Benefits shake-up: warning for non-working claimants

Gemstar30

frank_begbie wrote: »

When you only receive the bare minimum to survive when on Job Seekers how can they make it less?

Surely they should be making work more attractive by increasing the wages?

Its not that the benefits are too high its that the wages are too low.

ummmm

that's novel!!

so the employers should pay more in wages and increase the price of their goods or at worst sack people. Where will that get us?

If wages were only 10p more than benefits - is that so wrong?

Sixer

liam8282 wrote: »

Increasing the minimum wage will increase inflation.

Minimum wage increases, therefore all other wage rates have to increase in line with this. For example a person currently on £8 ph, will want £10 ph, if the NMW goes up by £2.

Wages are a major cost to any business, so you increase wages, you increase costs, you increase prices, hence increased inflation.

Also, people on minimum wage do not need tax credits to survive.

An average person on minimum wage would get £10,792.60 gross per year. That is £5.93 ph, 35 hrs pw, 52 weeks a year.

Therefore the average single person would not qualify for tax credits (I think anyway?!). (After doing the tax credits checker, a single person over 25 would be entitled to a small amount of tax credits)

As I said, upping the NMW to £8 would save £6bn a year in tax credits. This is because the majority of claimants are households with children, not singletons. These aren't my figures: these are figures from ONS data and quoted by sources across the political spectrum. I think, although don't quote me, the figure is actually in the Greens manifesto.

As I said again, I'm not proposing extra costs on employers. I'm proposing a fiscally neutral solution by reinvesting the £6bn saved into job creation by reducing employers NICs by the same overall amount. Employers NICs were a huge issue at the election, referred to by the current administration as a jobs tax and disincentive to employment creation.

Increasing average take home pay but maintaining actual household income by means of paying fewer tax credits is *not* inflationary. You are not increasing purchasing power.

Increasing NMW while decreasing employers NICs by an equivalent amount is *not* a burden on business.

liam8282

Sixer wrote: »

As I said, upping the NMW to £8 would save £6bn a year in tax credits. This is because the majority of claimants are households with children, not singletons. These aren't my figures: these are figures from ONS data and quoted by sources across the political spectrum. I think, although don't quote me, the figure is actually in the Greens manifesto.

But does this take into account all other factors, or does it just solely focus on saying that all those currently getting £6ph, would not be eligible for tax credits at £8ph?

Basically it is flawed.

Sixer wrote: »

As I said again, I'm not proposing extra costs on employers. I'm proposing a fiscally neutral solution by reinvesting the £6bn saved into job creation by reducing employers NICs by the same overall amount. Employers NICs were a huge issue at the election, referred to by the current administration as a jobs tax and disincentive to employment creation.

That is fair enough.

Sixer wrote: »

Increasing average take home pay but maintaining actual household income by means of paying fewer tax credits is *not* inflationary. You are not increasing purchasing power.

Again it is ok using that example, but with strictly limited criteria.

What about the increase in the personal tax allowance, that is definitely coming. You also want a wage increase for everybody on top of this?

Paying less tax, will result in a higher salary and will definitely increase purchasing power.

BTW, what is the difference between the tax credits and the £3,640 wage increase (£2 x 35hrs x 52 weeks).

Sixer wrote: »

Increasing NMW while decreasing employers NICs by an equivalent amount is *not* a burden on business.

To be fair, you have only just brought this point up, I agree with it in principal.

But what will the net effect be on your first point? Surely the savings made in tax credits, will be netted off against the reduced E'ers NIC? Therefore no saving, and the govt will still be paying for it, just via the reduced income from E'ers NIC.

schrodie

I understand that the UC is only in it's infant stage w.r.t. to becoming a fact of life but does anyone know what the situation is for a couple where one works full time and the other partner is disabled, no kids.

Will the income of the working partner be taken into account when assessing the amount of UC the disabled partner will be awarded? If so, is there an upper limit to what the working partner can earn before the disabled partner gets no UC?

Thanks

AnxiousMum

corbyboy wrote: »

Does anybody know how the enforced work placement is going to be compatible with the mimimum wage regulations?

I'm sure that when you factor into the payment of JSA, council tax benefit, housing benefit, child tax credits, working tax credits........I'm quite certain that the minimum wage regulations would be met. And oh......if you're on JSA for a year, and only have to work for one month......the wage works out quite a bit above minimum wage!

frank_begbie

Gemstar30 wrote: »

ummmm

that's novel!!

so the employers should pay more in wages and increase the price of their goods or at worst sack people. Where will that get us?

If wages were only 10p more than benefits - is that so wrong?

Depends what your out goings are, bus fares and so on.

If you had to travel 10 miles for instance, you could be a hell of a lot out of pocket.

Sixer

liam8282 wrote: »

1. But does this take into account all other factors, or does it just solely focus on saying that all those currently getting £6ph, would not be eligible for tax credits at £8ph?

2. What about the increase in the personal tax allowance, that is definitely coming. You also want a wage increase for everybody on top of this?

Paying less tax, will result in a higher salary and will definitely increase purchasing power.

3. To be fair, you have only just brought this point up, I agree with it in principal.

But what will the net effect be on your first point? Surely the savings made in tax credits, will be netted off against the reduced E'ers NIC? Therefore no saving, and the govt will still be paying for it, just via the reduced income from E'ers NIC.

1. No, it's just saying this would be the overall effect. As in any solution, the effect would not be the same on absolutely everybody. This is not a reason to reject it, else by implication you reject all other solutions.

2. We are already in an inflationary situation, thanks to QE and other inflationary macro-economic policies, none of which improve the standard of living for the average Joe - and in the case of QE at least, haven't even achieved what was wanted by increasing liquidity in the system. Again, this isn't a reason for rejection. I would aim my anti-inflation measures at ending QE and reducing rents (see point 4), thus negating your worries here.

3. No, I clearly said this in my first post. In an ideal world, this would be used to reduce government expenditure. But we are in a world expecting public sector job losses to the tune of 500k. Given this, I would make the measure fiscally neutral to maintain the private sector's ability to create jobs and taxpayers - thus moving us out of the current hole.

4. You ignored the final point in my original post, which was another strategy for combining reducing benefits and increasing employment: massive investment in social housing, which would reduce rents and the BtL cowboy situation without penalising vulnerable claimants by reducing subsistence incomes by 10%. For this, however, I don't see a solution acceptable to the current administration since they are hellbent on pandering to NIMBYism by calling it local empowerment. If you have a way around it, do tell!

5. None of this is to say that I actually approve of any of these ideas. They are just ideas. I would simply like to see employers, landlords and other parts of this equation debated. At the moment, only claimants are debated and we are seeing only part of the picture.

6. If it were down to me, we'd have a Citizen's Income, a land value tax, no benefits whatsoever, no income tax, no NICs, no VAT, etc etc. But that's just my little dream world!

donny909

There are a few issues on all this benefits reform issue that I and possably some on here in my position can see thats making some of the new proposals making the government look down right narrow minded while ignoring far simpler and cheaper options for those willing to get out of the benefits trap and truely do want to help themselfs at a cost far cheaper than the government propose via there latest training\work for 30 hours per week for your benefit (and dont get me started on the issue of this effectivly being against the minimum wage laws to work 30 hours for JSA when it should be hours worked at minimum wage for benefits received).

All this will be is just be a government run A4E (if anyone recalls the C4 program about them and such schemes) scheme, assuming they dont out-source, for the masses. Where it will not directly help anyone get back into work or help them in the slightest.

So to my point and I think I have raised and asked this on here in the past. The government with these new ideas and reforms etc will now spend an unknown amout or money per person to say what they should do to find a job and or make them do via work 30 hours per week for what they receive. And in no way am I against some hours being worked as I have thought at least 1 day per week should be provided for all receipients of JSA or any mainly capable of work people in receipt of any benefit. But under current rules people cant do this as such as they are then not activly available for or looking for work and thus against the rules for JSA or other benefits etc. Funny that how the government now want to do just that but for near a 4 day working week.

But the way they seem to sound like they are going to do it is to put everyone capable of work look into a big box and pull names out at random and then tell them what they are going to do rather than look at the individual and there needs and circumstances etc. Thus decreasing the chances for employment for those that really do what to work by labeling them the same as those who simply dont want to work.

So by the sounds of things is thus, do as they are told then do a 4 week 30 hour week for your benefit a few times a year. Either that or be forced onto those pathetic "training" schemes by the likes of A4E etc. What is the extra cost of that to the government\tax payer for those schemes anyway?.

Why cant they concentrate on areas of training and employment aimed directly at a persons capability and based on the area they live in based on what employment options are available in a persons particular area?. Because what might work from what the govenment say might work for each person from there viewpoint wont work at all because each person has different abilities and capabilities and each area has different industries, employment options and availabilities. So to force a single policy for every person and part of the country reguardless of ability and availability simply will not work.

What they should be doing is to give each person a kind of "grant" for say £500, available every 12 months. That grant must then be used for either training or a direct qualification that would greatly improve a persons chances of finding employment in both an area they can\would like to work in and\or know there is employment availability for in the area they live. In return they (once the training or qualification grant has been payed and the person on it) would be defered from any 4 week upto 30 hour work placement for 3 months after compleation of the training or gaining the qualification so they can go job hunting with there newly found real training or qualification.

That idea is not about picking and choosing what job a person wants to do if thats what it sounds like. But more like a real and genuine chance of a person increrasing there chances of finding employment through propper training\qualifications aimed directly at a person rather than the current schemes that simply dont work, gain any training or qualification and cost many times more than what I feel above and what the government currently do and certainly plan to do in the near future!.

Training grants like I suggest would even allow people to gain training and qualification in areas that whilst might not be able to directly work in today (say due to health issues etc) would be able to in the near future possably when health and circumstances allow but are capable of at least doing the training or gain the qualification ready.

ViolaLass

Gemstar30 wrote: »

Don't be ridiculous!!

Did you never do social and economic history at school or college??

Take some time off and get some books out of the library about working conditions in the 18th century.

It was just a thought and I did say I was quite happy to be corrected. Got any figures?

I don't see how working conditions are relevant - I was talking about what percentage of the population worked, not what work they did or what it was like. Really, I was thinking about the greater divide between classes back then and the fact that there is now a much larger middle class. Of course, I hadn't allowed for things like a larger student or pensioner group, which have just occurred to me. In any case, no need to be rude eh?

DX2

AnxiousMum wrote: »

Huh??? Whose blaming them for anything? So they're a 'non working claimant' if they are claiming and not working right? But who's blaming them for anything? All they have to do is get out there and work at finding a new job and accept something that comes up!

I think Kim was talking about Rok going into administration.