The government has decided to abandon a proposed change to child benefit regulations that would have enabled more parents to access the financial support. Under the current system, child benefit is phased out when a parent’s income exceeds a specific threshold. The previous Conservative administration had intended to modify this structure so that claims would be evaluated based on total household income starting in April 2026.

Chancellor Rachel Reeves did not reference child benefit during her Budget address, but the official Budget document indicated that implementing the proposed changes would impose too heavy a financial burden. Critics of the existing system argue that it is inequitable since some families can still receive benefits despite having higher incomes than single parents or families with one primary earner.

To qualify for child benefit, an individual must be responsible for raising a child under 16 years old or under 20 if they are in approved education or training. Only one person may claim this benefit for each child. Currently, the payment amounts to £25.60 per week for the first or only child and £16.95 per week for additional children. These figures will increase in April 2025 to £26.05 and £17.25 respectively. However, these payments decrease once a parent’s earnings surpass a certain limit known as the High Income Child Benefit Charge (HICBC).

Former Chancellor Jeremy Hunt raised the income thresholds in his last Budget, increasing the point at which individuals must begin repaying part of their benefit from £50,000 to £60,000 and raising the complete withdrawal threshold from £60,000 to £80,000. Furthermore, he indicated plans to adjust the HICBC so that it would consider household income rather than individual earnings after consulting on the matter.

Nevertheless, Wednesday’s Budget document confirmed that the government would not implement this reform due to its estimated cost of £1.4 billion by 2029-30 if thresholds were set between £120,000 and £160,000—where no families would be disadvantaged.

David Stuart, a father of two from Whitburn, West Lothian, expressed disappointment over this decision after initially supporting Hunt’s proposal for a fairer system. With his current income exceeding £80,000 and his wife earning around £10,000 as a self-employed childminder, they are unable to claim any child benefit. David noted that even partial eligibility could assist them in saving for their children’s future.

Laura Suter from AJ Bell commented on the administrative challenges of assessing household incomes instead of individual earnings but highlighted that not proceeding with these changes perpetuates an unfair system for single earners. The government also announced plans for employed individuals to pay their HICBC through their tax code starting in 2025 instead of requiring self-assessment tax returns.