Currently, the benefit is paid until children are 19 - £20 is paid for the first child and £13.40 for each subsequent child. The benefit costs the taxpayer £11bn per year; Field’s proposal would save £3bn a year and there would be considerably larger savings if the cut was extended to child tax credits.
Field and IDS will propose radical reform of incapacity and out of work benefits that will incur significant upfront costs – around £3bn by some estimates - so savings have to be made elsewhere on the welfare bill. In addition to the savings Field envisages, he wants to tax universal child benefit along the lines of income tax bands, to ensure that the poorest receive the bulk of the benefit. He argues that a tax option would be cheaper than means testing; it is also politically sound: the benefit would remain universal, which would disarm Labour’s likely line of attack that the government wants to create a two-tier welfare system that would maroon the poor. Field would also introduce a ‘life chances index’, which would measure family income, parenting and school readiness (holding a crayon etc), as the means to assess child poverty and to allocate funds appropriately.