To think Universal Credit still won't get the long term unemployed into work and targets the wrong people?(121 Posts)
UC (and the bedroom tax) is wrong on so many levels that its hard to know where to start.
I think one of the concerns is that it still won't get the long term employed, who have chosen to live on benefits, into work.
It targets and hurts the wrong people, those who have a real need of the welfare state.
Take my neighbours for example. They are a couple. Have 5 children. And have never worked a day in their life. They have 2 daughters who have left home and have children of their own (both were teenage pregnancies). They have 2 teenagers living at home who are at college. The youngest child is in primary school.
They live in a 3 bed council house.
Even with the recent JSA changes (having to prove you are looking for work etc) they still haven't been made to find employment.
AIBU to think UC will not change this? That they will still manage to avoid work?
I think UC will end up hurting a lot of people but not targeting the people it should be aimed at.
As has been said many times on these threads, there are about half a million vacancies (including part time and zero hours contracts) and several million people officially counted as unemployed...
You are over-simplfying the problem. There never has and never will be zero unemployment. Similarly there never has and never will be exactly the same number of jobs available as there are unemployed people. Even in the boom times where we were considered to have almost full employment there were people going around claiming we don't have enough jobs.
Firstly I'd say that just because there are less vacancies than jobseekers, that doesn't mean the person should stop looking for work.
Secondly there are many reasons why there are vacancies but noone filling those positions. Sometimes the job itself is simply not realistic. Eg. zero hours but they want a set of skills in demand so those workers with said skills are not unemployed or can find a fixed contract. Other times perhaps the job needs skills not easily available. Eg. leading edge IT stuff.
"In short, if you want to incentivise people to work, you need to pay them more."
The extra you pay them will be a subsidy. Because if what they are capable of doing were worth more, they would already be offered it. Ultimately all subsidies are paid by the productive part of the population. There is no "free money" that magically appears because you attach the initial burden of this subsidy to employers.
As a matter of policy it seems to currently be a popular idea that everyone who is not independently wealth should work. We already accept the idea that some people only partly pay their way, by working and claiming tax credits. We just need to extend the number of available jobs so everyone can do this.
Imagine if everyone on benefits was willing to work for free. Do whatever they are capable of, for nothing at all. Surely 95% of them are capable of doing something useful? For example clearning/childcare/gardening for neighbours who can't afford to pay for this at the current minimum wage.
Now imagine that minimum wage is reduced and UC is changed so that there are no out-of-work benefits for able-bodied people, but people can still achieve today's level of incomes from working plus tax credits. (Tax credits would be costing more of course, taking up the slack from lower wages.) Suddenly everyone is willing to do any work, for free, or as close to free as the minimum wage allows.
From an employer point of view, people would be working for as close to free as is necessary to ensure everyone can work. (Note it is the workers who are being subsidised, not the employers, who are only paying what the labour is worth to them.)
From a benefits system point of view, the money paid out is money that would mostly have gone out in benefits anyway, so it may not be a huge extra cost. What extra cost there is is the subsidy we are willing to pay to achieve the public policy objective of having everyone in work. It will come from taxes, which is a fairer source than the random selection of people who will suffer if one had merely increased wages. (That solution might ensure some people were paid more, but would probably destroy rather than create jobs.)
The minimum wage should become location specific and tied to the local unemployment rate, so that the state of the local economy at a particular point in time would determine the extent to which the benefits system was subsidising workers there. It should fluctuate at least annually with the state of the local jobs market.
AIBU to think UC will not change this? That they will still manage to avoid work?
You're rather implying that there are plenty of jobs around for them to avoid. As has been said many times on these threads, there are about half a million vacancies (including part time and zero hours contracts) and several million people officially counted as unemployed, and a further unknown quantity of people claiming JSA but counted as employed because they're on workfare.
But yes, your neighbours probably will manage to avoid work for a while at least. Eventually they'll end up sanctioned, although it probably takes longer for that to happen to the long-term unemployed-by-choice, because they know what to say to appease their advisers. When they do get sanctioned and their benefits are cut, it'll mean they have no money, but it won't magic up a job for them.
Your neighbours are clearly managing to get by on benefits. Fair play to them. If they're happy to do that, they're not occupying jobs that people with greater need for them could have. If you really want your neighbours to work, though, you need to make work more attractive - it needs to pay enough to afford a decent standard of living. If you can scrape by in a soul-destroying job for a pittance, or you can scrape by and have your time to yourself, a lot of people will choose the free time.
I'm well aware there'll be responses to that saying "that's why we're cutting benefits, so work pays more." But by cutting benefits to below the level required to survive, we're making people homeless, we're making children go hungry, we're setting ourselves up for a huge increase in petty crime. We're telling the poorest people - whose only failing is not having a job when there aren't enough to go round - we're telling them to piss off and starve. And a hell of a lot of "genuinely deserving poor" are getting caught up in it. How the hell does that help anyone?
In short, if you want to incentivise people to work, you need to pay them more.
I don't think it's targetting anybody. Just trying to get the welfare system fairer and under some sort of control. I don't think it's fair at the moment. We have people on low wages say £12,000 a year never being able to afford their own home and yet paying tax. And I do agree with the cap on Housing Benefit to a reasonable amount. And not people getting £2,000 a month housing benefit. A lot of people don't even earn that. it's madness.+
which is why we are reliant on business coming up with the money.
(also the govt is crap at generating jobs)
Yup we need more workers to generate tax etc, we still can't afford to actually build any industry at present though and invest with real money. It's just more borrowing and passing on the buck to the next generation. Common sense dictates we tighten our belts until we can afford to go building all these new job creation schemes. Borrowing in the first place got us into this mess.
lapsed - that would not apply if it were a Limited company.
the problem with the sole trader structure is there is no demarcation between the individual and the company money
for a limited company you can smooth out your income over the months.
the monthly reporting is a complete PITA but I expect it is designed to cut down on fraud i.e. make it harder to run cash and declared accounts.
We need to encourage entrepreneurship. Absolutely!
Well, if UC rules prevent people from starting up or running small / sole trader businesses, because you can't claim unless you can guarantee a minimum PROFIT (not just income) every month, how will this happen?
The Tories have always claimed to be the party which supports self-sufficiency and entrepeneurism and aims to reduce the beaurocracy which hinders small businesses from working efficiently. I wonder what sort of ghastly admin hoops we will have to jump through in future if we have to provide evidence of monthly profits, when the entire tax and accounting system is currently geared up to declaring annualised profits?
Well they are an example of the people I was referring to - it makes sense to reference them again, rather than explain in detail an example I had already given.
In future when I refer to my neighbours just take it as shorthand for 'long term unemployed who have no desire to find work'.
how does govt create jobs?
'Currently as things stand the revenue generated from workers isn't enough to sustain the welfare state. It's all very well wanting this and that etc but if there's no money in the pot, you can't pay with brass buttons. We all want access to the best health, housing, education, state support in difficult times.'
Then you create more workers. To do this you need a government committed to sustainable job creation first and foremost. But it's easier to put the cart before the horse and label people shirkers and vilify them than work towards real solutions.
'How do people get away with not doing workfare?
I find it hard to tie in what I hear about sanctions and people being left with no benefits when I see my neighbours doing nothing all day with no loss.'
You have a lot of concern about what your neighbours do.
My brother has Epilepsy so unable to drive,but he gets some kind of heavily discounted travel card as he has to catch a bus & train daily to work. it may even be free.
I wouldn't want some with epilepsy in the roads, it's not safe.
There are other methods of transport. Sure if we all looked hard enough ex find a reason not to make the effort and give up at the first hurdle.
I've known people with epilepsy that haven't been able to drive and have struggled to work. And they weren't entitled to a penny. The benefit systems as it stands is unfair.
Sorry that was a bit of a rant...
UC was here long before the Tories..it has been on the cards for years its obvious that this has been planned years in advance the benefits system cannot be changed over night..it takes planning...years of planning..it's been quite a few years since Employment Support Allowance was introduced as a new benefit and it still has issues,imagine changing the majority of the systems to regulate and pay alone would take years to implement.
Certain political governments with particular leanings are machinated into power to implement certain policy..Labour has a moral (and I use the term loosely) obligation towards the working people of this country ..Tories do not..they are all about free enterprise,big business and the wealthy aka utter bastards with knobs on hence the reason Tories always seem to be in place when we the people are being shat on from a height..they also if you notice tend to try things out and quickly back track when people protest...
Benefit claimants are being sanctioned more than ever before, the shortest sanction is 4 weeks the longest 3 years..imagine going without your wages for 4 weeks? because you missed an appointment...you can then claim hardship and if they choose to pay you your payments are further reduced you could get as little as 20% of what you were being paid and you are still expected to look for work in the same way..it's not easy.
Whats funny is that many of the things this government have said they have put into place to make the regime more robust are and have almost always have been there already, the majority of benefit claimants are working but they talking about making work pay when you will effectively make everyone worse off in the long run..it's amazing people fall for it..<<boggles>>
we also need to encourage more SMEs like they have in Germany. more likely to pay UK tax on all profits.
we need to encourage entrepreneurship.
The problem is wages have been allowed to drift along at a low rate because they have been supplemented by benefits. And also people working only a few hours a week and topped up with benefits. This needs to be sorted out. And working people having a lot of expenses such as travel so would be better off not working and on benefits. That isn't right either.
So start making the multi-national corporations and banks to pay their fair share of taxes as well.
The revenue from corporation tax has always been a small fraction of our overall tax receipts. The largest amounts have always come from income tax and VAT.
The problem with upping corporation tax is that it makes businesses more cautious. They are less likely to invest to grow, less likely to employ more people and more likely to move elsewhere in the EU/world.
And right now we desperately need more jobs. I'd much rather we lower corporation taxes, attract more firms here who employ more people than tax them. I'd happily lose a few billion in corporation tax if it means more jobs where people then are not on benefits, paying taxes and buying goods/services.
lapsed - how do you get companies to pay more tax here? e.g.
Amazon has a company registered in Luxembourg to 'make' its profits in a country where they are taxed at a low rate.
how do you get either Amazon to choose to move the profits here (so pay more tax on them) or Luxembourg govt to make them provide the UK govt with earnings information so we can tax them here more fairly?
neither Amazon or the Luxembourg govt want any change so how can a UK govt make this happen?
Currently as things stand the revenue generated from workers isn't enough to sustain the welfare state.
So start making the multi-national corporations and banks to pay their fair share of taxes as well. They're not just here because they can get away with paying bugger-all tax - they take advantage of the additional benefits of operating in this country as opposed to cheaper locations, such as efficient infrastructure, good security, transport and communication networks, lack of corruption, enforceable rule of law. Let them start paying a fair wack.
And this Government is committed to REDUCING worker taxes even further - this is and always has been a central tenet of Conservative political thinking, regardless of how appropriate or feasible it might be. The idea of a 'trickle down' economy, where giving people more money in their pay-packets through raising tax-thresholds and cutting top rates of tax in the hope it will spark a high street boom, and removing the incentive to save money by offering interest rates lower than inflation (so we all rush off to spend our lovely extra dosh!) has been proved wrong for years and years.
Honestly, they could anything and people would vote for them just to stop another 5yrs of the Tories.
I wonder if labour are using the UC fear and keeping quiet about what they will change and stuff to get more votes? People might be so fed up how it is now that they will vote blindly for labour so labour are wary of saying something that could stop that so they just say very little.
Labours lack of policies is increasingly frustrating.
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