Reform of benefits fair says Cameron

A Treasury spokesman said the number had increased by 50,000 over the weekend as high-earning parents opted out of the system rather than having to repay money through tax returns.

Prime Minister David Cameron yesterday insisted the reforms were “fundamentally fair”.

Families with one earner on more than £50,000 lose some or all of the payment while households with one parent earning more than £60,000 lose their entitlement completely. But families in which two parents earn less than £50,000 each – but potentially substantially more than £60,000 in total – remain unaffected.

Mr Cameron said: “This will raise £2 billion a year. If we don’t raise that £2 billion from that group of people, the better off 15 per cent in the country, we would have to find someone else to take it from.”

Around 800,000 families are known to be affected by the reforms with a further 400,000 potentially hit through changes in income over the next year.

Labour has criticised the reforms with Shadow Treasury Minister Chris Leslie claiming up to a million families face having all their child benefit clawed back through complicated self-assessment tax returns.

“This is a costly administrative nightmare that could also lead to family rows as couples decide who takes the financial hit.

“And it’s unfair too, because single earner families on £50,000 
will have their child benefit cut while some couples earning as much as £100,000 keep all of theirs and millionaires actually get a tax cut.”