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IFS attacks 'incoherence' in child benefit cut

IFS attacks 'incoherence' in child benefit cut

The Government's changes to child benefit will create "incoherence" in the benefits system and introduce "a series of administrative complexities", according to a new analysis from the Institute for Fiscal Studies.

On Monday families with one parent earning over £50,000 will lose a proportion of their benefit, with those earning more than £60,000 losing all of it.

The IFS observation says the "biggest concern" about the policy is that, with the child additions to the new Universal Credit, there will be two parallel system of means-tested child benefit which have "completely different" ways of testing income.

The thinktank has also calculated that for 320,000 people the marginal tax rate between £50,000 and £60,000 will hit 50%, while bigger families will see a marginal rate of 65%.

The number of people affected by the cut will also rise over time unless the Government decides to raise the £60,000 threshold at which families lose all their benefit.

In addition to the rises, the change will also mean 500,000 more people have to fill in income tax self-assessment forms.

Labour seized on the report, with Shadow Treasury minister Chris Leslie saying it was "becomingincreasingly clear that David Cameron and George Osborne failed to think through how this policy would work in practice".

The criticism will add to Tory MPs' concerns that the cuts will disproportionately affect strong Conservative constituencies.

The Daily Mail reports that nine out of ten constituencies which saw the most complaints about the changes are Conservative seats in London and the Home Countries.

Green Box: IFS attacks 'incoherence' in child benefit cutClick to open

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