People are puzzling over the following conundrum – It is proposed that Child benefit for individuals or married couples on GBP 44,000 a year is to be removed, but unmarried couples with a child, earning GBP 43,000 a year each, giving a household income of GBP 86,000 would be allowed to keep it.
The administrative details of removing universal benefits is nightmarish. Whichever solution is picked, the result is unfairness and illogicality.
Yet the public seems to be highly in favour of removing universal benefits. Free TV Licences, winter fuel allowance, free bus passes for over 60s are all disliked. The details will have to be worked out somehow, but where do you draw the line? The wisdom of Solomon will be required.
In essence, people understand that cuts will have to come, and that their universal benefit being sacrificed will be matched by everyone else losing their universal benefits. That’s fairness of a sort. The problem will be though how to decide who would still receive the benefits without setting up costly bureaucracy to decide who qualifies.
The biggest divide between the haves and the have-nots is not anything to do with benefits, but in the ability to find work and achieve independence from the state. Britain has a national minimum wage which applies from the quietest bleakest rural locations right to the centre of London. That cannot make sense. This is not a universal benefit at all. To some it provides a temporary advantage. To others it ensures they will never find a job. Yet unlike universal benefits, the public have not yet realised that the minimum wage, applied in a recession, damages their own interests, and is a universal cost to the economy. It merely drives jobs out faster. With six million sitting idle at home, it would seem just as sensible to lower the national minimum wage, and allow regional variations, as it is to get rid of universal child benefits. If not more so.
How long will it take before this issue makes it onto the political agenda?