The new Conservative government in the UK has landed itself in hot water over its plan to cut child benefit  payments to what it describes as “higher earners”.

And while the Government here is focused on cutting non-essential spending here, it might learn some useful lessons on what not to do from the approach taken by the Tories.

Chancellor George Osborne created two, arguably unnecessary, political problems for himself. Firstly, the threshold of just under £44,000 per annum was too low to claim that the cut was solely aimed at higher earners.

Secondly, his cut did not take into account the effect of tax individualisation.

The front page of the Daily Telegraph on Tuesday summed it up rather starkly:

“Couple with two children, father earning more than £43,875 and mother staying at home will lose £1,752

“Couple with two children, both working and earning up to combined £87,748 will lose £0”

This is due to tax individualisation, a policy which means that individuals in married couples are assessed as individuals for tax purposes, rather than as a couple.

So the Government will assess one single income as having breached the “higher earner” threshold (less than £43,875), and if both incomes separately fall below this threshold, they will escape the cut.

Keep in mind that this same system which penalises families where one parents works in the home already hits such couples extremely hard in terms of the taxation system. This move will unfairly penalise them through the welfare system too, although Prime Minister David Cameron did suggest other means might be used to ameliorate this situation.

Minister for Children Barry Andrews suggested on Monday that the Government here might consider cutting child benefits for higher earners. He suggested that it might be hard to justify a situation where high earners were receiving child benefit on the basis of tax paid by people on much lower incomes.

Maybe so, but politically the tax individualisation issue might be the biggest bombshell. In 1999, Charlie McCreevy brought the policy of tax individualisation into Ireland.

The upshot is that a single income family earning €68,000 now pays €6,240 more in taxation per annum compared to a double income family earning the same amount.

A cut to child benefit for those on higher incomes (however the Government chooses to define that group) would likely be brought in on the same basis as the British case. This would mean that it would use the income of each spouse individually to determine whether they fell above or below its definition of “higher income”.

Our single income family on €68,000 would now be faced with the double whammy of a far bigger tax bill and having its child benefit removed. All the major parties (including Fianna Fáil) promised to ameliorate the inequity of the tax individualisation at the last election, by increasing the Home Carer’s Credit (a sop introduced by Mr McCreevy in response to the furore created by his policy)

The crunch in the Budget has meant that this promised increase never happened. Nevertheless, the fact that all the parties felt the need to move in that direction suggests that increasing the burden on single income families probably isn’t good politics.

Perhaps wisely, both Foreign Affairs Minister Michéal Martin and Social Protection Eamon O’Cuiv were more circumspect. Both men raised serious practical difficulties, with Mr Martin saying that there were formidable administrative obstacles, and Mr O’Cuiv saying such a move might be unconstitutional.

Discretion may be the better part of valour for the Government as far as reforming child benefit is concerned.