I think the problem with the headline of the benefits cap being £26k and now cut to £23k is not so much the effect on the economy as a whole as it is one relatively small part of the whole it is the effect on the individual who rightly feels that there is something fundamentally wrong with people getting more money for not working or working part time in a low-paid job than they get working in a moderately paid job where they work full time and they have had to train to get where they are. This feels morally wrong. My wife is a teacher in one of the less pleasant parts of our fair city and every day she sees non-working (and indeed never-working) families rock up in new 4x4's to take the kids home to their new-build 4 and 5 bedroom social houses or taking time out of school to take their kids on holiday. I know of families who have another kid when their youngest hits 11 to ensure more years of benefits. Don't get me wrong I don't think that the kids in question should suffer in any way but I do think that it is fundamentally wrong that they should be given more than the kids going to the same school whose families are scraping by working full-time. I agree with Munky that a significant part of the problem is the money being farmed out of the State by landlords charging inflated rents to people claiming housing benefit and I sincerely hope that one of the effects of yesterday's budget will be to reduce that income stream and act as a check on the market which in turn should put a lid on rising house prices which has to be a good thing. I hope it turns the social housing sector into more of a buyers rather than sellers market - if the landlords want the guaranteed income from the State then they will have to accept lower rents. I am interested to see how the "living wage" will play out. If nothing else it is a bold move - effectively privatising the tax credit system by making employers pay more to compensate for employees gaining less from the State. I am in two minds about this as on the one hand it will extract more into the UK economy from large multinationals such as Amazon/Starbucks et al who pay very, very little corporation tax but do contribute a lot via the PAYE/NI system. If their wage bill goes up then it has a twofold effect of putting more money in their employees pay packets but also significantly more money in the Treasury's coffers via PAYE/NI tax take. On the other hand it could cripple small businesses and it will have a pretty seismic effect on sectors such as the care industry which is very staff intensive and is traditionally low paying. For every employee a company gives a payrise to they have to generate that extra income for the firm so it may erode profitability or cause prices to rise putting inflationary pressure on the economy. It will also have a knock-on on those earning just above these levels as they will want their "differential" over lesser skilled employees maintained. There is also going to be, as there is with any changes in tax/welfare, a section of the population who will lose out either in the immediate or longer term who and by how much remains to be seen. It could be a fundamental shift in the UK economy to higher pay and less state intervention but it could also be as divisive and destructive as the Poll Tax was and could massively cost the Tory party if the experiment fails.
So I don't have a very good understanding of economics? How arrogant and sanctimonious of you, I thought you would have done better than that. If you actually bothered to read my piece I did not say that was the reason for causing economic meltdown it was merely an example of extravagance. Quite frankly I do not care if one family received that benefit or the 'small proportion' that you accept but either way it is a bloody scandal. It is hard coping in the modern day in London, but probably a lot easier when somebody else picks up the tab. Regarding your comeback on the NHS and building hospitals, you have opened up a can of worms that inflicts an own goal. During the Blair years, or at least 1997 - 2007 there was economic propserity and plenty of money to invest and also put some away for the proverbial rainy day. What happened? As illustrated above Labour p*ssed it away not only on excess benefit payments but the hospitals were not paid for were they? They were put on tick through PFI which added to the overall debt going forward for the next 50 years making the private firms that built them very rich, so when the recession hit in 2008 we were already in the pooh and frittered away the pot that should have softened the blow. And do not accuse me of being a Mail / Express or whatever reader, you are not intelligent enough to know what paper I read. Your whole position on this is very disappointing and maybe you should look at the rosy tinted Labour spectacles! I am not a Tory by the way but I do expect people to take responsibility and as I have said with no hidden agenda, I think that the budget yesterday was actually not far off the mark for what is required. I can be objective, you seemingly cannot!
What a stupid bloody budget! They are going to inflict real hardship on low pay families by the withdrawal of tax credits. Having claimed that they were going to make sure that working families would be better off than non working they have done exactly the opposite. Don't take my word for it though. The Institute for Fiscal Studies has said that a million working families will be £1000 a year worse off. That is a lot of money when you don't have it to throw around.
What is even more stupid CT is that a percentage of the 13m who will be worse off, according to the IFS, voted for the lying bastards!! Talk about turkeys voting for Christmas!!
It's even worse than that, The cynical bastards took on researchers to find those groups who didn't vote to target their cuts on so as to suffer the least possible electoral fallout.
Morning folks. I have calmed down a bit now but I was really miffed by the earlier post yesterday (as you saw) and could not believe that TMC could be so arrogant and superior. Looking at some of the comments since from CT and 1950 I have to say that there is no doubt that there is no party as conniving and scheming as the Tories and they would sell their own Granny for a couple of votes. That said there is another aspect of the benefit culture which I think illustrates the whole problem and it relates to the Winter Fuel Allowance. When I was a kid and indeed for the whole of our times there was no such allowance and people just accepted that the Winter quarter needed saving up for. The then Chancellor Mr Brown at some point in the 80's then decided to give all pensioners £250 or £400 depending upon their age to effectively combat this heavy bill. Very noble in many ways bu again out of the blue handing out money like it is going out of fashion. Then when the coalition reduces these figures to £200 and £300 ( I think these are the right figures) of course everyone kicks off. But that is becasue they are having something reduced, the fact that they never had it before was overlooked. That is the problem with benefits, in that you do by nature become reliant on them and they are not a temporary prop but become a permanent fixture. There is no doubt that benefits have had to be reduced because they were not helping the overall situation nor in truth the individuals involved.
Surely the Tories should just cut 100% of welfare spending in Scotland? Deficit sorted at no electoral cost and it would annoy Alec Salmond and Nicola Sturgeon and so for that reason alone worth doing. Seriously though all political parties try to benefit "their" people as without their support there is no power for the Government of the day and had Labour been in power I imagine that there would have been a similar level of cuts but placed in different areas to people they deemed more worthy of taxing i.e. middle and high income individuals and corporations. Red or blue it's the same sized cake they are cutting up and the only difference is that they try to give the better pieces to their supporters. I am sure that a lot of coalition spending and time was funnelled into the Midlands and North where the marginal were required to take power again. No point in going overboard in the South or rural areas as they vote Tory anyway. No point going crazy in the metropolitan areas as they vote Labour anyway so cynically best to concentrate on the areas really worth fighting for and win the election. Utterly cynical but pretty much all politicians are - I'd struggle to name a real "conviction" politician since Tony Benn.
Morning Thurnby. The problem with Politicians is that they are all evasive and scheming as unfortunately it is the way they are encouraged to be. It is not just restricted to the Tories - it is just that they have mastered the art!! In the Budget statement Georgie boy made out that it was a tax incentive give away and a boost to low earning working families. Before the day was out the economists had worked out that it was a tax grab and by yesterday the IFS had calculated that 13m - yes 13m - families would be worse off and the worst affected were those who were working for low pay. Why can't politicians nowadays just tell the truth with their own slant on the facts. Turning to benefits I agree that there are faults but the idea of the Winter Fuel payment was a very sound one. If you try and get away from universal payment you spend more doing it than you save but there are easy alternatives. Our 4 at golf this morning are all retired on generous final salary pension schemes on which we all pay the higher rate of tax. We all get the State Pension as well - quite rightly - on which we have to pay tax - again quite rightly. We also get the Winter Fuel payment which, before you ask, I send to Age Concern but why do I get it in the first place or, if it would cause administrative problems, why can't it be automatically taxed in the same way that the State Pension is? Again, why will I get a free TV licence at 75? They obviously think I am a the sort of person who will vote Tory - got that one wrong Burlington Boy - but is that the way the Country should be run? Labour isn't perfect by any stretch of the imagination but at least they try and look after the vulnerable and the worse off and I just pray that they will now get their act together. If anybody is interested, and to show that I am not sexist despite my comments on the World Cup thread, I will vote for Liz Kendall for Leader and Caroline Flint for Deputy in the upcoming election as I think they represent the best chance of a fresh start.
Very fair assessment 1950 and I agree with you pretty much all the way, my tirade yesterday was based on a one-way diatribe the other way and that was something that i thought was out of order, yes politicians are all as bad as each other! Beieve me I am no fan of Gideon (as Private Eye call him) or Bullingdon Boy, and of course there was a fair amount of the sleight of hand in his presentation - who would have thought it! But I thought overall the package was not too bad overall. In admire the fact that you give you Winter fel allownace away but that is your decision and you are fully entitled to it, you have earned it my friend. I do worry about the opposition now in all seriousness and where the left of centre parties go. I like Tim Farron and Norman Lamb, but feel neither have the character and passion to drive a new third movement in the way that Paddy Ashdown did (he is my last conviction politician by the way). The Labour 4 leave me pretty cold really and think that on paper none of them look set to win in 5 years time. It was indicative I think a comment that was reported this week where one Labour MP said she woudl vote for Yvette Cooper because she was a working Mum and was then chastised by a male colleague for the paucity of the argument as her basis for voting. Liz Kendall is a bit light blue for me and does not offer a real vision other than Labour should be a bit more Tory. It is all a bit depressing really.
I agree. If forced I would vote for Burnham,but without any enthusiasm. The argument about cutting the cake is valid,but giving so much of it to a few so that they cannot eat it all whilst others get crumbs surely cannot be right.
I think the right wing press knew what they were doing in hounding Chuka out of the race - he was by far and away the most electable.
Burnham will take them back even further. Only one way forward for Labour, cut the Union links. I despise non politicians holding any power for their own needs, that includes big business as well.
The new aristocracy is going to consist of those with wealthy parents. An only child inheriting a £1 million house is going to be set up for the rest of his/her life regardless of any other criteria.
Great budget. Best I can remember, I'm going to be worse off about £20k a year because of the dividend rules but I like the cut in corporate tax and the rise in personal allowance and 40% tax limit.
Most of us at the bottom of the pile can only dream of EARNING £20K per year, let alone be happy to lose it!
