Barnet MP, Theresa Villiers has welcomed child benefit changes which apply from this month.
Following announcements made in the Spring Budget, people who earn up to £60,000 a year are now able to receive child benefit in full. The benefit will not be taken away entirely until a person earns £80,000.
The system had been criticised for being unfair to households with one high-earning parent. Under the rules in place for the past ten years, if one partner earns more than £50,000, child benefit starts being gradually withdrawn, such that if they earn £60,000, they do not receive any child benefit at all.
This means two parents earning £50,000 a year each would receive child benefit in full - but a household with one working parent or a single-income household earning more than £50,000 would see the benefit cut.
This threshold figure had not changed since 2013, despite increases in childcare costs. The Chancellor has now raised the lower threshold, and said that the top of the taper at which the benefit is withdrawn completely will go up to £80,000.
The Government estimates that almost half a million families will gain an average of £1,260 next year as a result of these changes.
Welcoming the news, Theresa Villiers said “These higher thresholds will benefit many of my constituents. Over the years since the 2008 austerity crisis led to restrictions on access to child benefit, a number of parents have told me that they feel that the system is unfair. It hits people harder in places like Barnet where salaries tend to be higher than the national average to take account of high costs in the capital.”
“It is therefore good news that the threshold is being raised meaning more of my constituents will qualify for the benefit. I also welcome the commitment by the Chancellor to switch to a system which looks at the income of the household, not the individuals within the family.”
“These changes will provide much needed help with cost of living pressures, alongside a reduction in National Insurance which cuts taxes for the average worker by £900, taking into account changes made in the Autumn Statement and the Spring Budget.”
The switch to a household income approach will be consulted on and should be implemented by April 2026. As well as changes in the threshold, the rate of child benefit goes up this month from £24 a week for one child and £15.90 for each additional child, to £25.60 and £16.95 a week respectively.
