Question proposed,That the clause stand part of the Bill.

The clause changes the definition of a disabled child in the Income Tax (Earnings and Pensions) Act 2003 to allow tax relief for employer-supported child care to continue where the child is in receipt of a personal independence payment rather than a disability living allowance. At first look, this is a short, technical clause, although it underpins some important issues.

Hon. Members will be aware that there are three types of exemptions from income tax and national insurance contributions available for employer-supported child care: exemptions for workplace nurseries; exemptions for child care vouchers provided to employees up to the relevant exempt amount; and exemptions for other child care made available to the employee up to the relevant exempt amount. I am resisting the temptation to go into any of the wider issues around child care, and the proposals that may or may not be brought forward at a later date, and am sticking strictly to the clause, Mr Amess. There are a number of qualifying conditions for each exemption. One relates to the child for whom the care or care voucher is provided. The age cap for relief is higher for disabled children than for children without disabilities, and is set at the first week of September following the child’s 16th birthday.

Following the Government’s changes to the welfare system in the Welfare Reform Act 2012, the definition of a disabled child for the purposes of the provisions in the clause now also needs to be changed, as I understand it, to include those receiving the new personal independence payment. As those payments are initially going to be phased in for new applicants, references to both DLA and PIP are required in legislation until such time as the DLA is replaced completely.

In the explanatory notes to the clause, the Government state that the purpose of the new PIP benefit is

“to contribute to the extra costs faced by long-term disabled people to leading full and active lives.”

I was pleased to see those words. Although I said that I would resist temptation, I find it difficult to resist saying that it would be useful to see that principle carried forward into other pieces of legislation, given the number of people who have come to me—and no doubt to other hon. Members—about withdrawal of support and other  changes taking place that mean that many long-term disabled people with long-term medical conditions do not feel that they are getting the support that they need to lead full and active lives. No doubt, however, that is a debate for another day, and I will not try your patience any further, Mr Amess.

The clause is important in ensuring that families with a child with a disability can get the support that they need under the system. I believe that assessments have to be designed around what disabled people need. We have to ensure that nothing is done within the process of legislation that in any way disadvantages disabled people. I would hope that when we are looking at tests around, and definitions of, disability, any savings would come about from the right test being applied rather than from designing a test to deliver a pre-set idea of how much money ought to be saved. That principle is important for people with disabilities.

According to their impact assessment for personal independence payments, the Government expect 500,000 to lose PIP by 2015-16, compared with what would have happened with DLA. I note from the work done on this issue that HMRC is not able to analyse the numbers precisely, and I want to probe the Minister on that. There is concern that the Government are generally trying to mould the benefits system around cuts rather than around meeting the needs of individual disabled people. I am sure that the Minister would agree that we must be careful about that when we come to provisions that have been made for children.

Given that inspiration will, I am sure, be able to strike him now, will the Minister tell us how many disabled children will be affected by the change from DLA to PIP, including those whom the tax exemptions cover? Has the Minister calculated how many disabled children affected by the provisions might not be eligible for the new personal independence payments? It is important for hon. Members to understand whether the measures will affect a significant number of people or a small one. Will the Minister also confirm whether the timetable for transferring the arrangements for disabled children affected by the provisions takes into account the new personal independence payments?

It would help if the Minister responded to those points on this technical clause. I understand what the Government are trying to do and I do not wish to stand in the way of that. However, we must recognise that such changes in legislation can, as I outlined in the discussion on the previous clause, sometimes lead to unintended consequences. We want to ensure that everything possible has been done to make the case that the families of children with disabilities ought to be given that additional support, as the Government have said, to contribute towards the extra costs faced by long-term disabled people. It is important that families can support and help their children to lead full, active lives. We would not want anything done in legislation that stood in the way of that. I look forward to hearing the Minister.

Clause 12 will ensure that parents of children in receipt of personal independence payment will continue to receive tax relief for employer-supported child care. This is purely a technical change affecting children who are 16 years old and ensures that the move to PIPs from the disability living allowance will not impact on current tax-free child care support.

The Government are reforming the welfare system and the Department for Work and Pensions has begun a phased introduction of personal independence payments. The parents of children who receive DLA can claim tax relief on employer-supported child care for a year longer than is otherwise allowed. The clause ensures that the parents of children who receive the personal independence payment will be treated in the same way, by amending income tax legislation to include the appropriate references.

Children under 16 will continue to receive DLA, so the changes made by clause 12 are not relevant to them. Rather, these changes mean that those with parental responsibility for children in receipt of either DLA or PIPs will be eligible for the same tax relief for child care. We believe that the numbers affected are small, but this change is being made to ensure consistency of treatment. To add a bit more information on numbers, about which the hon. Lady asked specifically, some 600,000 employees in total currently use employer-supported child care. Most employer-supported child care is used for pre-school-age children and a much smaller proportion is used for children aged 15 or 16. In the tax information and impact note issued by HMRC, we stated that some 50 individuals may be negatively affected, but I stress that that is the best estimate that HMRC has at this point.

The changes reflect previous discussions in the House during the passage of the Welfare Reform Act 2012 and are wholly consequential to the changes already in place. Furthermore, we published the clause for consultation in December and received no comments and no suggestions. I move that the clause stand part of the Bill.

Question put and agreed to.

Clause 12 accordingly ordered to stand part of the Bill.