Osborne botches child benefit reform

Osbourne has received a heavy amount of criticism after his child benefit reforms seemed to lack sophistication. Image credit: Conservative Party

Osbourne has received a heavy amount of criticism after his child benefit reforms seemed to lack sophistication. Image credit: Conservative Party

It has been an uncomfortable week for the Chancellor George Osborne, after his announcement that Child Benefit would be cut for all those earning over £44,000 was met by outcry from both outside, and within, the Conservative Party.

Child Benefit, which was originally introduced in the impoverished era of post-war Britain, is viewed by many as a central feature of the welfare state, providing universal support to mothers and children, regardless of income. Yet with a Tory government in charge, that is leaning ever further towards the right, this all looks set to change.

Interviewed on ITV’s daybreak, and seemingly unaware of the backlash that would follow, Osborne announced the end to universal benefits, in a move that is predicted to save the government £1bn. However, the TV appearance did little to soften the blow for many Conservative MPs who expressed their concern that the cuts would only serve to alienate their core supporters – the middle classes.

Indeed, one senior Tory figure was heard saying: “Well, my wife will certainly be voting Labour now.”

There is a definite feeling among many that this is a strategy that has not been thought through

There is a definite feeling among many that this is a strategy that has not been thought through, with critics quick to point out basic anomalies in Osborne’s supposedly “uncomplicated” benefit cuts.

Under Osborne’s new proposal, dual income families earning under £88,000 will still keep child benefit, while single income families will be unfairly penalised. These basic flaws, visible to any who cared to examine the plans even superficially, revealed an alarming and unusually improvisatory nature to the new plans, which has done little to sooth the 1.2 million families who will find themselves considerably less well off come 2013.

The flaws in the policy have prompted Ian Duncan Smith, the Work and Pensions Secretary, to revise the cuts into a means tested universal benefits and credit system, that would be means tested rather than imposing a £44,000 cut off point.

Despite the fact that 84% of the population agree that those highest earners should not receive child benefits, the general consensus appears to be that the Conservatives have handled the issue in an almost naïve and irresponsible manner; a black cloud that hung over the rest of the conference.

David Cameron has admitted he should have forewarned the public, though again this is unlikely to appease the working mothers who have raised particular objections to the ruthlessness of the cuts, and their notable absence from the election manifesto in May. The surprise expressed by Cameron at the furore that followed the announcement, and subsequent vigorous back peddling of policy, revealed a disconnection between government and voter; a lack of awareness of the fundamental importance of such a long standing benefit to so many families across the UK.

He now also looks to face the wrath of backbench MPs who are currently threatening rebellion. For the first time since they were elected, we are faced with a government who has lost the cohesion that made it appear so strong.

“We’re going to suffer for this” said one minister earlier this week. “It’s going to be very hard to defend this without something solid on tax rates. Unfortunately, there’s no real sign of that happening”

It is a sign that the honeymoon period for Cameron and Osborne is truly over, with the chaos of the cabinet, and the poorly thought through tax plans playing out alarming reminiscent of the government under Brown. After all, it is cuts such as these that give gravitas to Ed Miliband’s insistence that Middle England is “under attack”, and Cameron will have to work hard to convince Britain’s middle-classes he still has their best interests at the heart of this government.

One comment

  1. This is utter nonsense and anything but objective. There was a mistake in the policy, which was immediately pointed out, and will no doubt be rectified before being brought to the Commons. The anecdotal evidence of feeling within the government, and phrasing such as “chaos of the cabinet” and “leaning ever further towards the right” reeks of someone whose sole aim is to find fault in the coalition by blowing something like this out of proportion.

    Even if the benefit does end up being cut for individual parents earning above £44k, there is no real issue. After all, had the Conservatives campaigned against this cut, the left would have attacked them for defending the well-off. If this cut goes ahead, my family will be affected. We are not well off; our household income would be only just above the cut-off point. But is it really that difficult to downgrade your internet or Sky package? Does your – almost double the average wage – lifestyle really require a second car, or a new laptop?

    This benefit should be for people who require it just to bring their children up with a reasonable standard of care, not to support the much better-off middle-classes. Quit moaning, and start to live within your means.

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