MSE News: Government shrugs off Lords benefits defeat

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  • drwho2011
    drwho2011 Forumite Posts: 346 Forumite
    State Pension: 70bn + 8bn in Pension Credit
    Tax Credits: 35bn
    Housing Benefit: 22bn
    DLA: 12bn
    Child Benefit: 12bn
    Incapacity Benefit & ESA: 8bn
    Income Support: 8bn
    Attendance Allowance: 5.5bn
    Council Tax Benefit: 5bn
    JSA: 4.8bn (approx 800m is paid as contributions based JSA)
    Winter Fuel Payment: 2.2bn

    There's another 10bn unaccounted for but its mostly small amounts.

    Total: 202bn

    *figures are rounded but should be relatively accurate.

    1. £80bn in contribution related benefits.
    2. £84bn in income related benefits.
    3. £37bn in neither contribution nor income related benefits.

    If I recall correctly income tax and NI combined bring in about £250bn, but the state pays people £200bn in welfare benefits.




    Discuss





  • CFC
    CFC Posts: 3,119 Forumite
    Zziggi wrote: »
    I'm so pleased I made you laugh. But seriously how does it save the government money if a couple with a large number if kids "split up". Are you telling me that people severely hit by a benefits cut wouldn't do this??

    I'm not affected either way by this however if I was part of a couple with 8 kids & was going to find my benefits slashed then i'd be telling him-indoors to "split up" with me & take half of our kids. Two lots of HB, IS, CTB will surely cost more than one lot of HB & CTB etc

    I know of a number of people on the council estates who already do this to maximise benefits.
  • rogerblack
    rogerblack Forumite Posts: 9,446 Forumite
    CFC wrote: »
    I know of a number of people on the council estates who already do this to maximise benefits.

    And both benefit maximisation, and tax avoidance are entirely legal.

    It's not considered unusual to employ a professional to reduce your tax payment though, and to restructure your affairs.
  • LookingForNipsy
    LookingForNipsy Forumite Posts: 89 Forumite
    I don't understand why the rhetoric around "Making Work Pay" is all about lowering benefits and dealing with scroungers. A lot of benefits are paid out to families that have full time working parents who simply don't make enough, a lot to people who have been made redundant or have contracts end - households receiving 26k in benefits are actually few and far between.

    People are too obsessed with the few who deliberately rely on benefits and the government encourages this to distract us from the bigger and more difficult to tackle problems of inflated rents, structural unemployment, low wages and lack of job security in this country. Why aren't people frothing at the mouth concerning these issues??

    Capping benefits without tackling these other issues is simply advocating a race to the bottom and its divide and rule politics at its best!
  • cit_k
    cit_k Posts: 24,812 Forumite
    The cap is simply to move the poor out of high rent areas, to socially cleanse them.

    Everyone affected by this cap is going to be in a high rent area, there is no other way they can get that much in benefits otherwise.

    The people this will affect the most, are the buy to let landlords who will no longer have the state buying them a free house....
    [greenhighlight]but it matters when the most senior politician in the land is happy to use language and examples that are simply not true.
    [/greenhighlight][redtitle]
    The impact of this is to stigmatise people on benefits,
    and we should be deeply worried about that
    [/redtitle](house of lords debate, talking about Cameron)
  • MissMoneypenny
    MissMoneypenny Forumite Posts: 5,324 Forumite
    edited 25 January 2012 at 1:03PM
    trynsave wrote: »
    Deal with less money or go get a job. And no, I don't believe many are trying hard enough. People who don't have English as a first language can manage it.

    Some do, some don't. The government estimate that 6.4% of those of working age and claiming non-working benefits last year, were foreign born. The sampling also seemed to suggest that 2% did not have a right to the benefits they claimed.

    The welfare reforms are long overdue. It won't hurt parents to realise they can't get away with sitting at home and claiming, or just working the minimum hours to maximise their benefits.

    I would rather ensure that child poverty is stamped out by using the school kitchens to feed the children, instead of giving any child related payments to their parents.
    RENTING? Have you checked to see that your landlord has permission from their mortgage lender to rent the property? If not, you could be thrown out with very little notice.
    Read the sticky on the House Buying, Renting & Selling board.


  • drwho2011
    drwho2011 Forumite Posts: 346 Forumite
    edited 25 January 2012 at 10:58AM
    cit_k wrote: »
    The cap is simply to move the poor out of high rent areas, to socially cleanse them.

    Bit dramatic really, all it means is people must live within their means just as a country must.

    Else you end up bankrupt like Greece.

    Increasing rents led to increased in rates of LHA which led to LHA being used as a minimum rental value (as a landlord knows this is the maximum that will be paid) and so the increases at the bottom of the market would have led to an increase in the median rate, leading to LHA being increased further.......ad infinitum.

    Such actions cause an upward trend in rents, and how do you "cap" private sector rents? Even if you had LHA set at a national trend (and London rents would cause this to higher than it would otherwise need to be) then you are still in the same upward rental trend but it becomes escalated on a national level with the biggest impact being the cheaper to rent areas such as the North of England. Thus a benefit cap allows freedom of choice and is the most practical solution.

    Which is why I bought my house when I did, despite the risk of house prices falling as a 20% increase in rental costs year on year wasn't sustainable on my salary and I would have started to have to use my house deposit savings to help pay the rent.

    While I worked at the JCP I would regularly see people in 3-4 bed properties who's LHA was equal if not greater than my salary.

    The cap for a everyone should be based on a single persons NMW. The current system provides no incentive for family planning and encourages welfare dependency when you reach a certain point.

    Incidentally in:
    1991/2 we spent £121bn on welfare payments.
    2001/2 we spent £132bn on welfare payments
    2011/12 we are estimated to spend £202bn on welfare payments

    Labour changed the way they reported welfare in the last 10 years and so Tax Credits and Child Benefit weren't counted in the DWP spend of £156bn in an effort to fudge the figures and hide the massive increase in welfare spending.
  • Sezzler
    Sezzler Forumite Posts: 149
    Tenth Anniversary Combo Breaker
    Forumite
    I still think the £26K is massive and it prob going to be way more than I shall ever earn. :mad:
    it slightly grates when you hear on the BBC people moaning about their standard of living suffering - if you dont get enough money from benefits surely you should move where the rents are lower !!!
  • casement
    casement Forumite Posts: 6 Forumite
    I think that people should stop and think for a while. Many of these people affected will have been put out of work through no fault of their own and it may not be possible for them to move to cheaper accommodation. Secondly, whatever has happened, it is certainly not the children's fault. What are you proposing to do? Throw children out on the streets?
  • drwho2011
    drwho2011 Forumite Posts: 346 Forumite
    casement wrote: »
    I think that people should stop and think for a while. Many of these people affected will have been put out of work through no fault of their own and it may not be possible for them to move to cheaper accommodation. Secondly, whatever has happened, it is certainly not the children's fault. What are you proposing to do? Throw children out on the streets?

    No one would be made homeless, that is a silly argument.

    Whats your proposal, endlessly throw money and maintain this at the rate of inflation to them to solve poverty? That was what got us into this situation in the first place.

    People will have to move and adjust their lifestyle its really that simple.
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