Tax Credits / Step Children should my income count?

Sixer

BigAunty wrote: »

The best way I have heard this criticised is by a journalist that said Labours war on child poverty was a missed opportunity.

The emphasis on tackling child poverty by additional benefits to the parents because of their children meant that it never actually tackled poverty.

Namely, that by targetting children, there was no policies to ensure that the best route out of household poverty was through getting the parents in employment.

Absolutely. And of course, nobody's going to argue with a war on a child poverty. Not in public. So the tactics of said war largely passed without discussion.

And in turn, this one leads us on to debate on the minimum wage - a war on child poverty largely fought through welfare via having single parents (or both parents in dual parent families) in work but remaining significant welfare recipients due to low wages? Hardly the war most people thought they were fighting.

Sixer

MissMoneypenny wrote: »

True. With the tax payers now footing the bill; rents were raised; child minders charges were raised and wages were lowered. No wonder Frank Field resigned his ministerial post over the introduction of tax credits, calling them a poverty trap. Blair called them a "vote winner" and bought himself some rental properties. It wasn't "a missed opportunity" for everyone it seems.

Absolutely again.

embob74

zagfles wrote: »

In the UK a young woman under 25, out of work, living with her parents will get a trivial amount in benefits. If she has a child, she'd be able to get independant housing and a rise in cash benefits which far exceeds the costs of bringing up a child.
Then if she meets a bloke on a decent wage, who being single previously has all sorts of silly commitments like big car loan etc, and they work out how much he'd lose if they move in together, and simply can't afford it (or doesn't want to decimate his lifestyle). So she stays single. If this happened in France the bloke would see a massive cut in his tax for taking on a single parent family.

I totally agree. Having been a working, single parent it was quite a shock to suddenly have to struggle to make ends meet. As a single parent I felt I was financially quite well off even after paying for childcare.
Like the OP's wife I would get frustrated that my partner has to work 55+ hours a week while the absent parent contributed nothing. Still not sure what the answer is but there should be less barriers to people being able to become part of a modern family.

BigAunty

Sixer wrote: »

Absolutely. And of course, nobody's going to argue with a war on a child poverty. Not in public. So the tactics of said war largely passed without discussion.

And in turn, this one leads us on to debate on the minimum wage - a war on child poverty largely fought through welfare via having single parents (or both parents in dual parent families) in work but remaining significant welfare recipients due to low wages? Hardly the war most people thought they were fighting.

Non-working households dependency on child related benefits is shown starkly by the number of posts on MSE by parents who are astounded that tax credits and child benefit ceases when their child turns 18.

They simply can't counternance the large reduction in income this entails. They are shocked that even if the kid receives JSA, or gets a college grant, or has an apprenticeship, that their disposable income is less. The tap has been turned off and they are flummoxed that the tap has been turned off, that their kid is expected to contribute to the household purse or that they simply only have the option to reduce their expenses.

There are any number of incredulous posts along the lines of 'my kid is no longer in education or employment or is earning a small sum and has travel expenses to work', how am I supposed to cope with the shortfall of £x each week..' Waaaahhhhhhhhh! Breastbeating, etc.

zagfles

Sixer wrote: »

Absolutely. And of course, nobody's going to argue with a war on a child poverty. Not in public. So the tactics of said war largely passed without discussion.

Yes, people have been too cowardly to challenge this, even the Tories. But when you look at their definition of "poverty" - it really doesn't fit with the definition which most people consider "poverty" to be. This really should be challenged. When people think of poverty they tend to think of people being unable to afford food, clothing, and the essentials of life. But the "poverty" measures they use have nothing to do with this.

They define poverty as living on below 60% of the country's median household income, fiddled to account for family size. They even have a separate definition of "absolute poverty" - but even this is relative - relative to 60% of median household income at the start of the decade! So in a recession, relative poverty might be falling while absolute poverty is increasing!!

So it's really inequality not poverty that is being measured. But it even fails there - the rich have become massively richer over the past 10-15 years, which you might have thought would be bad news for the "child poverty" figures.

But it isn't - because of the subtlety of using median income rather than mean. This might seem like a technical distinction but it isn't. If someone is already above the median, then the median is unaffected by them earning more! The rich can fill their boots and award themselves 49% pay rises and "child poverty", although relative, isn't affected!!

This means the most effective way of tackling "child poverty" as they define it is to transfer wealth from middle income people to lower income people. Not from the rich to the poor! You reduce "child poverty" if you reduce the gap between the middle and the bottom not the top and the bottom!

There are 2 ways of reducing the gap, increase the income of the poor, or reduce the income of those in the middle. This might explain the last govt's policy of generally raising taxes on average income people, not the rich (not till right at their death anyway when they knew they'd soon be out of power!).

And the closing of the gap between people on middle incomes and the poor creates poverty traps where it's simply not worth working as you don't get rewarded for doing so. People with children get rewarded far less for working than single people/couples with no kids, so guess what. The UK has the highest proportion of children living in workless households in the EU. Even families with 2 parents are more likely to be workless than single people or couples with no kids, so it's not just about the cost of childcare.

And the war is lost anyway. Just look at this report from the CPAG, even after a decade of Labour's "war on child poverty" started, we are 24th out of 26th in the EU in terms of child "material wellbeing":

http://www.cpag.org.uk/info/ChildWellbeingandChildPoverty.pdf

We need a new direction.

Oldernotwiser

BigAunty wrote: »

Non-working households dependency on child related benefits is shown starkly by the number of posts on MSE by parents who are astounded that tax credits and child benefit ceases when their child turns 18.

They simply can't counternance the large reduction in income this entails. They are shocked that even if the kid receives JSA, or gets a college grant, or has an apprenticeship, that their disposable income is less. The tap has been turned off and they are flummoxed that the tap has been turned off, that their kid is expected to contribute to the household purse or that they simply only have the option to reduce their expenses.

There are any number of incredulous posts along the lines of 'my kid is no longer in education or employment or is earning a small sum and has travel expenses to work', how am I supposed to cope with the shortfall of £x each week..' Waaaahhhhhhhhh! Breastbeating, etc.

I totally agree. It makes you wonder for how long they thought the state was going to be funding these "children"!

BigAunty

Oldernotwiser wrote: »

I totally agree. It makes you wonder for how long they thought the state was going to be funding these "children"!

Well, in their hearts they knew that it would end when their kid is no longer classed as a dependent but they probably didn't appreciate just how much of a cash cow their kid is until it dawned on them that even if the kid gives them part of their employment income, JSA or college grant, it's not always approaching what they received from the state.

So they are baffled that when their kid is independent and has some means, it's still not on par with what they enjoyed in the previous 16 to 18 years.

It's like 'how can you switch off a payment to me and pay the kid a smaller sum? how am I supposed to manage by asking my child to start contributing to the household kitty? why should my kid have to part with their JSA or college grant or low wages, it's theirs?'

Sixer

BigAunty wrote: »

Well, in their hearts they knew that it would end when their kid is no longer classed as a dependent but they probably didn't appreciate just how much of a cash cow their kid is until it dawned on them that even if the kid gives them part of their employment income, JSA or college grant, it's not always approaching what they received from the state.

So they are baffled that when their kid is independent and has some means, it's still not on par with what they enjoyed in the previous 16 to 18 years.

It's like 'how can you switch off a payment to me and pay the kid a smaller sum? how am I supposed to manage by asking my child to start contributing to the household kitty? why should my kid have to part with their JSA or college grant or low wages, it's theirs?'

You made me go and check out the actual difference in rates!

So, for second and subsequent children in a workless household you get the max child element of CTC at £2,555 plus £13.40 a week in Child Benefit: £62.50 a week?

For the first child, you get £2,555 plus family element of £545, plus £20.30 in Child Benefit: £79.90.

This compares to £53.45 for JSA. In which case, the JSA claiming school-leaver couldn't replace CTC and CB even if they tried. Or about £100 for a 16-year-old's apprenticeship (less fares, etc). I can't see many kids wanting to hand over £62.50 out of that!

Golly.

MissMoneypenny

embob74 wrote: »

Like the OP's wife I would get frustrated that my partner has to work 55+ hours a week while the absent parent contributed nothing.

She should look on it as being worth every penny to get rid of her ex;)

Oldernotwiser

Sixer wrote: »

You made me go and check out the actual difference in rates!

So, for second and subsequent children in a workless household you get the max child element of CTC at £2,555 plus £13.40 a week in Child Benefit: £62.50 a week?

For the first child, you get £2,555 plus family element of £545, plus £20.30 in Child Benefit: £79.90.

This compares to £53.45 for JSA. In which case, the JSA claiming school-leaver couldn't replace CTC and CB even if they tried. Or about £100 for a 16-year-old's apprenticeship (less fares, etc). I can't see many kids wanting to hand over £62.50 out of that!

Golly.

If a family was living on benefits and the child was bringing in £100 per week, I would certainly expect a contribution of £50/60 for keep, and for the child to use the rest of their money for their clothes, fares and spending money.