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Labour’s seriously flawed new ‘Job Guarantee’ Unemployment Plan.

(3 Posts)
Isitmebut Mon 10-Mar-14 14:19:44

Labour’s flawed new ‘Job Guarantee’ Unemployment Plan

And based on the unemployment trend below, that included strong global economic times when you’d think businesses were hiring like gangbusters, few could argue we need more financial initiatives to companies than Osbourne’s recently announced National Insurance initiatives to employ the young, coming in soon.

Numbers and overall percentage of unemployed 16-24 year olds – by the ONS.
May-July 2004580,00012.2%
May-July 2005600,00012.6%
May-July 2006706,00014.5%
May-July 2007711,00014.6%
May-July 2008727,00014.8%
May-July 2009944,00019.8%
May-July 2010921,00019.4%

But history shows that there is a huge difference between how a social government commits private Sector money to government projects, and what happens in reality.

The problem is that it has to be real jobs, from real companies, within a vibrant Private Sector with low Corporate Tax rates and profit margins they can plan/budget on for years ahead, of whom a government is not also continually threatening/hitting on the key decision makers within those companies, tax on salaries, pension funds and ‘Mansion Taxed’ homes.

If I was in team Balls, without one company so far committing to Labour’s policies to thank them with higher business and personal taxes FOR PLEDGING to hire youngsters in uncertain times post political/economic 2015 times, I’d be looking for a career change about now.

And as far as City bonuses go, and many have campaigned for that, Labour have decided that the other 10 spending policies they have announced will be financed by taxing City bonuses, will no longer be – so Labour will be hoping City bonuses increase, they are now in 100% in cash and this cash or equity are not deferred bonuses for say 3-years, to be clawed back on company losses, or subsequently uncovered mis deeded by the recipient.

No future bonus tax receipt planning to cover guaranteed spending possible there then. So the taxation policy likely to fund the government ‘created’ jobs for the unemployed, within a private sector fearful of a Labour administration in 2015 and likely to scale back operations, will fall mainly on the taxation of pensions.

And Labour has recent form on hitting pension early in their administrations, even without national emergencies to justify it, or even previously mentioning it within their 1997 general Election manifesto - and Ed Balls was a key man then.

Currently they say they are only targeting the rich peoples pensions, but forget that like their increase of the 40% tax rate to 50% 100-days before the end of a 13-years administration, those ‘rich people’ have financial choices and little of the £4-5 billion they were convinced it would raise, materialised. So unless ideologically illiterate, what is the point of having a new tax that doesn't raise much money.

So if a government decides to take away most of the tax incentive for investing in pensions, the wealthy will not use that savings vehicle and look for alternatives – like buying private property for retirement rental income flows, rather than dividends on stocks, as many others did when Brown and Balls raided pensions in 1997/8.

So who’s pensions then get targeted to make up the shortfall?

Isitmebut Mon 10-Mar-14 14:32:31

ooops, lets try again on the table.

Numbers and overall percentage of unemployed 16-24 year olds – by the ONS.
May-July 2004 580,00 12.2%
May-July 2005 600,000 12.6%
May-July 2006 706,000 14.5%
May-July 2007 711,000 14.6%
May-July 2008 727,000 14.8%
May-July 2009 944,000 19.8%
May-July 2010 921,000 19.4%

Isitmebut Sat 19-Apr-14 11:33:50

Anyone heard any more about Labour's 'Job Guarantee' scheme, financed by private pension raids on the 'wealthy' that somehow always spills down to the 'not so wealthy' like Brown's last raid - as the last time I heard about this was back in mid March when Labour were canvassing employers for their input?

As recent changes to pensions arguably makes saving through pensions more attractive, rather than buying investment properties instead to rent out for income at ever lower yields - would this change in coalition policy make our pensions potentially a bigger ATM for Labour?

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