Last week, the government announced plans to introduce a universal state pension – £140 a week for a single person. Ministers have indicated that the universal pension can be introduced without increasing cost to the public purse. Details of what’s planned are scanty, but options could include further raising the state pension age (the coalition government has already announced it wants to accelerate progress to a state pension age of 66), reducing tax relief further on pensions contributions, or through the abolition of the state second pension – so there will be losers as well as winners depending how the plans proceed.

But overall, Labour should welcome the proposals with an open mind. A universal pension would support those least able to save for retirement – particularly women, and those in low-paid work. It would be simple, so likely to achieve high levels of take-up – means-tested pension credit by comparison has suffered from poor levels of take-up, not least as a result of stigma and reluctance among some pensioners to claim. And, importantly, it would reassert the centrality of the universal principle in the social security system – something the government’s plans for universal child benefit, by contrast, seriously undermine.

Welcoming the concept of the universal pension opens the way for Labour to challenge the child benefit plans hard. And there’s much to challenge, both on grounds of principle, and on simple workability grounds. Child benefit is a sign of society’s shared responsibility for our children: it supports parents with the direct cost of raising children, costs all parents face, irrespective of income. It follows the child, so has a protective effect, providing stability of income through changes in family circumstances that can hit even the better off. It’s simple and easy to claim, so take-up’s maximised and it’s thus especially effective at reaching the poorest. Paid usually to the mother, it’s mostly likely to be spent on the kids.

The government’s plans to remove child benefit from families where at least one parent is a higher rate taxpayer pay no attention to the thinking that underlies this highly effective benefit. Mixing one parent’s entitlement to child benefit with the other parent’s personal tax liability threatens to undermine independent taxation, strain couple relationships, and over-complicate a benefit whose success is founded in its simplicity. It seems ministers are so determined to attack this so-called ‘middle class benefit’ that they’ve lost sight of what works. If the case – rightly – exists for universal benefits for pensioners, surely it’s a case that applies to families with children too.

Photo: powercraft