said, would exclude many of the poorest children in society from support and which was “based on the falsehood that all children are planned and that it is possible to plan financially for children.” Ms Bardell said that the provisions were “nothing more than a move to socially engineer society into a form the Tory Government have dreamt up—one where the right to have a third child is a luxury reserved for the rich.”17 For Labour, Emily Thornberry said that the “two child policy” was “not going to end well,” adding that the proposal would see the current Administration “join that inauspicious rank of people who at one time or other have imposed state-sanctioned limits on the number of children a family can have.”18 She noted that there was no equality impact assessment, and said that the changes would have a disproportionate impact on black and Asian families, and on women.19 The then Treasury Minister Damian Hinds said that the Government believed that the two-child limit for support through tax credits and UC was “fair and proportionate.” The Government had, he said, given clear assurances about exemptions in cases of multiple births. In cases involving children conceived as a result of rape, the Government would take a “careful and sensitive approach” – more detail would be given in due course.20 Hannah Bardell said that it was clear from what had been said that there had been “no consultation and consideration on the most serious parts of the Bill, including the issue of the third child and the matter of rape,” and that getting the country’s finances into surplus should not come at the cost of the poorest.21 The proposed exceptions to the two child limit were discussed on a number of occasions during the passage of the Bill. At Lords Committee Stage on 7 December 2015, Baroness Manzoor, speaking to Liberal Democrat amendments, said: …there are lots of complex family situations and many areas could be considered for exemption. However, the ability to exempt these people requires knowing what exemptions they meet. Some exemptions will be easier to assess than others, but how will DWP caseworkers assess if a child is born as result of rape? How intrusive will the questions be and what evidence will

16 HL Deb 7 December 2015 c1328 17 PBC Deb 13 October 2015 cc277-9 18 PBC Deb 13 October 2015 c279 19 PBC Deb 13 October 2015 cc280-1 20 PBC Deb 13 October 2015 cc284-5 21 PBC Deb 13 October 2015 cc285-6 11 Commons Library Briefing, 10 April 2017

caseworkers look for? As we know, many people sadly do not report rape and, when they do, convictions are low, so that will not help. The Minister has already stated that cases of rape will be exempted. How will the DWP know whether a claimant’s child is indeed a result of rape? The only way would be to ask, and I shudder to think how deeply upsetting and totally inappropriate it would be for a caseworker to venture into such traumatic, deeply sensitive and personal issues.22 For Labour, Baroness Sherlock said: The noble Baroness, Lady Manzoor, expressed the concern I think many noble Lords will share about how intrusive a process might have to be to establish that a woman had been raped. I certainly hope the Minister realises that he will find it a challenge to get the Bill through this House in its entirety without explaining how a proposal that somebody should be tested to see if they have been raped would be implemented. At the very least, is the intention that it is only when a woman has made a complaint to the police or someone has been charged or convicted? If not, who will she give evidence to in DWP and how will that be assessed? How will the Minister guarantee that the process will be confidential? If any other official in a benefit or tax office or school could see that a woman was getting benefits or tax credits for a third or subsequent child, there are only two ways at the moment that that could happen—a multiple birth, which would be evident, or the pregnancy being the result of rape. I wonder where that leaves us in terms of confidentiality. Has the Minister given any thought to that? Given that, has the Minister considered the impact on the child if at some point they discover they had been conceived as a product of rape—something the parents may have gone to considerable pains to disguise from them? The Government mentioned in the impact assessment that they would consult stakeholders before deciding how to deal with this. Can the Minister tell us who the Government have consulted and who they intend to consult? I also asked at Second Reading—but got no answer—what the rationale was for exempting children in multiple births or those conceived as a result of rape. The Minister has indicated that this is about choice. Does he accept therefore that there are other circumstances where a woman may not be able to exercise choice? The noble Baroness, Lady Manzoor, mentioned domestic violence. The proposal, which I support, to exempt people in cases of domestic abuse rests on two arguments: first, that a child may have been conceived under duress, rather than as a result of a clear choice; and secondly, that the two-child limit may make it harder for a parent of more than two children to leave an abusive relationship as they would struggle to support the children. We have heard how widespread domestic abuse is. Each year more than 2 million people suffer some form of domestic abuse. Its impacts are severe and hard to escape. About 42% of domestic violence victims have been victimised more than once. On average victims experience 20 incidents a year, which can often increase in severity every time. While 80% of victims report physical abuse, it is not just that—nearly 90% of high-risk victims report experiencing emotional abuse and/or coercive control or behaviours. Those are exactly the kind of things that could lead a woman to become pregnant without exercising choice. Abuse can include a refusal to allow a woman to use contraception. It can

22 HL Deb 7 December 2015 c1336 12 The two child limit in tax credits and Universal Credit

include rape and pregnancy as a result of rape which she may have been reluctant to report to the authorities because of fear of the abusive partner. Of course, the use of power and coercion are the very things that make it hard for someone to leave an abusive relationship. Sometimes they do manage to leave, often by getting advice or support and by meeting other victims; sometimes things go too far, such as when a child is caught in the cross-fire of domestic abuse. At the point at which they flee, they need all the help they can get. Too often they leave just with the clothes they stand up in. They are homeless and need to move and often hide from their abuser; they leave behind schools and jobs. It is hard enough to rebuild a life in those circumstances but this policy could act as a further barrier, so I hope very much that the Minister will consider this exemption very carefully.23 At Lords Report Stage on 27 January 2016, the then Minister for Welfare Reform, Lord Freud, said that the Government’s thinking was that a “third party evidence model offers the most promising approach to striking the balance we need to achieve” when seeking to identify third or subsequent child born as a result of rape. He explained This approach would not be new for the benefit system. For example, we use a third party evidence model in universal credit for the temporary relaxation of the requirement to be available for work in cases of domestic violence. The evidence required is the reporting of the abuse to a third party acting in an official capacity, such as a GP or social worker. This model was developed with input from stakeholders. Of course, a significant amount of work is needed to take forward and develop the detail of the model. I also want development of the model to include working with stakeholders to help ensure that the process is as compassionate and supportive as possible for claimants in these circumstances, while providing the right assurance to government that the additional support is going to those for whom it is intended. We will be getting in touch with organisations with an interest in this policy shortly to seek their input, and I encourage any other stakeholders who would like to be a part of this to let me know. While there is a significant amount of work to do and detailed questions to be answered, I hope this helps reassure the House and stakeholders that we are thinking very carefully about how we respond to this difficult and sensitive issue.24

2.3 Responses from organisations Welfare rights organisations and pressure groups have voiced strong opposition to the two child policy. In its response to the Government’s subsequent consultation on exceptions categories (see below), the Child Poverty Action Group said that it was “completely opposed” to the policy of limiting tax credits and Universal Credit to two children, for the following reasons:25

23 HL Deb 7 December 2015 cc1340-1 24 HL Deb 27 January 2016 cc1294-5 25 Exceptions to the limiting of the individual Child Element of Child Tax Credit and the Child Element of Universal Credit to a maximum of two children: CPAG’s response, November 2016 13 Commons Library Briefing, 10 April 2017

• It broke the link between assessed need and the provision of a minimum level of support, which was “a fundamental pillar of a means-tested social security system.” • It placed into statute “a view which we believe is immoral: that some children, because of the circumstances of their birth, are less deserving than others of a decent standard of living.” • It would increase and deepen poverty. Children in larger families were already at an elevated risk of poverty, and the Institute for Fiscal Studies had estimated that 600,000 more children – all of them in families with three or more children – would be in absolute poverty by 2020/21. • The policy was “extremely likely” to contravene human rights treaties to which the UK is a signatory; by seeking to restrict women’s basic reproductive rights, discriminating against groups with a conscientious objection to contraception and abortion or for whom large families are a central tenet of faith, and by failing to give primary consideration to the best interests of the child. • The policy created “perverse incentives” which risked harm to families with children, including incentives for larger families to separate and for women to have abortions, disincentives to the formation of “blended families” by partners who already have children, and the danger that residency decision for the children of separated parents might be based on financial concerns, against the child’s best interests. • The logic on which the policy was based was “fundamentally flawed”: while it assumed that the conception and birth of children could be neatly categorised as either “voluntary” or “involuntary”, in reality women’s degree of control over their reproductive choices was “rarely either complete or completely absent. In addition, while the policy assumed that it was possible to plan one’s future financial circumstances eighteen years into the future, at the time of the time of the decision to have a child, and to guarantee that household’s financial security throughout their childhood, in reality this was impossible: “There are no guarantees against relationship breakdown, disability, long-term illness or widowhood affecting the income of any family.” CPAG concluded: …the policy can have only two outcomes: the impoverishment of children who continue to be born in larger families, and/or a reduction in births among lower income families. The government cannot in good conscience wish to increase the number of poor children. Nor need it seek a reduction in births: fertility in the UK is already below replacement rate, and the children of today will be the workers and taxpayers of tomorrow.26

26 Ibid. para 12 14 The two child limit in tax credits and Universal Credit

3. Impact of the changes

The two child limit and removal of the family element will save around £2.3 billion per annum in 2020-21 and, once fully in place, save around £5 billion a year. Once current, protected claimants have left the caseload, the two child limit might affect around 900,000 families.

3.1 Savings The two child limit will save around £310 million from expenditure on Child Tax Credit, Universal Credit (UC) and Housing Benefit in 2017-18, rising to £1.6 billion in 2020-21 and £2.0 billion in 2021-22. Spring Budget 2017 announced costings for targeted exemptions from the two child limit, expected to cost the Exchequer around £55 million in 2020-21 and £70 million in 2021-22.27 The removal of the of the family element will save around £230 million from expenditure on Child Tax Credit, UC and Housing Benefit in 2017- 18, rising to £645 million in 2020-21. In the long run, the Institute for Fiscal Studies forecasts that these two changes will save around £5 billion a year – see section 3.4 below.

Savings £ billions, nominal terms 2.5 Remove family element Limit child element 2.0 Target exemptions from child limit

1.5

1.0

0.5

0.0

-0.5 2016-17 2017-18 2018-19 2019-20 2020-21 Sources HM Treasury Summer Budget 2015 table 2.1, Budget 2016 table 2.2 and Spring Budget 2017 table 2.2

Savings to the Exchequer (£ millions, nominal terms)

2016-17 2017-18 2018-19 2019-20 2020-21 Limit child element - 310 765 1,205 1,615 Remove family element 110 230 405 540 645 Target exemptions from child limit - -5 -15 -35 -55

Note Equivalent measures to the removal of the family element came into effect for new claims to Housing Benefit from April 2016. Therefore, this measure saved £110 million in 2016-17. The removal of the family element for tax credit and UC claimants came into effect in April 2017; the two child limit comes into effect for UC, tax credits and Housing Benefit claimants in April 2017 Sources HM Treasury Summer Budget 2015 table 2.1, Budget 2016 table 2.2 and Spring Budget 2017 tables 2.1 and 2.2 In 2017-18 expenditure on Child and Working Tax Credits is expected to be around £26.6 billion, falling to £25.2 billion in 2020-21 (real terms

27 See page 22 of HM Treasury’s Spring Budget 2017 Policy Costings document 15 Commons Library Briefing, 10 April 2017

2017-18 prices).28 This might be equivalent to around £890 per household in Great Britain or 1.2% of GDP. Child and Working Tax Credits expenditure peaked in 2011/12 at £31.6 billion per annum, equivalent to £1,247 per household in Great Britain or 1.8% of GDP.29

3.2 Number of people affected DWP’s July 2015 impact assessment estimated that around 160,000 families in receipt of either Child Tax Credit or UC might be affected by the two child limit, rising to around 640,000 families in 2020-21. Around 270,000 families might be affected by the removal of the family element in 2017-18, rising to around 1.2 million in 2020-21. Families affected by these changes

2017-18 2018-19 2019-20 2020-21 Limit child element 160,000 350,000 510,000 640,000 Remove family element 270,000 680,000 970,000 1,180,000

Note Data for Child Tax Credits and UC claimants Source DWP Welfare Reform and Work Bill: Impact Assessment of Tax Credits and Universal Credit, changes to Child Element and Family Element, July 2015 In the long run, once existing claimants have ceased to receive support, all future claimants of Child Tax Credit and UC will be affected by these changes. The Institute for Fiscal Studies estimates that around 900,000 families might be affected by the two child limit and 4 million families by the removal of the family element (see section 3.4 below).30 Alternatively, we can use the current Child and Working Tax Credits caseload as a very rough proxy for the number of families that might be affected in the future. The table below shows latest available caseload data from HMRC, for December 2016. As of December 2016 there were around 3.67 million families with children in receipt of Child Tax Credit in the UK. Of these, around 863,000 families (23% of all families with children) had three or more children. Around 68% of all CTC claimants were in-work; similarly, around 67% of CTC claimants with three or more children were in-work. However, single parents in receipt of CTC with three or more children were more likely to be out-of-work than single parents with one or two children: 44% of single parents with three or more children were in-work, compared to 58% of those with one or two children. 36% of families in receipt of CTC with three or more children were single parent families.

28 These expenditure forecasts do not account for any effect replacing Child Tax Credits (and a number of other working age benefits) with UC might have on spending. 29 DWP Benefit Expenditure and Caseload tables Spring Budget 2017, “GB welfare” 30 Institute for Fiscal Studies; Significant cuts to two parts of the benefit system to be phased in from next week (20 March 2017) 16 The two child limit in tax credits and Universal Credit

There were an estimated 3 million children in families with three or more children in receipt of CTC as of December 2016, around 42% of all children in families in receipt of Working and/or Child Tax Credits. Families with children in receipt of Child and Working Tax Credits, UK, December 2016

Out of work In work Total

Families with children Single parents 836,900 1,151,800 1,988,700 Couples 329,800 1,354,600 1,684,500 All families 1,166,700 2,506,400 3,673,100

Of which with three or more children Single parents 175,700 136,500 312,400 Couples 111,600 438,800 550,300 All families 287,300 575,300 862,600 % of families with three or more children 25% 23% 23%

Estimated number of children One or two child families 1,250,400 2,862,500 4,112,900 Three or more child families 1,012,500 1,971,400 2,983,900 Total children 2,262,900 4,833,900 7,096,800 % of children in families with three or more children 45% 41% 42%

Source DWP Provisional Child and Working Tax Credits statistics, December 2016 Around 16% of in-work families in receipt of CTC with three or more children also received either the disabled child element or the severely disabled child element.31 As of December 2016 this included around 62,800 families also receiving the disabled child element and around 27,600 families also receiving the severely disabled element of Child Tax Credit. Note that in future families with third or subsequent children who are disabled will not receive the per child element of CTC for their child, but will receive the additional amount for a disabled or severely disabled child.32 See section 1, page 6 for further explanation.

3.3 Impact on awards As described above, per annum in 2017-18 the: • Child element within Child Tax Credit and Universal Credit is worth £2,780 per child (excluding the “first child premium” in UC – see below) • Family element within Child Tax Credit is worth £545 • First child premium in UC, the equivalent of the family element within Child Tax Credit, is worth £545.

31 Data is not available for out-of-work families in receipt of a CTC disability element because out-of-work statistics include households administered by DWP (whereas Child and Working Tax Credits statistics are produced by HMRC) 32 DWP Provisional Child and Working Tax Credits Statistics December 2016, tables 5.2 and 5.4 17 Commons Library Briefing, 10 April 2017

Child elements paid to families starting a new claim to either Child Tax Credits or UC, or existing claimants with two children who have further children, will be limited to two children from April 2017. Families making an entirely new claim for either Child Tax Credit or UC will no longer be eligible for the CTC family element/ UC first child premium from April 2017. Existing claimants will not be affected. These two changes are taking place alongside others within the welfare system, such as the roll out of UC, cuts to UC work allowances and a change to the UC taper rate. More widely, in April 2017 the Government will raise the National Living Wage (NLW) to £7.30 per hour (an increase of £0.30) and the tax-free Personal Allowance to £11,500 per annum (an increase of £500. The Government aims to raise the Personal Allowance to reach £12,500 in 2020-21).33 To demonstrate the combined impact of these changes, the chart below House of Commons shows their impact on six example lone parent families. Library blog A version of this Net income of example families, 2019-20 analysis was (£, thousands) originally published 30 in the Library blog Welfare Reform: 25 impact of changes 20 this Thursday

15

10

5

0 Example Example Example Example Example Example 1 2 3 4 5 6 Notes Net income includes income from earnings after tax and National Insurance payments, Child Benefit award and tax credits or Universal Credit award Source House of Commons Library calculations Each includes a lone parent working 35 hours a week on the National Living Wage (NLW) with three children and not in receipt of support for housing in 2019-20. Which welfare changes affect each family – and what benefit award they receive – will depend on when and where they started their claim and when their third child was born. Note these are example, “case study” families, calculated to demonstrate the interaction between these measures and not necessarily representative of all families on average. The chart shows that in 2019-20: Example 1, a “legacy” benefits and tax credits claimant whose claim started before April 2017 and whose third child was born before April 2017, might receive a Child and Working Tax Credits award of £10,090.

33 The Library blog Budget 2017 (background): welfare changes in April summarises welfare changes taking effect in April 2017 18 The two child limit in tax credits and Universal Credit

This family is not affected by any of the cuts announced at Summer Budget 2015. Example 2, a “legacy” benefits and tax credits claimant whose claim started before April 2017 but whose third child was born after April 2017, might receive a Child and Working Tax Credits award of £7,310. This family is affected by the limiting of support paid through tax credits to two children for new claims and births from April 2017. As a result, they might be around £2,780 worse off than example 1. Example 3, a “legacy” benefits and tax credits claimant whose claim started on or after April 2017, might receive a Child and Working Tax Credits award of £6,760. This family is affected by the limiting of support paid through tax credits to two children for new claims and births from April 2017 and removal of the family element for new claims from April 2017. As a result, they might be around £3,325 worse off than example 1. Example 4, a UC claimant whose claim started before April 2017 and whose third child was born before April 2017, might receive a UC award of £7,200. This family is affected by cuts to UC work allowances and gains from the change to the UC taper rate. As a result, they might be around £2,892 worse off than example 1. Example 5, a UC claimant whose claim started before April 2017 but whose third child was born after April 2017, might receive a UC award of £4,420. This family is affected by cuts to UC work allowances and limiting of support paid through UC to two children for new claims and births from April 2017. They also gain from the change to the UC taper rate. As a result, they might be around £5,672 worse off than example 1. Example 6, a UC claimant whose claim started in or after April 2017, might receive a UC award of £3,900. This family is affected by the limiting of support paid through UC to two children for new claims and births from April 2017, the removal of the UC ‘first child premium’ for new claims from April 2017 and cuts to UC work allowances. They also gain from the change to the UC taper rate. As a result, they might be around £6,198 worse off than example 1. Full calculations are published attached to the Library blog Welfare Reform: impact of changes this Thursday (4 April 2017).

3.4 Further comment and analysis This section provides further comment and analysis from the Institute for Fiscal Studies, Policy in Practice, Child Poverty Action Group, and the Resolution Foundation. 19 Commons Library Briefing, 10 April 2017

Institute for Fiscal Studies In its 30 March 2017 briefing Significant cuts to two parts of the benefit system to be phased in from next week, the Institute for Fiscal Studies (IFS) described the above discussed measures as “substantial changes to the long run generosity of the system.” On expected savings from the measures, the IFS said: Since the changes only affect families with new births and then (towards the end of next year) new claims, no one will see their benefit income fall between one period and the next as a result of this policy. But these are substantial changes to the long run generosity of the system, expected to reduce government spending by a significant £5 billion a year in the long run. About £3 billion of that £5 billion is expected to come through limiting support to two children, which means substantial cuts in support for larger families. While acknowledging that existing claimants will not have their awards reduced by these measures, the IFS further noted that: Eventually the reform will mean about 600,000 three child families getting around £2,500 a year on average less than they would have got, with a further 300,000 families with four or more children getting £7,000 a year less on average. The remaining £2 billion annual long-run saving comes from removing the £545 'family element', which will ultimately affect around 4 million families (on top of any losses from the limiting of support to two children). The IFS also questioned what claimant’s behavioural response to the policy might be. While cuts to benefits might create a strong financial incentive for some claimants to move into work, the IFS asked whether these change could “actually create strong disincentives” for some claimants. The IFS also noted that though there is some evidence that welfare changes might affect the timing of births in the UK, there is no conclusive evidence on whether such changes affect the number of children families have. Policy in Practice Policy in Practice have published research estimating that the two child limit will result in around 266,000 additional children living in relative poverty by the end of the Parliament.34 This analysis was based on the Family Resources Survey. Over 1 million children will be hit by the two child limit to tax credits policy by the end of this parliament. This policy alone will drive an increase in child poverty of more than 10%, with 266,000 additional children living in poverty by the end of the parliament. Over a quarter of a million children (256,000) already in poverty today will fall deeper into poverty as a result of this policy.

34 See page 9 of Policy in Practice’s report for full details 20 The two child limit in tax credits and Universal Credit

609,000 children in ‘Just About Managing’ (low to middle income) households will be pushed closer to the poverty line. Child Poverty Action Group Similarly, the Child Poverty Action Group and Institute for Public Policy Research have estimated these welfare changes could “push another 200,000 children below the official poverty line.” In particular, CPAG argued: The cut, which affects new claims only, could create disincentives for single parents to form new, 'blended families', CPAG warns. It will undermine the rights of parents who have conscientious or religious objections to birth control and could penalise children in separated families who switch the parent they live with – for example to be with siblings from a certain age, or to remain in their school if one parent moves from its catchment area. The reporting requirements for women who conceive a third or subsequent child as a result of rape and who apply for exemption from the limit, risk a grave breach of claimants' privacy. CPAG also warned that families with three or more children are already at greater risk of poverty: Children in families with more than two children are already at a higher risk of poverty: 39% of children in families with three or more children live in poverty after housing costs, compared with 26% for those in families with one or two children. Resolution Foundation The Resolution Foundation has also argued that: While the benefit changes arriving in 2017 have a relatively small aggregate effect this year, they are a big deal for the families affected and their impact will grow as more families become affected by these policy shifts in subsequent years – or to put it another way as more children are born with significantly reduced support from the state. The Resolution Foundation further commented that: Taken together, even adding in gains from free childcare hours and the development of the National Living Wage, this all means that by 2020 we can expect the poorest half of households to be worse off from combined tax and benefit changes announced this parliament. 21 Commons Library Briefing, 10 April 2017

4. Responses

Wider interest in the tax credit and Universal Credit has tended to concentrate on the two child limit and in particular the difficult issues raise by the proposal to exempt children born as a result of “non- consensual conceptions.”

4.1 E-petition to Parliament The proposals led to an e-petition calling on the Government to “Abandon plans to force women to prove they were raped before they get benefits.” The e-petition (which closed on 29 January 2016) – which received 10,627 signatures – is below, along with the Government’s response: Closed petition: Abandon plans to force women to prove they were raped before they get benefits According to George Osborne's budget, a woman who has a third child as the result of rape must justify her position in order to avoid losing tax credits. This will mean a woman having to prove she was raped to a government official before she can get benefits. In addition to the main problem with the policy outline above, the whole plan to restrict child tax credits to 2 children is nothing short of social engineering akin to a Chinese-style "two child policy" dictating to the public what sort of family life they should have. More background here: http://www.theguardian.com/uk- news/2015/jul/09/government-third-child-tax-credits-proposal- budget-rape and http://www.mirror.co.uk/news/uk-news/budget- 2015-raped-mums-could-6041873 This petition is closed. All petitions run for 6 months 10,627 signatures Government responded: Women will not be forced to prove they were raped in order to get tax credits. The Government is developing protections for women in these circumstances and this policy will not result in cash losers. The Government remains committed to putting welfare spending on a more sustainable path to make the system fair for those who pay for it as well as those who benefit from it. The Government wants to move from a low wage, high tax, high welfare society to a higher wage, lower tax, lower welfare society. That means more emphasis on support to those hardworking families on low incomes by reducing income tax through increases in the personal allowance and increasing wages, than on topping up wages through tax credits. At Summer Budget 2015 the Government announced that in future, all families - those in receipt of benefits and those supporting themselves solely through work - will be faced with the same sorts of financial considerations when making decisions about the number of children in their family. This means that families will no longer be able to claim additional support through 22 The two child limit in tax credits and Universal Credit

Child Tax Credit and Universal Credit for third or subsequent children in a family where the child is born, or in Universal Credit joins the family, on or after 6 April 2017. In addition, families making a completely new claim to Universal Credit after 6 April 2017 will no longer be entitled to support for their third or subsequent children. Where families already receive Child Tax Credit or Universal Credit for children before 6 April 2017 they will continue to receive it in respect of those children whilst they remain entitled to benefit and responsible for the children. Because of these transitional arrangements there will be no cash losers from this policy. The policy to limit support in Child Tax Credit and Universal Credit does not dictate how many children a family can or should have. It simply restricts the additional means-tested support available from Child Tax Credit and Universal Credit, reflecting the need for those benefits to be affordable for the taxpayer. We will still provide support for every child through Child Benefit. The Government has previously made clear that it will not cut Child Benefit. Families will therefore also continue to be entitled to Child Benefit regardless of the number of children or qualifying young persons for whom they are responsible. Currently, Child Benefit is worth £20.70 per week for the first or only child and £13.70 per week for second and subsequent children. The Chancellor of the Exchequer announced at Summer Budget that HMRC and DWP will develop protections for women who have a third or subsequent child as a result of rape. This exemption is clearly a very sensitive and complex issue and the Government recognises the concern about how it will work in practice. On 27 January, the Minister of State for Welfare Reform announced that the Government’s intention is not to focus on, or pre-empt, criminal justice outcomes but to ensure that mothers receive the help they need at the time they need it, using clear criteria that are straightforward to apply and not overly intrusive, but which secure the system against abuse. The Government’s intention is that this exemption will not be tied to the criminal Justice System. Women will not be forced to “prove” that they have been raped in order to avoid losing tax credits – the exemption will ensure they continue to be eligible for Child Tax Credits and the Child Element of Universal Credit for any third or subsequent children. A significant amount of work is needed to take forward and develop the detail of this exemption. The Government is considering how best this exemption could be delivered, while striking the balance we need to achieve. The Government is considering whether a third party evidence model, which is used elsewhere in the benefit system, offers the most promising approach for this exemption. We will be speaking to stakeholders about how best this protection can be delivered to ensure that the process is as compassionate and supportive as possible for claimants in these circumstances, while providing the right assurance to government that the additional support is going to those for whom it is intended. We would be interested to hear from any stakeholders with an interest in this area. This exemption will be developed and brought forward in secondary legislation following engagement with stakeholders in time for April 2017. HM Treasury 23 Commons Library Briefing, 10 April 2017

4.2 Campaign against the “rape clause” A website has been set up by campaigners who are opposed to the two child policy and what has become known as the “rape clause.” The website – Scrap the Rape Clause: Campaign to end the UK Government's two child policy and rape clause – states: The UK Government is introducing a policy from April 2017 that will restrict entitlement to child tax credits for the first two children and to force women to prove that their third child was born as a result of rape. SNP MP Alison Thewliss has been leading a campaign for the UK Government to end the two child policy and rape clause. Her campaign has won backing from a number of MPs and MSPs from across the political spectrum who agree that this vile, unworkable policy should be dropped immediately. Further information and a timeline of developments can be found on the campaign’s website. On 12 October 2016 Alison Thewliss secured a short Westminster Hall debate on a motion “That this House has considered Government plans to restrict tax credits to two children.”35 Ms Thewliss said: Let me deal with the rape clause first. I put on record the public opposition to it from Scottish Women’s Aid, Rape Crisis Scotland, Engender and the more than 10,000 people who signed a petition on the issue. I am deeply upset and disturbed with the attitude that the Government have taken to very vulnerable women and children. No woman should have to prove that she has been raped in order to get tax credits. I suppose it is not in the spirit of the chummy way in which people in this place like to do things, but I am unapologetic about the way I have spoken out about the meeting I had with the welfare Minister, Lord Freud, back in May. As he is a Member of the House of Lords, I have no opportunity to challenge or question him. I have been to many meetings in my eight years as an opposition local government councillor and in my year in this place, but I have never been so furious. For a Government Minister to open a meeting by saying “I’ve had to learn a lot more about this issue than I really wanted to” is appalling, and to go on to suggest flippantly that women facing the extremes of domestic violence should just flee demonstrates a dangerous ignorance. I hope the Minister will take the opportunity today to dissociate herself from her colleague’s comments. I do not think it is radical to suggest that Government Ministers ought to understand the implications of a policy before they inflict it on some of the most vulnerable people in our society. Children being born of rape is not something that tends to happen because a rapist jumps out of the bushes and attacks a woman, as awful as that very rare circumstance is. Rape happens when women are so vulnerable and so powerless that they are in fear for their lives. Rape happens as the result of control in relationships. Rape happens in marriage. If a woman is in such a relationship, she is not going to nip down to her local jobcentre and report to a Government official that her child was born as the result of rape. For a start, with the single household payment in universal credit, she is not going to see the money in any case; it

35 HC Deb 12 October 2016 cc137-146WH 24 The two child limit in tax credits and Universal Credit

will go straight to her partner and he will know what she has done. Nor will she want to go through a third-party reporting mechanism, as suggested by Lord Freud. She will not want to tell her family GP. If the family are not known to the social work system, she will probably not want to alert social workers. She might not yet have sought the support of her local Women’s Aid or of other sources of assistance. She will almost certainly not want to contact the police just for the tax credits. There is no clear statement from the Government on how their policy will operate. Once the rape is disclosed, what burden of proof will be acceptable to HMRC and the Department for Work and Pensions? After all, they are not organisations known for taking people at their word. What will the time limit be? Once a woman has left an abusive relationship and is in a position of safety, will she be able to make a claim retrospectively? Can that claim be backdated? For how long? If a woman needs to claim tax credits at a later stage in her life, because that is the nature of tax credits, will she need to trawl through her sexual history to identify that one of her children was conceived by rape? How will a claim be recorded? I cannot conceive of a way of doing that that would not be hugely stigmatising both for the woman and for the child. Lord Freud suggested to me that it might take the form of a letter that a woman would have to retain in her records at home. I cannot imagine the distress caused if somebody else in the family came across that letter at a later stage. Alternatively, will the information have to be held on the woman’s records with DWP and HMRC? Will staff have access to it? Which staff? Will they receive appropriate training? The Public and Commercial Services Union has come out against the policy because of the difficult position it would put its members in. Tax credits may be required at different stages in a woman’s life; would her claim be flagged up on any further occasion when a claim was made, or would she have to declare it on each separate occasion and relive that abuse again and again? Asking a woman to recount such abuse, perhaps on multiple occasions, to different officials is not protection in any sense of the word. The Government are not protecting any woman, or indeed any child, with this policy. In her heart of hearts, does the Minister believe that putting women through such trauma and humiliation is worth it? The rape clause must be scrapped.36 Ms Thewliss concluded: The two-child policy and the rape clause fundamentally punish families for the circumstances they are in— circumstances that may be beyond their control and in which children already exist. I urge the Minister and the Government to act in the best interests of children, as our international commitments make clear they must. I urge them to stand up for the most vulnerable in our society. Families in situations of poverty, who are working hard and doing their best, are extremely vulnerable. Women who have been raped are extraordinarily vulnerable. The Government need to think incredibly carefully about how they wish to pursue these policies, if they wish to pursue them at all. I call on the Government to protect the “just managing”—those people they say they value and wish to support—and to scrap the abhorrent

36 Ibid. cc137-8WH 25 Commons Library Briefing, 10 April 2017

rape clause and the pernicious and discriminatory two-child policy.37 The Parliamentary Under-Secretary of State for Welfare Delivery, Caroline Nokes, said that the Government was “considering very carefully the best possible way to deliver this exemption,” and that current thinking was still that a “third-party evidence model” offered the best approach: The Government recognise that women who have a child born as a result of rape face extremely difficult circumstances. That is why we are considering very carefully the best possible way to deliver this exemption. I want to be very clear that we are not looking to rely on or to pre-empt decisions within the criminal justice system. Instead, we are looking to ensure that claimants receive the help they need at the time they need it, using criteria that are straightforward to apply and not overly intrusive, while providing the right assurance to Government that the additional support is going to those for whom it is intended. Our current thinking is that a third-party evidence model offers the most promising approach to strike the balance we need to achieve. This is a model where a woman can request the exemption by engaging with a professional third party, such as a healthcare professional or a social worker. This approach would not be new for the benefit system. For example, within universal credit we use a similar model for the relaxation of the requirements to be available for work in cases of domestic violence, where the evidence required is the reporting of abuse to a third party acting in an official capacity, and that model was developed with input from stakeholders. We recognise the sensitivity of this exemption and the need to get advice from experts, so we have sought views from stakeholder groups involved in supporting victims of rape to help us to develop this exemption.38

37 Ibid. c142WH 38 Ibid. c144WH 26 The two child limit in tax credits and Universal Credit

5. Exceptions to the two child limit consultation

On 21 October 2016 the Department for Work and Pensions launched a consultation on exceptions to the two-child limit in Universal Credit and Child Tax Credit.39 The consultation paper made it clear that it was seeking views and evidence in relation to “the detailed design and implementation of the exceptions” to the two child policy and was “not a consultation on the policy itself.” The consultation sought views on the detailed rules on the exceptions to the two child policy in respect of a third or subsequent child who is: • part of a multiple birth where there were previously fewer than two children in the household; • living long term with family or friends because they are unable to live with their parents and could otherwise be at risk of entering the care system; • adopted from local authority care;40 or • born as a result of rape In relation to children born as a result of rape, the consultation sought views on: • The Government’s proposed “third party evidence model” • Whether the “third parties” identified by the Government (including health care professionals, police officers, registered social workers, registered counsellors, independent sexual violence advisers, and other organisations such as specialist rape charities) were appropriate groups, and if other professions/bodies should be added • From third parties themselves, their views on the process of providing evidence for the exception, and in particular any issues that might make it more difficult for a third party to assess a claim for exception • The Government’s proposal to make it a requirement that the victim is not living with the alleged perpetrator • As an alternative to the third party evidence model, applying the exception where there is a successful conviction or award of compensation for rape The consultation ran until 27 November 2016.

39 DWP, Exceptions to the limiting of the individual Child Element of Child Tax Credit and the Child Element of Universal Credit to a maximum of two children: Public consultation, 21 October 2016 40 The Government originally proposed to exempt children who were part of a sibling group adoption where there were previously fewer than two children in the household. However, as part of the Children and Social Work Bill, the Government gave further consideration to the position of children being adopted from Local Authority care and decided to extend the announced exception to all third and subsequent children in these circumstances. 27 Commons Library Briefing, 10 April 2017

5.1 Submissions The Government received a total of 82 responses, of which around 50 were from organisations. Links to the responses from selected organisations are below. Child Poverty Action Group, Consultation on exceptions to the two- child limit: CPAG's response, December 2016 Children’s Society, Exceptions to the limiting of the individual Child Element of Child Tax Credit and the Child Element of Universal Credit to a maximum of two children: The Children’s Society’s response, undated Citizens Advice Scotland response to Exceptions to the limiting of the individual Child Element of Child Tax Credit and the Child Element of Universal Credit to a maximum of two children – Public consultation, November 2016 Caritas Social Action Network, Caritas Social Action Network consultation response Universal Credit and Child Tax Credit: exceptions to the 2-child limit, 25 November 2016 Engender, UK Government consultation on exceptions to the reforms which limit the child elements in Child Tax Credit and Universal Credit to a maximum of two children: engender response, November 2016 Equality and Human Rights Commission, Response to the Department for Work and Pensions and HM Revenue and Customs consultation on Universal Credit and Child Tax Credit: exceptions to the 2-child limit, updated 13 January 2017 Low Incomes Tax Reform Group, Exceptions to the limiting of the individual child element of child tax credit and the child element of universal credit to a maximum of two children: Response from LITRG, 29 November 2016

5.2 Government response The Government’s response to the consultation was published on 20 January 2017. In relation to the children likely to have been conceived as a result of rape, the consultation response stated that the Government would- • Use a third party model to determine whether a child is likely to have been conceived as a result of “non-consensual sex.” • Neither DWP nor HMRC staff would question the claimant about the incident, other than to take the claim and receive the supporting evidence from the third party professional. • The assurance required from third party professionals would be based “solely on evidence that the claimant has made contact with the third party and demonstrated that their circumstances are consistent with those of a person whose child has been 28 The two child limit in tax credits and Universal Credit

conceived as a result of non-consensual sex.” This would be outlined in guidance for third parties, claimants and staff. • In recognition that many victims need time to come to terms with what had happened to them before they can disclose it to others, there would be no time limit placed on when the report needed to be made to the third party professional. • The “non-consensual conception” exception would also cover third or subsequent children conceived within a domestic abuse situation involving coercion and control. • The list of relevant third party professionals would be limited to “professionals who are trained to deal with such sensitive situations and with whom it would be beneficial for the claimant to engage in order to obtain relevant guidance and support.” This would include health care professionals, social workers and relevant specialist charities – but the list would be set out in guidance in order to give flexibility to add other groups “as appropriate in the light of delivering this exception.” • A requirement not to be living with the perpetrator would apply. While acknowledging that not all victims will feel able to leave the perpetrator, the Government’s intention was to minimise the risk of harm. It also had concerns that paying the child element in these circumstances “would allow the alleged perpetrator to financially benefit from the abuse” – this would “put them in an advantageous position in comparison to other families who would be limited to support for two children.“ Rather than financial support through benefits for those who do remain with the perpetrator, the Government believed other forms of victim support were more appropriate. • Provide that where there had been a conviction or compensation award for rape or domestic coercion and control this would act as an alternative to the third party model as a means of evidencing that a third or subsequent child was likely to have been conceived through non-consensual sex. It also confirmed that the Government would bring forward regulations to provide for the exceptions in tax credits and Universal Credit in time for the introduction of the policy from 6 April 2017. The regulations would also include the other necessary consequential changes in Housing Benefit, Income Support and Jobseeker's Allowance.

29 Commons Library Briefing, 10 April 2017

6. Social Security Advisory Committee

On 31 January 2017, the Social Security Advisory Committee (SSAC) wrote to the Employment Minister Damian Hinds with their scrutiny of the four exceptions set out in the regulations. Exception for non-consensual conception Concerns were raised about the privacy of claimants receiving payment on the basis of this exception. Given the small number of exceptions, and the ease with which some could be discounted, SSAC argued it was important to inform claimants beforehand of possible privacy issues when making a claim under this exception. In his response of 1 March 2017, the Minister admitted that the privacy risk was unavoidable, but noted that the DWP was familiar with holding sensitive data securely, such as information on domestic violence. SSAC also drew attention to the requirement for the claimant not to be living with the alleged perpetrator in order to receive a third child payment, and gave examples of circumstances where women would find it difficult to leave an abusive relationship, such as a disabled women receiving “care” from her partner. As a result, SSAC asked whether attention had been given to signposting women to organisations who could support women in these circumstances. In response, the Minister stated that: Whilst we acknowledge that not all victims will feel able to leave the perpetrator, and that victims may return to the perpetrator later in time we are concerned about paying the Child Element to claimants for third and subsequent children born in these circumstances. Rather than financial support through benefits for those who do remain with the perpetrator, we think other forms of victim support are more appropriate.41 He highlighted £80 million of violence against women and girls funding as one example of other forms of victim support. Clarity was requested from SSAC on circumstances where third party organisations, carrying out assessments instead of HMRC or the DWP, gave a cautious judgement, presented with limited certainty as to a claim’s veracity. In these circumstances, SSAC asked how final decisions on the exception would be made. The Minister gave further details of the decision-making process in response: The third party will not be required to attest to the credibility of the claimant, just the consistency of the claimant’s account with their circumstances. The procedures for the third party model are still being finalised, however as things stand we envisage that we shall use a form with boxes for the third party to tick/not tick to indicate if the reported circumstances are consistent with statements on the form. These tick boxes will act as qualifying criteria; therefore the

41 Damian Hinds' response to SSAC, 1 March 2017 30 The two child limit in tax credits and Universal Credit

evidence (a completed and returned form) will provide a yes or no determination on qualification for the exception, providing it was completed by an authorised third party.42 SSAC also encouraged the DWP to complete its list of approved third party assessors as soon as possible, given the proximity of the policy’s start date in April 2017. Adoption and formal long-term care arrangements The letter from SSAC urged the Government to look again at the kinship exception rules, which they argue create an “inequality of treatment which is wholly dependent on something as arbitrary as the order in which the children arrived.” The following examples were given to illustrate this argument: It is not hard to envisage a case where someone takes on caring responsibilities for the children of a sibling who has died before the circumstances have been right to start a family of their own. It is difficult to understand why they should be penalised for taking on that responsibility for children that might otherwise be in Local Authority care. And in very hard cases, where perhaps an individual could not otherwise afford to have a child of their own, it is conceivable that they would take the decision to put into Local Authority care one or more of the children they had been looking after.43 The Government response did not offer to look again at these rules. It argued that it did not want to put parents off adopting children, but that parents already caring for two children (adopted or not) would need to think about how they could financially support any additional children of their own. Claimant responsibilities SSAC raised concerns that the new arrangements would amount to a substantial change in claimant responsibilities: We understand that HMRC does not intend to investigate individual circumstances in third child cases, and that the intention is simply to direct claimants to GOV.UK when a claim is made or a relevant change of circumstances is notified. It would therefore be incumbent on them to find out the rules for themselves and present the required evidence. This is a significant shift from the current position where claimants have a duty to make the claim and produce the required evidence in support of it, and that DWP/HMRC has a responsibility to ask relevant questions, and require relevant supporting evidence, necessary to determine the claim correctly.44 The Government response noted that there would be an HMRC team to consider all supporting evidence for third child Tax Credit claims. With regards to Universal Credit, for the Live Service, claimants adding a third or subsequent child will be told about the exceptions rule over the phone. The Minister confirmed that the process for new claimants on Universal Credit Full Service was still being developed.

42 Ibid. 43 SSAC letter to Damian Hinds MP, 31 January 2017 44 Ibid. 31 Commons Library Briefing, 10 April 2017

7. Lords Secondary Legislation Scrutiny Committee reports

On 30 March 2017, the House of Lords Secondary Legislation Scrutiny Committee (SLSC) published its 30th report of session 2016-17, which included a section on the two child limit regulations. The Committee’s 31st report of session 2016-17, published on 6 April, included a letter to the Employment Minister Damian Hinds highlighting a number of concerns raised in the 30th report, as well as the Minister’s response. For the 30th report, the Committee received correspondence from a number of organisations, including the Association of Directors of Children’s Services (ADCS) and the Association of Directors of Adult Social Services (ADASS), Child Poverty Action Group (CPAG), Engender (jointly submitted with Scottish Women’s Aid and Rape Crisis Scotland), Glasgow Rape Crisis Centre, National Alliance of Women’s Organisations (NAWO) and Women’s Aid Federation Northern Ireland (WAFNI).45 The report concluded with the following major concerns about the regulations: A number of the answers (from the DWP) cast doubt as to whether the system will be fully set up by 6 April when the legislation takes effect and on whether the exception relating to non-consensual conception can ever be made to work. We intend to write to the Minister to seek clarification on these points.46 A number of related and additional concerns were explored further in the 30th report. Sufficient notice of policy change The Committee proposed that there should be a transitional period for children conceived before the regulations were laid, but born after 6 April 2017, as they would not have had sufficient information to make an informed choice. In response, the DWP noted that the policy was announced in the Summer Budget 2015, therefore claimants had sufficient notice to plan for the changes. The Committee did not agree that this amounted to adequate notice: This appears to us an unrealistic expectation: the average person does not follow politics that closely and therefore, clear messages should have appeared on the Universal Credit website, and on material given to current claimants.47 The Committee’s 31st report reiterated this opinion:

45 The submissions can be found on the Committee’s web pages 46 House of Lords Secondary Legislation Scrutiny Committee, 30th Report of Session 2016-17, HL Paper 148, 30 March 2017, para 45 47 Ibid., para 33 32 The two child limit in tax credits and Universal Credit

As a general rule we find that publishing claimant guidance on the day that the policy comes into effect unhelpful: in this case, we think it particularly inappropriate.48 A press release from the Low Incomes Tax Reform Group (LITRG), published on the same day as the 31st report, raised similar concerns about a lack of timely guidance for claimants: The policy in itself polarises opinion, popular in principle with some and a very bad idea to others. What really concerns us at the present is how the new rules are being implemented and how claimants can properly access the support they are entitled to. We are not convinced that families will be aware of the various exceptions or what to do if an exception does apply. The policy itself is complicated and HMRC has not left enough time to implement it properly. At the very least, such a big change should be supported by fully updated forms, notices and guidance.49 Exception for non-consensual conception The majority of submissions to the 30th report raised concerns about forcing women to disclose and prove that they were raped. NAWO’s submission pointed to evidence showing that the forced disclosure of a rape can exacerbate post-traumatic stress disorder and a sense of isolation.50 Glasgow Rape Crisis Centre argued that the requirement not to be living with the alleged perpetrator was the “least well-thought-out part of this ill conceived piece of legislation.” They pointed to evidence that the most dangerous time for a woman and her children is at the point of leaving an abuser, and women should not have to choose between this danger and accessing financial support.51 The Committee shared this concern. WAFNI also argued that the exception was limited in its understanding of domestic violence, as it ignored experiences such as the restriction of access to contraception by an abusive partner.52 The DWP pointed to its use of third party assessors, who would understand the issues at hand: The list of third party professionals to whom the circumstances surrounding the non-consensual conception can be reported has been kept deliberately tight to ensure that they would be accustomed to dealing with the kinds of incidents and relationships likely to feature in many of the narratives.53 However, the Committee raised concerns that the full list of third party assessors had not been finalised, and that no account was being taken of the training they would need to carry out the work. Engender’s

48 House of Lords Secondary Legislation Scrutiny Committee, 31st Report of Session 2016-17, HL Paper 154, 4 April 2017, para 1 49 ‘Proper guidance needed for families affected by new welfare cuts for third and subsequent children’, LITRG press release, 6 April 2017 50 NAWO submission to SLSC, 27 March 2017, para 2 51 Glasgow Rape Crisis Centre submission to SLSC, 21 March 2017 52 WAFNI submission to SLSC, March 2017 53 House of Lords Secondary Legislation Scrutiny Committee, 30th Report of Session 2016-17, HL Paper 148, 30 March 2017, para 25 33 Commons Library Briefing, 10 April 2017

submission highlighted the limited number of organisations in Scotland willing to take on this role: At the time of writing, there is no plan of which our organisations are aware for providing this capacity in Scotland. As a national organisation, Rape Crisis Scotland will not be performing this function, and contends that forcing rape survivors to disclose sexual violence in order to access social security payments is inhumane. Scottish Women’s Aid has just been approached by the Department for Work and Pensions to discuss implementation and has agreed to a discussion. Their existing stance, however, is that this policy cannot be made ‘acceptable’ to anyone who values women’s and children’s dignity and rights. We are collectively aware that other professional bodies and agencies that appeared to be proposed by the Department for Work and Pensions as ‘third party assessors’ have yet to hear from UK Government on this.54 The DWP responses did however address one of CPAG’s concerns, by stating that police officers would not be used as third party assessors. Other areas where the Committee felt the DWP answers were unsatisfactory were on appeals, specifically how the DWP could reconsider a case without asking intimate details of the applicant; and on fraud, specifically whether an assessor who accepts a weak case may be deemed party to benefit fraud. In Damian Hinds’ response in the 31st report, he confirmed that no new legal duties would be placed on third party assessors, and that no sensitive information would be asked of claimants during any appeal: We will use procedures that are mindful of the sensitivities involved and DWP staff will not question the claimant about the incident other than to take the claim and receive the supporting documents. If the completed pro-forma document shows that, according to the circumstances reported to the third party, the legal requirements for the exception have not been met, DWP will decide not to award the exception. In this case, the claimant could approach another approved professional third party.55 In the 30th report, the Committee also raised concerns that a women receiving money for a third child could be identified as a victim of rape. The DWP appeared to accept this as a possible outcome: Award notices will not state the reason for the exception. We do accept that an inference may be drawn as to the reason for an exception being in place, this risk is unavoidable, given the limited range of exceptions in place but we believe that this risk is outweighed by the financial benefit to the claimant in being granted the exception.56 Finally, WAFNI raised two issues specific to Northern Ireland. In Northern Ireland, unlike the rest of the UK, all disclosure of serious crimes must be reported to the police. This would make third party assessors legally

54 Engender, Scottish Women’s Aid & Rape Crisis Scotland submission to SLSC, 20 March 2017 55 House of Lords Secondary Legislation Scrutiny Committee, 31st Report of Session 2016-17, HL Paper 154, 4 April 2017, Appendix 1 56 House of Lords Secondary Legislation Scrutiny Committee, 30th Report of Session 2016-17, HL Paper 148, 30 March 2017, para 35 34 The two child limit in tax credits and Universal Credit

obliged to pass on information to the police, whether or not the claimant wished to make a criminal complaint. They also noted that as abortion remains illegal in Northern Ireland (except under extremely limited circumstances), the policy would: Therefore doubly penalise poor women, who can neither afford to travel abroad to access abortion nor afford to lose their child tax credits. They may be forced into a choice between having a child and being forced further into poverty, or procuring medical abortion pills and risking up to life imprisonment.57 The Committee concluded that the practicalities of applying the exception in Northern Ireland would need to be fully thought through before equivalent regulations are brought forward. Order of children A number of submissions, including from ADASS & ADCS, argued it was unfair that if a first or second child would have been an excepted child (i.e. they were adopted, the result of non-consensual conception etc.), the family would not receive any money for a third child, whilst a family with an excepted child as their third child would be eligible for financial support. ADASS & ADCS stated that: It cannot be right that the financial support available to families is determined by the sequencing of the children they look after.58 In their response, the DWP stated that the ordering rules meant that families would have to make an informed decision about having a third (non-excepted) child: The new rules mean that households will need to think carefully about whether they are financially prepared to support a new child without relying on Universal Credit.59 Kinship assessments ADASS & ADCS also raised concerns that local authorities would need more resources to carry out assessments on the kinship exception. They highlighted estimates that there may be 200,000 – 300,000 families in the UK living in kinship care type arrangements, many who would not previously have had any interaction with social services.60 The DWP response noted that HMRC was currently assessing the additional resource requirement, to ensure that local authorities would receive any additional funding required. Whilst welcoming this response, the Committee raised concerns that ADASS & ADCS did not appear to have known that this assessment was taking place. Drafting inconsistencies CPAG’s submission noted drafting inconsistencies between the Tax Credit regulations (SI 2017/387) and the Universal Credit regulations (SI 2107/376), even though both are intended to achieve the same outcome:

57 WAFNI submission to SLSC, March 2017 58 ADCS & ADASS submission to SLSC, 21 March 2017 59 House of Lords Secondary Legislation Scrutiny Committee, 30th Report of Session 2016-17, HL Paper 148, 30 March 2017, para 34 60 ADCS & ADASS submission to SLSC, 21 March 2017 35 Commons Library Briefing, 10 April 2017

Discrepancies with possible substantive effect include these: • Under SI 2017/376 reg 4(1)(b) no reference is made to QYP (qualifying young persons), unlike in the equivalent reg 12(1)(b) of SI 2017/387. • SI 2017/376 reg 4(2)(a) refers to the child arrangement order being ‘in force’. There is no such reference in the equivalent reg 12(3)(a) of SI 2017/387. • SI 2017/376 reg 4(2)(f) refers to the Children(Scotland) Act 1995 whereas the equivalent SI 2017/387 reg12(3)(f) refers to the Children and Young People (Scotland) Act 2014.61 Child poverty Several submissions to the Committee raised concerns that the regulations would have a negative impact on child poverty, as 34% of children in poverty in 2014-15 were in families of three or more children. CPAG’s evidence highlighted projections that the policy would put 200,000 children in poverty by 2020-21. The DWP’s response stated that: There will be no cash losers as a direct result of this policy and Child Benefit will also continue to be paid regardless of family size, as the basis of the Government’s contribution towards the cost of bringing up a child.62 Consultation and equality impact assessment The Committee criticised the consultation period, and argued that six weeks should be the minimum (the consultation ran for just over five weeks), and that many people did not feel they had had an adequate opportunity to comment on this issue. It also criticised the lack of a detailed equality impact assessment. The DWP response to the Committee stated that all families, regardless of background and beliefs, would need to think about choices of family size, and that the policy does not interfere with any person’s right to reproduce. In response, the Committee argued: We accept the point that the requirement to consider their means before deciding to have another child will apply to all families on benefits but this does not allow for cultural or religious views which do not allow for contraception. Nor are we convinced on the equality point, as we do not foresee any men being subject to distressing interviews in order to obtain benefits.63 Cost of exceptions in Universal Credit In Damian Hinds’ response in the 31st report, he set out the estimated cost of implementing the exceptions, once Universal Credit is fully rolled out and the policies are applied to all households. He noted that this could take up to 20 years:

61 CPAG submission to SLSC, 16 March 2017 62 House of Lords Secondary Legislation Scrutiny Committee, 30th Report of Session 2016-17, HL Paper 148, 30 March 2017, para 38 63 House of Lords Secondary Legislation Scrutiny Committee, 30th Report of Session 2016-17, HL Paper 148, 30 March 2017, para 40 36 The two child limit in tax credits and Universal Credit

Annual steady Families Exception state cost (£m) ('000s) Multiple births 115 30 Non-parental caring arragements 25 5 Adopted from Local Authority care 30 5 Non-consensual conception 5 <5 Total 170 45 Administrative data is only available for benefit recipients with multiple births, so there is a greater degree of uncertainty around the values for the other three exceptions.64 Proposed extra exceptions In their submission to the 30th report, CPAG argued that the four listed exceptions were insufficient to cover all circumstances where conception is not entirely voluntary, or families with unforeseen changes in family income. As a result, they proposed an additional ten exceptions: • All children born less than 10 months after the family could reasonably have been expected to be aware of the policy and available exceptions, regardless of the date of claim • Births resulting from the failure of contraception • Families in unforeseeable hardship due to the death, ill- health, new caring responsibilities, involuntary reduction in earnings, redundancy or separation of parents or carers • Children born to women with certain learning disabilities or mental health conditions • Families with a conscientious or religious objection to contraception or abortion • Persons who have been victims of, or at risk of, domestic abuse, within a recent grace period • Children who move from the household of one parent to another • Children whose parents make a new claim as a result of separation • Children who move into a new household after the death of the parent they were living with • Children who join a household as part of a blended family • Families with a disabled family member • Third children whose older sibling is not expected to survive childhood • Saviour siblings65

64 House of Lords Secondary Legislation Scrutiny Committee, 31st Report of Session 2016-17, HL Paper 154, 4 April 2017, Appendix 1 65 CPAG submission to SLSC, 16 March 2017 37 Commons Library Briefing, 10 April 2017

8. The regulations

The two child limit rules for Universal Credit and Child Tax Credits were brought into force on 6 April 2017, through two sets of regulations: • The Social Security (Restrictions on Amounts for Children and Qualifying Young Persons) Amendment Regulations 2017 (SI 2017/376); see also the accompanying Explanatory Memorandum; and • The Child Tax Credit (Amendment) Regulations 2017 (SI 2017/387); with accompanying Explanatory Memorandum Both were laid on 15 March 2017 under the negative resolution procedure, meaning that they become law automatically without debate unless there is an objection from either House.

8.1 Guidance on the two child limit and exceptions DWP and HMRC have now published material on GOV.UK relating to the two child limit and the exception categories: • 2 child limit: claiming benefits for 2 or more children, 6 April 2017 • Child Tax Credit: exceptions to the 2 child limit, 6 April 2017 • Universal Credit and families with more than 2 children: information for stakeholders, 6 April 2017 • Universal Credit and families with more than 2 children: information for claimants, April 2016 • Support for a child conceived without your consent, 6 April 2016 (includes information for claimants and third parties, including information specific to Northern Ireland) • Support for a child who is informally living with you, 6 April 2016 8.2 Application for an emergency debate On 20 March 2017 the SNP Member Alison Thewliss sought leave to propose an emergency debate under Standing Order No. 24 “on the introduction of the non-consensual sex exemption in respect of tax credits.” The application made reference to the lack of a vote in Parliament on the regulations, and disputed whether the Government was ready to implement the rules on 6 April, when they would come into force: I rise to propose that the House should debate a specific and important matter that should have urgent consideration: the introduction of the non-consensual sex exemption in respect of tax credits, which I will henceforth refer to as the rape clause. Since the two-child limitation of tax credits and universal credit was proposed in the summer 2015 Budget, I have pursued this matter relentlessly. I have used every means available to me through questions and debates, raising the matter in this House on no fewer than 25 occasions. The Government should by now 38 The two child limit in tax credits and Universal Credit

have had adequate time to refine or, as I would prefer, to abandon that deeply flawed policy, but they have left deeply worrying gaps that will leave vulnerable women exposed, which is why I am calling for the debate. The Government have sought to reassure me many times that women making a claim under the rape clause will be treated sensitively, and that they will be able to go through third-party professionals such as nurses, doctors and social workers, rather than frontline staff of Her Majesty’s Revenue and Customs or the Department for Work and Pensions, but answers to written parliamentary questions I tabled have exposed that there has been no training—none—in domestic violence or in the application of the policy to the 660,000 third-party professionals, with the policy due to come into force very soon, on 6 April. That puts vulnerable women seeking to make a claim in the position of having to present themselves to a GP, nurse or social worker to reveal that their third child was conceived as the result of rape, for that professional to determine, without having had domestic violence training or knowledge of the policy, if the circumstances are consistent with their having been raped. What kind of response can such women expect? The Government are still saying today that they will issue guidance. When? I remind the House that the policy goes live on 6 April, in the middle of the recess. How will we parliamentarians know if the Government have done what they say they will do? Information has been shared with me by a member of staff at HMRC, who wishes to remain anonymous, that the sensitive unit, which will deal with rape clause claims, will not go live until 6 April. Until then, HMRC staff are left crossing their fingers that they do not get inquiries from the public about a sensitive issue in which they have not been trained. Utterly unacceptable. The Government have been dodging scrutiny on this issue from the start, burying it at the back of the 2015 Budget, being forced to carry out a consultation they did not want to have, sneaking out the response to that consultation during Trump’s inauguration, and laying Statutory Instrument 2017 No. 387 last week under the negative procedure, to avoid debate in this House. I feel compelled to appeal to you, Mr Speaker, to grant this emergency debate. Women who have faced the worst trauma of their lives—being raped and becoming pregnant as a result of that most serious and dangerous of sexual assaults—are being forced to relive that trauma just to claim tax credits. That is a gross and despicable invasion of privacy. I believe that we owe it to these women and their children to hold this Government to account.66 The Speaker did not agree that the matter was proper to be discussed under Standing Order No. 24. He noted however that a “prayer” had been tabled against the regulations, adding “I would hope and anticipate that the usual channels will find time for it to be debated.”67

66 HC Deb 20 March 2017, cc 654-655 67 HC Deb 20 March 2017, c655 39 Commons Library Briefing, 10 April 2017

8.3 What happens now? On 15 March Alison Thewliss tabled an Early Day Motion (EDM 1078 2016-17) “praying against” the Child Tax Credit (Amendment) Regulations 2017 (SI 2017/387). EDM 1078 2016-17 currently has 92 signatures. These are mainly from SNP and Labour Members, including Angus Robertson and Jeremy Corbyn, as well as signatories from other parties. A separate EDM (EDM 1124 2016-17) was tabled by Alison Thewliss on 29 March praying against the Social Security (Restrictions on Amounts for Children and Qualifying Young Persons) Amendment Regulations 2017 (SI 2017/376) – the regulations providing for the exceptions to the two child limit in Universal Credit, and making consequential changes to other benefits. This EDM currently has 37 signatures. A prayer is a particular type of EDM that is used, by convention, when MPs wish to object formally to a statutory instrument.68 If a motion “praying” that an instrument “be annulled” is tabled within 40 days of it being laid before Parliament, a debate may be arranged in a Delegated Legislation Committee or, more rarely, in the House of Commons Chamber. For both sets of regulations, the 40th day will be 4 May 2017. The CTC and UC regulations came into force on 6 April 2017, during the Easter Parliamentary recess, but can still be subsequently annulled within the 40 day period.

68 For further details see What are Early day motions? on the Parliament website. 40 The two child limit in tax credits and Universal Credit

9. Media reports

“Rape exemption clause for tax credits 'in chaos', says MP Alison Thewliss,” Guardian, 3 March 2017 Victims meant to be exempt from two-child limit, but with weeks to launch no systems are in place, claims SNP politician “Tax credit ‘rape clause’ becomes law without parliamentary vote,” Guardian, 13 March 2017 Controversial move, which requires woman who had third child as result of rape to verify her position, added to existing act Susanna Rustin, “The ‘rape rule’ for tax credits tramples the rights of children it’s meant to protect,” Guardian, 17 March 2017 (opinion piece) It beggars belief that a government that claims to take sex crime seriously would rush through legislation with so much potential for harmful consequences “MP urges Speaker to grant emergency debate on child tax credits ‘rape clause’ exemption,” Independent, 20 March 2017 Alison Thewliss hopes an emergency debate will enable MPs to 'shine a very bright light on the horror that is about to unfold for rape victims' “Alison Thewliss MP seeks debate over tax credit 'rape clause',”, BBC News, 20 March 2017 A Scottish MP will attempt to force an emergency debate in the Commons later over a controversial change to tax credits. “Tax credit 'rape rule' puts Northern Irish women in legal peril, charities say,” Guardian, 6 April 2017 Policy exempting victims from two-child limit leads to risk of prosecution if benefits assessment finds women have not disclosed a crime “Government under fire over new child tax credit form for rape victims,” Guardian, 6 April 2017 Form requiring rape victims to declare they do not live with attacker called ‘inhumane and barbaric’ and a ‘vile policy’ “Government unveils eight-page 'rape assessment form' for mothers hit by tax credit cuts,” Independent, 6 April 2016 Form NCC1 4/17 will assess whether a third child is conceived as a result of rape

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