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George Osborne warns £25bn more cuts needed
Comments
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the SMI only covers the interest on the mortgage and not capital so it can't fairly be said to be 'paying down a privately owned asset'
It may have changed reasonably recently but my understanding was that the payment wasn't based on the actual interest payment thus some people were receiving considerably more than they were paying in interest.Having a signature removed for mentioning the removal of a previous signature. Blackwhite bellyfeel double plus good...0 -
spacey2012 wrote: »So he wants £25 billion of cuts over 4 years.
The foreign aid budget is 11bn a year.
Well thats 44 billion, a surplus of 19 billion left !
Have a referenda on abolishing foreign aid George, I bet the result is 99% in favour, possibly higher and you could walk the next election as people would at last see a government in tune with the people.
The cronies pocketing the money on the kick backs might not be happy, but hey ho.
We are all in together.
I don't disagree with your point.
I wonder how much actually ends up being "spent" back in the UK? More of a "subsidy" for exporters or an offset against some other "debt"?"If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
It may have changed reasonably recently but my understanding was that the payment wasn't based on the actual interest payment thus some people were receiving considerably more than they were paying in interest.
It's based on a standard interest rate (3.63%) rather than the claimants actual payment.
Some will be getting more than the interest and some less but 3.63% is about the average interest rat being paid so it'll balance out although the thought of some people getting more does cause some vexation.
Probably a pragmatic attempt to keep costs down.
https://www.gov.uk/support-for-mortgage-interest/what-youll-get0 -
grizzly1911 wrote: »I don't disagree with your point.
I wonder how much actually ends up being "spent" back in the UK? More of a "subsidy" for exporters or an offset against some other "debt"?
how does it being 'spent' back in the UK make it an better?0 -
Graham_Devon wrote: »SMI is a completely different beast to that of other welfare payments.
Not to labour the point here, the issue isn't SMI, it's that it's paying off a mortgage in which the beneficiary is soley the homeowner. When the homeowner ceases using SMI for any reason, maybe because the mortgage has now ended, the homeowner will end up with a property worth X amount of which they can do with what they please. I don't find that a particularly good use of taxpayer money considering those benefitting from it are are tiny fraction of the population but benefit greatly from it.
As the majority of SMI claimants are over 60, it stands to reason SMI will be used until the mortgage is fully paid off.
In these times of austerity, looking at what you can cut, or at least claim back later on, this, surely, is a prime example. The owner gets to stay in their home until they either decided to sell on their own accord or pass on. At that point, the taxpayer get's their loan back. I don't see what's to dislike or take issue with in all honesty. I'd go as far to say some currently using SMI may drop the scheme and find another way if they see it as a loan, rather than a free handout, so we'd save money.
Jobseekers, income support, housing benefit etc. None of those directly support paying down a privately owned asset. Similarly it's unlike the person receiving said welfare could even attempt to pay down an asset on the sums provided while maintaining a living. The welfare is aimed primariliy at living costs, food, clothing, heating, rent etc. It's not aimed at supporting the ownership of a private property.
So no, it's not fair to treat those benefits as a loan in the same sense as SMI. In doing so, you will just hamper any progress when they stop using welfare and move on.
I thought SMI only covered the interest on a mortgage so makes no contribution to the capital payments. If so, then the mortgage will never be paid off while claiming SMI. Personally, I'd rather someone who finds themselves in need had the interest paid until they got themselves back on their feet rather than a landlord who will get not only his mortgage paid, but a nice return, too paid by housing benefit.0 -
how does it being 'spent' back in the UK make it an better?
It doesn't (short message)."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
Well as SMI is only available for 2 years I can't imagine it would clear too many mortgages or net too much profit in that amount of time. Where do you stand on having a time limit on benefits? Housing benefit is a good example, do you feel this should be used as a safety net for tenants in temporary financial difficulties, or a permanent benefit to subsidize tenants who otherwise would not be able to afford to rent the property they are in?
The 2 year limit only applies to a handful of people on the scheme. For most using the scheme, there is no limit.0 -
the SMI only covers the interest on the mortgage and not capital so it can't fairly be said to be 'paying down a privately owned asset'
Indeed, but as I said before, arguably the interest is a massive part of paying down the mortgage for all of us.
Not going to argue this one any further anyway. If you believe an attachment to the house in order to pay for the help received by the taxpayer is wrong, so be it.
I see it as fair. And for most, it will be a choice of whether to take it as a loan or take another option of their choice (sell up and move to a cheaper home, sell up and use the equity to rent etc).
Essentially we are talking about people here who can't afford their house without taxpayer support, so seems fair to me that if we help them buy it, even if it is just paying the interest on their mortgage, we get a slice of it at a later point.
No ones making them choose this option, and as I say, some may decide they don't want the government taking a slice of equity, so may find another way which doesn't include taxpayer cash.
If were trying to save money, these sorts of "nice" giveaways where it's easy to recoup the money seem like a no brainer. The taxpayer is covered for their outlay and the homeowner gets to stay in their home unless they choose to do something else. Job done in my view.
Not sure why you think they should just get the money for nothing. Maybe you could explain that instead of questioning me?0 -
Graham_Devon wrote: »The 2 year limit only applies to a handful of people on the scheme. For most using the scheme, there is no limit.
What are the circumstances of the people on permanent SMI?
You seem to have missed the main part of my post, asking if other benefits should have a time limit...0 -
JencParker wrote: »I thought SMI only covered the interest on a mortgage so makes no contribution to the capital payments. If so, then the mortgage will never be paid off while claiming SMI. Personally, I'd rather someone who finds themselves in need had the interest paid until they got themselves back on their feet rather than a landlord who will get not only his mortgage paid, but a nice return, too paid by housing benefit.
The homeowner pays the capital. The government pays the interest.
Afterall, the homeowner can't just stop paying the capital as that's a default.
So the home does get paid off, unless they are on an interest only mortgage. In that case, they are essentially paying nothing for the house, but taking all the equity when it's sold and the taxpayer get's nothing.
A bit like housing benefit, other than with housing benefit, the claimant never gets to keep the house.0
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