Child benefit cuts

We've been lied to? How unprecedented! :-)

Sure, but what next? If they're wealthy enough (in terms of having a very comfortable private pension), would you argue they should not need the basic state pension either?

If your baby had a need for heat, he could have cuddled up to mummy. More seriously, you could have just heated his room, and not needed to heat the entire house.

I didn't say it would. It would pay for part of it. The idea is to shift the holiday he would have taken in summer into the winter instead, which already makes it cheaper (being off peak) which means it can be a longer holiday than otherwise. The fuel cost savings would mean it could be longer still.

Nor do I, but even pensioners do generally have holidays.

But he already is subsidising a pensioner's whole cost of living, through the state pension. And you mustn't think of subsidising the holiday other than as indirectly subsiding the cost of staying warm.

I would certainly disagree with 1). Over 16s in full time education do not suddenly become cheaper.

Which is really easy during a period of high inflation, zero pay rises and rising unemployment.

In message , BartC writes

As did the woman who called a R4 program today to say that she was bringing up two children on about 1/3 of £45,000...

Anyone who is living to the limit of a £44,000 salary should heed the words of Mr Micawber:

"Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."

This does not alter the gross unfairness between single earner families and two earner families on the cusp of £44G salaries, if Osborne introduces these changes as planned.

If they become unemployed, then there's no problem: they will re-qualify for the benefit (of course they might realise that earning £45K and *no* child benefit is much better).

However you have to look at how other people see this: people earning double the average salary (and about 4 times mine), receiving state handouts!

And £45K is the very bottom end of the income band we're talking about; there will be people earning £1000 to £2000 a week or more getting state aid. That's not right.

Who told you that? I don't think it's been the case for years.

No. But a lot of things about tax are already unfair. Even forgetting child benefits, a couple, each on £44K, will between them get two lots of personal allowance, and two 20% bands, compared with just one of them earning £88K and the other staying home. (There used to be an extra married person's allowance, not sure if that still exists, but I don't think it's double a single person's)

(And similarly, as happened to me, earning almost nothing for a few years, then getting clobbered at 40% when I briefly earned good money. And if you stray into National Insurance, which is calculated weekly, there are odd discrepancies there too: you can pay more NI working 4 days Mon-Thurs than Fri-Mon, because the latter straddles two weeks.)

Who's better off, a family of 6 on a single salary of 45k or a single person on 12k?

They might use the public libraries, parks and the NHS too.

Only for those over 75 (or so). Cameron wants to reintroduce this - or a transferrable allowance rather than an additional allowance which makes more sense. They'll probably get this through - the LibDems oppose it but I think they agreed to abstain so the Tories would still get it through.

Yeah - like I've said before if you earn 3k over 3 months and nothing for the rest of the year, you'll pay loads in NI but get no NI credits. If you earn about 5k over a year you'll pay no NI but will get NI credits!

You can get NI credits towards the state pension without paying any NI.

You can be forced to pay NI but get no credits.

NI is charged as a percentage but the vast majority of NI benefits are flat rate, and even S2P is becoming flat rate.

NI is a tax, nothing more.

Are you sure about that last bit? I thought NI is only calculated weekly if you are in fact paid weekly, and is then charged to the week in which pay day falls, not the week which contains the days on which you worked.

To make it more realistic, let's talk about a family of 4 on £45K and a single person on £12K.

Around here, the single person might pay about the same in rent as the family (2 or 3-bedroom house, say £550pm).

He might pay about the same for water (£450pa).

About the same for a TV licence (£150pa).

A bit less in council tax (£900pa instead of £1200).

Roughly the same for heating and electricity (say £1500pa plus a bit more for the family for extra showers etc).

Also similar fixed car costs (say £1000pa for one car, not including running costs).

The single person does pay a lot less tax, some £1200, while the family I think would pay about £8000 plus NI.

So far, the single person is down to a mere £200.

Meanwhile the family is still on some £26,000 (less NI) !

The family of 4 also have the *choice* of splitting their income, where both parents work, for example into £35000 and £10000; that way, they keep child benefit, and have an extra £6K tax-free band. Plus of course there are the various concessions usually available to children, and young mothers. Plus other economies of scale which are more practical with more people in the house.

Are you still sure it's the family on £45,000pa who deserve the extra hand-out?!

I seem to remember asking once, and NI was a weekly tax, however you were paid. (Certainly if you were a casual worker, getting the dates wrong could result in extra NI.)

NI I think was 10% of earnings over £87, Sunday to Saturday (IIRC). £160 earned during the week would attract £7.30 NI.

Split across two weeks (eg. £80+£80), NI would be £0.00.

But they're still called NI credits which adds to the implication that NI pays for the state pension.

This is a different "class" of NI.

It seems it is nowadays. Although governments hide behind it being something different by promising no income tax rises but instead increase emloyee's NI, which amounts to the same thing as far as the employee is concerned -- less takehome pay.

I'd definitely say there would be a problem. The family would get substantially less income even with the reinstatement of the child benefit.

That was the principle of this universal benefits. Also remember that middle income and wealthy are not eligible for /most/ benefits. However it's the details of this proposal that I really object to, particularly the "anomalies" that GO describes.

Well I disagree. £45K is an absolute value and does not reflect the actual discretionary income. In some cases a salary of that would lead to the family being able to save and, in another, it would be a struggle.

In addition children will benefit everyone in the future by earning money and paying tax. Childless people still get the benefit of this through their pension and in many other ways. I think it is right that some taxpayers money is invested in this way. You'll get better returns on this investment ;-)

You must live in a very different area than me since I would come up with very different figures. Rent or mortgage on a family house would be about 4 times as much as your figures here. As this is a rural areas most families have two or more cars since they cannot travel to work by public transport. According to the AA the annual running costs of a small car is about £2000. A family car would be at least double this.

How? Ask their employer for a pay /cut/?!!! This also assumes that the partner is able to find employment and someone else to look after their children.

This does illustrate how the system is unfair on families where one partner looks after their own children. Personally I think that parents /should/ look after their own children, rather than farm them out and I am opposed to the system which discourages looking after one's own children. I know loads of people who felt forced to return to work after having children.

Unfortunately this is a myth. The cost of bringing up children is much greater than any concessions could give. And the economy of scale sounds nice but does not happen in the real world.

Some of them do certainly.

I had thought of that myself, but with a seasonal variation.

So why does someone who doesn't pay NI get credits, if NI is "paying" for his pension?

No it isn't. The normal employee class 1. I've already said how in this thread (eg working part of the year).

Yup.

OK.

So you expect the single person to have the luxury of living alone, with his own kitchen, toilet etc exclusively for his own use, while the family of 4 have to share the same facilities?

If you want to compare like with like, compare the single person sharing a house with 3 other people. Then he'll have the same standard of living as the family.

Or 112 is he shares his accomodation like the family.

Or 37.50 if he shares.

Or 300 if he shares.

So again you expect the single person to have his *own* car whereas the family should share a car of the same size/expense??

And the difference will get greater, the family will pay more NI and the same tax as from April, the single person will pay less tax and less NI.

Try again assuming the same standard of living.

Do you think the family should survive of the same amount of food as a single person too?

Do they? Do you think it's easy getting 2 jobs which never overlap in time, so there's always some at home to look after the baby?

It shouldn't be a handout. We should have a system like France, where everyone gets to use their tax allowance against the salary that supports them, whether or not they earn the money themselves. I think children get half an allowance, so a family of 4 with a single earner on 45k would get 3 allowances to set against that salary, and the tax bands would be 3 times wider.