The post you are reporting:
To expand this a little.
What would you do to save money on Child benefit as an alternative to this?
I would, instead stop CB at 16 and limit it to no more than 3 children.
In addition once the first, eldest, child leaves home it should be the first child payment that ends.
Plus I would give it a basic rate tax credit so higher rate tapayers would pay 20% or 30% tax on it.
Marek, I think it was, introduced another issue regarding universal benefits - the State Pension. This is of course contributory in the sense that you need to work and pay NI for 30 years to get the maximum amount of BSP, also you get credits for looking after children/or on jobseekers.
One little known fact is that at age 65 you get an 'age allowance' an extra tax free allowance bringing your tax free income up from £6,475 to £9,490 per annum This extra tax allowance gets lost at a rate of £1 for every £2 that you have in excess of £22,900 in taxable income. So effectively pensioners, with a better retirement income, are taxed at 30% on a band of c. £6,000 above £22,900. Often it is when people start to receive the State Pension that their income increases into this band (where they retired earlier).
You should also note that often it is the State pension that is the only income that increases with inflation (soon to be prices)
I am involved daily in advising clients how to maximise their tax allowances so they do not get caught out by this age allowance trap. Often I find a married couple, a non earning wife and a well pensioned husband, where the wife does not even use up all her tax-free allowance while the husband is caught by the 'age allowance trap' paying 30% effective tax, in some ways a similar anomaly to what the CB proposals might bring about. It happens at the 40% tax level as well. Some people though leave it too late to plan. But still, its a better problem to have than not enough retirement income.