Mr. Toby Wolfe:

We were asked about the 10% who will be worse off under the new scheme, who they were and what can be done. There are people who will benefit from the scheme. We are not talking about people who will get no benefit. However, there are those whose income is at a level where the level of payment the scheme will give them is a bit less than they are currently receiving. This relates in particular to people on the CETS scheme, which has the highest level of payment of the current schemes. People at those levels of income will still benefit from the affordable child care scheme, however. The scheme provides for what we are calling a "saver clause". As such, anybody on a current scheme at the moment of transition to the new scheme will retain the current level of payment for a transitional period. In the case of those people who are on the CETS payment by virtue of being on an education or training course, they will retain their current payment right through until the end of the education and training course that gave rise to their payment. They will never be in a position where they started a course expecting a certain level of payment but then find themselves stranded. That will not happen.

There was a question on maintenance payments and the statement in the policy paper that the only deductible maintenance payments would be ones with a legal agreement around them. There was a change between the policy paper and the heads of Bill. We had discussions with one-parent organisations on the issue and the heads of the Bill now have a much wider range of maintenance arrangements that can be deducted from income. As such, the issue the Deputy was concerned about has been addressed in the heads.

There was a question around the tax year being potentially 2015, the previous year, and that incomes might have changed in the meantime. We have tried to design a scheme which is streamlined so that when a parent applies, once the automated system is up and running, he or she will get an instant response. The way we are doing that is by using the most recent income data available from Revenue. That is somewhat historic, but one of the protections we are building into the scheme is to provide that, at most after 12 months, a parent's income will be reassessed automatically every 12 months. That is the maximum period for which an income can be out of date. We have also built into the proposals that if a family's income has fallen since the most recent data was available from Revenue, it can request an assessment based on current income. For instance, if somebody loses a job since the most recent data was available from Revenue, he or she will be able to request a manual assessment in which his or her current income is calculated. If someone is out of a job, he or she will then get the maximum payment.

A number of members referred to rent and mortgages. We are not proposing that housing costs will be deducted from income, either housing costs of a family's first home, whether it is mortgage or rent, or the housing costs of a second home. The cohort of families who will benefit from the scheme all, by and large, face significant housing costs. It is not that some face a housing cost and some do not. Large housing costs are common to the cohort. Clearly, there is variation in the level of housing cost families pay, but we must be clear that the scheme is intended to reduce child care costs rather than to function as a support for family housing costs. We were aware in the decision not to deduct housing payments of a risk of subsidising up to 39% of the difference between two families' housing costs through the affordable child care scheme. I take the example of two families with the same income level and children of the same age, but where one lives in a larger house with a larger mortgage payment. If the housing costs were deductible, the difference in the affordable child care subsidy for the family with the larger house could be up to 39% of the difference in the value of the mortgage. If we were to deduct housing costs, we would have to be clear that we were, in effect, subsidising the difference in mortgage and rent payments between families.

There was a follow up question on family income supplement asking if we would continue to look at the issue. We will certainly keep looking at the issue. We want to avoid any unintended consequences for FIS recipients.