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It will be fully withdrawn where one parent earns above £60,000.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
    +4

    Comment number 1000.

    Even though i will lose it i think its a good idea to overhaul child benefit but they should have gone the whole hog and scrapped it completely. What right do we have expecting someone else to pick up the tab for bringing up our children. UK people need to learn some maths and budget accordingly! I'm getting sick and tired of this entitlement culture we now live in!

  • rate this
    +3

    Comment number 999.

    941. CantSilenceMe - How thick are Tories? How thick do you think, they're tories! Don't expect them to understand that some on benefits, of which CB is one, will be troops returning from Afghanistan and Iraq with missing limbs and needing lifelong care, which of course, ATOS, in their wisdom will deem unnecessary, as they have for many others. If you expect tories to think, you expect too much.

  • rate this
    +5

    Comment number 998.

    If Cameron really believes in 'all in it together' then he would stop aristocratic families like his from setting their homes up as charitable businesses to avoid paying council tax.

  • rate this
    0

    Comment number 997.

    Life-long Tory, but never again. They have completely underestimated public opinion regarding the fairness of this, and it will prove to be the issue that stops them winning the next election.

  • rate this
    +2

    Comment number 996.

    Anyone on £40k + needs no 'benefit' of any sort - this greed pervades the UK.

  • rate this
    +1

    Comment number 995.

    Cameron and Osbourne are a disgrace! THEY ARE STEALING FROM CHILDREN!! Anyone who thinks that the people earning over £60,000 will not be affect are not in the real world. In most cases we will need to find 5% more salary to stand still. Osbourne & Cameron why don't you give 5% of your salary or your parents trust funds and see if you &your children notice it. We are all in this together, JOKERS

  • rate this
    0

    Comment number 994.

    How can this be a fair way of saving the government money when a couple could earn £98k jointly and get full child benefit yet we earn way less than that and are set too loose the lot?! It's obscene. We have 3 children, one who is disabled too. Thanks Mr Cameron.

  • rate this
    +4

    Comment number 993.

    According to Mr.Cameroon..
    If You work in Front of a Computer ...Betting/Speculating Finance then You are a Striver..
    Remember Work for Free (Slavery) for Teenagers..
    Can we Pls Pls Account/Audit the Bank of England ..a Big Usury Going on ..As the FIAT System Encouraged a Big Greedy ShadowBanking ..that is now Going around the World ...All Greedy..
    Liberal Democrat Should Abandon the Government?!!

  • rate this
    +2

    Comment number 992.

    Rather a poll tax than a tax on poles.

  • rate this
    +2

    Comment number 991.

    i read about these people who earn all this money,many in excess of £50k these are the people who are breaking this country pushing up the cost of living with their exorbitant wages,i did not know we had so many plumbers in the uk!

  • Comment number 990.

    All this user's posts have been removed.Why?

  • rate this
    -1

    Comment number 989.

    Little_old.... I think you'll find that the banking crash and recession started with the last government !

  • rate this
    -2

    Comment number 988.

    What a plonker for a prime minister we have, these people pay their taxes and DC has decided now to rob them of the little they get back from the government. He can still waste our taxes by giving billions in overseas aid instead of looking his own people.The next election can't come fast enough so we can get rib of these idiots.The three political parties are a waste of space it's our taxes.

  • rate this
    +1

    Comment number 987.

    I agree with the comments that CB is now outdated and unnecessary, scrap it for all and use the money for something else; I like the idea of free childcare for WORKING parents.
    I also the idea of families being able to combine tax allowances to allow better use across family incomes – now that’s a good idea

  • Comment number 986.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this
    0

    Comment number 985.

    This mealy mouthed government who were not voted in are totally destroying all that was good to take us back to the thirties cloth caps and whippets will be provided

  • Comment number 984.

    All this user's posts have been removed.Why?

  • rate this
    +3

    Comment number 983.

    952. chocolateninja said:@899 ioioos..."people breeding as a means to support themselves" You make your fellow human beings sound just like animals.

    And you suggested that its anyone's right to have as many kids as they want regardless of the burden on society. How is that fair on those being socially responsible?

  • rate this
    +2

    Comment number 982.

    Having children is your choice, not the states. Child allowance should've been scrapped decades ago.

  • rate this
    +1

    Comment number 981.

    967.neverastriker - "......Whatever happened to " cutting ones cloth to suit." "


    And what about the million people thrown on the dole courtesy of the banking crash and Coalition double dip recession?

    Should "cutting their cloth" also include culling some or more of the children just because they lost their job through no fault of their own...???

 

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