Benefits rising twice as fast as salaries!!! DM

(43 Posts)

really?

MiniTheMinx Wed 02-Jan-13 12:40:36

A cut and paste of the article below to save anyone having to link to the daily mail.

Benefits rising twice as fast as salaries: Payments to unemployed jump by 20% in five years
Jobseeker's Allowance up 20 per cent from £59.15 a week in 2007/08 to £71
In the same five-year period wages only rose by 12 per cent
Iana Duncan Smith said the system is not fair on workers


Welfare handouts to those languishing on the dole have risen almost twice as fast as average wages over the past five years.
Out-of-work benefits have jumped in value by an astonishing 20 per cent since 2007 while wages have crept up by just 12 per cent, official figures released last night reveal.Work and Pensions Secretary Iain Duncan Smith said the figures proved that automatically increasing benefits by the rate of inflation, as has previously been the case, was ‘not fair’ on working people whose taxes fund the handouts.

Ministers are now battling to reform the system and impose a 1 per cent cap on out-of-work benefit increases for the next three years, but face opposition from Labour.
Mr Duncan Smith said yesterday: ‘Working people across the country have been tightening their belts after years of pay restraint while at the same time watching benefits increase. That is not fair.
‘The welfare state under Labour effectively trapped thousands of families into dependency as it made no sense to give up the certainty of a benefit payment in order to go back to work.’

The disparity between those in work and those on welfare is laid bare by the figures from the Department for Work and Pensions.
While working families have faced a greater squeeze on their income from inflation, benefit claimants have been cushioned from the soaring cost of living by automatic inflation-linked rises in their payments.

Over the past five years, Jobseeker’s Allowance rose by 20 per cent from £59.15 a week in 2007/08 to £71 in 2012/13.
Last year alone, out-of-work benefits rose by 5.2 per cent, while average earnings increased by 1.7 per cent – just one-third the rate.
Meanwhile, across the whole economy, weekly earnings went up from £392 in 2007 to £441 in 2012.
Ministers argue that the figures underline their case that Labour’s welfare system provided a disincentive to claimants to take a job.
A new Universal Credit scheme, to be introduced in stages from April, will replace most existing out-of-work benefits and is designed to ensure that it always pays to work. Unifying taxes and benefits into one system, it will also prevent total benefits from exceeding the average wage.
The new figures will also strengthen the case for the Government’s decision to cap benefit increases to 1 per cent.

Chancellor George Osborne faced criticism from Labour and the unions for the decision, announced in his Autumn Statement last month. Labour has vowed to vote against the 1 per cent rise when the measure is debated in Parliament early this year.
But ministers insist it would be unaffordable to allow benefits to continue to outstrip wages, as well as unfair.
Private sector pay has stagnated during the recession, while the public sector has been subject to a three-year pay freeze.
Labour argues that the new benefits cap will hit millions of working families on low incomes whose tax credits will also be capped. The party’s work and pensions spokesman, Liam Byrne, said the move would mean some part-time workers would be better off on benefits.
Mr Duncan Smith said the new Universal Credit system would ensure fairness, adding: ‘This Government is restoring fairness to the system and Universal Credit will ensure it always pays to be in work.’
Mr Osborne is determined to shave a further £10billion from the welfare bill, on top of an £18billion reduction in benefits already in place, after a more downbeat than expected economic forecast.

The cost of increasing benefits in line with inflation since the 2008 recession has been £6.3billion. In 2009 alone, the Labour government raised means-tested benefits – not pensions – by 6.3 per cent.
Overall, more than £90billion is spent on working age welfare every year, the same as the entire education budget.

CogitoErgoSometimes Wed 02-Jan-13 12:43:13

Benefits increases are linked to the Consumer Price Index which, last year,hit about 5% at the crucial time. Wages haven't been going up by more than 1% or 2% a year... and that's if you're very, very lucky. So the statement is mathematically accurate. Inflation has come down a little since.

Xenia Wed 02-Jan-13 13:46:14

And we cannot afford to pay anyway. I do some work where the rate has been the same for about 12 years never mind 3!

CloudsAndTrees Wed 02-Jan-13 13:47:06

Anything that ensures that people are better off if they work has got to be a good thing. It is wrong that out of work benefits (excluding disability related benefits) have risen when wages haven't.

CloudsAndTrees Wed 02-Jan-13 13:48:06

shock that the same amount is spent on working age benefits as education!

MiniTheMinx Wed 02-Jan-13 13:51:43

One could ask though, why do we persist in educating people when at the end of it there is no work?????

timidviper Wed 02-Jan-13 13:52:20

I read somewhere recently an article which showed (if I remember correctly, and I may not) that this countries GDP had increased x3 over several decades, over the same period benefits had increased x12. It is no wonder we are struggling.

MiniTheMinx Wed 02-Jan-13 13:57:30

It is wrong that out of work benefits (excluding disability related benefits) have risen when wages haven't

Maybe it is because benefits reflect the fact that there is an absolute basic amount that is needed to live. Employers constantly seek to drive down wages and if it is benefit levels that are assumed to represent the actual amount needed to subsist that would incentivise employers to do this. Plus you have the added pressure of knowing that your employer has an ever growing pool of unemployed labour on which to draw should you demand higher wages or better working conditions.

pumpkinsweetieMasPudding Wed 02-Jan-13 13:57:52

I want to know where all this work is?
Please tell me? As my dh has been out of work nearly 3 months and applied for every job going and has so far only managed to aquire a holiday job which has now ended...
It will take us ages to sort our jsa again and let me tell you, the money is shitsad

Xenia Wed 02-Jan-13 14:10:19

I don't share the MTM view and I think we have gone hell for leather after relative poverty rather than simply ensuring the measure is absolute poverty and keeping people fed for temporary periods when they are out of work.

Someone posted this link on another thread. Both Labour and The Coalition proposed some supposed cuts 20% and 25% respectively. They are tinkering and we still spend spend spend whilst Rome burns. The ultimate bonfire may not be very pretty.

Where is the work? There is certainly not much of it around but people do come here abroad to find work so there must be some. Also many of us have had to move to find work.

info.moneyweek.com/urgent-bulletins/the-end-of-britain?infinity=gaw~DISPL%2BSPCFC%2BThe%20End%20Of%20Britain~DISPL%2BSPCFC%2BThe%20End%20Of%20Britain%2BPL%20guardian.co.uk%2BKW%20%20Financial%20Crisis%2BTXT~17168933349~placement:www.guardian.co.uk~c&gclid=CJ-SnI_FybQCFTDMtAodrwYA8Q

CloudsAndTrees Wed 02-Jan-13 14:24:17

Maybe it is because benefits reflect the fact that there is an absolute basic amount that is needed to live.

I think this is a fair point, especially when it comes to JSA which is pitifully low, but I'm not sure I agree because there are people in work that are surviving on the bare minimum too.

One could ask though, why do we persist in educating people when at the end of it there is no work?????

The answer to that is simple. People need to be educated to a reasonable level whether there is work available or not. Hopefully we won't always have such high unemployment levels, and there will always be some work.

Why shoukd disability benefits rise but not others?

CloudsAndTrees Wed 02-Jan-13 14:55:49

Because living with a disability is more expensive than living without a disability. And people who are unemployed are only in that position temporarily, whereas disability is for life. Disabled people haven't had the opportunity to save up in case of redundancy, and in many cases, they have no chance of being able to work again. The same cannot be said of someone who has lost their job.

BoulevardOfBrokenSleep Wed 02-Jan-13 15:18:08

Has the mail, in its wisdom, calculated how much food prices have gone up in five years I wonder? hmm

BoulevardOfBrokenSleep Wed 02-Jan-13 15:20:37

Oh, there we are.

30-second google.

"Food prices in Britain have risen by 32 per cent since 2007, double the EU average, according to figures released by the Department for Environment, Food and Rural Affairs (DEFRA). " source = Telegraph

picketywick Wed 02-Jan-13 15:20:58

Its a very complex debate and the DM has a Tory agenda. I notice Duncan Smith does not seem to do the medai debates on benefits now. Grant Schapps
woh has another name, does the media speil

Garnier Wed 02-Jan-13 15:21:06

Well I had a 6 pence per hour pay rise for first time in 3 years, so it's certainly true in my case.

ParsingFancy Wed 02-Jan-13 15:29:22

So what IDS actually means is "Wages have gone up more slowly than the basic cost of living."

It's all in the way he tells it, innit?

Btw, of course the working-age benefits bill will increase under when this happens, as working people claim more benefits to supplement their inadequate wages.

Nancy66 Wed 02-Jan-13 15:39:30

I don't know anybody who is earning 12 per cent more now than they were five years ago. most people i know are earning less

MiniTheMinx Wed 02-Jan-13 15:44:57

Maybe it is because benefits reflect the fact that there is an absolute basic amount that is needed to live

I think this is a fair point, especially when it comes to JSA which is pitifully low, but I'm not sure I agree because there are people in work that are surviving on the bare minimum too

This is actually what I said confused because if the amount paid in benefit is the actual bare minimum needed to subsist.....this could be argued by the capitalist class, that is all the worker actually needs to subsist. Have you read Engles writing about the poverty conditions of the working poor in the 19th century factories?

You see, if you have a basic minimum required to subsist and reproduce, then the employers are likely to use this as a justification for exerting downward pressure upon wages. If you do this, the worker can not spend any money surplus to his absolute living costs (rent, food, taxes, water etc) which means two things......less commodities can be purchased and less workers are required ( but a huge pool of unemployed labour exerts downward pressure upon wages too) and your employer has a business apt to go bust, in other words the employing class (corporate/capitalist) thinks he is only digging your grave but is in fact digging his own as well !

This process has been underway since 1980, if anyone also follows what is happening in the states, they are further along this trajectory than we are. The only thing to have mitigated against the worst effects was women making up the missing wages of their men through their entry into the labour force and the ease with which workers could take on debt. That debt doesn't help workers ultimately but it sure as hell keeps the show on the road the cash registers topped up for the rich.

One could ask though, why do we persist in educating people when at the end of it there is no work?????

The answer to that is simple. People need to be educated to a reasonable level whether there is work available or not. Hopefully we won't always have such high unemployment levels, and there will always be some work

If there is no work, it can no longer said to be about educating people for future employment, instead it becomes a case of containing people and taking up their time in something that is deemed to be of value. Of course learning for learnings sake is wonderful but that is something that is actually denied to working people, through the introduction of tuition fees and the withdrawal of ema and other support to poorer students.

Over the history of capitalism schooling has taken up a larger and larger percentage of our lives. School leaving age keeps rising and the labour required under this economic system keeps shrinking. I doubt very much whether we can get back to a situation of low unemployment.

So what is the real cause of the unequal distribution in rises btw wages and benefits? Well it could be said that the state is misguided but still benevolent enough to ensure whether people eat, whilst the private sector doesn't much care if you eat or pay extortionately for rent and fuel. They'll either squeeze you for productivity (as over 1980-2009) or they will squeeze you for non-negotiable payments.

<awaits right wing to tell me I am deluded> grin

2old2beamum Wed 02-Jan-13 16:02:09

Agree with MiniTheHinx
20 per cent of bugger all is bugger all. 12 per cent of a wage is more in hard cash than the benefit scrounger will get.

claig Wed 02-Jan-13 16:27:12

<awaits right wing to tell me I am deluded>

Mini, you don't need us to tell you that, you know that full well yourself! wink

<<only joking>>

MiniTheMinx Wed 02-Jan-13 16:38:34

Hi Claig.....Happy New Year, love all the links and info about LCP.

<I'm mad as well as delusional, don't tell anyone !>

Do you think that some of the language used in that mail piece is designed to stoke up hatred and envy between workers and non workers?

Xenia Wed 02-Jan-13 16:41:30

If workers are paid too little to buy goods (not that goods are are main thing anyway, services are in the UK) then we export. British exports have been doing reasonably well as the pound has been low. China is a huge market. We need Boris and Cameron abroad more plugging British services and goods.

Perhaps we just have far too many people. I remember in those very very difficult days in the 70s with civil unrest 60% inflation over 3 years, 3 day week, power cuts and the like when the nation was almost breaking down, with highest tax rates over 80% and people moving abroad, there was a huge criticism of those having babies. You just never hear that now in the UK, nothing about population explosion etc. It all died away.It is rare on mumsnet that anyone is critcised for breeding yet when I was a teenager talking about wanting 5+ children ( I have had five) it was socially unacceptable. As there is no work the Poles are going home and Britons are considering moving abroad.

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