Should Labour abolish the two child benefit cap?

[changefromhr]

In two minds about this. Yes for those who find themselves on benefits after having more than two children (job loss, divorce etc) but perhaps not for those who choose to have more than two children when they have never worked (disabled families excepted).

https://www.theguardian.com/society/article/2024/jul/11/uk-two-child-benefit-cap-affected-1-6-million-children-last-year-figures-show

"If you prioritise your career you shouldn't be expecting handouts".

Really?! How about "if you choose to have children when you cannot provide for them you shouldn't be expecting handouts."

It’s kind of scary how often we’re agreeing these days @Badbadbunny!

I've always thought that people generally agree with others for most things and it's only a minority of matter where they disagree. We've all got a lot more in common with each other than we think. There'll be very few people where they disagree in most topics/opinions.

I think for a healthier/happier society, we need to understand and appreciate what we have in common and dwell less on our differences. After all, elections are won and lost from the middle ground which a huge number of people being "floating" voters which kind of proves my point.

Nothing wrong with healthy/respectful disagreements, but very important to agree on topics where you more or less are in the same mind, rather than disagreeing for the sake of it just because you disagree in other matters.

We also need to look at why it is so easy to work in the Back Economy and make it far harder to do so.

I totally agree.

I live in a village with 200 houses. I know of 2 neighbours who are claiming benefits because they are supposedly unable to work but both work cash in hand. One works for another neighbour and the other does gardening and handyman type jobs.

The one that does the gardening and handyman jobs actually advertises on our local facebook page!

I can't help wondering how many others in my village there are doing the same let alone across the country

I want work to always pay - not only at low income, but also at higher income levels. I find it insane that for a single mother of just one pre-school child, she'll have the same disposable income whether she earns £70k full time or whether she drops to 1 day pro-rata earning £15k, the only difference being handing over a large amount of her salary versus taking a huge payout from the state.

I want people who are middle income to be able to afford 2 or 3 kids and it still be worth the University-educated mother working.

I want those extra kids who aren't currently being born to become affordable to our working and middle classes, so that they grow up to become the doctors, nurses and teachers of tomorrow so that we don't have to keep importing people from other countries because of skills shortages. I'm not saying all the existing kids shouldn't also do these jobs: There are plenty of those roles available for kids with the ability and the willingness to study and then work But there aren't enough kids who want to. No shit sherlock - the families who would raise those kids can't afford to!

I think the way we have structured our tax and benefit system is unsustainable, encouraging people to not work or limit how much they work. The labour party have made growth their goal. If they're serious about that, they can't ignore these structural issues.

It's not just the "one man" type businesses though. It's way bigger than that.

When we needed scaffolding, we got a few large local scaffolding firms round to quote - over half of them did the "we'll knock off the VAT for cash", and these were supposedly reputable long term firms.

Same when we had our car written off my a moronic neighbour and we bought it back to repair ourselves. Took it to a couple of "proper" local bodyshops who did insurance work so regulated etc., and both said they could do it without VAT if they could do it over a weekend and if we could pay in cash without wanting a receipt!

When firms are blatantly offering "VAT free for cash", you know there's a problem - they're not remotely frightened of HMRC. For all they knew, we could have been HMRC staff.

Another firm we phoned to get a quote for garden fence panels, one of their first questions was whether we'd be paying cash so they didn't have to add VAT!

It's an epidemic now. No surprise when HMRC have basically gone AWOL. A bit like how the streets are lawless now that the police don't bother with anything short of a murder these days (unless it's thought crime or anti gay!)

@strawberrybubblegum

I think the way we have structured our tax and benefit system is unsustainable, encouraging people to not work or limit how much they work. The labour party have made growth their goal. If they're serious about that, they can't ignore these structural issues.

I agree. I've said on here many times that there should be a limit of 50% for all deductions/benefit losses, from working "more". I.e. if you get a pay rise, or take an extra shift, or whatever, there needs to be a rule that you WILL get 50% of your gross earnings in your pocket, and that the deductions, i.e. tax/nic/student loans etc, plus loss of ANY benefits, should never be more than that 50%. Then people have a real and tangible reason to work that extra shift or take a promotion, or work more hours, or whatever, as they WILL see at least 50% of the extra earnings, after ALL things considered, including loss of UC, loss of council tax discounts, loss of free prescriptions, loss of free childcare, child benefit - the works!

The moment people see more than half their extra earnings disappear, either as payslip deductions or loss of benefits, is the moment they think "sod it" and simply don't bother.

Brown did a lot of damage with his tax credits. He made it "OK" for people to work a minimal number of hours to get showered with benefits. As an accountant, I had huge numbers of new clients setting up "fake" businesses in the year or two after they were introduced, typically things like car boot stalls, market traders, car washes, window cleaners, etc., who set up cheap/easy set up businesses to work the bare minimum of hours, only intending to break even, just to tick the boxes that they were working the right number of hours as the gateway to tax credits. They had no intention of making a proper go at the business, as long as they broke even, they were happy, as they could live on the tax credits!

I only hope that Starmer doesn't go down that route again. Hence why I want to see lots of changes that "make work pay", to tax incentives, maybe tax relief for commuting to work using public transport, or tax relief for childcare costs (for those who don't get it free), etc. We need to incentive people to work, and stop incentivising them not to work!

That sort of fraud thing really gets my goat. If the piss takers were all weeded out there would be more for those genuinely in need.
Aren't you tempted to report these 2 people?

I agree it's far too common now and, obviously, wrong. The two neighbours though are claiming benefits for supposedly not being able to work (so a decent amount I should think) but also working cash in hand. Both work more or less full time so have quite a bit of money coming in a month. Both have a pretty good lifestyle.

One actually claims he can't work because his anxiety is so bad he can't leave his house. Strange then how he can leave home 5 days a week to work and at weekends to shop, walk his dogs, go to the pub etc etc.

I have reported both of them, more than once, and sent a screenshot of the ad on facebook but nothing has happened. I know it probably takes a while but I first reported one of them over 2 years ago.

Makes me so angry

Well done, that must be do frustrating for you. As someone else said up thread the HMRC system is broken, unless of course you're 2 minutes late submitting your tax return then the automated system swings into action !

As accountants, we are bound by law to make "suspicious activity" reports for any clients we suspect of tax evasion, money laundering etc. Over the 20 or so years that the reporting regime has been in place, I've reported a few dozen clients and potential clients. Guess how many have resulted in any kind of tax enquiry/investigation? Yes, absolutely zilch, zero, nada! Some of those reports were for tens of thousands in tax evasion, so not just small fry. But the regulators etc just don't care. Our professional accountancy body want to know how many reports we've submitted when we get "audited", but that's just to prove to them that we're reporting - they never ask how many result in any action.

And what madness is this? Choosing to get my ass to college and university and then get a job, so I don’t have to go on jobseekers after secondary school, was not a lifestyle choice but a necessity so I don’t take away benefits from the disabled and vulnerable.

and I’m NOT on £100k (half it and you’ll get close), yet I have to pay full whack for childcare, subsidising others in nursery fee payment, whilst also paying taxes that those subsided people get in benefits - talk about double whammy.

The cliff edge hits people at muuuuuch lower incomes then you think…

And the point you make about lifestyle choice? Well I shouldn’t have to pay for someone who’s decided to prioritise a lifestyle of not using contraception when they can’t even afford to feed themselves - this is not a nice generalisation is it? But neither is your stupid comment about people who chose to be sensible being a life style choice that shouldn’t be supported. Yes I might have a career, but those paying the higher taxes, not having childcare support, etc, are not all millionaires.

And my mat pay was shit thanks.

A PP makes a good point about the Black Economy. Feckless and people making daft decisions to have children whilst living chaotic lives is one thing but the black economy is huge. In my nearest town there are 20 barbers all Turkish and 2 nail bars run by people from Vietnam all requesting cash. There are people pretending to live alone when in fact they have their boyfriend there (who is down as living with his Mum and Dad).

Why arent these places raided weekly?

That is shocking.
I'm self employed and keep honest and rigorous records for my tax returns. I do everything by the book. Reading some of these posts is making me wonder why I even bother. Maybe I should 'forget' to declare some income as well, especially as my taxes look to be going to so many people who fiddle the system.

Well, childcare support is available for those who earn up to 100k, so why are you not getting any support???

You should've worked for a better employer if your mat pay is poor.

I did all of what you did re college etc & following my partners death bought up my DD without any free childcare and paid higher rate tax, i certainly did not expect a handout whilst earning a significant amount, thats really not how it works & i never begrudged someone else getting CB for a 3rd child.

I do begrudge people like Sunak earning 2m per year via investments but paying 20%.

Oh and having lived in a country where the poor get nothing at all, i'll tell you what happens: they take what they want from you, hence the better off lived in gated communities.... it my be unfair that a tiny minority get handouts and behave badly but short of sticking them in the Work house, whats your alternative? or maybe you think we should bring back the victorian solutions to the feckless?

Yes, if the government want to make all these savings...

There are people pretending to live alone when in fact they have their boyfriend there (who is down as living with his Mum and Dad).

Why arent these places raided weekly?

Where I live there are a handful of people I know of, both men and women, non working, that have been allocated a housing association flat yet not only live at their partners address they also sub let their flat out to working mates at a reduced rent and keep it.

The authorities have been told yet everytime its reported they write to them at said address saying that it's against rules to do so and will visit at such and such a date/time to check that they do infact reside there...

As of yet never been caught out as its not hard for them to pop back at said time and date to open the front door just to show their face and appease the authorities.

@Tracker1234 when we lived in Copenhagen they were red hot on this -whole teams of them, no warning- and the same with cab drivers too. It wasn't just about tax etc- it was about immigration too -obviously different for EU citizens (although still tight on tax for those too) but for everyone else - they were very tight on this- problem with the UK was it developed 'can't be arsed syndrome' - they simply didn't invest in having teams on the boil with this- relied it would seem on people being reported . It's one reason people thought UK was a soft touch with a black economy - word gets out there - other places are often way more stringent.

Its been like this for years. I wont use them but friends do because they are cheaper. Presumably because they arent paying any tax yet use all the facilities of this country!

No need if fathers pay for their kids.

💯%

But unfortunately there's so many fathers out there that find it simple to just walk away and impregnate the next women ready to be impregnated, 50/50 chance that they'll also be left lone parenting they're DC too...

Seems to work out very well for these type of fathers though.

Even if it’s a two parent working family?

How do you get money from absent parents who simply don't have any spare, even if working.... many have moved onto new families....

Well I'm centre left but personally feel that good quality child care should be fixed price and heavily subsidised like it was when we lived in Denmark for all children 9 months plus- earnings should be irrelevant- make it a proper career with good training too for those working in it so there can be progression -

It is totally mad that middle income women working full time and with a mortgage and particularly single mum earners are often only as well off as if they were doing 15 hours a week

No wonder we end up with a shortage of workers in some sectors, couples pretending to be single or separated , or working few hours but enough to keep the benefits system off their back and claiming instead- I admit myself I would be tempted if I was in that position and a low earner.