Government to review child benefit cuts

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Was on lunchtime news (on phone so can't do link) that the government have confirmed that they will review the plans to cut child benefit. Sounds like they will still do something - what do people think we will end up with?

Still no announcement on the NI credit, though.

Which is probably far more valuable in terms of one's long term financial planning. And it really breaks the principle of individual taxation if partner A's current NI credit is withdrawn because of partner B's income.

Only sane answer is to scrap the whole silly, ill-thought out plan. Keep it universal. No additional admin costs. Freeze (or even reduce the cash amount) to erode the cost over time. Increase instead CTC.

I have no idea dragon

And what about Dave and Nick et al saying before the GE how important CB was and how universal benefits would be protected???

sigh.

Is it just me but every time its been on the news they are talking about people earning 42 grand because their wives stay at home to look after the children.Are they completely ignorant that some two income families still earn less than that? Just another example of how out of fecking touch the govt are with real people.
Also he assumption that the "wives" are staying at home to benefit the children sticking two fingers up at those of us who have no choice but to work
Irritated i tell you irritated.

I agree dragon. I claim CP and work tax at the standard rate because I do work outside the home. Apparently I'm supposed to turn around and say 'Yes please remove £188 (three dcs) every 4 weeks from me because my husband earns so much.' Can this government even spelling 'demeaning'?

God the thing in these discussions that really pisses me off is the idea that every htrpayer has a little wife at home doing childcare. Dh is a hrtaxpayer and - I WORK PART TIME AND PAY CHILDCARE. We will be a bit more skint due to all the debt and childcare costs if we lose 242 every month. Thank you.

I am a sahm, I've always wondered how it was going to be worked out?

I receive child benefit for our children but dont class it as an income as it is split equally and saved into Thier bank accounts. We are fully prepared to lose this benefit as dh is a 50% tax payer. I guess we are currently eligible to receive it, but many would see that we are Not entitled to it!

Either way, I've thought it very unfair, and feel it should be awarded based on a household income and not one set salary.

That's another thing though - how is it ever going to be fair? Some people use it to save as above and others too live on and some people manage on 30k and some struggle on 90k - they should have just left well alone rather than make a stupid, badly thought out announcement which instantly gave rise to suspicions about their maths!

Yes indeed. Personally I've always absorbed the CB in to family income and paid for reckless luxuries like dcs shoes, yoghurt, apples and a sunday joint. We can manage without it but I will miss it because for three dcs it's not a small amount. Just relieved this is coming in as dd2 goes to secondary and dd3 is at school so childcare costs are falling.

2. Independant taxation - since when has a benefit paid to an individual NOT a family unit, been removed from that individual because of another person's earning?

3. HRP - what will replace this?

I'm still waiting to see how the whole principle of independent taxation will be compromised - they can have my cb if dh then gets my unused tax allowance. (Sent abroad with HM Forces, so even if I did work, no benefit to the UK as I'd be paying Belgian tax and NI).

HRP - I hope you are all aware that HRP has been withdrawn from when your youngest child hits it's 12th birthday? This was done from April 2010.....

see here www.direct.gov.uk/en/MoneyTaxAndBenefits/BenefitsTaxCreditsAndOtherSupport/Caringforsomeone/DG_10018691
and it wasn't the nasty Tories who introduced that piece of legislation!!!

Its on newsnight now.

Hear hear for the tory MP for Christchurch who said the government should leave Child Benefit alone on the basis they had said it would not be touched before the last general election.

It irritates me that they only talk about the unfairness of both couples earning 40K keeping theirs whilst a family with one earner on 42K loses theirs. To my mind, just as big an issue is the cliff-edge effect - 1p over the HRT threshold (which is being lowered every year) and suddenly you're thousands of pounds worse off. What a disincentive to getting a payrise! If you did that with tax credits, housing benefit etc there would be a massive outcry, so why is it OK to sting 'higher earners' like this?

I've heard the £50k figure bandied about but that would be a nightmare to administer. What if you get a bonus that just tips you over or you have a deduction made from your pay and are just under.

I think a sensible solution is to stop it completely for those in the higher 50 per cent bracket. For those in the 40 per cent tax bracket it should be stopped when the youngest child is 7.

would a Carer need to reaply to get HRP when their child reaches 12 then?

'And I will be controversial and say that if you can afford to SAH, you are better off than the average already. A lot can't afford to SAH. Our mortgage is half of DHs pay.'

I'm tired of explaining this. A lot of SAHP cant afford to work. I couldnt when the older 3 were small. Childcare for 3!! Now number 4 would require SN childcare which a, doesnt exist and b, cost £20 an hour. I still cant afford to work. DH earns 18K and our mortgage is half that.
And I'm up all night Caring.

What I find amazing is that everyone has swallowed the line that somehow it has to be parents with children who pay to fix the deficit. So, taking thousands of pounds away from HRT payers with children is somehow ok....

What about HRT payers WITHOUT children? They are not coughing up anything. We are losing 10% of our income, and we can seriously not afford this, it is a disaster. But not only will families on almost double our income keep the child benefit, but people earning a LOT more than us, and without the associated costs of children are not being hit at all.

It's bonkers.

Put a couple of pence on the HRT. That is progressive, in that the more you earn, the more you pay. There are no cliff edges. It is dead easy to administer - there is no extra admin. No unfairnesses. And I reckon it would raise more money.

In time I would like to see them restore the thresholds to where they should be - imo the HRT level should be about 70k or so, BUT I would then raise it significantly to about 45 or 46 p, and then abolish the 50% tax rate.

But please, don't swallow the line that it has to be families with children who are hit the hardest, at ANY level. Just as it is wrong that EMA is abolished whilst bankers bonuses remain rampant, it is wrong that families with children bear the entire brunt of the cuts, whilst high-earners without children pay nothing extra.

I became a sahm mum because the salary I earned full time didn't cover 2 in childcare. It wasn't easy to start, but dh was on a ladder with his career and and every year got easier, we only had our 3rd child because we could justify it. (We had luckily paid our mortgage off.)

Hazie, where did you pluck the age of 7 from? Many 40% taxpayers need that money. Maybe 12, moving into comp/seniors would be a better figure?

I agree it needs a over haul, but i don't actually agree with cutting it off at an age.

I think a better system were to award it to the first 2 children in every family only.

KalSkirata your DH isn't earning £42k is he? I just get ticked off when people earning £42k crying poor. That's more than a lot of peoples combined income. If there are two of your DH, you will still be on £36k, and you have childcare to pay.

A quick google found this article from nov 2011, which claims the median salary for a FT worker is £26,244. So yes, £42k is better off than a lot of people.

On lower incomes though you do get extras, because you will often still get CTC, WFTC, and sometimes other benefits too. At 43k or so you get nothing, except Child benefit. So you can't just compare salaries and say 'oh that's really well off', because it's not a direct comparison.

What about HRT payers WITHOUT children? They are not coughing up anything.

We now have a 50% tax bracket which was introduced as a measure to paying off the deficit. So I think they are coughing up quite a lot.

I do agree though that the fairest way is either pop a penny on income tax is fairer than the current CB debacle.

And 50% tax payers are also about to lose Thier pension relief!

Takemeout. Personally I think that CB should stay for everyone but as that isn't going to happen I made suggestions.

I suggested 7 for a cutoff because I think it is the age that those on benefits have to start searching for work. If you say 11/12 some people will argue that there is an inference that families with an higher rate tax payer can stay at home until their children start secondary school whereas single mums have to go out to work when their children are much younger. I know that CB was not supposed to be related to whether families are working or not working but it seems that the original aim of CB has been lost now anyway.