Should child benefit change, and how?

[MidnightPatrol]

Martin Lewis talking about the unfairness of how child benefit is applied today. Millions more are being caught up by its removal.

Key points:

• A single income household with a £60k income is eligible for £0, while a dual income household earning up to £100k gets 100%.
• The earnings threshold has not changed since 2013

Should this change, and if it does change what would be 'fair' instead?

e.g.

• Should the arbitrary cut-off be higher?
• Should it be universal?
• Should it be based on household rather than single income?

Should be based on household income. That one is so obvious and simple.
I also think the National Insurance Credits should be up to age 16 (or 18/19 if claiming for a child still in full time education) - not stop at age 12.

It should be based on the income of the person claiming it. The person claiming it is usually the child’s main carer and there is no guarantee that they have access to the household income.

And the cutoff should be significantly raised

Should be based on household income. And a cut off point (if there has to be one) of around £100k household income.

It is supposed to be for the children though, and there are some benefits, I think, for pension aged people, that are not means tested. Winter fuel allowance I believe? I think child benefit should be universal again.

This! So entirely unfair that many families who really aren't earning a huge amount combined get denied this money, that can make a huge difference to being able to live, whereas a family earning pretty much double, can be entitled to still claim it?! Definitely needs to be based on the income of the claimant.

Would this have an income threshold attached, or would it mean in any couple the lower earner could claim?

I suppose the argument in favour of it being universal is that it stops an 'us and them' mentality of those who are allowed to claim vs those who aren't.

Why should a parent receive NI credits because they have an 18 year old in education?

Unless their child is disabled or home schooled, the parent isn't really prevented from work, are they?

But doesn't this just create unfairness for a different group of families?

A woman who doesn't work but whose husband makes £200k can get CB.

A couple who both earn £60k each get nothing?

How does that make the system fairer?

I believe it should be universal again.

Would be interested to see if money is really being saved once the administrative load of adjusting people's taxes has been accounted for.

There are several ways round / loopholes that people can take advantage of anyway in order to retain child benefit, such as paying extra money into their pension instead. It's just ridiculous and punitive to have a cutoff, like so many policies of this horrible government.

@wutheringkites "home schooling or disabled" is EXACTLY the reason why.
(or other issues like school refusal etc)

I think it should be universal.

And not increased too fast, but extra money go into a child- based element of UC.

But this doesn't apply to most 17/18 year olds in education so it would make more sense to allow NI credits for those specific groups, surely?

@Sapphire387 It does seem a strange policy 'incentive' from the government to be making parents at two very specific income levels (and life stages) overpay in to their pensions (£50-60k+ and £100-125k+).

Entirely due to the odd removal of the respective family benefits at those levels.

@wutheringkites up to 16 then.

I agree. This is the most sensible change to make.

I think it should be scrapped and far better childcare should replace it from 0-12 and dla should be increased by the value of child benefit.

It should be universal. Just like a pension. Raising kids is a contribution to society and needs to be supported.

@wutheringkites although my daughter will be at her SEN school until 19 and for reasons that aren't really your business I can't commit to a job because of her disability.
I can claim Child Benefit for her until she leaves (at 19) but the NI credits stop at the random age of 12.

Someone said to me once that her friend was in a abusive relationship,her husband controlled money and the only reliable money she recieved was the child benefit. I think it should be based on the person that claims it.

But it's still not relevant to most families at that point is it? The vast majority of parents are able to work when their children are teens.

If this is a known issue for parents of disabled children then surely it would be better to cover this through a link with another benefit claim like Carer's Allowance?

There are two serious problems at present:

1. That the main carer of the children, usually the mother, can be denied access to the main earners income. Household income doesn't mean it is shared. Child Benefit, in theory, went to the child's carer.

2. That the NI credits are connected to Child Benefit and the higher earner has to do a tax return if CB is claimed so it can be returned through their tax. This has led to many couples not claiming CB when one earns more than £60k (rather than earning and paying back). This means if the child's carer is a SAHP, or works low part time hours, they are not getting NI credits which mean a reduced state pension. This is going to be a massive problem that many will only discover when they retire. This will start coming to light in the next 20 years...

I'd completely flip it and run this and other working benefits through the tax codes i.e. you'd get an additional tax free allowance- it's none sensical to be deducting from salary for tax and ni and then paying it back in benefits BUT I'm a fan of universal basic income and this idea is moving towards that. It would need thought about how to deal with people not earning - perhaps they would get a payslip from the government.

make it universal

@wutheringkites the NI credits are only given if you aren't working. If I was working it wouldn't be required.
I do get Carers Allowance so I am getting my credits through that.
But for children who are out of school for reasons that aren't necessarily "diagnosed" reasons - they've been removed due to bullying for example - and the parent has to stay home with them and not be able to work they should get the credits.