Child benefit change is right approach, David Cameron says

 

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

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It will be fully withdrawn where one parent earns above £60,000.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

 

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  • rate this
    +14

    Comment number 980.

    A married couple, both earning 30K, family take home (after tax) is £46K
    A married couple, one earning 60K, other not working, take home is 41.5K

    The taxation system already penalises single earner families, taking away child benefit is just another penalisation for being in stable relationship. The system rewards divorce!

    I agree with balancing the books, but the approach is ill though out.

  • rate this
    +4

    Comment number 979.

    He is living in lalala land! This is not fair - at the end of the day the child is going to be affected. It's okay for him, he's rolling in money!

  • rate this
    +3

    Comment number 978.

    As a lifelong conservative voter being the sole earner on £65K with 3 children this will have a massive impact on my family income. I find it completely unfair that a family with joint-income of nearly 50% more can retain this benefit. So much for the conservative support for the family unit and the 'big society'. I will never vote conservative again - as we are not all in this together!

  • rate this
    +2

    Comment number 977.

    i cannot understand how a lone parent eaning £50,000 can lose child benefit but a two parent family with both parents earning £49,500 each can keep their benefit surely it would be fairer to say over £60,000 per household would lose CB that way look at the money wasted on man hours,paper,postage would also be saved.

  • rate this
    +5

    Comment number 976.

    The Tories' 1% cap on benefit rises is a real terms cut for working people. Dave says this attack on the working poor is 'fundamentally fair' and 'the right approach'. He plays with figures: 1% of a benefit is far less than 1% of a decent wage. But so few get a decent wage, and that's our present problem, not benefits, however much Dave tries to distract us while he dismantles the welfare state.

  • rate this
    0

    Comment number 975.

    Damn benefit scroungers moaning about benefit cuts. Some might have to send the kids to state school - God forbid.

    -------
    -If you think a Charge Nurse or Warrant Officer in the Army or a Police Sergeant or Fire Service Station Officer all of whom lose all of their child benefit are sufficiently "rich" to send their children to fee paying schools you are as deranged as Cameron and Osborne

  • rate this
    +2

    Comment number 974.

    Why did he not just say we had to do this or we could not have lowered tax for the very rich and that would and that would of upset his friends and family

  • rate this
    +4

    Comment number 973.

    For David Cameron to stand on National Television and say its the right thing to do knowing that a family where both parents work could be potentially 40k better off just shows you what an incompetant idiot he really is. He's an absolue liar and should be stuck off for this sham.

    Surely stopping legal aid for terrosrists and prisoners and stopping international aid should be priority.

  • rate this
    +2

    Comment number 972.

    This is a great decision. All of you people wanting child benefits when you are on such high salaries are despicable. You claim that this is wrong and seem to want the right to child benefits because it is 'unfair' and you will have less money wreaks of greed. If you are earning wages that high you can afford to care for your own child. This sense of entitlement is partly why this country is broke

  • rate this
    +3

    Comment number 971.

    Bottom line is we are a country that suffers in silence, we will complain about child benefit but won't do anything, complain about rail fares and nothing will happen, about fuel prices and the cost of heating our homes, again do nothing.

    It's about time we stopped moaning as a nation and did something about it, because this country right now is shocking, what are we all working for anymore?

  • rate this
    +3

    Comment number 970.

    Child benefit is not a benefit it is a redistribution of tax to the carer of children. Kids are a fiscal responsibility for 25 yrs. Noone has suggested yet how much you need to save to be able to start a family

    Yes single people lose out but the vitriol; aim it at the establishment.

    How will universal credit work if CB can't

    People will die if this goes wrong so ask difficult questions

  • rate this
    -1

    Comment number 969.

    Martin-Niemöller

  • rate this
    0

    Comment number 968.

    Its only this government that is changing the concept of child benefit, DLA and such like into benefits that are paid to scroungers. We are one of the highest taxed nations on the planet so the state should give something back to parents and the disabled to help. After all DC claimed DLA himself. So if its OK for him why is it not OK for the rest of us.

  • rate this
    0

    Comment number 967.

    Child enefit should only be paid for the first child. If people choose to have lots of kids thats down to them. Whatever happened to " cutting ones cloth to suit."

  • rate this
    +1

    Comment number 966.

    Re 916.TheTakeleySocialist
    So true, so true. We`ve got the tabloid press to thank for turning the working class against itself. Divide and rule, and all that.

  • rate this
    0

    Comment number 965.

    "I still ask, how come the UK cannot afford it, even if choosing not to pay?"

    The uk could also 'afford' to give all your money to me, but that's not much of an argument to do it.

  • rate this
    +4

    Comment number 964.

    In months to come the nasty party will be able to claim the moral high ground as they start means testing other universal benefits.

    For that is what is in store.

    Nasty.

  • rate this
    +10

    Comment number 963.

    513.hellhesk
    My husband earns £50k then bonuses. Our daughters nursery fees are £900 a month. I currently work full time on a good salary. We have another one on the way. We need to move to a house suitable for a larger family.

    ==

    Why on earth should the taxpayer fund your lifestyle, your choice to have children and continue working and your choice to move to a larger property?

  • rate this
    0

    Comment number 962.

    @954 Kelly

    The extensions are probably for disabled kids, ones who need more care or mentally disabled kids. Or those trying to get through education that their families cant afford.. (so then they can get out of the poverty trap)

    There are some circumstances which do make sense in this context.

  • rate this
    +2

    Comment number 961.

    Finally something worth applauding the government for. If 2 people both earn double the average annual wage then they shouldn't have any child benefits at all. A cap on benefits for people with more than 3 children please! I'm fed up having to pay tax for someone who doesn't know what contraception is when me and my partner can't afford to have children right now.

 

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