Perfect illustration of the lack of sense in the Coalition Government

I don't believe it will save any money at all. There will be an admin charge, there will be charges to 'check up' on people declaring it, and there will be a drop in spending by those families affected. And if Cameron does as he says and brings in his stupid married couples allowance, I think it could well be a net loser.

niceguy, it's all perception though. The proposed benefits cap of £26k + Child Benefit has been criticised by many as being 'unfair' on families, and leading to families living in poverty, and yet this is only £80 a month less than a family with 1 income of £42k. Who are described as 'loaded'.

And one other point - the argument they used was that 'our tax system is based on individuals, ie we are taxed individually not as a household'. But I will lose my child benefit because of dh's income, so it is not even consistent with THAT principle.

Just re-reading reports and watching interviews - David Cameron says it's fair because 'the tax system already negatively affects single income families'. So he's making it even worse.

And it would apparently be 'complicated' to means test. But that is already in place, for CTC and WFTC.

So it is a political decision, that is financially unsound, but will make life very hard for some families, whilst not affecting families who are much better off. It is a bad policy and should be scrapped.

What's more, the cut in CB will have a big negative effect on the economy, so the saving is much much less than the 1 billion stated. The spending power of parents will be hugely reduced (£250 a month is a LOT to have to find out of a family budget), so growth figures will be further inhibited, reducing revenue to the treasury. The 1 billion saved does not factor this in, nor Cameron's patronising married couple's allowance.

niceguy, you mustn't just swallow it as a bitter pill. Because there are ways of making cuts that are fair. The CB cut was not a policy that had been thought through, and reluctantly agreed upon, as part of a coherent cuts programme.

When it was announced, it was a surprise to most in the cabinet. It was essentially drawn up in the bar the night before, by Cameron and Osborne. No-one was consulted.

Why? Because the LibDems had made some announcements on policy at their conference, the previous week, and they felt they had to announce something. And also to avoid being criticised for announcing the cut in housing benefit. You don't normally announce a cut in a benefit like that at conference, it is normally part of a budget. The policy was made for purely political grounds, not financial grounds. When the media went nuts about the intrinsic unfairness, Cameron wobbled, and said they might try and redress it with a 'married couple's allowance' which is true insanity - because all the savings made would be negated, and you would be taking money from families with children (and therefore higher expenses), and sharing it among all married couples - whether or not they had children - single mothers and unmarried parents would still miss out. Madness. And supposing, like us, you would be losing 3k, the projected married couples allowance was proposed to be £150.

I can't emphasis enough, this cut is not for financial reasons, it is for political ones, and as such, we must not just say 'oh, cuts need to be made'. The RIGHT cuts need to be made.

My thinking behind making it a tax allowance above a certain threshold (you could make the threshold quite high to ensure that no-one misses out), is that the philosophy 'when an income has more calls on it, you keep more of it' is a better philosophy than 'people on high incomes still get paid a benefit'.

To those who say that it is unfair for higher income families to get any sort of benefit (either as a benefit or a tax allowance), bear in mind that those of us on medium incomes (say a single income family on about 42k) are losing a huge whack of child benefit, but through our taxes are paying for Alan Sugar (for example) to get a free bus pass and a winter fuel allowance. He himself says this is anathema, and tried to send them back, but there was no mechanism for this. Universal benefits still exist, just not for families.

meditrina, yy, the issue of not paying enough tax for it to be beneficial is why you need a dual scheme. The reason I would advocate some sort of voucher system is because I think there is an issue concerned with the child benefit actually getting to some children - either because it is spent on other things, or because it is snaffled by a debt collector.

You could equally well have a swipe card, that had a certain amount of credit put on it each week/month, valid for certain goods/services. But I do think that no child in this country should be hungry, or inadequately clothed, and yes we still have problems with this, (as depicted on 'Poor Kids' for example), either through poverty, or chaotic family life, and so the benefit simply isn't reaching all children. They changed the benefit from a tax allowance to allow the money to reach mothers, now there is a need to ensure it reaches the child.

CES - not claiming simply isn't an option, as under the current rules, if you are a SAHM and don't claim, then you don't get credits towards your state pension, and will not get a full state pension on retirement. The act of claiming CB actually protects your state pension.

Going back to the point about making it a tax allowance, that makes a lot more sense to me - even if very high earners get it too - because it is a good philosophy - if you have more people to support, you get to keep a bit more of the money you've earned. We can then support low incomes through benefits, possibly paid in terms of vouchers. The reason I don't have a problem with very high incomes getting it as an allowance is that even at a high income, kids cost money, and therefore perhaps you should be let off a tiny proportion of tax, for their costs.

Did you see the programme 'Poor kids'? What emerged from that programme was that one of the biggest causes of poverty is debt, and debt repayments. Paying child benefit to low income families as vouchers would also mean that CB could not be 'snatched' as debt repayments - it would safeguard it so that children WOULD get food, and WOULD get clothing. Rather than a parent in desperation handing the money over to a baliff, or a debt collection company putting pressure on a parent that 'they have some money, they MUST pay it'.

Did you know we are the only developed country in the world NOT to have a universal child benefit (either as a benefit or a tax allowance)?

What you can't have is the proposed system, where benefits are given, almost at random, families that really need the benefit and rely on it, lose it, families who are FAR wealthier than they are, keep it, families who are desperately poor, can't use it for what it's intended for, and a v small number of families, see it as an ever increasing source of income - have another child, get more money.

In a nutshell, if I were IDS, this is my reform;
Families on incomes over £15k (this would need properly calculating though); CB to be removed completely, and instead is a tax allowance, per child. This is a fairer form of taxation, reflecting the drains on an income as well as the actual income.
Families on incomes under 15; CB to be given in the form of vouchers, valid for food and clothing, and also valid for clubs at school (eg either breakfast clubs, or even 'activities' after school - it's not intended to remove parental choice, but to protect the benefit for the child).

Actually you've missed the point a bit, the 'hoops' will only be jumped through by those who will LOSE the money. Because the way they are proposing to administer it is;
Mother claims CB.
Father then has to declare it on HIS tax return, which will then have the CB paid added on to his tax bill.

If you are keeping the CB, you retain the right to privacy over your financial affairs.

adamschic, there's no point looking at extremes like that. Because they have created some massive disincentives to progress in your career - and that is damaging to the economy.

And even when times are tough, fairness has to be enforced, and be seen to be enforced.

This doesn't save much. But £95billion lost in tax evasion and they don't chase it? (that is the figure btw, child benefit cuts save somewhat less than 1billion).

They have cocked up anyway, because a wife and husband are not obliged to share their financial affairs, so they are either removing a right that every other married couple enjoys, from married couples with 1 HRT payer, or it is unenforcable. The law states that I do not need to tell dh if I am claiming CB, and he does not have to tell me what tax bracket he is in. And yet on our tax forms, he will have to fill in data about my financial affairs.

bitsyandbetty, it's not a case of criticising people for being on benefits, it's a criticism of a system that draws an arbitrary line, says that this is the maximum amount the state will give you, anything above it and you are shafted, unless you are a dual income family.

People aren't complaining so much about the principle, but about the implementation.

I always quote this, but living in our city, with an income that puts you just into the HRT bracket and with 3 or 4 children, you are on the 30th centile of standard of living, using the IFS calculator. That means 70% of people have a higher standard of living, and yet you are punished by the Government, for supposedly being wealthy.