Northern Ireland’s middle-class loses out in plan to slash child benefits
Thousands of Northern Ireland's middle-class families will lose their child benefits under drastic moves to slash welfare spending.
Chancellor George Osborne unveiled a package of measures to save billions that includes axing payments to higher rate tax earners — workers on around £44,000 — from 2013.
The measure will cost affected families with one child £1,055 a year, two-child families £1,752 a year and those with three children almost £2,500.
Government records show around 238,000 Northern Ireland households receive the payments and party aides predict that the changes will affect around 15% of recipients here.
That would mean up to 36,000 local families losing out — around three quarters of the province's 40% rate tax payers.
Addressing a packed party conference in Birmingham, Mr Osborne insisted the move was “tough but fair”.
Critics, however, were quick to point out that lone parents and families with stay at home mothers or fathers will be hardest hit by the change as it takes no account of joint incomes.
That means a mother and father who both individually earn just below the cut-off point would still be eligible for the cash, even if they have a combined income of £80,000, while a single parent bringing in £45,000 would lose out.
SDLP Social Development Minister Alex Attwood said: “None of this has gotten through the House of Commons yet, people should remember there's a coalition Government.
“At the end of the day any welfare reform or benefit cuts are subject to the will of the Westminster Parliament, and there's a lot of opposition over there.
”In any case, there's a good |argument for Northern Ireland, given our circumstances, that some of this stuff shouldn't come down the tracks. That's what me and the other ministers will do, argue robustly the case for Northern Ireland.”
It is the first time the universal payment has been touched and it is a tricky pitch to make to core Conservative voters, many of whom will be hit.
Mr Osborne insisted that everyone had to play their part in reducing the UK's structural deficit, but left-of-centre think tank the Institute for Public Policy Research attacked the “crude” cut and called for child benefit to be taxed as a fairer way to save the taxpayer the same amount.
Deputy director Kate Stanley said: “George Osborne's proposals go further than even Mrs Thatcher dared to go. The welfare state will only survive if it has the |support of the middle classes and child benefit is their key payback.”
Shadow work and pensions secretary Yvette Cooper attacked the move, saying: “Of course there are difficult choices to make and we need reform, but it's better to get the economy growing faster and raise more tax from the banks than to cut support for children in middle income families.” Mr Osborne also declared an end to unlimited bills for welfare by announcing a cap on payments so no household can claim more than the average family earns.
He pledged to “make work pay” by hitting families that make no attempt to work but drain the state of tens of thousands of pounds. “For the first time, we will introduce a limit on the total amount of benefit any one family can receive,” he said.
“Unless they have disabilities to cope with, no family should |get more from benefits than the average family gets from going out to work.”