Child Benefit should be limited to no more than four children per family to help cut welfare spending, say Policy Exchange.

A report by the centre-right think tank Policy Exchange has recommended limiting child benefit for larger families. The move could save around £1 billion over the course of a parliament, say Policy Exchange.

Policy Exchange is said to have close ties with the Conservative Party and was founded by a group that included Michael Gove, Francis Maude and Nick Boles. Many of the past recommendations made by the think tank have been adopted into tory manifestos.

If this new policy is adopted, it would see child benefit progressively cut for each child born into a family, and rise by no more than 1% each year over the five-year course of a parliament.

Parents would initially receive £21.50 a week for their first child, £14.85 for the second child, £14.30 for the third and £13.70 for the fourth. Payments would be limited to no more than four children per family. Supporters of the policy claim it would help deter immigrant from coming to the UK to claim benefits for their children.

Policy Exchange said that a YouGov poll, commissioned by the think tank, found that 67% of voters would support cutting child benefit for larger families. 20% were opposed to the move.

According to the results of the poll, the proposal is supported by 83% of Conservative voters, 63% of Liberal Democrat voters and 55% of Labour voters.

The Conservatives have previously considered a similar proposal put forward by Nadim Zahawi to limit child benefit to just two children, but decided against the policy out of fear it would cost the party votes.

The author of the report, Steve Hughes, said:

“The chancellor has suggested that annual welfare savings of £12bn will have to be found to avoid further and faster cuts to departmental budgets.

“Choosing where this money comes from is not easy, but with such high levels of public support, capping child benefit at four children and redesigning payment levels offers a very real opportunity to generate some much needed savings in the fairest way possible.”

A spokesperson for the right-wing pressure group, Taxpayers Alliance, told the Daily Express:

“No one should be immune from having to make the sometimes hard choices associated with having a family and people have to realise that there is not a bottomless pit of money.”

Opponents argue that the tory-led coalition government has consistently targeted Britain’s poorest households with draconian welfare cuts, while continuing to allow multinational companies to escape paying their ‘fair share’ in tax and handing tax cuts to the highest earners, who could afford to pay more.

They also say that there has been far too much focus on cutting state benefits, rather than introducing a living wage to help parents cover the cost of living and raise their own children, instead of having to rely on benefits to top-up stagnating wages.

Figures released by the Office for National Statistics (ONS) yesterday (17 June) appear to support such an argument. ONS figures show that average pay has increased by only 0.7% on this time last year, or just 0.3% excluding bonuses – well below inflation which currently stands at 1.9%.

A Survation poll for the union Unite, found that over a third (34%) of low wage earners cannot afford to shop where they work and nearly sixty percent of workers earning £6.50 or below (58%) feel trapped in low waged work. 79% of respondents said that they want work to pay and want to earn a living wage instead of depending on benefit top ups.

Welfare News Service requested a comment from the Child Poverty Action Group (CPAG) on how limiting child benefit would impact upon child poverty figures. Unfortunately they did not respond in time for publication.