Wages and Working Tax Credits

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Re: Wages and Working Tax Credits

Postby pabenny » Sun Feb 19, 2017 12:38 pm

planteria wrote:
pabenny wrote:Certainly a Good Thing. The result of changes in benefits or the improved state of the economy?

both.. but primarily the former. the intentionally created dependent class are now better off if they go to work. it has been hugely successful reform. further improvements hopefully to come. locking in votes with benefits dependency and the bloating of the public sector has cost us beyond comprehension and has backfired. we'll never recover some of the damage from that era, with assets sold to fund the bloating etc, but i'm positive for our future.

Lots of sweeping and unsupported statements there.

"the intentionally created dependent class". Intentionally created by whom? Maybe there is a Downton-world where the gentry want to keep the lower orders in their place. Surely dependency is costly and so undesirable.

"Bloating of public sector" - According to ONS data, public sector employment was 5.4 million at Q3 2016 (latest data), which was almost exactly the same as at the end of 1999. If I look at the state of infrastructure such as roads, schools, hospitals, or resource shortages in health and social care, continuing reductions in funding for police and defence, I see no evidence of bloat. Meanwhile, we expect more and more - longer lives post-retirement, more costly healthcare interventions at all ages, better technology and equipment for our armed forces, etc.

"Locking in votes with benefits dependency". Is there any evidence on the voting patterns of recipients of working-age benefits? I searched without finding any. For older people, we've certainly seen governments 'buying' votes by increasing state pensions and allowances when other benefits were being cut. Not to mention the generous pensioner bonds offered before the last election. Critics of the costs of welfare benefits invariably overlook that the dominant share of welfare benefits goes to the over-65s.

"Asset sales to fund..." I'll agree that the proceeds of asset sales were not used well. The privatisations of the 1980s and 90s seemed to fund consumption rather than being reinvested.

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Re: Wages and Working Tax Credits

Postby parchedpeas » Sun Feb 19, 2017 2:28 pm

Lower-paid workers should be supported, but the larger companies have used this as a reason to keep wages low, as they know the state will pick up the tab. The state support should be targetted at giving people something to work towards, rather than helping them for day to day expenses. If tax credit payments were paid into a suspense account, but delayed, this could give the individual a 'savings' account, built up from being employed. The employer would have to pay living wage salaries if they wanted good workers who could support themselves, and those who worked on these lower wage jobs would have a small nest egg that was building up as they worked. This could be used to dip into if they suffered brief periods of unemployment, and then paid out in full every X number of years to help with house deposits etc. A proper National Savings scheme.

It'll never happen correctly though: the Tories would use it to make people pay for things the state had always provided, and Labour would empty the pot and let people blow it holidays to Spain and tanning salons.

It's a shame we don't have more grown up governments.

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