The coalition prepares to "rethink" child benefit cuts

Ministers consider offering relief to families who on average will lose £1,750 a year.

George Osborne's plan to remove child benefit from higher rate taxpayers hasn't received much attention in recent months, largely because the change isn't due to be implemented until 2013. But it remains a policy fraught with difficulties. At a time of high inflation and stagnant wages, it amounts to an average tax increase of £1,750 a year (£1,000 for the first child and £750 for each subsequent child) for the families affected, and disproportionately penalises single-earner households. While all households in which at least one person earns £44,000 or more will lose out, a family with two adults earning, say, £40,000 a year will not. Osborne's decision to freeze the benefit for three years tightens the squeeze.

With this in mind, it's no surprise that, as today's Times (£) reports, ministers are "rethinking" the proposal. One solution proposed by Iain Duncan Smith - to means-test the benefit as part of the universal credit - has been rejected by the Treasury. But Osborne is looking into how he could offer relief to the biggest losers. The Tories are increasingly anxious about their flagging support among women and fear that the child benefit cuts will compound the problem. An unusual number of the coalition's austerity measures - the abolition of baby bonds, the three-year freeze in child benefit, the abolition of the health in maternity grant, the cuts to Sure Start, the withdrawal of child tax credits from higher earners - hit women and families hardest.

One of Ed Miliband's first decisions as Labour leader was to oppose the coalition's child benefit cuts. It offered evidence of his commitment to "the squeezed middle" and to an expansive welfare state. A passionate universalist, Miliband has often quoted Richard Titmuss's wise assertion that "services for the poor will always be poor services". But whether this stance survives the Labour leader's new emphasis on fiscal rectitude remains to be seen.

George Eaton is political editor of the New Statesman.

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Theresa May is paying the price for mismanaging Boris Johnson

The Foreign Secretary's bruised ego may end up destroying Theresa May. 

And to think that Theresa May scheduled her big speech for this Friday to make sure that Conservative party conference wouldn’t be dominated by the matter of Brexit. Now, thanks to Boris Johnson, it won’t just be her conference, but Labour’s, which is overshadowed by Brexit in general and Tory in-fighting in particular. (One imagines that the Labour leadership will find a way to cope somehow.)

May is paying the price for mismanaging Johnson during her period of political hegemony after she became leader. After he was betrayed by Michael Gove and lacking any particular faction in the parliamentary party, she brought him back from the brink of political death by making him Foreign Secretary, but also used her strength and his weakness to shrink his empire.

The Foreign Office had its responsibility for negotiating Brexit hived off to the newly-created Department for Exiting the European Union (Dexeu) and for navigating post-Brexit trade deals to the Department of International Trade. Johnson was given control of one of the great offices of state, but with no responsibility at all for the greatest foreign policy challenge since the Second World War.

Adding to his discomfort, the new Foreign Secretary was regularly the subject of jokes from the Prime Minister and cabinet colleagues. May likened him to a dog that had to be put down. Philip Hammond quipped about him during his joke-fuelled 2017 Budget. All of which gave Johnson’s allies the impression that Johnson-hunting was a licensed sport as far as Downing Street was concerned. He was then shut out of the election campaign and has continued to be a marginalised figure even as the disappointing election result forced May to involve the wider cabinet in policymaking.

His sense of exclusion from the discussions around May’s Florence speech only added to his sense of isolation. May forgot that if you aren’t going to kill, don’t wound: now, thanks to her lost majority, she can’t afford to put any of the Brexiteers out in the cold, and Johnson is once again where he wants to be: centre-stage. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to domestic and global politics.