Child benefit changes - what do you think?

[KateMumsnet]

Next week, the Inland Revenue will write to 1.2m families about upcoming changes to child benefit eligibility. The changes mean that from next January, single-income families earning more than £50,000 per year will no longer be eligible for the full amount (currently worth £1,055 for the first child) - and those earning over £60K will no longer receive it at all.

The changes are controversial. Dual-income families who both earn just below the 50K cut-off - who have, in other words, a family-income of just under £100K per year - will continue to receive the full amount, leading to criticism that the changes penalise both stay-at-home mothers and single parents. Accountants are warning that new partners of divorced parents could also lose out. And the entire process is so complicated - with families forced to fill out complex self-assessment forms for the first time - that the Inland Revenue has reportedly postponed sending out the letters because they can't find a form of words that families will be able to understand.

What do you think? Will you be affected by the changes, and what will it mean for your family? Are stay-at-home mothers being unfairly targeted - or is staying at home a luxury which shouldn't be subsidised by the taxpayer? Should child benefit be universal - or should it be available only to families who are really struggling? Let us know what you think here on the thread, and don't forget to post your URLs if you blog on this subject - we'll be tweeting them over the next few days.

I think I might have pasted above what £50k is £38k a year net or £688 a week. if you are single parent on that your nursery place is about £200 a week. That leaves you £488. Your tube costs in London are about £8 a day (£32). You probably are buying a 1 bed flat costing about £180k in outer London. Your mortgage repayment is about £240 a week.

That leaves you £216 a week after your childcare and housing and travel to work.

Is that £50k gross wage for the single full time working mother - the net £216 very much more than the benefits claimant who has all rent paid and also has free prescription charges.

I just think non working single parents need to be aware £50k as a single parent full time working mother is £216 a week to spend on food, work clothes and all the rest and probably babysitting when you work late.

What is net benefits per week for single mother (ignoring housing benefit) with one child? Ignore child benefit and perhaps working tax credits too which I assuming our working mother does not get.

50K is nothing in London Scottish mummy. We don't earn that much but we need the CB. Alot of it goes on transport costs to school.

Cost of living varies for different regions but it is expensive here and the housing costs so much more in the first place.

that a useful breakdown of figures

We will lose all CB and I am okay with that. That said, we are a two-income family, each earning close to the threshhold so there will be families with a slightly different split who will still get it.

so what do you suggest a regional variation in threshold
Higher in Ldn and SE?
50K in scotland is a significant wage

possibly, but I think it will be too hard to do that.

I could imagine 50K going a long way in Scotland.

50K used to seem like alot in London but there is so much taxation, person will be in the higher rate, band petrol is expensive, heating and electricity. everything has gone up so much. House prices are ridiculous.

If you think about it, 2 people earning say 30K each won't pay as much tax either as they won't be hr tax payers.

I know this applies to everyone regardless of region but I think sometimes food costs may vary in different places.

my mum always comments how cheap it is when she goes to Lincolnshire compared to Northwest London.

I think the CB cut off should have been pitched so much higher say 100K then we wouldn't be having all this bad feeling and setting people against each other - divide and rule me thinks.

I just my figures through a benefits calculator (let us ignore council tax inc omparing the £50k single mother with a mortgage who works full time with 1 child a nursery and the benefits claimant single mother). the not working one gets £62 child tax credits and £71 income support and £11 council tax benefit- so £144. She also gets her rent paid and her prescription charges paid.
We are ignoring child benefit here.

So £50k working mother gets £216 after tax and work expenses and childcare a week and never done a days work in her life single mother gets £144 a week in my rough calculations. So the non workers thinking £50k mother has the life of rile are not actually that much worse off. Also I bet the working mother has a lot of extra costs, baby sitting, need to buy certain clothes to look okay in the office, probably sometimes buys her lunch out because packed lunches take time to make, need to pchip into work collections for leaving colelagues etc etc.

My thesis has always been that you can earn £40k - £50kin the UK and work very very hard nad yet have as little in net income as someone who is on benefits. My answer is aim as a woman to earn well over £100k and then things like loss of CB becomes irrelevant. Encourage your daughters to look at which careers are likely to pay severla hundred thousand rather than pin money and then life can be al ot easier particularly if you put a lot ofhard work in your teens into getting relaly good A level results and a good degree.

it is interesting seeing the figures
mmm so perhaps regional variation,would be v unpopular though

Many o0f the English cannot wait to divest ourselves of Scotland (more in England favour the Scots going than in Scotland where only 1 in 3 does amusingly). If Scotland does go it can set its own rates.

I very much doubt a full time nursery place in London and a mortgage of £160k which is what our mythical 50ker single mother is paying here would be too different from Scotland. I have put our mythical mother in very much outer London, possibly Luton even although then her transport costs would be even higher and put her in a one bed flat with her baby not a house or a 2 bed flat and put her in outer London where most of us slum it. I gave her one child so she had one full time nursery place not 2 or 3.

There has to be a more realistic solution to the inequitable way in which cuts are being targeted towards women rather than men than just suggesting that every female should aim to earn >£100k though. There really aren't that many of us earning that sort of money of either gender. Even if every single man earning that level or higher was replaced by a woman that would still only be a tiny percentage of the existing female workforce let alone the existing female working age population. It's also worth bearing in mind that those females earning the most money are those who are in the most risky sector - the arts. A sector which has a huge number of low or inconsistent earners. And which is typically (though not exclusively) chosen for reasons other than potential monetary rewards.

shot of the scots dont make me laugh.we are pivotal in running the country
dont hold breath for independence,
stats not good for 1st minister

For the Tories the CB changes have not exactly been a triumph. I can obviously afford not to get CB any more even as a single parent but it still feels a bit unfair because it was the one benefit ever that I have had. I never even got maternity pay and I've never had a tax credit or help with childcare. it just made think - wow the state recognises the efforts I've put in over nearly 28 years into children who now 2 are in their 20s are paying a lot of tax. I dont' know how much tax they pay as someone asked above but a reasonable amount if they earn £44k to £65k or whatever the girls earn in their mid 20s. So I have produced productive tax payers.

Anyway in general I am in favour or abolition of all these distortions and tax reliefs and benefits for the working people so that the free market can prevail. At present benefits prop up low wages and our poor £50k full time working mother with her £216 a week after her working and modest housing costs is not too much better off than the mother on benefits.

(I am sure Scotland will remain part of the union and I'd better not deflect the thread)

I suppose the mythical working mother above has the chance to earn more, that's the thing. I dfon't expect mky daughters to earn what they do for the next 40 years. I expect them to get promotion (if they choose). So you might feel hard done by when those not in work get abou the same but over time you probably do do better overall.

xenia it's income support of say £65 and just over £50 ctc plus cb - so £135ish. considerably less i think you'll agree.

i agree 50k is plenty for a couple who chose to have only one person working and avoid childcare costs through a sahp. but for a single working mother of pre school age children her costs are mammoth. you don't generally earn 50k plus by working cosy 9-5's and term times - you need a lot of expensive childcare and you are probably doing a lot of traveling which costs a lot also.

i do think people live in cuckoo land to come on here moaning about being poor as a higher rate taxpayer.

Yes, the benefits calculated had it at £144 but your £135 may not be too out of line ) think it had £71 as child tax credit and £11 for council tax benefit. Our working mother would have to pay her council tax.

The weekly child nursery place of £200 in my calculation above is the biggest cost. however say my daugthers had babies now without being with a man on their salaries which are about this kind of level it would still pay them to work as soon the child is at school and in the jobs they are in some people earn £1m to £2m a year so having 5 very hard years of your child care costing a lot and you not drawing much more than a benefits claimant if that means in 8 years' time you are doing very well particularly once childcare costs disappear it is worth the sacrifice. It i s like that toddler deferral exe;rcise psychologists do - two sweets later or one now. If you can think difficult now but the benefits will pay off later then it tends to benefit women to take the working choice rather than benefits chocie as the longer you are out of work the harder it is to get back into ti. Or you could follow the route of many a woman and simply life of male earnigns for life by being p4retty and slim enough to attract rich men . We have that option too which many men don't have. We therefore have two routes to get on and men tend just to have one. In that sense we are luckier than men.

i get just over £50 ctc for one child.

work does pay - it's all lies about it not doing so and just another excuse to cut benefits and divide and rule making workers resent non workers.

i'm about to cross over from disability benefits and ctc etc to working. i will only be working part time and yes i will lose HB, council tax, free school meals, incapacity benefit, free prescriptions etc but i WILL be financially better off. not by tons admittedly, but better off and with a chance of improving that over time.

people who are saying work doesn't pay are wrong. also people who think people on benefits get nearly as much as them are wrong. for the last few years even on disability benefits and factoring in all benefits and concessions i've lived on aprox. 13k a year. i'm good with money and do not drive a car etc so we managed fine but the idea that we'd have been rolling in money and as well off as a working 2 parent family is rubbish.

(obviously rent, council tax and everything had to come out of that 13k and i'm in middle england so hardly cheap iyswim)

Being in London does make a difference. I work for NHS and get £5000 as London weighting which pushes me just over the £50000 threshold so I lose some of CB but colleagues on the same grade outside of London and don't have the expense of living in London get to keep all their CB. So I lose some of my the benefit of the LW as I'll lose £1500 in CB for my 3 dc.

Xenia there is little point in putting figures in a post like that trying to compare a typical single working parent, as compared to someone on benefits. You have made a whole truckload of assumptions about what her childcare costs will be, what price property she'll live in - its not as clear cut as that.

And whilst I'm all for equality - you can't say that there is no distinction between men and women. Women are the ones who have children, and even if they take a short amount of maternity leave, their career is disrupted. And its not just a question of getting women to change their opinions of what they should be doing in their lives (in your view we should all be aiming for the highest paid careers possible!) you still have to change the opinion of (predominantly male) employers who are still less likely to hire women in their 20s for fear they'll go off on maternity leave.

If you decided at the age of 16 what you were going to do in your life, based on what your earning potential would be, knowing that it would fit in with a family and that it would be recession-proof, you were obviously well informed. Not everyone was lucky enough to be in that position.

Well I said many years ago that tv stars pop stars etc and anyone over a certain amount should not be entitled to child benefit, its always the same story really the working class work to get what they have and some single parents cant help being a single parent due to violence abuse etc... the society is being divided what happened to great Britain in most shops I go I feel I am in Poland why should they get what us british cant even have, I believe that all youngsters should be made like the old days to go into the army for 2 years hence less criminal damage and idle hands and drugs being dispersed in schools and maybe send back all those of not a british nationality, lets help our own and help our children instead of them going without some parents rely on this monies and the next step will be only 2 children per household, it really makes me sad

'can't help being a single parent'

i think even graduates won't necessarily earn fantastic salaries just get saddled with debt. My dd is doing Physio Therapy. She has tried hard and worked diligently at school along with loads of other kids. She will come out with some sort of qualifcation and earning potential.

but it is such a joke as housing costs are so ridiculous.

In the good old days someone who was a dustman could probably buy a small terrace on one salary or get a house of the council.

sorry i know it is a bit stereotypical but i am sure you get my drift.

I think we are confusing the issues here. There may be rights or wrongs about a certain threshold above which people don't get a benefit. The point of how it's now designed is that there's very very little incentive to work more hours / harder, that push you above £50k, if you have more than one child. I am not sure that this does much good for the economy or for families. It certainly won't save money. We'll just see a cluster of incomes around the 45-50k mark.

I think it depends on your long term propsects. The single mother on £50k who has £216 a week after childcare and mortgage and work costs might well be able to push herself up to £60k or £70k in the next few years if she works hard so it is worth her making the effort just as swallowed above will, we hope, in the example above.

I suspect few people will refuse a pay rise although some may ask for pension instead and a few may have man going part time an dhis housewife getting a job to use both single person allowances and so that they keep child benefit - that would probably benefit women as they would be getting bcak to work.

I can see a problem with people wanting to keep their income just under the threshold. But I'm sure I read the benefit will be taken off on a sliding scale up to £60,000 a year. And two people working do have twice the expenses of commuting and other expenses related to working. It does seem to cost quite a lot of money to actually work.