Age 7 government child trust fund payments not being released!!!

Deepmistrust

LizzieS wrote: »

Neither do I. What is wrong though:
1) Are benefits too high?
2) Are wages too low?

Two couples move into identical houses. Couple A are on benefits and are able to reclaim rent under the Local Housing Allowance Scheme. Couple B work and are unable to qualify for rent as they are not high priority, they take a mortgage out instead.

Both rent and mortgage is £138pw. Council Tax is £15.34pw.

Couple A remain on benefits and produce 2 children. Couple B also produce 2 children and one parent now stays at home to look after the children.

Couple A
102.75 income support
138.00 housing benefit
33.70 child benefit
15.34 council tax benefit
98.84 child tax credit
388.63 total net income
138.00 rent
15.34 council tax
235.29 net income after housing costs

Couple B
200.71 earned income (40 hours less tax and NI)
44.10 working tax credit
98.84 child tax credit
33.70 child benefit
377.35 total net income
138.00 mortage
15.34 council tax
224.01 net income after housing costs

Both before and after housing costs, couple B are £11.28 per week worse off. They then have to pay for school dinners & getting to work.

Even if the working partner of couple B earned an extra £5 per hour, the net result would make them better off than couple A by just £48.72pw less cost of getting to work & school dinners.

Hi Lizzie, thank you for researching a scenario. At first glimpse it does appear that there is occasion (like i have also said) that being unemployed is as well off as being in work for certain scenarios.

However, on close inspection (put those details into "entitled too.com"), and I get different figures from yours.

The WTC is higher at: £88.34 per week.
The CTC is the same at: £98.84 per week.

Which indicates it is still better off to be working.

If couple B were renting as opposed to owning their own home, they would also be entitled to HB according to entitled to.com of £55.23 per week. Instead they get to keep ownership of their property and all equity accumulated.

Thus the couple working would be significantly better off, by having one parent in full time work, even on the minimum wage.

I believe it is wages that are too low, hence the need for tax credits in the first place. It doesn't take much of a mathematician to work out that couple B (i.e. the working couple) would be in negative figures if they didn't recieve financial assistance to top up their low income via tax credits and housing benefits.

LizzieS_2

Deepmistrust wrote: »

However, on close inspection (put those details into "entitled too.com"), and I get different figures from yours.

The WTC is higher at: £88.34 per week.
The CTC is the same at: £98.84 per week.

I did it on entitledto. I still get WTC as £44.10pw and I have checked it manually too.

This is what I input:
couple
2 children
£800 annual council tax
selected mortgage
ignored pop ups for children (assumed over 1)
ignored all benefits
both ages of adults 30
selected 30+ hours
Input annual wage of £12334.40 (£5.93 x 40 hours x 52 weeks)

If couple B were renting as opposed to owning their own home, they would also be entitled to HB according to entitled to.com of £55.23 per week.

I got £85.54 for that one

Instead they get to keep ownership of their property and all equity accumulated.

Agree. For most people working, the only choice is to rent privately or buy. Rents and mortgages are pretty equal, hence why I assumed more would try for a mortgage first. My main point here was to show where the poverty trap really is by going for an average starter home. It gets worse if you try putting a partner as working on minimum wage and adding childcare - often it comes out as gaining next to nothing despite 80% of childcare being claimed.

I think it is a bit of both. Will write up later.

LizzieS_2

Hi Deepmistrust & Liam

Why I think benefits are too high and wages too low. For ease of reference, I am using the example I gave of a couple with 2 children throughout.

As I have already identified, working couples start off on the mortgage route because that is the best of their limited choice. Even when they buy the cheapest houses, theirs are the children who are stuck in the poverty trap more. The couple could only avoid this if they waited until the mortgage was paid off before trying for children – hardly fair. For this one, I would add in a housing allowance.

The other big housing problem is council housing v social landlords. The latter charges a going rate where the former often charges up to 2/3 less. This one has been discussed in DT before and comments I have heard from claimants is that it is much harder to move into work when they are not living in a council property, ie they are receiving LHA for a social housing property. This one should have been solved years ago – simply increase council rents to match, everyone renting is at an equal par then.

In the moves above, I have put every worker and every claimant in the same position for housing.
From the example, you can see the suggested workfare scheme does mean a proper wage for the benefits claimed if one of the couple had to work 40 hours in the community. I agree to the workfare scheme for the simple reason that it forces people to work instead of expecting handouts. From the example and using workfare, I think it is fair for the claimant (obviously there are problems with the few who breed like rabbits but these may become rarer).

Naturally we do not want the DWP to find us all work, so it must pay for us to find our own jobs. Here I suggest increasing WTC rather than minimum wage (again this is down to comments I have listened to in DT and can see our Government have means to make sure they are not subsidising profits).

Couples with mortgages are already restricted on the number of offspring they produce. The same should apply across the board whilst at the same time recognising that people’s choice of house should not be at the expense of others. Remember here that I already mentioned everyone should have a housing allowance and I effectively killed off housing benefit (LHA applies to all due there being no difference in rents). For this I suggest everyone is given a basic allowance based on their local council average for a 3 bedroom house (some areas within will be cheap and others expensive). If the family need a bigger house, it is for them to fund the difference from their income.

Extras. There are many but I will stick to 2. All tenants should have some of their rent taken into account if they choose to buy later (same level whoever owns the property) and the upper earnings limit for NI should be abolished (making high rate tax payers actually pay a higher rate overall, in fact I would abolish NI altogether by increasing tax equally).

All in all, I think the basic benefits in this situation is a decent starting point providing they do 40 hours workfare, those finding work themselves should be better off and no-one should benefit more by the house they live in.

liam8282

LizzieS In your scenario, where would Couple B suddenly find the 10% deposit to go and get a mortgage? The more likely outcome is that they will have to rent privately.

Deepmistrust To coin one of your phrases, "greater minds than yours", have calculated the minimum wage etc. If it has been assessed that this is the minimum amount a person can earn to live on, why do you disagree with it?

You also made the remark that my opinions are "bigotted" (actually bigoted, but nevermind), the definition of bigot is:

"A bigot (in modern usage) is a prejudiced person who is intolerant of any opinions differing from their own or intolerant of people of different ethnicity, race, or class."

IMO that perfectly describes your personal crusade on this thread.

My comments are my own views and opinions on the subject, your comments on the other hand are personal attacks against other peoples opinions because they happen to differ from your own.

Your comment,

"Just because you can't have the internet to yourself, to whine about benefits recipients without having your smears countered, is no reason to have a meltdown."

Is just laughable, you became a member May 10, you have made 207 comments (& counting), just about all of them will be on this thread, where you have gone crazy quoting every single comment that is made and breaking down each individual sentence, to post your own (bigoted) view on what someone else has written.

pupsicola

The tories go on and on and on about helping those who help themselves. Yet again the savers of this country are being smacked in the face. The child trust funds were a good idea and gave an incentive to people to put a little away for their kids futures. Dont see the point of elections. They all say what they feel will get them into power and then make a total hash of it when they are there. 5 more years of this

LizzieS_2

liam8282 wrote: »

LizzieS In your scenario, where would Couple B suddenly find the 10% deposit to go and get a mortgage? The more likely outcome is that they will have to rent privately.

Both couples moved before having children which is more common.

Couple B both worked until children came along which again is common.

It is easy to save 10% deposit if you live with parents until you can actually afford to move, with £400 per week between them they could have saved first - this is more common.

liam8282

Ok, I get where you were coming from with the housing, but there are so many things that could go wrong for Couple B, and I don't think it is all that common as you are making out.

It could be quite common for everything you have said to happen, but I would say that would be in a perfect situation. It doesn't always work out that way for a lot of people.

Just getting any sort of mortgage nowadays is like getting blood out of a stone.

I don't know how long you expect people to live at their parents for and how much the average cost would be to live at your parents.

I wouldn't like to say what the average persons (couple weekly living costs are, even if they were living with parents, they would still have to contribute to the parents household bills, food, travel, clothing..........

Or even if it is possible that the parents would want them living with them, it is quite common for parents to want their grown up "kids" out of the house asap.

Even if everything went according to plan, if the couple managed to save £400pm it would still take them 25 months to get together a £10,000 deposit, then adding on fees etc, it would probably take them at least 2.5 years, just to get them to a point where they could get a house.

Where as couple A, could do everything couple B, want to do, but straight away, no effort involved.

Also, when you consider the work and effort Couple B have to go through for their income, to achieve the equivalent of what Couple A receive for nothing. It values Couple B work and effort at nothing.

A further point, if Couple A have the same net income, what is there to stop them saving the same amount as Couple B and buying a property? This property would be entirely funded via benefits, but solely for the benefit of Couple A. (I am not sure of the consequences this would have on Couple As income from benefits, but cannot see why they couldn't do it?)

I do agree with your points about the workfare scheme.

LizzieS_2

Hi Liam

I wouldn't expect adult children to live with their parents forever. Generally parents encourage their offspring to save especially those parents who have taken on a mortgage themselves. By encouraging saving couple B would have already individually saved towards a future, so in reality for many (not all) they would not be suddenly saving upon meeting their partner. Also many of these have parents who have put savings away for them throughout childhood.

What it costs to stay with parents varies around the country. What young adults spend also varies. Virtually every working person living at home does have some capacity to save.

Assuming they stay for college, but do not go to university, get a minimum wage job at 18/19. Their income has dramatically increased even taking away the direct costs (parents lodging fees, clothes etc). It would only take 2 to 3 years to save, but realistically most would take longer than that through choice. I have no idea what the common age for children to leave home nowadays, there was some report a while ago that suggested 30 was becoming normal.

Couple A could not save the same as they would only get a maximum of £65pw each for staying with parents. Their income goes up when children appear.

For both couples, it is much harder to save when you have to pay all household bills.

Agree with you in that couple A have had to make no effort towards their future - couple B have effectively been totally undervalued from the outset and punished for their efforts by the system later.

Deepmistrust

liam8282 wrote: »

LizzieS In your scenario, where would Couple B suddenly find the 10% deposit to go and get a mortgage? The more likely outcome is that they will have to rent privately.

Deepmistrust To coin one of your phrases, "greater minds than yours", have calculated the minimum wage etc. If it has been assessed that this is the minimum amount a person can earn to live on, why do you disagree with it?

Because, more often than not there are corporations taking huge chunks of profit off the backs of others labour. If wages were improved, and payrises were kept at least in line with inflation, less people would be reliant on top up benefits such as WTC. The minumum wage is a relatively new policy. Using your logic, therefore "greater minds" would have allowed no such law to protect workers, previously.


You also made the remark that my opinions are "bigotted" (actually bigoted, but nevermind), the definition of bigot is:
Boring spelling Nazi impression aside, yes, you have a serious issue with people who receive benefits, including working families, thus yes you are bigoted towards those on lower income (see class if you want the definition to fit).

"A bigot (in modern usage) is a prejudiced person who is intolerant of any opinions differing from their own or intolerant of people of different ethnicity, race, or class."

IMO that perfectly describes your personal crusade on this thread.
I don't think you yet quite understand the definition tbph.

My comments are my own views and opinions on the subject, your comments on the other hand are personal attacks against other peoples opinions because they happen to differ from your own.
You should really swallow your own pill here, none so blind as those that refuse to see. Your attacks, and in some cases complete falsehoods, do not have any bearing on the fact that I can indeed "attack" your opinions if I so wish. If you air them on a public internet forum, then why do you find it so hard to cope when they are countered?

Your comment,

"Just because you can't have the internet to yourself, to whine about benefits recipients without having your smears countered, is no reason to have a meltdown."

Is just laughable, you became a member May 10, you have made 207 comments (& counting), just about all of them will be on this thread, where you have gone crazy quoting every single comment that is made and breaking down each individual sentence, to post your own (bigoted) view on what someone else has written.
That's a strange obsession with my posting numbers you have. I tend to have more posts on here, because more people have quoted my posts on here, hence I am responding to those people (of which you are one). Does this cause you difficulty? You can get help with that. Quite pathetically sad, actually.

The manner in which I respond to the numerous posts that people have quoted me on, is neither here nor their. Yes I opt for ease to quote after their sentence if I am refering to that particular part of their post (as above). You will one day have to get over that though, there really is nothing you will achieve by continually whining about the manner of my replies.

Now do you actually have anything to say about the TOPIC in hand (including the digression onto various other benefits), or are you going to continue to make numerous replies to me, whining about the manner in which I type?

No need to answer, I think your next rant will speak for itself :rotfl:

liam8282

Deepmistrust wrote: »

No need to answer, I think your next rant will speak for itself :rotfl:

Why is there no need for me to answer a post which is aimed at me, and quite insulting to myself, basically calling me a bigot for having a different opinion to yours and comparing me to a Nazi for having that opinion?

Because you cannot accept that people have different opinions to your own, that is not my problem.

I have also expressed my opinion on the topic in hand in some detail on this thread, without the need to attack or belittle any other persons opinion.


"A bigot (in modern usage) is a prejudiced person who is intolerant of any opinions differing from their own or intolerant of people of different ethnicity, race, or class."

Exactly what you are doing in your numerous replies (rants) to various people on this thread, stating that their opinion is wrong because you happen not to agree with it.

I do think you understand the definition tbph, but you choose to ignore it because you don't agree with it.