UK annually pays £31mn in child benefits to parents abroad
Figures unveiled by the Telegraph show a total of 31 million pounds (US$950,000) was doled out to families of children living abroad in 2013. In total, 20,400 Child Benefit claims were made on behalf of 34,268 children. Approximately two-thirds of those children reside in Poland.
Others relying on the system include: 1,231 families in Ireland receive payments covering 2,505 children; 1,215 families in Lithuania; 797 families in Latvia; and 789 families in France.
Children living outside of the UK receive the same amount of money as those living in the UK, even if they have never called Britain home. This is true in countries with both a lower cost of living and a lower level of domestic child benefit.
For example, Poland pays out 13.60 pounds ($21.76) a week for children under five, 18.20 pounds ($29) for children aged five to 18 and 19.60 pounds ($31.30) for those aged 18-24 who are enrolled in education. By contrast, British parents receive 20.50 pounds ($32.80) a week for their first child and 13.55 pounds ($21.68) for any further children in Britain.
Excluding Northern Ireland, average wages in Britain are more than 3.6 times higher than in Poland. And according to Numbeo, consumer prices in London are 112.47 percent higher than in Warsaw, rent prices are 306.06 percent greater, and grocery prices in London are 121.48 percent higher than in Warsaw.
Labour said the figures demonstrate that the governing coalition “seems to have given up any effort to end the scandal of millions of pounds of child benefit being sent abroad every year.”
“Rather than admitting defeat the Prime Minister should be ordering his ministers to work with governments across the European Union to bear down on this abuse of our benefits system,” the Telegraph cites Rachel Reeves, the shadow Work and Pensions secretary, as saying during a visit to France last week.
Reeves said it is “unfair and unaffordable” that hard-working people paying into the social security system have to sit back and watch child benefits being sent abroad.
She warned if the government fails “to act over millions of child benefit being sent abroad each year, a Labour government will.”
A treasury aide responded that Cameron’s position on changing the rules governing the Child Benefit system remain clear.
“We need a change of EU law to do this, which is why the Government is pursuing renegotiation of the relevant EU rules with our European counterparts.
“It is part of having a fair system that helps people move around the EU to work, but which tackles abuse or exploitation of Britain’s welfare system.”
Cameron has said the child benefit issue remains one of several points he intends to tackle if the Conservatives emerge victorious in the next election and are able to renegotiate the UK’s relationship with the EU.
Under current EU rules, child benefits can be claimed if the parents have paid into the national insurance system. The UK, Czech Republic, Germany, Latvia and the Netherlands currently allow for child benefits to be paid even if the children reside in other EU states.
In July, the PM said migrants coming to the UK from the EU would see their child benefit and unemployment claims reduced from six to three months. The plan is set to go into effect in November.
On Monday, Chancellor George Osborne announced billions more in austerity cuts which would mostly target the working poor, including welfare payments and child benefits.
According to the Guardian, working families with children will lose as much as 490 pounds a year in child benefit and tax credits under the plan.