Whenever the Tories have a semidecent idea, they back away from it.

[Donald Ian Rankin]

If you desperately need to cut government spending, then two of the least harmful places to do it are defence spending and benefits for higher earners. Notice how rapidly the Tories backed away on those two, while still pressing for cuts to vital public services?

[T_i_B]

1. What gets me...

...is how the Tory press is clamouring one minute for an end to "middle class benefits" then squealing the moment they get the very thing they have been calling for.

[muriel_volestrangler]

2. The child benefit stuff does look a bit of a dog's dinner, though

Might have been better to make child benefit taxable, assume the basic rate tax has been paid, and then make higher earners declare it on their tax return. That way, there's no sudden loss of, say, £2,450 for someone with 3 children when they become a higher rate payer. That would fit in with Duncan Smith's "don't make it more worthwhile to claim benefits rather than work" - accepting a pay rise shouldn't actually mean you lose money.

And for the households with one higher rate earner and one non-earner, the latter gets the benefit, and so they don't pay the extra tax - which keeps the Tories happy about parents who stay at home to look after children.

[fedsron2us]

3. While it is good that some higher rate earners have had a taste

of the 'benefit trap' that many poor claimants have endured for years this fiasco is a sign of a Chancellor who has lost the plot (if he ever had it in the first place). The obvious and fairest solution to the problem is to treat all benefit payments as earnings like wages and tax it accordingly. At the moment we have the crazy situation where some payments such as JSA are regarded as income taxable in the normal manner while others such as such as Child Benefit are paid tax free earning £43,000 yet effectively taxed at 100% when they earn over £44,0000. While many may think it is daft to pay benefits to people out of general taxation only to subject it to oncome tax again the reality is that this system is a lot fairer and simpler to administer than general means testing. Moreover it also removes the concept of the benefit 'cheat' as all fiddlers under this system would essentially be tax evaders. Of course, in my cynical moments I suspect that this is the number one reason why it has not been adopted since there are many wealthy tax dodgers who are only too happy to have the concept of benefit bludgers to divert attention away from themselves.

[TheBigotBasher]

4. The whining wealthy.

Easy way to have achieved he policy objective - add the amount of child benefit to the already means tested child tax credits as an allowance. Therefore keeping the link to the parents and ensuring that the wealthy do not get it.

Anyway it was a smokescreen for the benefit cap, a very badly thought out policy.

http://thebigotbasher.com/2010/10/06/george-osbornes-land-of-make-believe/