Interest rates - impact of 45% u turn

NedS

Exodi said:

Frequentlyhere said:

Not only backbenchers but already cabinet ministers lining up to oppose any real terms cut to benefits.

BBC summarising as "PM Liz Truss is facing mounting anger from within her own party over her refusal to commit to increasing benefits in line with inflation"

It's happening slightly faster than I thought and without them even putting a figure on it, but I think this idea is dead in the water already. Especially since she hasn't even committed to it yet so can easily reverse out.

I don't know if it's fair to say her ministers are 'lining up'? You mention the BBC, yet on the front page you see the below - It's certainly not as cut and dry as you make out.

"But the thinking inside Number 10 is that help is already being channelled towards those who need it most, through support with energy bills and targeted cost of living payments.

They think their big intervention to keep energy bills from rising this winter is addressing the main component of inflation and will have the effect of bringing the rate down over time.

And so they could argue that to increase benefits in line with inflation would in effect be a duplication of support – an additional layer that isn’t required.

I can understand, although I don't agree with, those arguments as long as they keep the CoL payments going next year (and for as long as energy prices remain high) like they have this year, as it is these that have kept the most vulnerable afloat, otherwise it's all just smoke and mirrors. That means the £650 cost of living payments for those on means tested benefits, the £150 payment to those on disability benefits, the cost of living council tax rebates and all the other cost of living schemes. Those have helped pay for the large increases in energy bills for people experienced between March 2022 and when the Energy Price Cap was introduced. The re-rating of benefits in line with inflation is then expected to cover those increased costs on an ongoing basis (prices went up, benefits go up). If they do not re-rate benefits in line with inflation, the handouts must continue otherwise these vulnerable people simply sink further into debt and become ever more reliant on government bailouts. Energy prices are unlikely to ever return to 2020/21 prices - failing to increase benefits in line with inflation will simply move more and more people into poverty.

murphyslaw2020

xylophone said:

Not even close. It's 43% more income than single rate Pension Credit.

But being on PC opens the door to other benefits/help with CT/rent/TV licence etc.

Isn’t it the case one contributes through tax whilst working and the other just receives the pension without having worked at all?

Beddie

I think the energy cap should have been up to a certain amount of usage. A high unit figure, to cover perhaps 75% of households approximately. That way they are not subsidising the very high energy users, who will mostly be wealthy.

I would also rather they kept the 1% income tax cut and used it to restore access to NHS dentistry for all. Not increasing the thresholds is a tax rise anyway, but less obvious, further showing the stupidity and inconsequence of this little attempt at a vote-winner using borrowed money.

sevenhills

Beddie said:

I think the energy cap should have been up to a certain amount of usage. A high unit figure, to cover perhaps 75% of households approximately. That way they are not subsidising the very high energy users, who will mostly be wealthy.

I would also rather they kept the 1% income tax cut and used it to restore access to NHS dentistry for all. Not increasing the thresholds is a tax rise anyway, but less obvious, further showing the stupidity and inconsequence of this little attempt at a vote-winner using borrowed money.

That would be similar to having a personal carbon allowance', which I favour.

MiserlyMartin

aroominyork said:

MiserlyMartin said:

The way we are going the country should now ask for a bailout from the countries who have been in receipt of our foriegn aid money for all this time. They certainly have better healthcare and infrastucture eg roads than the UK does. At least you can access a doctor and dentist there.

What total nonsense. I think you are getting confused with adverts offering dental work in Hungary.

Seems that you need to get out of the country more. Pretty much all of the EU countries even the poorer ones have perfect roads, and then I come back to third world roads in the UK, potholed bumpy tracks. I walked into a 24 hour dentist place and saw the prices, a fraction of what we pay. I could have been seen the next day. Countries outside the EU are even better.

MiserlyMartin

Frequentlyhere said:

Not only backbenchers but already cabinet ministers lining up to oppose any real terms cut to benefits.

BBC summarising as "PM Liz Truss is facing mounting anger from within her own party over her refusal to commit to increasing benefits in line with inflation"

It's happening slightly faster than I thought and without them even putting a figure on it, but I think this idea is dead in the water already. Especially since she hasn't even committed to it yet so can easily reverse out.

I think this will be the pattern for a while - gentle prods on every bit of the flesh being met with loud screams. She has already spent her political capital on a budget of wild abandon.

The most likely candidate I've seen for cuts that might get through is capital expenditure, which is of course ridiculous given that the idea is to target growth. So maybe a delay/cancel/reduction to the corporate tax cut (which frankly no businesses even cared about anyway), and some trimming of capital expenditure. 

The Tory party policies are run by whatever the media dictates to it. The Tory party has for the last decade been running scared from all the left wing bleating from the BBC and other media, and this is true even more so during the past 2 years and now. Oh no, we can't have the poor benefits people getting poorer, never mind the fact that a lot of them earn more money than many working people.

The U turn on the top rate of tax is just going to miss an opportunity to increase the UK's attractiveness as a place to do business. That's the reason the markets reacted badly to it.

Malthusian

sevenhills said:

You are obviously more interested in making a political point instead of Googling for the facts.
Here is the data.
"The latest figures for July 2022 show:

• a record of over 6.84 million people waiting for treatment
• 2.67 million patients waiting over 18 weeks for treatment, a further increase from last month
• 377,689 patients waiting over one year for treatment - over 365 times the 1,032 people waiting over a year pre-pandemic in July 2019"

I would suggest that even a small proportion of that 6.84 million are working people that will return to work.

https://www.independent.co.uk/news/uk/home-news/nhs-uk-hospital-waiting-list-b2176161.html

And the number of people who would be working if not for a chronic illness that the NHS will cure, and will leap back to the coalface as soon as the NHS gets round to it, is...

Sorry, the Indy is paywalled, can't scroll that far down.

All I see from your data is further evidence that the UK spends more on healthcare than any other country in the developed world to have the sickest population in the developed world.

murphyslaw2020 said:

xylophone said:

Not even close. It's 43% more income than single rate Pension Credit.

But being on PC opens the door to other benefits/help with CT/rent/TV licence etc.

Isn’t it the case one contributes through tax whilst working and the other just receives the pension without having worked at all?

No. It is possible to earn a full State Pension without paying a penny in income tax. Rare, but perfectly possible.

You can get National Insurance credits for earning between the "lower earnings limit" and "primary threshold" (but no NI or income tax is actually payable), for being on working age benefits, for claiming Child Benefit, and a few others. Being jailed for 35 years for something you didn't done did would also secure a full State Pension.

You could even pay millions in working income tax in the UK and not get a State Pension. It would take some phenomenally bad planning - specifically taking your entire income as dividends - but it is again possible.

Letting all the household income go through your spouse and then divorcing is a less far-fetched scenario in which you could contribute considerably to the Exchequer (via your partner) but still end up on Pension Credit.

Point being that the idea that State Pensions are earned while the Pension Credit is a handout is misguided. The same error that WASPI committed. Both are state benefits, paid to pensioners from the tax receipts of those currently working.

(This is beside the point either xylophone or myself were making. My point was that someone on Pension Credit is by definition the bottom - so badly off that the Government has to top them up to what society considers a minimum standard of living. Someone over 40% clear of the bottom without even needing to work is not the bottom.)

NedS

MiserlyMartin said:

Frequentlyhere said:

Not only backbenchers but already cabinet ministers lining up to oppose any real terms cut to benefits.

BBC summarising as "PM Liz Truss is facing mounting anger from within her own party over her refusal to commit to increasing benefits in line with inflation"

It's happening slightly faster than I thought and without them even putting a figure on it, but I think this idea is dead in the water already. Especially since she hasn't even committed to it yet so can easily reverse out.

I think this will be the pattern for a while - gentle prods on every bit of the flesh being met with loud screams. She has already spent her political capital on a budget of wild abandon.

The most likely candidate I've seen for cuts that might get through is capital expenditure, which is of course ridiculous given that the idea is to target growth. So maybe a delay/cancel/reduction to the corporate tax cut (which frankly no businesses even cared about anyway), and some trimming of capital expenditure. 

The Tory party policies are run by whatever the media dictates to it. The Tory party has for the last decade been running scared from all the left wing bleating from the BBC and other media, and this is true even more so during the past 2 years and now. Oh no, we can't have the poor benefits people getting poorer, never mind the fact that a lot of them earn more money than many working people.

That's not entirely true. A large number of benefit claimants will be affected by the benefit cap, and if so it doesn't matter whether the increase is 5% based on average wage rises or 10% CPI inflation as they will see none of it anyway due to the cap. Much like the £20/week uplift during Covid - those on the benefits cap never saw any of that either.

kaMelo

NedS said:

MiserlyMartin said:

Frequentlyhere said:

Not only backbenchers but already cabinet ministers lining up to oppose any real terms cut to benefits.

BBC summarising as "PM Liz Truss is facing mounting anger from within her own party over her refusal to commit to increasing benefits in line with inflation"

It's happening slightly faster than I thought and without them even putting a figure on it, but I think this idea is dead in the water already. Especially since she hasn't even committed to it yet so can easily reverse out.

I think this will be the pattern for a while - gentle prods on every bit of the flesh being met with loud screams. She has already spent her political capital on a budget of wild abandon.

The most likely candidate I've seen for cuts that might get through is capital expenditure, which is of course ridiculous given that the idea is to target growth. So maybe a delay/cancel/reduction to the corporate tax cut (which frankly no businesses even cared about anyway), and some trimming of capital expenditure. 

The Tory party policies are run by whatever the media dictates to it. The Tory party has for the last decade been running scared from all the left wing bleating from the BBC and other media, and this is true even more so during the past 2 years and now. Oh no, we can't have the poor benefits people getting poorer, never mind the fact that a lot of them earn more money than many working people.

That's not entirely true. A large number of benefit claimants will be affected by the benefit cap, and if so it doesn't matter whether the increase is 5% based on average wage rises or 10% CPI inflation as they will see none of it anyway due to the cap. Much like the £20/week uplift during Covid - those on the benefits cap never saw any of that either.

Although to be fair it's very easy to avoid being subject to the benefit cap, it's a cap but only in name..

MK62

Malthusian said:

(This is beside the point either xylophone or myself were making. My point was that someone on Pension Credit is by definition the bottom - so badly off that the Government has to top them up to what society considers a minimum standard of living. Someone over 40% clear of the bottom without even needing to work is not the bottom.)

...though tbh, if you set out to illustrate the actual effect of the government's proposed income tax policy, you would hardly choose, as an example, someone whose income was below the threshold of actually paying any income tax at all, either before or after any tax policy changes.
Now, fair enough, you might not consider a pensioner with a £13600 pa income as being "at the bottom", and technically you are absolutely correct.......I'll concede the point that this pensioner would more accurately be described as "near the bottom", or does that not really fit either, as his income is "40% clear of the bottom"? How would you categorise this pensioner's income?