Is the benefit system to generous?

[CliveH]

Hi Dave & Sue

 

I do not think that is happening and there is a cut of re child tax benefit

 

See:-

 

http://www.hmrc.gov.uk/rates/taxcredits.htm

 

In this latest budget they are looking at reducing the cut off to £30,000.

 

So not sure millionaires come into this particular benefit.

 

[W3526602]

Why should I subsidise someone who earns more than me to to have kids?

 

Hi Pelmetman,

 

You have probably subsidised the rich as well. Way back when, Maggie (I think) devised a scheme (BES ?) to improve the economy.

 

The idea that you could invest in a business, provided you did not work in that business. You could, however, be a director.

 

Instant scam. Half a dozen blokes would get together, form a partnership. Each wouild invest a large sum of money and buy a house to let out.

 

Instant return of income tax on investment ...... at that time 25%

 

Receive rent from house.

 

After five years, sell house wind up the partnership, no CGT to pay on profit.

 

A couple of years later houses were excluded from the scheme.

 

Housing Associations are also very interesting. Buy a house, get immediate refund of 80%. Let the house out for rent. The Association is not allowed to make a profit ...... but director's fees are not profit.

 

OK, somebody tell me I am wrong.

 

602

 

 

 

[Guest pelmetman]

CliveH - 2010-06-23 12:57 PM

 

Hi Dave & Sue

 

I do not think that is happening and there is a cut of re child tax benefit

 

See:-

 

http://www.hmrc.gov.uk/rates/taxcredits.htm

 

In this latest budget they are looking at reducing the cut off to £30,000.

 

So not sure millionaires come into this particular benefit.

 

Thanks for the link Clive,

 

I stand corrected, perhaps it was a urban myth but I thought everyone could claim child benefit, providing you have a child of course :D

 

£30,000 sounds fare to me B-)

[CliveH]

Yes to be fair to the last government - the old child benefit that every parent got was unfair in that everyone did get it regardless of "need". Some but not all "wealthy" individuals would forward their Child benefit to charity. In fact a lot of them did.

 

So much so that I heard that when the system changed to tax credits, charities were dismayed to find their donations down as a result.

 

But that could be another "Urban Myth!"

 

 

(lol)

[CliveH]

The old BES was not just for small groups - via schemes from national & Provincial and Bradford and Bingly, the schemes were used to "mop up repossessed houses and enabled even small investors to take part.

 

Repossession is always devastating and hard. But this scheme was one that enabled those houses to be rented out rather than just sold at a huge loss.

 

So they were not all bad! This from the Independent in 1993.

 

http://www.independent.co.uk/money/50m-pounds-bes-scheme-launched-by-bb-1474149.html

 

 

[W3526602]

Hi Clive,

 

I can't comment about those who get accomodation via the BES, I guess its probably a good thing from their point of view. Question, is it acceptable that a bunch of fat cats get even fatter by looking after some skinny cats, at our expense? I'm asking - I don't know the answer.

 

What I have noticed, is that in my area, any development in the town centres is being done by Housing Associations. I'm guessing because they are the only ones who can afford to (at our expense). OK, I admit it, I'm jealous. They are buying up dilapidated properties that I would like to have bought for myself.

 

602

[CliveH]

This from Wiki (seen to be a bit of a dubious reference source now due to Wikipedia being run by some who "have an agenda" but for this instance I think it is reasonably accurate) :-

 

"Housing associations' day-to-day activities are funded by rent and service charges payments made by, or on behalf of those living in its properties. In this sense, housing associations are run as commercial entities and the majority do not depend on donations for their general activities.

 

New housing however tends to require subsidies to be economic, the source of which will depend on where the association is based:

 

In England, housing associations were funded and regulated by the Housing Corporation. However the Housing and Regeneration Act (2008) created two new bodies. From the 1st December 2008 the Homes and Communities Agency (HCA) deals with funding and regeneration work and the Tenant Services Authority (TSA) take responsibility for regulation. From 2010 the TSA will regulate all providers of social housing and they will all be known as Registered Providers irrespective of the private, public, for profit or not for profit status.

 

In Northern Ireland, the same role is carried out by the Northern Ireland Housing Executive.

 

In Scotland, this function is fulfilled by the Scottish Government.

 

In Wales, the regulation and funding of housing associations is carried out by the Welsh Assembly Government.

 

..............................

 

So it seems from this that only new housing gets any sort of subsidy. Older property development and upkeep is paid for out of the profit made from the existing rental income.

 

However, as lot of people that have to use HA homes are on benefits that rent does come ultimately from the tax payer.

 

So not a clear answer overall.

 

[Bulletguy]

CliveH - 2010-06-23 6:50 AM

 

Because when those kids grow up and pay their tax and NIC's they will be paying for our care etc.

Assuming they will go to work.

 

If they don't....they won't pay a penny cent but will benefit from those that do work and are paying into 'the system'.

[Madmaggott]

I don't think that benefits are too generous as long as they only go to those in real need.  There lies the problem: how does the system ensure that the 'hangers on' get forced off?

IMO the main problem lies in the 'I'm entitled to it' attitude and the belief that one has no responsibility for oneself.  Time was that the majority would lose self respect if they were on benefits for a long period; the general attitude these days seems to be self satisfaction at being able to 'work the system'.

 

[Bulletguy]

Madmaggott - 2010-07-07 2:24 PM

 

I don't think that benefits are too generous as long as they only go to those in real need.  There lies the problem: how does the system ensure that the 'hangers on' get forced off?

 

Increasing the differential in pay to benefits would be a good start which of course would mean raising the minimum wage. I know thats not so simple and unlikely to happen.

 

But some of the pay rates on offer (dependant upon what part of the country you live in), are appallingly low. I'm amongst the fortunate in being in full time employment my entire life, but am well aware of the meagre pay scales paid to shop workers and the like.

 

How on earth can people be expected to make a decent life for themselves on rates of £5.80 an hour? Some will be picking up more than that in benefits so it makes a total nonsense to go and work for less.

[Porky]

Stopped at a motorway service station last weekend. All the staff were eastern european. Stopped at a Little Chef yesterday the three staff were Polish.

My wife works for the NHS and all the cleaners, laundry staff and most of the porters are eastern european.

I am sure this is repeated across the country so why aren,t these jobs being filled by unemployed people first and anything then left can be done by others. Please don't tell me about freedom of movement in europe if we want to reduce our costs why are we not being proactive in making people take jobs.

 

Roy Fuller

[Porky]

Bulletguy - 2010-07-07 3:03 PM

 

Madmaggott - 2010-07-07 2:24 PM

 

How on earth can people be expected to make a decent life for themselves on rates of £5.80 an hour? Some will be picking up more than that in benefits so it makes a total nonsense to go and work for less.

 

It may be nonsense but they should be made to do it.

 

Roy Fuller

[Bulletguy]

Porky - 2010-07-07 3:38 PM

 

Stopped at a motorway service station last weekend. All the staff were eastern european. Stopped at a Little Chef yesterday the three staff were Polish.

My wife works for the NHS and all the cleaners, laundry staff and most of the porters are eastern european.

I am sure this is repeated across the country so why aren,t these jobs being filled by unemployed people first and anything then left can be done by others. Please don't tell me about freedom of movement in europe if we want to reduce our costs why are we not being proactive in making people take jobs.

 

Roy Fuller

 

You will find east europeans working in jobs like this, and yes they have the same right to work here as what we do in their country.

 

Brits often blame the east europeans for taking 'our jobs' or working for meagre pay which lowers our own pay standards. But you have to look at the bigger picture.

 

Since the mid to late '80s there has been a rise in casual employment supplied by private employment agencies. The casual employee works on a contractual basis which is worlds apart from a full term contract employee. They work from day to day and their employment can be terminated at any time without notice. They are often doing exactly the same work as the full term employee.....but on a lower hourly pay rate.

 

The employer pays the Agency a percentage for this 'hire 'n fire' facility.

 

Agency supplied workers has led to a steady but continual erosion of decent pay scales in this country.

 

So in answer to your question I can only repeat what i've stated before. There needs to be a much larger differential between benefit payments and a wage. It isn't the benefits which pay too much.....it's the wages which are far too low.

[Bulletguy]

Bulletguy - 2010-07-07 3:03 PM

How on earth can people be expected to make a decent life for themselves on rates of £5.80 an hour? Some will be picking up more than that in benefits so it makes a total nonsense to go and work for less.

 

Porky - 2010-07-07 3:40 PM

It may be nonsense but they should be made to do it.

 

Roy Fuller

 

I suppose we could always send little children back down the coal mines like we used to. But we don't have any mines left. Maggie closed 'em all down and started shipping coal in 'on the cheap'......from Poland. *-)

 

I guess what goes around comes around eh Roy?

[malc d]

The problem these days with wages is that the more you pay people, the more jobs go to the far east.

 

It seems obvious to me that benefits must be less than wages, otherwise why would anyone go to work ?

 

 

:-(

[Guest pelmetman]

malc d - 2010-07-08 2:16 PM

 

The problem these days with wages is that the more you pay people, the more jobs go to the far east.

 

It seems obvious to me that benefits must be less than wages, otherwise why would anyone go to work ?

 

 

:-(

 

I think you hit the nail on the head :-D

[CliveH]

There is a real danger that the "developed" economies such as ours will degrade into "4th World" economies where rather than paying high taxes to pay for those on benefits or to pay for profligate State spending, the average person starts bartering and cash payments for goods and services - in other words the "black economy".

 

You can see the sense in it. If I pay cash for a car service for example so that it does not "go through the books", I should be able to ask for a discount as no VAT would be payable, and no income tax and NIC payable on the cash paid over.

 

To do this now is illegal - but to barter against other good is not.

 

Similarly as I understand it, it is not illegal for communities to set up their own currency - and indeed some town have with a fair degree of success.

 

Interesting how such concepts take off. If it does and the States tax revenue falls then we have the situation that Greece finds itself in now, whereby its citizens say no to paying tax but the state carries on paying out money to the public sector and benefits etc.

 

Result?

 

Virtual meltdown and a bail out by the EUzone that has the Germans spitting feathers as they are the ones giving the biggest amount. And I do not blame them. I am appalled at the lies and deceit that masquerades as policy regarding the deeply flawed Euro.

 

If China/India/Brazil et al takes over Manufacturing, Research and Development, as well as the Financial sector - just what sort of role will a country like the UK, with a bloated expensive State infrastructure, no manufacturing to speak off, and a tarnished Finance sector actually have in the world?

 

If we do not get a grip on State spending, however painful, however difficult, however much it costs us now - the longer term implications are truly dire.

 

We simply can not afford to have people taking money in benefits without contributing in the first place. The something for nothing culture that seems to have developed has got to stop or else those that DO work and therefore currently pay for everything will decide to run a parallel economy so as to a) survive and b) keep their hard earned money in their pockets rather than give it to the state who then gives it to those that do not deserve it.

 

I support the welfare state - and want it to help those with genuine needs. But some are truly having a laugh at our expense.

 

[MandyAndy]

There are so many times you hear it said, " Well if they got it why don't you go for it, after all you need/deserve it more than they do"

 

Its the same with insurance claims on accidents , we see and hear all the time of things people claim for and the mentality is growing of " Well why should he claim for it and not me"

 

There is no straight answer and I don't believe there is a way to stop it either, there are too many ways around systems and companies all too willing to show you them, along with solicitors who are quite happy to back your claims.

 

Just my thoughts, not quite as deep as some but I don't do deep with politics or religion .

 

Mandy

[Madmaggott]

CliveH - 2010-07-08 4:12 PM I support the welfare state - and want it to help those with genuine needs. But some are truly having a laugh at our expense.

 

Hear, hear!!

 

[Bulletguy]

malc d - 2010-07-08 2:16 PM

 

The problem these days with wages is that the more you pay people, the more jobs go to the far east.

Wonder why all those bankers pulling in million quid plus in BONUSES didn't clear off to the far east then? Banking telesales folk are all based there......so why not them as well?

 

 

malc d - 2010-07-08 2:16 PM

It seems obvious to me that benefits must be less than wages, otherwise why would anyone go to work ?

 

:-(

 

The level which benefits are set is the minimum existence allowance.

[Guest pelmetman]

Bulletguy - 2010-07-08 6:00 PM

 

 

The level which benefits are set is the minimum existence allowance.

 

Because our joint income last year was less than £14,500 we qualified for tax credits.

 

Which to my mind is well above existence level, and without an insentive the work shy will not make the effort.

 

Also how do you define existence, satelite tv, fags, drink :-S

[malc d]

Bulletguy - 2010-07-08 6:00 PM

 

malc d - 2010-07-08 2:16 PM

 

The problem these days with wages is that the more you pay people, the more jobs go to the far east.

Wonder why all those bankers pulling in million quid plus in BONUSES didn't clear off to the far east then? Banking telesales folk are all based there......so why not them as well?

 

 

malc d - 2010-07-08 2:16 PM

It seems obvious to me that benefits must be less than wages, otherwise why would anyone go to work ?

 

:-(

 

The level which benefits are set is the minimum existence allowance.

 

 

 

Why don't the bankers all clear off to the far east ??

 

 

Because the banks out there wouldn't be daft enough to pay out the kind of bonuses that they get here.

 

(But any job that can be done cheaper in the 'third world' will go there - only the owners of the companies will stay here ).

 

 

 

[Bulletguy]

malc d - 2010-07-08 6:43 PM

Why don't the bankers all clear off to the far east ??

 

 

Because the banks out there wouldn't be daft enough to pay out the kind of bonuses that they get here.

But you said previously.......

 

malc d - 2010-07-08 2:16 PM

 

The problem these days with wages is that the more you pay people, the more jobs go to the far east.

Obviously thats one 'trade' that hasn't gone off to the east.

 

 

 

malc d - 2010-07-08 6:43 PM

 

(But any job that can be done cheaper in the 'third world' will go there - only the owners of the companies will stay here ).

 

Glad you at least clarified that point, though I doubt that many will actually live here more than a few weeks each year, choosing instead to join the band of 'non-doms'.

[Bulletguy]

Bulletguy - 2010-07-08 6:00 PM

 

 

The level which benefits are set is the minimum existence allowance.

 

pelmetman - 2010-07-08 6:23 PM

 

Because our joint income last year was less than £14,500 we qualified for tax credits.

 

Which to my mind is well above existence level, and without an insentive the work shy will not make the effort.

 

Also how do you define existence, satelite tv, fags, drink :-S

I don't....the Government does.

 

To qualify for tax credits you first need to be working in employment.

I suspect that unemployment benefit, JSA or whatever it's now called would amount to a lot less than £14,500 pa.

[Guest pelmetman]

Bulletguy - 2010-07-08 7:38 PM

 

Bulletguy - 2010-07-08 6:00 PM

 

 

The level which benefits are set is the minimum existence allowance.

 

pelmetman - 2010-07-08 6:23 PM

 

Because our joint income last year was less than £14,500 we qualified for tax credits.

 

Which to my mind is well above existence level, and without an insentive the work shy will not make the effort.

 

Also how do you define existence, satelite tv, fags, drink :-S

I don't....the Government does.

 

To qualify for tax credits you first need to be working in employment.

I suspect that unemployment benefit, JSA or whatever it's now called would amount to a lot less than £14,500 pa.

 

I suspect by the time all the other benefits available are added to the basic benefit figure then it will probably be in excess of £14,500.

 

I base this on the assumption that a married couple working on minimum wage of £5.93 would bring in £24,052.08 per year.

 

So the available benefits must be higher to make it uneconomic for people to find work, or their workshy :D