Child benefit cut unenforceable

[mcquade]

It has emerged that the scrapping of child benefit for upper rate taxpayers is unenforceable and the Treasury is in a flap about, having failed to consult civil servants before making its headline-grabbing announcement. Yet another mess. Full story here:

blogs.wsj.com/iainmartin/2010/10/28/child-benefit-cut-unenforceable-treasury-in-a-flap/?mod=rss_WSJBlog&utm_source=twitterfeed&utm_medium=twitter

Lusi - I don't disagree & I'm sure the investment banker family on £500k spend more on vintage wine than they will miss in ChB....but I did the figures based on a scenario similar to Milamae, whose DH is just in the HRT bracket and she was basically told "stop whinging, you're rich you must be your DH pays HRT"

I think the point BetsyBoop and Mia are making is that the family on £44K aren't rich, not that they can't make ends meet.

Who knows if lowering Housing Benefit will make rents (and house prices) go down. It won't solve the housing problem. There will still be more people in need of homes than there are homes available. Whether on HB or paying a mortgage, I think most people just want the opportunity to work and put a roof over their head and food on the table. (And maybe have a camping holiday if mumsnet is anything to go by). I can't see that any of these policies make that more possible. I think providing more affordable housing and promoting employment outside the South East would.

As well as CB for their children, HR tax payers are also entitled to free healthcare for their family, free education, an endless supply of library books etc. etc. In some countries they would also be entitled to free childcare. In other countries they wouldn't be entitled to healthcare or education.

If there isn't enough money coming in from taxes to pay for these things, of course they aren't possible. Anybody with a calculator can see that. However, the removal of universal benefits is the beginning of something that ends with means testing for all benefits and deciding that hey, we didn't need to pay so much tax after all.

People will just have to vote for what they want at the next election (and presumably that won't be 'the third way', whatever that was supposed to be).

I don't mean this to be an attack on Mila or any other individuals but something has gone very wrong in society if people on significantly above average wages feel they cannot cope without state benefits.

Water, would you be happier if the family on £44K were paying £10K tax rather than £12K, because I am sure the conservatives can fix that for you.

just to add another figure, scenario 3 (FT on £15kpa) in net terms is roughly the equivalent income of someone on £36k who claims nothing, once you have added in tax credits, ChB, HB, CTB.

So those on £15k £36k shouldn't be saying they struggle either?

It's just made me realise even more what a mess the country is in....

Not read the whole thread, but I think HRT payers with children 18 or under should always declare they or their partner is claiming CB.

Why? Because Government estimates 97-98% of eligible parents claim it! So the chances of someone erronously ticking the box are very small.

This is not a comment on the rights and wrongs of taking away CB from HRT payers btw.

I think one reason that families who earn over 44k are sounding vexed about CB reduction is that it is not fair. And, the Chancellor keeps saying it is Fair but Firm.

If someone earns 65 or 70 grand and loses their child benifit....they may not really mind....but the fact that their neighbours and friends could earn more as the both work, and they get to keep it all....this is where the annoyance comes in.

And also hambo, , the chancellor could genuinely be described as very rich indeed (although to be fair, through no fault of his own). That is a bit annoying too.

Also don't forget the chancellor avoids a lot of tax by keeping a lot of his fortune overseas.

Would just like to say if we weren't paying so much in tax and council tax and didn't have such an expensive mortgage for a relatively small house,hadn't had a pay freeze for 2 years already and weren't paying so much for food/fuel I wouldn't feel entitled to/need anything.

If I didn't need it I wouldn't winge.

Thanks Betsyboop your figures are exactly the point I'm making. I think free school meals should factored in as they'd be a godsend,mine don't have them as can't afford it X3.If you made them have a hot meal your weekly food bill could be halved.I feed 5 on £80 a week so would save £160 a month if we had free school meals. Also isn't there council tax benefit too for some or have you factored that in?

Dp is actually under the threshold and it's his overtime when he's lucky(he can no longer do due to loosing CB) that brings us very slightly over.

Also owning your own home brings a lot of bills you don't get if renting.

If the government reduce tax I'll happily give up CB. The fact is we pay a lot of tax and actually I don't see how having 1 benefit we actually need whilst we have young children is a lot to ask for especially when the tax we pay helps out a lot of people and gives some a similar amount in their pockets as us each month.

Actually aren't they going to be lowering the threshold to £38 K when they lower the HT so we'll be over the threshold and loose it whatever and be paying more tax to boot so Betsy you'll need to factor in the extra tax too to those figures.

Erm - ANYONE who works doesn't get free school meals for their dc. It doesn't matter if they earn £12K or £112K, they don't get free school meals.

And what extra bills do you have when you are buying that you don't have when renting? The ONLY extra's I can see are Life insurance and Building insurance. Those of us that are renting still have to pay council tax, contents insurance, utility bills, transport costs and food bills, please enlighten me as to what other extra costs there are that are not made up for by having your own home at the end of it, instead of being in insecure private tenancies where you could be forced to move with only 2 months notice? Incurring extra costs in removals and agents fees trying to a) get your deposit back and b) find another home at short notice. I would hazard a guess that these 'extra' costs balance each other out....

Boiler cover,windows,general wear and tear (eg our shower pump went the day we moved in so having baths still),the built in oven went too managed to fix it,fence blew down had to repair it to keep neighbours happy,cost a fortune.

There are many ,many things you have no control over that all add up,if you've got an old house(we haven't thankfully) it's eye watering. We've done zero DIY and won't be as general upkeep costs too much.

Not running but got to take the dc out will be back later.

And sorry, Betsy, but those of us working FT for an income of £16K pa will not be getting an extra £20K in WTC/CTC/HB. Don't know where you get your figures from, but they're wrong.

If the government reduced tax, then maybe we wouldn't need so much help from CTC/WTC. It's the fact that our tax bill doubled from 10% to 20% that has actually increased the amount we get in TC's. They can't reduce tax for HRT without bringing back the 10% rate for lower earners, there really would be riots in the streets then!

And Mila - My CT for a 3-bed mid terrace shoebox is £100 a month. We don't get any help with that, despite DP's shitty income. Fuel costs - push up bus fares to get DP to work & the dc's to school. DP - also having a pay freeze for 2 yrs. Do you think our food bill is miraculously smaller than yours? It is expensive for us as well! STOP being so bloody-minded and feeling that you are better than us and more entitled to the CB because your DP/DH earns considerably more than £16K.

WARNING: This following comment is meant tongue in cheek, but follow the message nonetheless : Why should DP pay 20% tax on earnings of £16K pa to pay for someone who's husband is earning £44K pa to claim CB?

OK boiler cover. At least you have the option of fixing these things. If they go in our house we have to wait for the crap LL to either fix it or tell us to shut up or find somewhere else to rent. Our fence went - LL refused to fix despite us having dc and it being near a main rd. Wer replaced it. Our cooker breaks - our house is rented unfurnished, we pay for it to be repaired or replaced. Do you honestly think that most LL's of private rented will fix these things, or tell their tenants that they can do it themselves if they want it done? Honestly, aside from boiler cover, your outgoings are probably no different (for essentials) than ours. You are just LUCKY that your DP/DH can earn waaaay more than mine. Luck. Not anything else.

You could say well DH went to Uni and worked hard etc etc. DP has LD, just wasn't possible. £16K is the MAXIMUM earning potential of my DP. I was earning £29K, having trained further (being able to). Got diagnosed with a disability that meant I was BARRED by LAW from doing the profession I had trained in. Dropping my earning potential from £29K to less than £12K. Can't work FT due to said disability (gets worse when in FT work,have tried), so my ACTUAL earning otential is just over £6K MAXIMUM.

Did I work any less hard training than your DH? NO. Did my DP work any less hard training than your DH? NO. Just shitty circumstances have led us to this point.

I have to pay for general wear and tear where I live too. Including replacing any of the 28 lightbulbs in the house when they blow.

And most of them aren't "bog standard" bulbs so they cost a bleeeding fortune.

)

The only appliance in this house the LL has any obligation to fix is the cooker and the boiler.

If anything else breaks, well it's mine and I have to either pay to have it fixed, replace it, or live without it........kind of like when we owned our own home.

And there's a vast difference between needing the CB to help with after school clubs etc, and it going on clothes and food for your DC already. If you can't afford food and clothes for your dc on an income that you pay HRT on, then you need to seriously look at your budget to work out where the money is going, if someone working ft and claiming TC's (and STILL getting a hell of a lot less than £44K) is managing to.

It all comes down to expectations, I believe. Someone whose DP is earning £44K expects to be able to afford to own their own home, go on at least one holiday (even camping) a year, run a car.

Someone whose DP is earning £16K exects to have to rent an overpriced shithole, never holiday (ever), not have a car and have to use expensive public transport.

People keep saying cut your cloth according to your means, but what if your means are...erm...crap? Should we not have dc? Should we not have a home? Even if we work hard ?(just as hard as someone earning £44K, just the wages don't reflect it!).

Mamo - you get a cooker ! We wish. Ours went 12 months ago, we are still paying for it in installments. It was the ONLY way we could have a cooker at all. Which is going to cost us an extra £150 in total by the time we've finished paying it off, but the dc had to eat!

i owned my own home. it was much cheaper than when i had to leave it in the recession and move into a council house.

i moved in to zero carpets, bare walls or worse crumbly plaster and patchy old wallpaper to be removed before you could even start, no cooker, washing machine etc obviously. i had to carpet the place as the floor was dangerous the way it was, decorate the whole house install cooker etc and in fact i had to pay to have wiring put in to the old cold barn because there wasn't room to have a washing machine and a fridge in the kitchen and there is no launderette round here.

the rent i pay is gone, the mortgage i paid would have given me a massive asset 20 years on.

i don't know what planet some people live on.

if you think you're hard done by whilst married, having three children and owning your own home and car in the south and can afford to have one adult not working at all then you will never be thankful. it wouldn't matter what you were given because your mindset is obviously set to poor me.

I did - but it was fitted - so he couldn't really take it with him LOL

And sorry, Betsy, but those of us working FT for an income of £16K pa will not be getting an extra £20K in WTC/CTC/HB. Don't know where you get your figures from, but they're wrong.

Loudlass - the figures come from entitledto I didn't make them up

I wasn't saying that it was an extra £20k "in the hand" but that it is the equivalent in total to earning £36k gross, as those earning that amount have to pay tax & NI on their gross income, whereas WTC/CTC/HB/CTB/ChB is paid nett...

Betsy and Loudlass don't forget those figures will be variable.

As a single parent of 3 children, if I were to work full tme for 15k a year, if you exclude the childcare element (as I haven't got a clue how much that would be yet) I wouldn't get 20k in benefits on top of my wage.

It would be just over 14k (and around the same figure for if I had a partner as well)

OK no tax on the WTC/CTC/HB, but still 20% tax on the £16K wages...and I suppose I was going by the fact that DP is on £16K and we don't get £20K benefits, didn't think about childcare, we don't pay any as I'm a SAHM.

Loudlass - even taking childcare out of the equation it's still variable.

LHA allowances vary so much across the country - mine is quite low here at £126 (full rate) for a 3 bedroom house, but certainly not the lowest around the country, and other areas are £250+ for a similar type or property.

That can make a huge variation in HB - and overall benefit "income" -as well as varying council tax rates across the country.

"Why should DP pay 20% tax on earnings of £16K pa to pay for someone who's husband is earning £44K pa to claim CB?"

I know it was tongue in cheek, but because you get the money back in benefits, so you make a net gain. You are paying about £3K a year, the person on £44K is paying about £12K a year.

To be fair, if you have children in school or any kind of serious illness, both the person on £44K and the person on £16K receive more from the state (once you include education and NHS) than they are paying in tax. However, it is not true to say that poor people are paying for rich people to have benefits.

On the other hand, if we are completely honest, healthy, childless HRT payers are paying for us all to have benefits. However that is how the welfare state works. You allocate resources according to need, and in exchange for higher taxes you receive benefits (or a family allowance as it was called in the old days) at times in your life when you have more need.

Again, if there is really a public appetite for a welfare state that relies completely on means testing, I am sure that if you vote Conservative enough times that is what we will get.