MSE News: Benefits shake-up to introduce Universal Credits

jojo90_2

Any change is welcome however I would have liked to see a more hardline approach. I won't say this often however I think the US system has got it right.

Unemployment compensation is money received from the United States and a state by a worker who has become unemployed through no fault of their own. In the United States, this compensation is classified as a type of social welfare benefit. According to the Internal Revenue Code, these types of benefits are to be included in a taxpayer's gross income.[18]

...

Eligibility and amount
Americans out of work who do not qualify for unemployment insurance include part-time, temporary, and self-employed workers.[26]
Generally, the worker must be unemployed through no fault of his/her own (generally through lay-offs). Unemployment benefits are based on reported covered quarterly earnings. The amount of earnings and the number of quarters worked are used to determine the length and value of the unemployment benefit. The average weekly payment is 36 percent of the individual's average weekly wage.[27]

Seems fair to me. If you work and lose your job then you get help based on how much you put into the pot. If you choose not to work you get nothing. It's not rocket science.

Personally I think the £26,000 limit for families out of work is a joke and hardly any encouragement.

plumber2009

I was unemployed for about 4 months in 2010 after loosing a job. I was about to be made homeless also, but because i did not have kids i was not entitled to any help with accomodation or any other benefit appart from JSA.

So my view is that single parents with children should get nothing as this this the root cause of the problem, not those looking for work.

I found a job and relocated in the space of 4 months when there are apparantly no jobs. What a joke as there is loads of work out there if you are prepaired to actually look. The reason it took me this long was down to the fact that i had zero funds. I had to crash at frends houses and did not know where my next meal was comming from.

All I needed was help in the short term but had none. I even did not get any JSA money until about a week before starting my new job.

jojo90_2

plumber2009 wrote: »

I was unemployed for about 4 months in 2010 after loosing a job. I was about to be made homeless also, but because i did not have kids i was not entitled to any help with accomodation or any other benefit appart from JSA.

So my view is that single parents with children should get nothing as this this the root cause of the problem, not those looking for work.

I found a job and relocated in the space of 4 months when there are apparantly no jobs. What a joke as there is loads of work out there if you are prepaired to actually look. The reason it took me this long was down to the fact that i had zero funds. I had to crash at frends houses and did not know where my next meal was comming from.

All I needed was help in the short term but had none. I even did not get any JSA money until about a week before starting my new job.

Exactly! If I get laid off from my job tomorrow despite having contributed 10s of 1000s in tax I get sweet f.a. Probably have to sell my house and live at my parents. If however I'd knocked up some girl it's a different story. Under the US system I'd have enough money to cover the payments on my house, find a job, and get back into work with a minor blip.

mrsspendalot

calleyw wrote: »

Lucky you. After 2 and half years I have had a 2.5% wage rise which is a whole 18p a hour.

But life goes on.

Yours

Calley

We got nothing last year and this year we got 0.5%

tod123

Tigsteroonie wrote: »

Better off? Debatable.

I've just worked out that we are currently £35/week better off with me working than staying at home with Marley & the littl'un. I have to spend £15/wk of that on travel and lunch (bring my own).

So I am getting out of bed for £4 every day. The way I felt this morning, I could happily have sacrified today's £4 for the chance of sleeping a little longer.

Its not a choice issue!

State aid is there as a safety net not a lifestyle choice.

staffsuk

I have just discovered something quite alarming under the new plans... The following is buried in the text of the white paper:

"For Universal Credit we are considering introducing a floor of assumed income from self employment for those registering as such. The floor will be set at the National Minimum wage for the reported hours; clearly profits above this limit may be received and reported."

It's rare for many starter businesses to get anywhere near the tax threshold in net profit for the first few years - many in fact make a loss.

So if a person stated they were working 40 hours - then they would assume they were earning 40 x £5.93 - whereas in fact they could be netting way less than that?

Under the current system you are entitled to the full credit if you are single and working over 30 hours / week up to the tax threshold - whereupon it tapers off.

Am I missing something here - do they not state 'No-one will be worse off in work under the new system'?

'Assumed income'. What an absolute joke. Are they serious??? What about the actual income :mad::mad::mad:

nitpicker_2

Let me put it like this if i may,
Two Skeletons bump into each other and one Skeleton turns and says to the other,
"Tell me,did you die before or after the cuts to the benefits??
The other one replies"No, I'm still alive".

pandaspot

Universal credit is an excellent idea on paper. When we first read the White paper in November I have to say I thought what an excellent idea. But I seriously can't see it being done by 2013, and widespread by 2017.

They expect to take on all new hb cases by oct 2013,I just can't see it happening. Dwp staff have to be trained to assess it. They now also want to take ctb as well from la's.

Nice idea, I lose my job because of it. But if it works then it will really reduce fraud which has to be a good thing

Jowo_2

I'm not familiar with the new proposals as it relates to self-employment.

Perhaps this new threshold has been imposed because of the number of people who set up rather rotten 'businesses' which are no more than pocket money hobbies in order to be eligible for tax credits. I'm thinking of the amount of posts I see on this forum from people being urged towards setting up an 'ebay' or catalogue commission selling job like Avon, being instructed that even if they don't make a profit, it'll simply mean that they trouser tax credits.

There have been discussion on this forum about how tax credits tempt many into becoming self-employed who have no true entreprenurial impulse, suggestions that it encourages pretty much 'bogus' businesses where the person doesn't really put any effort into business planning, marketing their services, finding clients or increasing turnover because its not worth it from a benefit claimant perspective.

We have posts from tax credit recipients who earn sometimes less than pound or two per hour, after running costs, for their alleged 16 hour per week self-employment in child care, taxi driving and similar.

Sixer

staffsuk wrote: »

I have just discovered something quite alarming under the new plans... The following is buried in the text of the white paper:

"For Universal Credit we are considering introducing a floor of assumed income from self employment for those registering as such. The floor will be set at the National Minimum wage for the reported hours; clearly profits above this limit may be received and reported."

It's rare for many starter businesses to get anywhere near the tax threshold in net profit for the first few years - many in fact make a loss.

So if a person stated they were working 40 hours - then they would assume they were earning 40 x £5.93 - whereas in fact they could be netting way less than that?

Under the current system you are entitled to the full credit if you are single and working over 30 hours / week up to the tax threshold - whereupon it tapers off.

Am I missing something here - do they not state 'No-one will be worse off in work under the new system'?

'Assumed income'. What an absolute joke. Are they serious??? What about the actual income :mad::mad::mad:

Related remarks are elsewhere hereabouts.

I think this is so that a) people can't say they're working 30+ hours on their Avon round, for which they nett £25 a week and claim full in-work benefits, and b) so that business start-ups are financed by finance companies rather than the benefits system.

ETA: cross-posted with Jowo.

ETA2: added post I was referring to after threads were merged.