Explaining the child benefit saga

Do you prioritise fairness for individuals or for households? The coalition is realising you can't d

Observing a government in the midst of a policy u-turn is rarely an elegant sight. When it is drawn out over an extended period, and fuelled by briefing and nods and winks from the PM downwards, it is even less edifying. So it is with the coalition's current contortions on Child Benefit.

None of the proposals being discussed as improvements to the coalition's original idea (to axe Child Benefit for households with a higher rate tax payer) are attractive. All are likely to be an administrative nightmare. Indeed, if the government could press rewind I doubt very much they would choose to repeat the initial pledge they made (not withstanding polling evidence showing it could be quite popular). And if they could press fast-forward into the future my guess is that they would probably decide not to plump for the sort of complex proposal that they are reportedly leaning towards (for instance creating what would in effect be a new tax threshold at £50k).

As things stand, Osborne's room for manoeuvre is limited. He's made clear that he wants to remove Child Benefit from the affluent. Some of the ways of achieving this that have been floated by leading voices like the IFS, such as integrating Child Benefit within the tax credit system, and so means-testing it according to household income, are now likely to be deemed to be politically too difficult (even though they might have once been possible back in 2010).

Why? Because they would hit (many) households with two earners each on say £30k-35k. You might think this would be more rational than axing Child Benefit for single earner households on £45k. Perhaps. But the last thing a government in retreat wants when placating one group of losers is to create another disgruntled set who previously thought they would escape unscathed. Indeed, the biggest risk the coalition faces right now on this issue is not that they fail to recoup the full £2.4bn they were hoping to save, but that they find themselves making a series of expensive concessions as each new proposal they make comes under pressure. They need to find a position they are sure they can defend and stick to it.

Given the hole they are now in on this issue, and assuming a complete u-turn is not on the cards, the least bad option for Osborne would probably be to ditch the idea of abolition and instead start taxing Child Benefit for higher rate taxpayers; though he will probably feel this falls short of what he needs to do (and it still suffers from some of the problems as his original idea).

Given the upheaval, it's worth asking what led the government down this path? Part of the answer is the tendency towards politically-driven but ill-conceived policy announcements - recall that the Child Benefit proposal arose in the first place in order to soften up opinion in advance of the wider cuts to the benefit system.

But it also reflects an underlying and still unresolved issue about the future of the tax system. Take a step back from the detail of this row and consider what pattern emerges from the coalition's changes to the tax and benefit system. In terms of where money has been spent, it has been on Clegg's flagship idea of increasing personal allowances - an agenda which is primarily about tax-cuts targeted at individuals. Meanwhile those parts of the tax and benefit system targeted at supporting households and children (like tax credits) face harsh cuts, though no one in the coalition would like to put it this way.

The Child Benefit proposal is an uncomfortable hybrid: it's based on individual earnings (means testing child benefit for higher rate tax-payers) but in a very clunky and arbitrary way it nods towards considering household income in that it asks each claimant whether their partner pays the higher rate of tax. The result, as has been widely pointed out, is that the single-earner household on £45k risks losing up to several thousand pounds while the dual-earning household on a combined income of £80k loses nothing.

At the heart of the issue is the point that tax and benefit reforms can prioritise fairness for individuals (Clegg's argument), or they can seek to respect the principle of individual taxation whilst advancing greater equity for low and modest income households with children - which is in essence what tax credits seek to achieve (at the price of far greater complexity). But they can't do both at once.

Regardless of how the current Child Benefit saga plays out it is unlikey to be the final word in this debate about supporting individuals as opposed to households. Why so? Because if personal allowances continue to be the favoured mechanism for tax reform, and there's little reason to think they won't for as long as the coalition survives, then sooner or later their comparative shortcomings as a way of supporting families with children will surface as more of an issue.

Liberal Democrat strategists concede as much (at least in private). Looking to the longer term they are interested in exploring ways of making the personal allowance better reflect household circumstances - for instance through some form of children's tax allowance. This isn't an issue for now, but could well be in the event Lib Dems are in with a real chance of forming another coalition government beyond 2015.

If you think some of this sounds vaguely familiar, you'd be right. We used to have child tax allowances before they were phased out in the 1970s and replaced by the Callaghan government with (you guessed it) a version of today's Child Benefit - a system thought to be much more beneficial to mothers than its predecessor.

Gavin Kelly is a former adviser to Downing Street and the Treasury. He tweets @GavinJKelly1.

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What David Hockney has to tell us about football

Why the sudden glut of blond footballers? A conversation I had with the artist back in 1966 gave me a clue. . .

In 1966, I went to interview David Hockney at a rather run-down flat in Bayswater, central London. He was 28 and had just won a gold medal at the Royal College of Art.

In his lavatory, I noticed a cut-out photograph from a newspaper of Denis Law scoring a goal. I asked if he was a football fan. He said no, he just liked Denis Law’s thighs.

The sub-editors cut that remark out of the story, to save any gossip or legal problems. In 1966 homosexual activity could still be an offence.

Hockney and a friend had recently been in the United States and had been watching an advert on TV that said “Blondes have more fun”. At two o’clock in the morning, slightly drunk, they both went out, bought some hair dye and became blond. Hockney decided to remain blond from then on, though he has naturally dark hair.

Is it true that blonds have more fun? Lionel Messi presumably thinks so, otherwise why has he greeted this brand-new season with that weird blond hair? We look at his face, his figure, his posture and we know it’s him – then we blink, thinking what the heck, does he realise some joker has been pouring stuff on his head?

He has always been such a staid, old-fashioned-looking lad, never messing around with his hair till now. Neymar, beside him, has gone even blonder, but somehow we expect it of him. He had foony hair even before he left Brazil.

Over here, blonds are popping up all over the shop. Most teams now have a born-again blondie. It must take a fortune for Marouane Fellaini of Man United to brighten up his hair, as he has so much. But it’s already fading. Cheapskate.

Mesut Özil of Arsenal held back, not going the full head, just bits of it, which I suspect is a clue to his wavering, hesitant personality. His colleague Aaron Ramsey has almost the full blond monty. Paul Pogba of Man United has a sort of blond streak, more like a marker pen than a makeover. His colleague Phil Jones has appeared blond, but he seems to have disappeared from the team sheet. Samir Nasri of Man City went startlingly blond, but is on loan to Seville, so we’re not able to enjoy his locks. And Didier Ndong of Sunderland is a striking blond, thanks to gallons of bleach.

Remember the Romanians in the 1998 World Cup? They suddenly appeared blond, every one of them. God, that was brilliant. One of my all-time best World Cup moments, and I was at Wembley in 1966.

So, why do they do it? Well, Hockney was right, in a sense. Not to have more fun – meaning more sex – because top footballers are more than well supplied, but because their normal working lives are on the whole devoid of fun.

They can’t stuff their faces with fast food, drink themselves stupid, stay up all night, take a few silly pills – which is what many of our healthy 25-year-old lads consider a reasonably fun evening. Nor can they spend all their millions on fun hols, such as skiing in the winter, a safari in the spring, or hang-gliding at the weekend. Prem players have to be so boringly sensible these days, or their foreign managers will be screaming at them in their funny foreign accents.

While not on the pitch, or training, which takes up only a few hours a day, the boredom is appalling, endlessly on planes or coaches or in some hotel that could be anywhere.

The only bright spot in the long days is to look in the mirror and think: “Hmm, I wonder what highlights would look like? I’ve done the beard and the tattoos. Now let’s go for blond. Wow, gorgeous.”

They influence each other, being simple souls, so when one dyes his hair, depending on where he is in the macho pecking order, others follow. They put in the day by looking at themselves. Harmless fun. Bless ’em.

But I expect all the faux blonds to have gone by Christmas. Along with Mourinho. I said that to myself the moment he arrived in Manchester, smirking away. Pep will see him off. OK then, let’s say Easter at the latest . . . 

Hunter Davies is a journalist, broadcaster and profilic author perhaps best known for writing about the Beatles. He is an ardent Tottenham fan and writes a regular column on football for the New Statesman.

This article first appeared in the 22 September 2016 issue of the New Statesman, The New Times