Child Benefit - what to do?

dvpower

Mary Hannifin was on the radio at the weekend confirming that in the next budget there were definitely going to be changes to child benefit.

The Indo today had a short article outlining the options:

1. Cut the rate: Easiest way to do it and the preferred choice of Bord Snip. Colm McCarthy says €513m can be saved by a 20pc cut or by introducing a standard rate of €136 for all children. But it's not fair as it targets everybody, regardless of need and income.
2. Means-testing: Similar to a third-level grant, the payment would only be made to those under a certain income. But it's a bureaucratic nightmare and how do you evaluate household income if the mother is not married?
3. Taxation: The welfare payment is still made, but it's taxed as regular income so that the exchequer gets a slice of it back. Again, the problem arises of how to tax the income if the parents are not married or if they are not jointly assessed under the tax code.

So, given that cuts are inevitable, what option or range of options would be best?

I'm tempted to go for option 1 myself; maybe not the fairest, but certainly the simplest solution.

Kernel

Was reading this in the Indo. As you say, option 1 is not fair. Option 2 is fair but too difficult to implement bureaucratically apparently. Option 3 would work well for those in joint tax bracket. What about a mixture of the two. Single mothers (living with the boyfriend) take the cut, and people on joint incomes have the option to be taxed?

It may seem discriminatory, but I think it's pragmatic in the face of the current scamming, and also gives a nod back to the special constitutional role of the family. It's just a quick thought, I'm open to correction on it.

Realistically though, she'll just cut it, as the government are incapable of any organisational skills or innovative thinking beyond changing base rates.

Tipp Man

Isn't it about time that every man/woman/household in this country made an annual tax return whether they are PAYE, self employed, social, whatever?? That way all income is assessed for tax - it sickens me when you hear stories of families getting 3,800 monthly in social - that is a taxable level of income and just like my company car is taxed so should their housing allowance!!

It also means then that items such as childrens allowance can be taxed on those who earn enough and not on those who don't, makes means testing for collage fees (example)so much easier. its pretty simple

Plenty of countries go down this route so i don't want to hear that it couldn't be done from an admin point of view, god knows there's enough f##kers on public service salaries,

Carawaystick

cut child benefit by x and add x to the dole payment for children?

Or

tax child benefit. the social welfare know your tax number. the taxman knows it. link the systems to track this instead of moaning about it.

Tippman has a valid point, if you've a monthly income above the tax credit limit, pay tax on it.

j1smithy

I imagine a combination of options 1 and 2 may be used.

gurramok

Cut the benefit for 3rd and subsequent children, its just a huge subsidy not to work and have more kids.

FlutterinBantam

Good idea there, I would agree with that.

ninty9er

Tax it at the marginal rate...which should be increased! Leave the standard rate where it is or cut it.

irish_bob

gurramok wrote: »

Cut the benefit for 3rd and subsequent children, its just a huge subsidy not to work and have more kids.

too right , encourages fecklessness of the highest order

Tricity Bendix

A blanket cut would be totally unfair, and potentially disastrous for the government.

Cutting it after a certain number of kids doesnt really make much sense. Its not like they stop costing money. And the idea that people will base the decision on whether or not to have a child on child benefit sounds a bit off.

Best idea is to tax it. Its not large families we should be hitting, but wealthy ones.

gurramok

Tricity Bendix wrote: »

A blanket cut would be totally unfair, and potentially disastrous for the government.

Cutting it after a certain number of kids doesnt really make much sense. Its not like they stop costing money. And the idea that people will base the decision on whether or not to have a child on child benefit sounds a bit off.

Best idea is to tax it. Its not large families we should be hitting, but wealthy ones.

Kids do cost money, ask any parent. Having kids is a choice, having 2 kids is a natural population replacement for the nation and yes should be subsidised to an extent.
Having more than 2 is not needed and should be borne mostly out of the parents cost. Lots of people don't have loads of kids and don't see the necessity of their taxes subsidising them or their parents lifestyle who maybe on welfare.

At the moment, if you are out of work and have lots of kids 'without a father', you're lifestyle is subsidised by the taxpayer through rent allowance and child supported payments.

At the moment, there is no incentivisation for that mother to stop having kids and return to work and then have kids out of her own expense.

ninty9er

Tricity Bendix wrote: »

Cutting it after a certain number of kids doesnt really make much sense. Its not like they stop costing money. And the idea that people will base the decision on whether or not to have a child on child benefit sounds a bit off.

I think the point is that it's €38 a week for kids 1 and 2 and €47 per week for subsequent kids.

If anything economies of feeding should kick in at 3+ so maybe a half rate for 3rd and subsequent children.

If you can't afford kids, don't have them. It would be unfair to the child above anyone else.