Well I agree it's pretty annoying and Apple should not implement it this way. It feels very Microsoft-like of the 90s. But how I solved it is to just delete all my photos from the iCloud and switch off the photo sync. If you keep the sync on it'll start to annoy you again cause every ****in photo you ever saved ends up there.
But with that workaround, you can use all other features of iCloud except the photos with 5GB...
I just don’t get the motivation behind saving .80 pence. ¯\_(ツ)_/¯
I mean, seriously?!

it’s named the same but the function and infrastructure behind the entire system has changed now. The backup stuff is just an added feature whereas Apple has continued to expand on their cloud based platform.