Author name: 胡思

Child Benefit was originally the hallmark of the British welfare state established after World War II. Launched in 1946 as the Family Allowance and consolidated into the current system in 1977, its rationale is straightforward: raising children incurs costs, and children are the future of the nation, warranting universal support from the government. Thus, it began as a universal benefit, unexamined and income-blind, available to all families, which was both dignified and simple. Today, the benefit amounts to approximately £1,355 per year for the first child and about £897 for each subsequent child, providing tangible support for many families.

In 2013, the government introduced the High Income Child Benefit Charge (HICBC), fundamentally undermining the logic of universal welfare. The coalition government at the time was reluctant to bear political responsibility and shied away from implementing income assessments within the welfare system, as that would equate to admitting the end of universal benefits. The Liberal Democrats staunchly opposed such measures, leading the government to sidestep the issue by embedding the recovery of Child Benefit within the tax system. With tax data readily available, the assessment only needed to consider individual income, disregarding family structure, which officials found convenient but resulted in deeper injustices.

The outcome of this system is that individuals earning over £60,000 begin to repay their benefits, and those reaching £80,000 must return the full amount. While welfare considers the ‘family’, recovery is based on ‘individual’ income, creating a contradictory framework. Thus, a single-income family earning £80,000 must return all their Child Benefit, while a dual-income family each earning £59,000, with a total income of £118,000, can still receive the full amount. The actual financial burdens faced by these two families are vastly different, yet the system penalizes the weaker party, which is not welfare policy but administrative chaos.

Even more absurd is the practical implementation. The government first disburses the funds and then requires recipients to repay them through Self Assessment. Many salaried individuals, who previously had their taxes directly deducted under the PAYE system and never had to file a tax return, now face recovery actions from HMRC for failing to report income, incurring penalties and interest. Some, to avoid hassle, forgo receiving Child Benefit altogether, resulting in mothers losing their National Insurance credits, which adversely affects their future pensions, ultimately sacrificing the most vulnerable groups.

These confusions are not merely technical issues but the cumulative result of political compromises and administrative laziness. Officials, unwilling to bear the costs, have layered the system with patch upon patch; the more patches applied, the more it becomes a trap. The British tax and welfare systems have become increasingly fragmented over the years, with HICBC serving as a clear example. What should be the simplest form of child support has now become a symbol of systemic failure.

As time drags on, public confidence in the government will only erode more rapidly.

The absurdity of local taxation in the UK requires little elaboration; one example suffices to illustrate the entire picture. In London, a Band D residential property valued at £691,000 incurs an annual local tax of £990. In contrast, a similar Band D property in North England, valued at £205,000, faces a local tax of £2,463. While property values are three times higher in London, the tax bill is only 40% of that in the North. This inversion, where higher assets lead to lower tax burdens, is the result of a system that has remained stagnant for over thirty years.

The root of the problem lies in the fact that local taxes are still based on valuations from 1991. Over three decades, the landscape has changed dramatically, yet the system remains stuck in a bygone era. Even more absurdly, for a new residential property completed in 2025, the government will estimate its value based on what it would have been in 1991, applying the outdated tax assessment table from that time. Back then, the land might have been barren, the surrounding area undeveloped, and transportation poorly established; the current vibrancy simply did not exist. Replacing reality with a fictional past makes any notion of fairness impossible.

A deeper structural issue is that local taxes are a form of regional taxation, which exacerbates regional disparities. Wealthy counties have high property values and substantial tax bases, with additional revenues from parking fees and fines being significantly higher. Wealthy families can afford private schooling for their children, and their need for other social services is lower, allowing them to pay less in local taxes without issue. Conversely, impoverished areas have weak tax bases and limited additional revenues, yet they must still bear greater statutory responsibilities for education and social care. As service demands grow, financial resources dwindle, leaving councils perpetually strapped for cash. Local taxes, which should help address these weaknesses, instead become a force that deepens inequality.

The Institute for Fiscal Studies (IFS) has long pointed out that the current system neither reflects property values nor the actual financial burden on households. For over thirty years, neither England nor Scotland has dared to reassess property values, while Wales managed a reassessment in 2005. Although imperfect, this step acknowledged reality and was necessary. England, however, remains trapped in the shadow of 1991, mistaking obsolescence for stability.

To break this deadlock, it will take not finesse but determination. Local taxes must be reassessed to bring the tax base into the modern era, ensuring that high-value properties bear their fair share while low-value properties are not crushed by outdated valuations. Simultaneously, the central government should take on a larger share of the structural costs associated with education and social care, allowing local taxes to be fully allocated to purposes determined by local governments.

After more than thirty years of stagnation, the system can no longer be maintained through minor adjustments. The question remains: will the UK continue to live in the illusion of 1991 valuations, or will it rebuild a fair and modern local finance system? The answer is written on the wall.

In the next two years, the North Sea will witness the largest leap in British energy history with the addition of over 9 GW of offshore wind capacity through major projects such as Dogger Bank A, B, C, Hornsea 3, Sofia, and East Anglia Three. This will create a clean energy corridor extending from Yorkshire’s offshore to the east coast of England. These wind farms will gradually connect to the main power grid of England and the east coast, bypassing Scotland’s long-standing transmission bottlenecks. This will not only prevent exacerbation of wind power ‘curtailment’ but also reduce waste and enhance stability. Annually, this group of wind farms is expected to generate approximately 34 TWh of green electricity, accounting for about 12% of the nation’s total electricity generation, thereby significantly altering the overall energy structure.

The influx of low marginal cost wind power will naturally reshape the electricity market. In the UK, wholesale electricity prices are determined by marginal units, historically dominated by gas. A slight fluctuation in fuel costs leads to corresponding changes in national electricity prices. As more wind power enters the market, renewable energy will become the price setter during more periods, pushing gas to the periphery. With an increase in low-price periods, the average electricity price throughout the year will naturally decline. This is not a vision but an inevitable outcome following a change in supply logic; the more wind blows, the more stable the electricity prices become.

The foundation of this transformation largely stems from the Contracts for Difference (CfD) system introduced a decade ago. This system stabilizes purchase prices to eliminate investment risks while competitive bidding drives down costs, enabling the UK to develop offshore wind power on a large scale within a market framework. The aforementioned wind farms have all grown under the CfD framework, representing one of the few truly visionary policies of the Conservative government in the past. Today, the proliferation of North Sea wind farms is the fruit of seeds sown years ago. However, it is regrettable that the Conservative Party has wavered on the ‘net zero’ issue and failed to maintain the clear direction of those earlier years.

Wind power is not a utopia but a tangible reality that can be quantified. As turbines spin, electricity prices will fall, and carbon emissions will decrease, benefiting coastal ports, manufacturing, and maintenance supply chains. The real question lies not in the wind but in belief—whether the government can uphold the vision of the past and help Britain regain its direction in this North Sea breeze.