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Forum Home  →  Discussion  →  Children and childcare  →  Thread

Child Benefit could be abolished and subsumed into Universal Credit…

 

Paul_Treloar_AgeUK
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...at least that’s what I’ve just been reading in something from the Resolution Foundation.

The analysis shows that, as well as being worth less, Child Benefit is no longer universal. The effect of tapering it away once someone’s earnings reach £50,000, and the complete withdrawal once earnings reach £60,000, is that one in five families no longer receive Child Benefit in full. The analysis also shows that families with a main earner between £50,000 and £60,000 can face marginal tax rates of over 70 per cent, due to the tapering of CB.

The Foundation warns that if these thresholds continue to be frozen, CB recipients will soon be overwhelmingly concentrated in the bottom half of the income distribution. At that point it says, the government could abolish Child Benefit and subsume it in to Universal Credit, as there is no point having two systems of means-tested benefits for the same group of families.

I’d be rather more circumspect personally about giving this shower any bright new ideas myself….

40 years on from its introduction, future of child benefit in doubt as its value falls to record low

     
Vonny
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these 1 in 5 families are unlikely to be living in south-west Wales!

     
Elliot Kent
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I suppose the point is that if inflation continues and there continue to be no increases either to the ChB rates or the point at which it starts to be tapered, we will eventually reach a position where ChB is only of interest to people who are either unemployed or on very low wages. As we reach that point, it would eventually become sensible to roll ChB into UC - as the people who want ChB will pretty much all be getting UC anyway.

This position only really applies if there are no increases either in the rates of ChB or the income level at which a taper is applied between now and 2039. Either can be changed fairly easily by the government of the day. If we end up in a situation in 2039 where £50k is considered an average salary but benefits are still frozen at 2013 rates, we will be having bigger problems than the abolition of ChB.

The article does a pretty good job of showing how ChB has diminished in value but I’m not sure its really assisted by that point.

     
ClairemHodgson
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and the other point on the introduction of child benefit back in the day - it was generally the only bit of money the woman in the house could call her own if (as many did back then) it was the husband that controlled the finances.

     
Pete at CAB
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If it is eventually subsumed into UC would the two child limit then apply?

     
Mike Hughes
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ClairemHodgson - 02 April 2019 10:09 PM

and the other point on the introduction of child benefit back in the day - it was generally the only bit of money the woman in the house could call her own if (as many did back then) it was the husband that controlled the finances.

I am constantly surprised how much this very much remains the case.

     
ClairemHodgson
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Mike Hughes - 05 April 2019 03:08 PM
ClairemHodgson - 02 April 2019 10:09 PM

and the other point on the introduction of child benefit back in the day - it was generally the only bit of money the woman in the house could call her own if (as many did back then) it was the husband that controlled the finances.

I am constantly surprised how much this very much remains the case.

i’m not.

     
MartinB
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Paul_Treloar_AgeUK - 02 April 2019 04:19 PM

...At that point it says, the government could abolish Child Benefit and subsume it in to Universal Credit, as there is no point having two systems of means-tested benefits for the same group of families.


Other than when your UC or other benefits stops you would still have a source of income, to feed your children.

     
Sarah-B
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Abolish UC and reinstate Child Benefit as a Universal Basic Income for all children… that’s my personal view!