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Conservatives vow to let high earners keep more in child benefits

Currently someone is eligible for the benefit if they are responsible for raising a child who is under 16, or under 20 but still in education or training.

Parents receive £25.60 per week for one child and £16.95 for each additional child.

The benefit begins to be reduced once one parent earns more than £60,000 and is removed entirely for an income over £80,000 – a deduction called the High Income Child Benefit Charge (HICBC).

This has created a situation where a household with two parents earning £60,000 each get the full amount, while a household where one parent earns just above £60,000 would see their benefit reduced.

In his Budget in April, Chancellor Jeremy Hunt said he wanted to “end that unfairness” and announced a consultation on moving the charge to a household-based system by April 2026.

His party is now recommitting itself to the change – in addition to raising the salary threshold at which the charge kicks in to £120,000. Child benefit payments would be removed entirely from households earning more than £160,000.

Announcing the Conservative’s election policy on Thursday, Mr Hunt said: “Raising the next generation is the most important job any of us can do so it’s right that, as part of our clear plan to bring taxes down, we are reducing the burden on working families.

Tom Waters, associate director of the Institute for Fiscal Studies said the change “would mean that only 900,000 families (12% of those with children) would still be losing some or all of their child benefit”.

“That does mean that the problems affect fewer people. But at the same time, at that point one has to ask whether it’s really worth having the additional administrative apparatus, rather than simply returning child benefit to being universal, as it always was before 2013.

“This would cost around another £1.5bn a year on top of the Conservatives’ plan.”

The Liberal Democrats said Conservative policies “aren’t worth the paper they are written on, after years of hiking taxes on hardworking families”.

Responding to the Conservative announcement, the SNP said Westminster parties should “follow the lead of the SNP Scottish Government and introduce the equivalent of the Scottish Child Payment which has lifted 100,000 Scottish children out of poverty”.

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