Dear Sir or Madam,

Please provide documentation relating to the suspension of payment
of Child Tax Credits to residents of "Other Member States" relating
to Incapacity Benefit, UK State Pension, Widows' Benefit and
Industrial Injury Benefit. This is to include minutes of meetings
and memoranda.

Yours faithfully,

Suzie Francis

Dear Ms Francis

Freedom of Information Act 2000 | Our Ref: 1991/08

Thank you for your request for information. Your request was received on
19/09/08 and I am dealing with it under the terms of the Freedom of
Information Act 2000.

In some circumstances a fee may be payable and if that is the case, I
will let you know. A fees notice will be issued to you, and you will
be required to pay before we will proceed to deal with your request.

If you have any queries about this letter, please contact me. Please
remember to quote the reference number above in any future
communications.

Yours sincerely

Michael

Michael Armstrong
Freedom of Information Unit
Room BP5001 | Dunstanburgh House | Longbenton
Newcastle Upon Tyne | NE98 1ZZ
Tel: 0191 2253065 | Fax: 0191 2253098
email (internal): Armstrong, Michael (G&S)
email (external): [HMRC request email]

show quoted sections

Dear Ms Francis

I am writing to confirm that the Department has now completed a search
for the information you requested on 19 September 2008.

Question

Please provide documentation relating to the suspension of payment of
Child Tax Credits to residents of "Other Member States" relating to
Incapacity Benefit, UK State Pension, Widows' Benefit and Industrial
Injury Benefit. This is to include minutes of meetings and memoranda.

Answer

The information HMRC holds is subject to legal professional privilege
and is therefore exempt from disclosure under section 42(1) of the
Freedom of Information Act 2000. In this instance, we consider it is
appropriate for us to withhold the information. Details of this
exemption together with the associated public interest considerations
can be found at annex A. I have very carefully considered the public
interest but, on balance, I have concluded it is better served by
withholding the information.

It might be helpful if I explain that under European Community (EC)
regulations dealing with social security for workers and pensioners who
move anywhere within the European Economic Area (EEA), family allowances
for the children of persons receiving a state retirement or invalidity
pension are generally provided by the Member State paying that pension.
These rules define a "family allowance" as periodic cash benefits
granted exclusively by reference to the number and, where necessary, the
age of the children.

HMRC's has concluded that there is a distinction between family
allowances and family benefits which are covered under Article 77 & 78,
in that Child Tax Credit (CTC) would not be regarded as a family
allowance. Because of that we have reviewed awards of CTC in relevant
cases and concluded that in view of the provisions of EC law, such
awards should, strictly, be terminated.

Conclusion

If you are not happy with this reply you may request a review by writing
to:

HMRC FOI Team

Room 4/52,

100 Parliament Street

London

SW1A 2BQ.

You must request a review within 2 months of the date of this letter. It
would assist our review if you set out which aspects of the reply
concern you and why you are dissatisfied.

If you are not content with the outcome of your complaint, you may apply
directly to the Information Commissioner for a decision. Generally, the
Information Commissioner cannot make a decision unless you have
exhausted the complaints procedure provided by HMRC. He can be contacted
at:

Information Commissioner's Office

Wycliffe House

Water Lane

Wilmslow

Cheshire

SK9 5AF

Yours sincerely

John Sharpe

Governance & Security

HM Revenue & Customs

Room 4/52

100 Parliament Street

London

SW1A 2BG

Fax 020 7147 0666

[email address]

Annex A:

Freedom of Information

Exemption.

Section 42(1) of the Freedom of Information Act (Legal Professional
Privilege) provides that:

1) Information in respect of which a claim to legal privilege or,
in Scotland, to confidentiality of communications could be maintained in
legal proceedings is exempt information.

Public Interest Test.

The public interest arguments I considered in relation to the exemption
under s42(1) are set out below.

It is in the public interest that the decisions taken by government are
taken in a fully informed legal context. Government departments
therefore need high quality, comprehensive legal advice for the
effective conduct of their business. That advice needs to be given in
context, and with a full appreciation of relevant facts.

The legal adviser needs to be able to present the full picture to his or
her departmental clients, which includes arguments in support of his or
her final conclusions but relevant counter-arguments. It is in the
nature of legal advice that it often sets out the possible arguments
both for and against a particular view, weighing up their relative
merits. This means that legal advice obtained by a government department
will often set out the perceived weaknesses of the Department's
position. Without such comprehensive advice the quality of the
government's decision-making would be much reduced since it would not be
fully informed and this would be contrary to the public interest.

Disclosure of legal advice has a significant potential to prejudice the
government's ability to defend its legal interests - both directly, by
unfairly exposing its legal position to challenge, and indirectly by
diminishing the reliance it can place on the advice having been fully
considered and presented without fear or favour. Neither of these
scenarios is in the public interest.

There is also a risk that lawyers and clients will avoid making a
permanent record of the advice that is given or make only a partial
record. This too would be contrary to the public interest. It is in the
public interest that the provision of legal advice is fully recorded in
writing and that the process of decision-making is described accurately
and fully; the legal advice must be part of that record. At worst there
may even be a reluctance to seek the advice at all.

This could lead to decisions being made that are legally unsound. In
addition to undermining the quality of the government's decision-making,
this is likely to attract successful legal challenges which could
otherwise have been avoided. Even in areas where a legal challenge is
unlikely, government's willingness to seek frank legal advice is
essential in upholding the rule of the law.

HMRC considered the arguments that disclosure of the legal advice could
increase public confidence that our decision on this matter was correct
and that it could enhance the transparency of decision-making in this
context. HMRC has decided, however, that these considerations did not
outweigh the very strong interest in maintaining the confidentiality of
the underlying legal advice in this case.

The information in this e-mail and any attachments is confidential and may be subject to legal professional privilege. Unless you are the intended recipient or his/her representative you are not authorised to, and must not, read, copy, distribute, use or retain this message or any part of it. If you are not the intended recipient, please notify the sender immediately.

HM Revenue & Customs computer systems will be monitored and communications carried on them recorded, to secure the effective operation of the system and for lawful purposes.

The Commissioners for HM Revenue and Customs are not liable for any personal views of the sender.

This e-mail may have been intercepted and its information altered.

show quoted sections