Child benefit change is right approach, David Cameron says

 

David Cameron: "This will raise £2 billion a year"

Related Stories

David Cameron has said the decision to remove child benefit from better-off families is "the right approach".

He told BBC One's Andrew Marr Show "85% of families" would get the payments in "exactly the way they do now".

The prime minister also said the government was "absolutely right" to limit most working age benefits to a 1% rise, which will be the subject of a Commons vote on Tuesday.

Labour's Ed Balls called the child benefit changes "perverse".

Mr Cameron's comments come ahead of the coalition's mid-term review on Monday.

Changes coming into effect from Monday will see families with one parent earning more than £50,000 lose part of their child benefit.

It will be fully withdrawn where one parent earns above £60,000.

'Fundamentally fair'

Analysis

If you or your partner get child benefit and either of you has an income of above £50,000 a year you may have to pay more tax from Monday.

The income that counts is confusingly called 'net-adjusted income'. In fact, it is your gross income before tax from all sources but minus pension contributions, child care vouchers, and gift aid donations.

If you live as a couple it is the higher income that is counted not your joint income.

If that income is more than £50,000, the person who earns it will have to pay a new tax called 'high income child benefit charge'. It will be collected through self-assessment and you must register with HMRC by 7 October.

If that income is £50,000 to £60,000, the charge will be less than the child benefit received on a sliding scale - at £55,000 it will be 50% of the child benefit received.

If that income is £60,000 or more, the charge will equal the child benefit received. In other words, one partner will get the child benefit but the higher earning partner will pay it all back in the new tax.

Q&A: Child benefit changes

Defending the policy, Mr Cameron said: "I'm not saying those people are rich, but I think it is right that they make a contribution.

"This will raise £2bn a year. If we don't raise that £2bn from that group of people - the better off 15% in the country - we would have to find someone else to take it from."

He added: "I think people see it as fundamentally fair that if there is someone in the household earning over £60,000 you don't get child benefit... I think it is the right approach."

Asked about government plans to cap working age benefits at 1% - including the rise in the pay of public sector workers, out-of-work benefits, and tax credits - Mr Cameron said "those are all in my view absolutely right decisions".

"We need to control public sector pay... we need to limit the growth of welfare payments overall - and that must include the tax credit system, and for those out of work it's right that their incomes aren't going up faster than people in work."

The prime minister also insisted the government was going "full steam ahead" with a packed agenda in the second half of its term.

In the wide-ranging interview, Mr Cameron made a number of major points, including:

  • He promised British voters they would be offered a "real choice" on Europe at the next election
  • On the economy, he said it was vital for a country to be able to pay its debts - maintaining "a low rate of interest" so it could borrow money cheaply
  • He said he was "absolutely determined" to overhaul the deportation system so the radical cleric Abu Qatada and others could be deported from the UK before they appeal
  • The prime minister also said he was "absolutely clear" Britain would defend the Falkland Islands in the face of mounting pressure from Argentina
  • He also confirmed he wanted to remain prime minister until 2020
'No pleasure'

Writing in the Mail on Sunday, Chancellor George Osborne said he took "no great pleasure" in reducing people's benefits but that it was needed to ensure a "brighter future".

Labour's Ed Balls says that the government should tax the richest people

Conservative Party chairman Grant Shapps told the BBC's World at One: "I have three children I've filled in the form. I totally understand and get how frustrating these things are."

Mr Balls, Labour's shadow chancellor, told Sky News the changes to child benefits were "perverse".

"It's a complete shambles," he said.

"We're going to have many many hundreds of thousands of people who will end end up filing in tax returns because they didn't realise they were supposed to apply by today not to get the child benefit.

"I've always supported a principled approach to the welfare state which we would call progressive universalism."

 

More on This Story

Related Stories

The BBC is not responsible for the content of external Internet sites

Comments

This entry is now closed for comments

Jump to comments pagination
 
  • rate this
    +3

    Comment number 20.

    As usual Marr goes easy on the PM regarding the abusive, offensive and divisive language used by IDS, Osborne etc regarding curtains-down scroungers.

    He knows many low paid WORKING families receive benefits and this language is being used as a propaganda tool to whip up hatred between the low paid employed and low paid UNemployed.

    What happened to one nation politics?

  • rate this
    +9

    Comment number 19.

    Cr*p Mr Cameron. So friends of ours who earn almost £80K between them keep their child benefit because they each earn less than £50K, whereas because I earn £55K and my wife doesn't go out to work, we loose half of our child benefit. "Fundamentally fair" - I don't think so!

  • rate this
    +6

    Comment number 18.

    But of course the Tories won't withdraw the Winter Fuel Allowance from wealthy pensioners because that's where the bulk of their, admittedly, small vote comes from.

    I know of a couple who use it to pay the air-con bill on their villa in Spain.

    Whilst others sit in cold.

    Perverse or what.

    That's Britain for you.

  • rate this
    0

    Comment number 17.

    Taking millions of our families to give to mostly corruption abroad in the guise of aid, and that is to be increased. We still can`t look after our elderly. So from just where is this idiot coming from.

  • rate this
    +160

    Comment number 16.

    I have no problems with cutting child benefits for the well off but the way this has been done is plain crazy. When two people can each earn £49,000 per year and they still get the child benefit but one person earning over £50,000 doesn't, where is the fairness in that?

  • rate this
    +23

    Comment number 15.

    Whether it is fair or unfair to reduce child benefit is something left and right clearly won't agree on but can everyone at least agree it is nonsensical that a family with two working adults earning £50K each lose no benefits but a family with one working adult on £60K lose all.

    I can only assume the reason the gov won't take into account two salaries is a computer says no situation.

  • rate this
    +15

    Comment number 14.

    It is not fair or morally acceptable or even good economics to make 99% of the population poorer while giving tax cuts to the remaining 1%
    It is not fair morally acceptable or good economics to pretend that the majority of benefit recipients are feckless wasters when most of them are in work often in the emergency services

    It is not fair to pretend 1 £60k income is more than 2 £49K incomes

  • rate this
    +12

    Comment number 13.

    How can it be fair that one couple, earning £60,000 get no child benefit while another, earning nearly £100,000, get all of it? The basic idea of removing it from better off families is fine, but the way that it's done is just ridiculous!

  • rate this
    +136

    Comment number 12.

    How can it possibly be fair?

    Family A - Mum earns £60,000 and Dad earns £0 = Total household income of £60,000 and £0 Child Benefit

    Family B - Mum earns £49,999 and Dad earns £49,999 = Total household income of £99,998 and FULL Child Benefit

    In what universe can that be considered fair?

  • rate this
    +38

    Comment number 11.

    Child benefit was designed as a benefit for families with children. It's obviously unfair if some families earning 100k get the benefit and some earning 60k get nothing. More bungling from the incompetents - the clock is ticking...

  • rate this
    +4

    Comment number 10.

    £2billion less towards children. £2billion more he can push towards supporting banks and buying weapons.

  • rate this
    0

    Comment number 9.

    Looked at rationally, this is, actually, a fair move.
    The problem is, this "government" shifts like sand...robbing Peter to pay Paul.
    I guess the theory is "divide and rule"?
    In the meantime, the truly wealthy, and the corporations, laugh at us all.

  • rate this
    +59

    Comment number 8.

    If two parents are earning £49,000 each their benefit isn't cut, but if a single parent earns £50,000 their benefit is cut.
    Cuts should be based on household income, and not individual earnings.

  • rate this
    +1

    Comment number 7.

    I always thought that "benefits" were for people who were poor

    Certainly the original intention of the post WW2 Welfare state was to help those who were the most in need and not to hand out money willy nilly to people who were already well off

    Means testing should be a basic requirement


    If you had over 16k of cash assets then you used to be ineligible for receiving unemployment benefit

  • rate this
    +8

    Comment number 6.

    Argh! How many times!!! Yes, it would be the right approach. IF IT WERE BEING IMPLEMENTED CORRECTLY!!

    Removing it when ONE earner is above 50k is fundamentally WRONG.

  • rate this
    -1

    Comment number 5.

    Cameron taking from the wealthy instead of the rich?

    Tory voters must be well annoyed with him

    First time he has done something I agree with

  • rate this
    +2

    Comment number 4.

    Sorry Mr PM you are anything but fair- how come no cuts on MP's income and expenses, how come your government has had no guts to name and a shame a single rich person evading tax-Come on you only want to hit those least able to resist

  • rate this
    +1

    Comment number 3.

    Great! Now how about increasing such benefits for lower-income families. The plate for the poor is not made more full solely by austerity-measures in the face of the relatively wealthier mate. Redistribute!

  • rate this
    -13

    Comment number 2.

    The whole tax & benefit system is over complicated, this is just an added unnecessary complication

    The 1980s Conservative Government simplified taxation & welfare, it seems clear that the Lib Dems are stopping this necessary clear out of Labour's welfare & tax creep doing the necessary

  • rate this
    +4

    Comment number 1.

    When the government cut the highest rate of tax from 50p to 45p for those on £100k, that was “giving money to the rich”.

    But when it, in effect, does the opposite, by cutting welfare to a couple on £100k, that’s “an attack on the family”.

    So are you “poor” on £100k if you have kids, but “rich” on £100k if you don’t ?

 

Page 75 of 75

 

More Politics stories

RSS

Features

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.