The Politics Thread

[Alf Bentley]

I'm still not convinced. I put a family with one child into the calculator where one parent earned the average £26k and the other partner worked part time for £5k, which I think must make them below average as a household and they were entitled to no tax credits of any kind. Looks to me that this only effects the very bottom of the salary scale, those people who have already and will continue to benefit most from the increase in the minimum wage and tax free allowance.

 

 

Let's look at it more simply:

- Currently, £30bn per year is paid out in tax credits

- According to ONS, in 2014 there were 26.7m households in the UK (but about 6m would be pensioner households)

 

So, the average UK working age household receives about £1500 per year in tax credits (£30bn / 20m).

 

Obviously, people who are on high incomes or unemployed are not entitled to tax credits.

 

You reckon that only those at the very bottom of the salary scale are affected? If, say, only the bottom 10% were affected, they'd have to be receiving an average of £15,000 per year in tax credits (£30bn / 2m) - and that simply isn't the case!

Imagine, instead, that the bottom 40% are affected: £30bn / 8m = £3750 per year on average. There are a lot more households reliant on £1k, £3k or £5k tax credits than you might think, I reckon.

 

As for the increase in the tax threshold, that's now of no benefit to someone working part-time on £8k, but does benefit someone on £99k.....not very tax-efficient, but beneficial to a lot of fairly high earners with a disproportionate tendency to vote Tory!  

[Alf Bentley]

 

I wouldn't actually mind the Tories being unpopular for the next couple of years, get Cameron in a weaker position for the European referendum, also maybe Labour increase slightly in the polls giving them some sort of hope that Corbyn could actually do something, then George can turn into Father Christmas again around 18 months from the May 2020 election, strategy is everything.

 

The odds on that scenario must be pretty short, to be fair! 

 

The EU referendum and the state of the economy, with all its structural weaknesses (at UK level and internationally), remain big unknown factors, though.

[MooseBreath]

That Nicola Marshall is all over the left wing crap rags.

www.bdlive.co.za/world/europe/2015/07/12/low-paid-british-workers-brace-for-more-austerity

In that one she says she earns £11k and gets £5k tax credits plus maintenence from her ex husband. In total she receives over £20k, almost all tax free, the equivalent of about a £30k salary, for 21hrs per week. The poor thing.

[MooseBreath]

Let's look at it more simply:

- Currently, £30bn per year is paid out in tax credits

- According to ONS, in 2014 there were 26.7m households in the UK (but about 6m would be pensioner households)

So, the average UK working age household receives about £1500 per year in tax credits (£30bn / 20m).

Obviously, people who are on high incomes or unemployed are not entitled to tax credits.

You reckon that only those at the very bottom of the salary scale are affected? If, say, only the bottom 10% were affected, they'd have to be receiving an average of £15,000 per year in tax credits (£30bn / 2m) - and that simply isn't the case!

Imagine, instead, that the bottom 40% are affected: £30bn / 8m = £3750 per year on average. There are a lot more households reliant on £1k, £3k or £5k tax credits than you might think, I reckon.

As for the increase in the tax threshold, that's now of no benefit to someone working part-time on £8k, but does benefit someone on £99k.....not very tax-efficient, but beneficial to a lot of fairly high earners with a disproportionate tendency to vote Tory!

I'm just reporting what the government's online calculator is telling me, Alf, and it's telling me that unless you're right at the bottom of the salary scale you're not getting much, if anything.

I'm guessing most of the tax credits are child tax credits, in which case you're dealing with the pop-a-kid-out-a-year careerists and imported large families who probably do receive tens of thousands each per annum.

[Guest MattP]

That Nicola Marshall is all over the left wing crap rags.

www.bdlive.co.za/world/europe/2015/07/12/low-paid-british-workers-brace-for-more-austerity

In that one she says she earns £11k and gets £5k tax credits plus maintenence from her ex husband. In total she receives over £20k, almost all tax free, the equivalent of about a £30k salary, for 21hrs per week. The poor thing.

 

It's flashed up on a meme on my timeline, on this one she earns only 9k a year.

[Jon the Hat]

Let's look at it more simply:

- Currently, £30bn per year is paid out in tax credits

- According to ONS, in 2014 there were 26.7m households in the UK (but about 6m would be pensioner households)

 

So, the average UK working age household receives about £1500 per year in tax credits (£30bn / 20m).

 

Obviously, people who are on high incomes or unemployed are not entitled to tax credits.

 

You reckon that only those at the very bottom of the salary scale are affected? If, say, only the bottom 10% were affected, they'd have to be receiving an average of £15,000 per year in tax credits (£30bn / 2m) - and that simply isn't the case!

Imagine, instead, that the bottom 40% are affected: £30bn / 8m = £3750 per year on average. There are a lot more households reliant on £1k, £3k or £5k tax credits than you might think, I reckon.

 

As for the increase in the tax threshold, that's now of no benefit to someone working part-time on £8k, but does benefit someone on £99k.....not very tax-efficient, but beneficial to a lot of fairly high earners with a disproportionate tendency to vote Tory!  

 

The living wage will help though.  The gamble here is that less tax credits + better pay + higher tax free earnings means people are not worse off, but the government gets to save some of the billions they spend on administering tax credit system.  It is a gamble though, and some will no doubt be worse off.  I suspect in reality they will delay or phase the cuts.

[Guest MattP]

Right on.

 

[Alf Bentley]

I'm just reporting what the government's online calculator is telling me, Alf, and it's telling me that unless you're right at the bottom of the salary scale you're not getting much, if anything.

 

 

Thing is, you seem to see a couple on £31k or a singleton on £13k as "at the bottom", whereas the truth is that there are a hell of a lot of people on less than that, for whom tax credits are critical unless replaced with other income:

- £26k is the median F/T wage, so 50% of F/T employees are on less than that

- Self-employed income is lower than that; was it about £16k or something that was quoted as the median there? Some are obviously on a lot more, but increasing numbers are just scraping by

- A lot of young unskilled singletons or single Mums will be on incomes much lower than £13k, particularly if they're only able to work part-time

Must be your megabucks salary as CEO of a leading multinational that causes you not to see this.... 

 

The living wage will help though.  The gamble here is that less tax credits + better pay + higher tax free earnings means people are not worse off, but the government gets to save some of the billions they spend on administering tax credit system.  It is a gamble though, and some will no doubt be worse off.  I suspect in reality they will delay or phase the cuts.

 

There's a good leftist argument for the trade-off you describe, Jon. At a time when the public finances are under strain (ageing population, increased NHS costs, increasing school numbers, low per capita growth, deficit/debt), why should the state be subsidising low-wage employers? Obviously, the minimum wage can't go up too sharply or you put viable businesses and jobs at risk, but a reasonable increase actually favours efficiency, productivity and competitiveness....and weeds out the minority who are effectively being subsidised to pay their workforce crap wages. 

 

I'm not against Osborne's basic policy at all. The problem is in the implementation, front-loading the cuts to tax credits and taking longer to increase the minimum wage - and, of course, there's no guarantee that pay rates that are lowish but already above minimum wage level will rise sufficiently to compensate for the loss of tax credits. It sounds as if more will lose than gain long-term - and some employees will lose big-time in the short-term.

 

I'd be surprised if they delay or phase the cuts, for the reason MattP hinted at: strategy. Politically, it makes sense for them to shaft people now and then have a bit more cash to splash in 3-4 years time with an election around the corner - and with the bloke currently making the cuts planning to move next door to No. 10.

 

 

Right on.

 

 

Is that you on the left with a new hipster beard, Matt?

 

I knew that, like me, you were spending too much time on here and too little achieving business success. But I thought you were planning to launch a new career, not join an anarcho-idlist anti-capitalist protest group! 

[MooseBreath]

£13k is minimum wage, so there are no single full time employees on less than that, and you'd get £30 a year in tax credits in that situation. That's equivalent to a 1.5p increase in minimum wage, which has been covered many times over.

There's no excuse for an able family not to have at least one full time earner and one part time worker. That's a realistic minimum household income of £20k-ish and at that level still increases to minimum wage and the tax free allowance are worth more than tax credits.

And you know, they could always try to increase their earned income by themselves. Even I managed to lift myself off minimum wage by getting an assistant supervisor (fry section) role at maccys.

[Rincewind]

No comment.

 

[Guest MattP]

Why no comment Ken?

Enjoyed that video, that's two I've seen him produce recently I've liked. He did a good one with Peter Hitchins as well.

Jones is clearly far more likeable in person than he appears on debate shows.

[Dr The Singh]

That Jayda, leader of Britain first is the sexiest politician ever. I bet she would be into all sort s

[purpleronnie]

Judging by the look of those at those rallies maybe they should tally up and buy themselves some new clothes.  Some truly astonishing sights, almost as offensive as racist bile.

[Guest MattP]

Why do these people get so much airtime and coverage?

They number about 20 people and when they stood for any election didn't even get 1% of the vote.

How do they manage to get an hour of near prime time BBC television.

[Wymsey]

To raise awareness and think how dangerous their potential could become in the future.

[Dr The Singh]

Why do these people get so much airtime and coverage?

They number about 20 people and when they stood for any election didn't even get 1% of the vote.

How do they manage to get an hour of near prime time BBC television.

Because Jayda is so chrasmatic and bright, according to the BBC presenter.

Seriously though, if she was intelligenr, she could really become a force, with someone like me and Mattp by her side, a match made for politics and mass orgies

To raise awareness and think how dangerous their potential could become possibly in the future.

Ken with one arm and and leg is more dangerous

[EnderbyFox]

[Rincewind]

I bet his answer was 'the ecomony is better and there are more people in work as har working families which is more than the last government did;

[Guest MattP]

Aside from Theresa May's laughed effort, we've had some fantastic speeches this week, IDS and Boris leading the way.

A lot from Cameron to live up too, the central theme appears to be homes for working people.

[Rincewind]

What a surprise. I think homes for everyone would be a good idea too.

[Guest MattP]

I think homes for people actually working should be the priority instead of spending billions more on welfare but there you go.

Something is wrong in society when a person working all week earning 18k can't afford a house but has to see his earnings taken away to house someone whose decided to pop out children to gain accommodation.

The Tories now do have a chance to spend some cash, it's not like Corbyn is going to base any of his arguments on debt or deficit.

[Guest]

We've had a Tory scum chants, BBC presenters being harassed, journalists spat on and cameramen attacked.

Is the new non personal kinder politics Corbyn talks about?

Looks like we're going back to the 80's rent a mobs.

 

nothing compared to France. Did you see the shirtless Air France execs this week?

[MooseBreath]

What a surprise. I think homes for everyone would be a good idea too.

Me too, homes for everyone who has a job to go to at least

[Guest]

Spot on from Theresa May.

 

"Even if we could manage all the consequences of mass immigration, Britain does not need net migration in the hundreds of thousands every year. Of course, immigrants fill skills shortages and it’s right that we should try to attract the best talent in the world, but not every person coming to Britain right now is a skilled electrician, engineer or doctor"

 

No, some of them are fleeing persecution and war.

[purpleronnie]

No, some of them are fleeing persecution and war.

Maybe we should stop brits emigrating who aren't going into skilled jobs abroad.

 

I swear some peoples obsessions about immigration only come from daily mail headlines.