HM Revenue and Customs have confirmed that £1.9bn of the £13.5bn paid out in Gordon's child and working tax credit scheme was overpaid to 1.9m claimants last year. A lucky few received overpayments of £5,000!! With £1 in every £6 being paid incorrectly, the Government appears to have two choices. Employ more civil servants to reduce overpayments by increasing the bureaucracy, slowing the payment process down and capping the individual total benefit available or scrap the whole scheme and administer the benefit (if required) in a different way.
As the benefit is for working parents, I would prefer the personal allowance to be increased as it is equitable, removes the bureaucractic costs of administering the scheme and reduces the benefits trap. The only downside is that Gordon will no longer appear to be rewarding "hard working families" but rewarding everyone who works instead!!
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