Low paid to be deemed as "not working enough"

ALIBOBSY

N1AK wrote: »

I also agree. However what I take exception to is the idea that my wife and I, who could not afford for one of us to give up working and bring up children in a way we'd be happy with, be expected to pay £20k in tax and NI so that someone else can choose not to work and get paid by the state to stay at home with their child. The current system is a discouragement to financially stable people to have children (paying more tax leaving less income) and an incentive to have children for people who can't afford it.

Anyone who works hard and earns a reasonable income has to make a sacrifice in order to stay at home with their children, why should people who don't be rewarded for it?

Well for a long time we lived off a single wage and I became a SAHM when we had our third child. We made the decision for me to finish as with the extra costs of childcare etc it simply wasn't worth me working part time and we cut our spending etc. By this I mean I actually would lose money working part time and paying child care/travel costs, compared to using my time shopping around for food deals and cooking from scratch etc.
We certainly don't live a high life by qualifying for TC, but I have to admit it has helped me to be able to stop at home with the children. I also think there are unquantifiable advantages to one parent being at home and doing school runs etc that may have knock on effects on how well those children live their future lives and if they become future tax payers or not. But we certainly had to cut right back and make sacrifies for me to stop at home, even with the TC.

I now work part time self employed from home and we have 4 children so do get some TC. BUT I appreciate the pot of cash from tax is under strain and would happily accept them assuming a min part time wage for me- obviously my income varies.

We actually had a period for about 2 years when we didn't get any TC at all because of OH's income and we managed, you cut your cloth to suite your income. Actually in some ways its nicer to be self sufficient.

But I still can't see how all this is to be administrated, surely its a hell of a lot of people to be interviewed?

Ali x

chucky

N1AK wrote: »

I'm not sure if I should be flattered or concerned

I've been on a bit of a crusade the last few days about debating methods; I started to notice my posts were moving away from discussion and towards snide remarks and sound-bites and that disappointed me. We're not all sworn enemies and I think the forum would be 'better' if we remember that (hopelessly naive as that sounds).

Flattered is fine. When you post things that make sense I will be happy to praise you.

Keep up the good work. Well done.

ab.da54

Graham_Devon wrote: »

So someone should work 40 hours for the same income as working 25 hours?

What for exactly? It's not going to save anyone any money, not going to be positive for anyone and only serves to punish.

So someone should work 40 hours for the same income as working 25 hours + benefits - absolutely!

ash28

MFW_ASAP wrote: »

Which was also raised by G4TD:



I remember in the 80s recession. My dad lost his job as an engineer and ended up having 2 jobs to make up his hours/money. They didn't all these tax credits and other benefits in those days so he didn't have the option to just take one job and have Joe Taxpayer pick up the slack.

Except they did have a form of tax credits in the 1980s and have had an income supplement for poor families since 1971 with the introduction of FIS (Family Income Support), which was to try and alleviate poverty especially single parent poverty.

FIS was a means tested benefit for families with an adult working at least 24 hours a week and with a dependent child.

Your father's part time job probably didn't have enough hours (in one job) or it paid too much to be able to claim....

In 1988 it changed to FC (Family Credit), in the early 1990s the hours requirement was reduced to 16, it had a childcare disregard......and it was paid to the mother in the form of a payment book, cashed at the Post Office.....it was paid for 6 months at a stretch regardless of changes in circumstances - my sister used to get this as a single parent working 16 hours a week.....

In 1999 it was changed to WFTC and the terms were changed again....the childcare disregard was to changed to direct childcare payments of up to 70% of the cost.....it was changed due to the low take up of the childcare disregard in Family Credit. It was changed again in 2003.

In a minimum wage family...one fulltime (40 hours) and one 16 hours with no childcare cost - assuming partner working fulltime looks after children in the evening while mother goes to work (£978 and £437 nett) - they would still be entitled to almost £2.7k a year in Child Tax Credits and £1.7k a year child benefit....

Currently (April 2013) there 1.48m unemployed families receiving Child Tax Credits. (over 1m of them single parents)
3.31m families or couples receive Child Tax Credit and/or Working Tax Credits....

Help for the working poor is not new by any means - it has been around in different forms for over 40 years......the current system is similar to the last system but with changes to childcare and payment method....

From the introduction of supplementing family income to today one of the problems has been the huge increase in the number of people eligible to claim.....the massive growth in single parent families is one reason, and I guess the fact that minimum wage isn't a living wage for a family in the UK, along with the increase in part time jobs.

One of our daughter's is manager in retail and she isn't allowed to recruit fulltime staff.....she would love to but she can only employ up to a maximum of 25 hours and some are as low as 12 hours....she has around 20 staff and has no fulltime workers and it drives her mad.....I don't think she is unique. She also has 3 drivers who all work part time too. 2 of them work 2.5 days and 1 works 2 days. Mostly on minimum wage.

I'm not sure when an employer has to pay NI for an employee but if there's a threshold below which they don't pay, employing staff under that threshold would reduce costs......but I don't know.

Loughton_Monkey

ash28 wrote: »

.......One of our daughter's is manager in retail and she isn't allowed to recruit fulltime staff.....she would love to but she can only employ up to a maximum of 25 hours and some are as low as 12 hours....she has around 20 staff and has no fulltime workers and it drives her mad.....I don't think she is unique. She also has 3 drivers who all work part time too. 2 of them work 2.5 days and 1 works 2 days. Mostly on minimum wage.

I'm not sure when an employer has to pay NI for an employee but if there's a threshold below which they don't pay, employing staff under that threshold would reduce costs......but I don't know.

As far as I know, Employer's NI switches in at around £149 a week. That seems to be just under 24 hours a week at minimum wage.After £149, they have to pay around 12%.

So it seems to me that part time work is 'highly desirable' from bothe the employer and employee angle. It might help to explain why so many people do part time.

ALIBOBSY

lazer wrote: »

If someone doesn't attend the jobcentre will there full Universal Credit be cut, if so - then I think its wrong, but what they can do is assume 35 hour week on minumum wage and base the tax credits on that instead of actual earnings.

I suspect that purely from a logistic POV this is what will happen. The reality is the job centres do not have enough staff to sudden increase the numbers of interviews being done, and the government certainly won't want to dramatically increase the number of public sector staff.

So the easiest thing to do would be place the applicant in the various groups and if you are in the interview/further help group you are offered the extra "push" into more hours or you will be treated as earning the equivalent of min wage for 35 hrs. This will be especially useful for people who are self employed and earnings/work goes up and down week to week/month to month. It will be cost effective and easier to ask people to volunteer to forgo the help and go straight onto a cut price tax credit than make them jump through hoops and the extra staff costs that involves.

In effect a back door way to cut the benefit bill. Where as a slash of rates across the board might get a bit of a public outcry, tinkering like this doesn't get noticed in the same way.

Ali x