A think tank with close links to the UK Conservative party has proposed capping child benefit to four children per family in a bid to save the taxpayer money.
The scheme, if adapted and enforced, would only allow each family to claim child benefit for the first four children they have, and the amount paid per week would decrease with each second, third and fourth child.
Policy Exchange, a think tank originally set up by a group including ministers Michael Gove, Francis Maude and Nick Boles, says the proposal could save the taxpayer up to £1 billion over the course of a parliament.
It also explained that it will encourage families on benefits to consider carefully their ability to afford another child, much like working families must do. The rule would align nicely with the current changes being made to the welfare state, like universal credit, they said.
A Conservative source said:[quote]Because the plans would not be retrospective, you are not taking benefit money away from anyone.
It is right that people consider the number of children that they can afford. The savings this kind of policy would make would be huge. It is being seriously discussed.”[/quote]
If the new regime were to be implemented, families would no longer receive the current rate of £20.50 a week for their first child, plus £13.55 per week for every child they have afterwards.
Instead, they would get £21.50 for their first child; £14.85 for their second; £14.30 for their third and £13.70 for their fourth.
This payment plan is based on research that suggests a family’s first child has the biggest impact on their financial situation. For every child they have after this, the marginal cost decreases.
Since the think tank made the proposals, chancellor George Osborne told the ITV’s Good Morning Britain that there were certainly no real plans as of yet to include them in the new party manifesto.
However, it is worth noting that many proposals made by the Policy Exchange have found their way into Conservative manifestos before.
Even if the Conservatives do choose to make the proposal part of their manifesto, the new system would only come into force if the Conservatives were to win the next general election.
The prospect also received considerable public support in a YouGov poll, in which more than two thirds of people said they agreed with capping child benefit at four children.
Steve Hughes, author of the report, said:[quote]With such high levels of public support, capping child benefit at four children and redesigning payment levels offers a very real opportunity to generate some much needed savings in the fairest way possible.”[/quote]