COMMITTEE FOR SOCIAL DEVELOPMENT

Report on the
Legislative Consent Motion associated with the
Savings Accounts and Health in Pregnancy Grant Bill

Departmental Correspondence

Peter McCallion Clerk to the Social Development Committee Room 412 Parliament Buildings Stormont Belfast BT4 3SW

18 November 2010

Dear Peter

I understand that the Legislative Consent Motion in relation to the Great Britain Savings Accounts and Health in Pregnancy Grant Bill will be one of the items listed for Committee business on Thursday 25 November.

I enclose a note for the information of the Committee members. Officials will be available for the meeting on 25 November.

Yours sincerely

Anne McCleary

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Will Haire
Barney McGahan
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Michael Pollock
Dave Wall
Margaret Sisk
Michael McKernan
Billy Crawford
Julie Lavery
Joann Hanna

SAVINGS ACCOUNTS AND HEALTH IN PREGNANCY GRANT BILL – LEGISLATIVE CONSENT MOTION

General

1. The Savings Accounts and Health in Pregnancy Grant Bill was introduced in the House of Commons on 15 September 2010 and is expected to go forward for Royal Assent in December 2010.
2. The Bill contains provision to repeal the Saving Gateway Accounts Act 2009. It will also end eligibility to Child Trust Funds and abolish the Health in Pregnancy Grant.
3. The Saving Gateway was to be a tax-free cash saving account for working age people on lower incomes (with eligibility “passported” from receipt of certain social security benefits and tax credits) and was to be administered by HM Revenue and Customs. Accounts would have lasted two years and at maturity the Government would have made a contribution of 50 pence for each pound that had been saved (up to a maximum of £300). Saving Gateway accounts were due to have been available from July 2010.
4. In the Budget on 22 June 2010, the Government announced that the Saving Gateway was not affordable given the need to reduce the Budget deficit. It will not be introduced and will be brought to a close by the provisions of the Savings Accounts and Health in Pregnancy Grant Bill.
5. The Bill contains a measure to remove the provision that would have allowed information held by the Department for Social Development to be supplied to Revenue and Customs for the purposes of the Saving Gateway. The supply of this information would have been necessary for the operation of the Saving Gateway, as eligibility for an account was to be conferred on people entitled to certain social security benefits administered by the Department for Work and Pensions and the Department for Social Development.
6. As this provision is consequential on the proposed repeal of the Saving Gateway Accounts Act 2009, this means that the requirement on the Department for Social Development to provide Revenue and Customs with information relating to social security for the purposes of identifying those individuals who would have been eligible to open a Saving Gateway account will be removed. The provision is obsolete; therefore this is a technical amendment.
7. As the inclusion of this provision falls within the transferred matter of social security, Westminster will not normally legislate with regard to devolved matters, except with the agreement of the devolved legislature.
8. The Saving Gateway would normally have been a transferred matter. It was made an excepted matter so that responsibility would remain with the United Kingdom Parliament. The Bill also contains a provision to remove the Saving Gateway from the list of matters in Schedule 2 of the Northern Ireland Act 1998.
9. While the Saving Gateway has never been added to that schedule (as the relevant section in the Saving Gateway Accounts Act 2009 has never come into force) this is intended to avoid any doubt.
10. The agreement of the Executive Committee, the Social Development Committee and the Assembly (through a Legislative Consent Motion), to the inclusion of provisions for Northern Ireland in the Bill will be required. The agreement of the Assembly must be obtained before the Bill goes forward for Royal Assent in December 2010.