[Closed] child benefit..

We'll likely lose it, and with three kids, it'll be a noticeable amount, £200 a month. But we never really needed it, and if it hadn't been around fifteen years ago wouldn't have influenced our decision to have kids. Not qualifying for WTC/CTC either. There used to be an argument that the state gives at least symbolic support for family life, but that seems to have gone too. I remain unconvinced that anyone getting around or above the average wage should be getting any benefits, massive bureaucracy and skewed labour market results. Plus the opportunity for politicians to keep offering rises come election time only to find the country bankrupt by the time the next election comes round.

Don't forget, some people here live in one of those parallel universes. You know the one, where you can live a 5 minute walk from your work, or where public transport exists.

Like tram systems perhaps? 😉

rkk01 - Member
After all, the furore about the £26k (?) benefits cap was quite enlightening. What does 26k after tax equate to as an earned gross salary equivalent? - must be somewhere in the mid 30s????

I can see your point that someone could in theory "earn" £26k tax free in benefits. One person would need to earn just shy of £35k gross to end up in the same ball park.

But when my CTC notice arrived for 2012/13 the upper cap was £26k, gross. As a family we are now £240 a month worse off.

I've had mixed fortunes with jobs / redundancies / jobs over the last few years. I went from circ £30K to £14K and now back up to £30K. Plus The Wife now works part time. I can testify that £30K is bloody comfortable compared to £14K.

I can only dream of the "hardship" that £42K must bring.

very few public servants will ever get into that £40 000+ bracket. So how do you think nurses, teachers, etc manage in the south east?
simple - its cut your cloth according to your means.

Still avoiding the question up in your ivory tower tj...

what jambo? I pay around £300 a month - dead cheap. I do live in a one bed flat in a non posh part of town.

[i]very few public servants will ever get into that £40 000+ bracket[/i]

Well, not until they retire that is 🙂

When they'll then take out a big lump sum and have a final salary pension - which is why the rest of us need to pay higher taxes.

[i]what jambo? I pay around £300 a month - dead cheap. I do live in a one bed flat in a non posh part of town. [/i]

As said TJ, you've no idea of the costs involved for the majority of us.

Ah but I do BR and the point remains no matter what your costs are earning in the top 10% of earners makes you well off which is the basic point

My heart bleeds for all these people on the breadline on £42 000 pa who cannot possibly live in a cheap house.

90% of the population don't get these choices including the vast majority of public servants. you know -the folk who empty your bins, the ones who teach your kids, the ones who look after your granny when she is ill, the ones run all the services you take for granted. they have to live in the south east as well and they do not earn £42 000+ PA

Reality check required please

TJ is absolutely right of course.

it's just a shame that his point is lost in the pious way he posts it...

(100!)

And TJ - have you ever been to Romford? Its a war zone.

LOL. Plenty of places you could live in Essex within commuting distance to London where you could rent a family home for less than 50% of your take home on a 42k income. It's a simple measure to implement I guess. I know that simplicity means there will be some losers in this scenario but most people with at least £40k coming into the household should be able to adjust with only a reasonable amount of pain IMO. Have a look at the changes to WTC if you want to find some people who are about to really suffer 🙁

Agree with ho hum, takehome is an indication of wealth, but it should not be taken in isolation. Those who have managed to scrape themselves onto the housing ladder for the first time in the last few years are saddled with pretty big outgoings. Those with more modest incomes but cashed in on the equity boom are in much much better positions. The majority of my colleagues in their late 30s early 40 s are in nice family homes and pretty close to paying mortgages off.....things are very different for those in their early 30 s. My poor sisters in their early 20s are resigned to living at home until their thirties! Salary is a bollox way of determining if someone is wealthy.

Back in the days when child benefit was introduced there was a real need for it, but many decades of rising living standards later, can it still be justified? I think not. In the depths of my old shed I have a slowly rusting tin dating from the early sixties that once contained state-issued milk powder for infants, I may well have drunk some of it. AFAIK the state doesn't issue tins of milk powder anymore so shouldn't the child benefit be reduced over the next decade, then be abolished?

The state [i]does[/i] still pay for baby milk for those on the lowest income.
You recieve a 'healthy start' voucher and use it to pay for the milk at a shop ,rather than having to collect it from the health centre, thats the only difference.

TJ - the point remains no matter what your costs are earning in the top 10% of earners makes you well off which is the basic point

However, generally speaking I don't think most people have an absolute objection to getting rid of the benefit for high earners (although tell anyone that they will loose say 5% of their net income and they will understandably be concerned) - inevitably anyone just the wrongside of the threshold wishes they weren't. What I do hear people objecting to is that HOUSEHOLDS with earnings just over the limit from a single earner will loose the income but households with joint incomes will not, and perhaps most concerning households with joint incomes at the top 3% will still qualify...

HMRC stats for income.

Amusing graph on page 10.

Basically, if you're in the bottom 90% of earners, your salary has been slowly increasing over the last decade.

If you're in the top 1% of earners, though, your salary has gone up around 60% in the last decade.

I guess because you're worth it.

And that was under a Labour(champagne socialist swigging)government!

Where did this top 10% figure come from by the way? I noticed [url= http://www.bbc.co.uk/news/uk-politics-17256946 ]Nick Robinson said " only [u]15%[/u] of people earn enough to be higher rate taxpayers."[/url]

Other google sources say there are currently 3.74 million higher rate tax payers. And the IFS says 1-in-4 will be higher rate taxpayers by 2015. As I said, this isn't some wealthy elite in gold plated hot tubs we're talking about.

poly has it right - the issue is fairness.

Suggesting that higher earners may not need the Child Benefit is fair. It's rather against the idea of a universal benefit, but fair.

However removing the benefit based on one salary, while allowing households with far higher incomes to keep it is unfair.
Likewise expecting households with children to suffer much greater benefit cuts than those without is unfair, especially at a time when funding cuts means they already suffering due to various child facilities and support services being withdrawn.

Graham S, the only caveat I'd have against your point above is that a dual income family might well have a healthy childcare bill.

Where did this top 10% figure come from by the way?

HMRC. But it turns out that the "top 10%=£40k" statistic is from 2008. Google is your friend.

How about flipping the argument on it's head. How much money will be saved in removing child benefit from the top 10% compared to the cost of administering it?
Miss CD is from Denmark, a country often put forward as having one of the best standards of living and social care in the World. Their child benefits (and may other) are universal and most women are only out of work for a year when they have a child where as in the UK women often have to take a career break for 5 years as childcare costs are so high. Consequently they have far more women in you positions that we do. It could be argued that in the UK by achieving 'fairness' based on salary we could help create (continue) gender inequality.

Graham S, the only caveat I'd have against your point above is that a dual income family might well have a healthy childcare bill.

As someone in that exact position, I'd definitely agree 😀
Childcare costs can be crippling and there is a definite consideration of [i]"is it worth both of us working when the childcare costs are practically one salary?"[/i]

Someone will be along to tell you you shouldn't have had kids 🙄

Indeed. I've got money on who it'll be too 😀

Before tax people in the 90th percentile get £46,600 (09/10).

After tax people in the 90th percentile get £39,200 (09/10)

Here is an informative table:

[img] [/img]

[url= http://www.hmrc.gov.uk/stats/personal_incomes/statistics-release-note.pdf ](source)[/url]

I may just need a coffee, but I have no idea how to read that table or what it shows. Can you explain it and where you get your £39,200 figure from?

The table refers to the cumulative amount of tax (in millions) per salary group and numbers of people per group are in thousands. Hence those earning over £30k pa, 5.4million people pay the largest amount of tax (cumulatively) but are the biggest group.

You shouldn't have kids.

tonyg2003, ta! I'm being a bit slow today.

So... the 30k is lower limit. So the range means 30-50k, yes?

Looks like that is the second biggest group with 5,490,000 people, with the biggest being 20-30k with 6,800,000?

Why the odd distribution of the ranges?

And how does this relate to the £46,600 pre-tax, £39,200 after tax figures that CaptJohn mentioned?

TandemJeremy - Member
very few public servants will ever get into that £40 000+ bracket. So how do you think nurses, teachers, etc manage in the south east?
simple - its cut your cloth according to your means.

Erm, they get things like London waiting, first dibs on shared accomodation etc.

Things that we are unable to get because we both work and are just above the cut off line. The fact that we both work and pay a fortune in childcare is not taken into account - apart from by the mortgage lenders who say that we earn too little disposable income to warrant lending money to.

very few public servants will ever get into that £40 000+ bracket. So how do you think nurses, teachers, etc manage in the south east?

This is disingenuous anyway

GrahamS - Member
I may just need a coffee, but I have no idea how to read that table or what it shows. Can you explain it and where you get your £39,200 figure from?

Sorry different table: [url= http://www.hmrc.gov.uk/stats/personal_incomes/statistics-release-note.pdf ]table 3.1 page 33[/url]

rkk01 - Member

"very few public servants will ever get into that £40 000+ bracket. So how do you think nurses, teachers, etc manage in the south east?"

This is disingenuous anyway

Why? Its perfectly valid. It just shows how out of touch with reality you are when you perceive a salary level available to very few in the public sector to be not enough to live on

Ah gotcha thanks.

So you're saying that to have been in the Pre-tax Top 10% (for 2009-10) you had to earning £46,600 or more before tax.

And to be in the Post Tax Top 10% you had to be left with £39,200 after tax.

Hmm... doesn't that mean you can be top 10% pre-tax but not post?
[url= http://www.incometaxcalculator.org.uk/index.php ]According to Stanley[/url] a salary of £46,600pa in 2009-10 should leave you with £33,805 after paying £8,570 income tax and £4,224 NI.

Why? Its perfectly valid.

Apart from the points about scott_mcavennie2 raised about things like London weighting and access to hospital-provided or subsidised accommodation. Plus other benefits outside the salary/tax scheme that are not available to non-public sector workers.

It just shows how out of touch with reality you are when you perceive a salary level available to very few in the public sector to be not enough to live on

No, it shows how crappy some public sector salaries are (Which is why they got those good pensions in the first place).

And I never said it wasn't enough to live on, I said that outgoings can be such that even a top 10% salary [i]can[/i] still leave people with very little disposable income. Having £50 spare in a month (as per rkk01's example) is not my idea of "well off".

Why? Its perfectly valid.

No, I don't believe that it is.
To quote:

very few public servants will [b]ever[/b] get into that £40 000+ bracket

I am sure that there are very similar proportions of workers in both public and private sectors who aspire to, and proceed to, positions of higher responsibility and are therefore paid within those salary levels.

Teachers pay scales extend into mid to high 30s, even without additional allowances. Those that progress to management positions can expect to get paid well into the 40-50+ brackets.

It just shows how out of touch with reality you are when you perceive a salary level available [s]to very few in the public sector[/s]* to be not enough to live on

I've not said that it is not enough to live on. A salary of 40+ should provide a very comfortable lifestyle.

The point that I am arguing is that it does not equate to being "wealthy". To pitch the 40% threshold as a definition of being welathy is rather blinkered

* already demonstrated to be falacious

You really are so far out of touch its not funny.

the top 10% of earners not wealthy?

The vast majority of public servants will never get close to £40 000. Teachers are one of the few groups that can get close. Virtually no others can at all. Almost no nurses will - only a very few that get to higher managerial grades managing multiple units will. Local government workers - bin men, school dinner ladies, care workers in council run homes, council workers of all types. £40 000+ is riches to be dreamt of not acheivable saleries

You really do need a large reality check.

If you've got a wife, children and a mortgage on a house in the SE to pay for, you won't feel wealthy on £40k.

You may not [i]feel [/i]wealthy but you are as 90% of the workers of the country earn less

The vast majority of public servants will never get close to £40 000. Teachers are one of the few groups that can get close. Virtually no others can at all. Almost no nurses will

The amusing thing about your protests TJ is that I am not a Higher Rate Tax Payer, but my wife, a public servant, is.

As for nurses, hmm...
Band 7: £30,460 - 40,157
Band 8: £38,851 - 80,810
Band 9: £77,079 - 97,478

Plus inner London loading of up to 20 per cent of basic salary (subject to a minimum payment of £4,036 and a maximum payment of £6,217).

http://www.rcn.org.uk/support/pay_and_conditions/pay_rates_2010-2011

If you've got a wife, children and a mortgage on a house in the SE to pay for, you won't feel wealthy on £40k. till you retire and see what the house is worth

FTFY
Someone who was not wealthy would not have the mortgage

You may not feel wealthy but you are as 90% of the workers of the country earn less

If you earn a million pounds, but I take away £999,999 can I still call you a millionaire?

Do you live in a palace with staff and a few cars and three holidays per year to exclusibve resorts but claim you are poor because there is nothing left at the end of the year due ot the "upkeep" of the stately home etc

It is interesting you could earn less than 40 k and be "better off "oop North with a cheaper house for example. That said I still dont see how we can call the top 10% of the uk population anything other than well off.

Looking at those Band figures Armed Forces Nurses earn significantly more than their NHS counterparts, and thus £40k is attainable at a lower Rank/Band.

That's really the issue isn't it? People have an expectation that if they earn £Xk salary, they can live a certain lifestyle, have a certain quality of house/area/car/holidays/etc. which then eats into that extra money and means that they don't have much more disposable cash than when they earned less.

And that's basically why TJ does have a point, though I'll reiterate that the way he presents it as ever makes it hard to win any one over...

Thats right graham s - only those on band 8 will get into 40% tax band and those are only those very few nurses managing multiple units get band 8.

A few at the very top of band 7 working in inner london might just scrape in. Again very rare - thats people who have had senior posts for many years - again a tiny minority.

a very few % of nurses will ever reach these levels