Can someone explain to me why/how the Labour government has directly made them worse off in the last 15 months?

[MotherofAdults]

Can someone explain to me why/how the Labour government has directly made them worse off in the last 15 months? I see this claim a lot on these pages, but I don't understand why. Sorry if I sound stupid, I am just trying to get clear.

I totally understand that the cost of living keeps going up - that inflation keeps rising (3.5-3.8%?) and that mortgage interest remains relatively high, but I don't understand why or how this is the fault of the current government? What have/haven't they done? Are people angry that they haven't curbed inflation? What should they be doing?

If we could avoid mentioning the things that didn't actually happen (eg the Winter Fuel Allowence cuts) and speculation about what the next budget will do (doubling of council tax, rise in minimum wage etc), that would be really helpful. I am looking for actual changes made by this that have directly affected your financial situation since Labour got it.

Lol. I've known my friends for long enough to know what their political views are, and for them not to spare my feelings.

It isn't surprising that your friends are expressing different views, because we tend to be friends with people who share similar values to our own.

I know quite a few of the "pissed off about VAT" types too, but they're not generally the type of people that I would choose to spend a lot of time with.

Well yes, they had dwindling student numbers because the children are being charged a 20% more on their fees and any extracurricular activities.

Good for mn posts on how people like to pay more tax, I mean other people.

Things that are affecting me:

My fixed-term contract role that was expected to be made permanent wasn't. The company needed to reduce heads after the budget so all FTCs went. I picked up agency work as the company I work for have frozen recruitment fearing what's coming from the next budget and the Employment Rights Bill. As an agency worker I have no rights, very few benefits (e.g. no sick pay) I can be served a week notice at any point. My company and many others are using this as a way of protecting themselves against what's coming in the Employment Rights Bill - it's going to be far more risky to hire permanent untested staff once it comes in.

I've applied for countless jobs, the market is saturated and recruiters regularly tell me they're receiving multiple-hundreds of applications for every role.

My weekly shopping bill increases every week. A £120 a week shop last year is now costing £180. I spend most of the shop telling my children no. Every point in the supply chain has had to increase costs, which have been passed on.

Several small local business have closed. The local hairdresser, chip shop and ladies wear shop. Many more are struggling and I think they'll sadly fold after Christmas.

Several school trips at the kid's school have been cancelled as 'voluntary donations' no longer cover the costs and the PTA fundraising has also dropped so can't make up the shortfall.

My council tax increased significantly, as has my gas / electric and water bills.

So many everyday items have increased slightly in price as cost increases are passed on, be it mobile phone contracts, broadband, bus passes, school lunches, after school club, holiday clubs, extra-curricular clubs, haircuts. It's a few pounds on each, but across the course of the year and with everything else, it's significant.

Sorry, I don't know what you're talking about?

We’ve had to spend over 10k on legal fees getting the farm gifted into our name. Now, statistically, unless we are very unlucky we will pay no IHT. The only winner there was the land agents and lawyers.

This hasn’t affected me directly but it’s affected most supermarket purchasers of food. You probably buy a product I produce in the supermarket. What we get paid by the supermarkets is based on them estimating our costs, which is based on NMW and NI. As those have gone up, so has the price in the shops to pay for it.

Oh, and they pulled the funding at the last minute for SFI applications at the last minute. Luckily we were ok but many many friends missed out. They also pulled our BPS payments - they were supposed to go slowly but they went quickly. Not great for business cash flow. Oh, and they’ve pulled grant funding for YFC groups. And for farming mental health.

so, yeah as a farmer they’re not exactly supporting our industry! And I haven’t even mentioned the VAT on school fees

That is quite clear.

The country was going badly down the drain well before Labour got in - the Tory’s knew it, why do you think he called an earlier election than needed - results of Brexit, a lack of a cohesive social care policy being brought in during their time, austerity, letting everyone and his mother in to fill gaps in sectors caused by Brexit - 400 billion down the drain, again Brexit related and piss poor Covid financial management were rapidly coming home to roost - actually inheriting this utter maelstrom, I’m not sure I would have wanted that - you can’t improve things rapidly in a shirt frame of time with shirt buttons and when you have half the population wanting scandi level services and Dubai tax levels and a large percentage of the other half wanting to work 15 hours a week and still have a decent home and a great life style - I honestly do think so nany aspects went way too far away from public interest in last 40 years that are now causing big issues and a lot of it started with thatcher selling off essential services and public housing -

@MrsBennetsPoorNervesAreBack - most of my friends are either in mixed race marriages or dual nationals so they have options elsewhere, sometimes even 2 heritage countries. So they are not beholden to Labour Party 1970s ideology. They are here at their own volition, to contribute, loved the freedom of UK society originally and the creativity and buzz of London. Once the State takes too much back, they are perfectly entitled to be mightily pissed off. I suppose Blair & Co should not have invited so many successful highly educated EU type professionals into the country in the 90s.

Yes, I agree that the pp's post didn't make any sense, so perhaps I'm stating the obvious.

I think she was implying that I am happy for other people to pay tax but not myself. However, I think she'll also find that I have consistently said that people like me should be paying more tax, so that argument is a bit hollow.

This Labour gov are particularly bad. Even the last Labour one had better ideas on aspiration and taxes.

Well apart from the cost of living going up, I work in a private school in a near minimum wage job. No hope of a pay rise, and staff numbers have been cut so we are even more overworked than before. Cutbacks everywhere.

The quiet back peddle (within a week of being elected) to not proceed with the plan to limit the total amount a person would pay for care at (I can’t remember the actual amount but it was about £80-£100k iirc)

You said “And as for the ones who want to move, theu can fill their boots - but they would have to give up their British Citizenship if they dont want to pay tax.”.

If they don't want to pay tax being the key context there i.e under an US style system.

A quick Google tells you this is nonsense. The US tax system is much more complicated than that.

I think perhaps you need to do more than a quick Google. US citizens who live abroad have to file a tax return if their income meets the threshold. The low(ish) tax bands in the US, reciprocal tax arrangements and tax credits mean many don't pay anything because the countries they live in have higher tax rate.

Two thirds of US citizens living abroad are below the thresholds and the majority of the rest don't pay anything due to the double taxation safeguards.

A US citizen living in the UK and earning £250,000 would not have to pay any tax because UK marginal tax rates are higher than the US. However a US citizen living in the UAE and earning £250,000 / $312,000 would have to pay around $63,000 to the IRS because the UAE is a zero tax economy.

If we had a system with the same rules as the US, a UK citizen living in the US would end up paying UK tax on anything earned over £125,000.

The US also tax ALL income - not just PAYE - the IRS tax return applies to capital gains, dividends, interest etc as well.

Under what I'm proposing, no-one earning less than £200,000 would be worse off in the UK. Anyone earning more than £200,000 who chose to move abroad to a lower tax economy would still need to pay UK tax on a proportion of their income if they wanted to retain their citizenship.

They could of course choose to do as Boris Johnson did with his US citizenship and give up they're UK citizenship - but it would mean that they had less access UK opportunities.

How would services improve if the tax take falls? Where would the funding for improved services come from? Your reasoning doesn’t make sense. You’d lose VAT from people leaving (wealthier people have more disposable income so tend to spend more on items subject to VAT).

The money comes from borrowing and capital investment which improves services and increases GDP thus reducing the GDP / debt ratio. Its basic Keynsian economics which successfully rebuilt this country post WW2 until the destructive consumer driven nonsense that is Friedman's free-market ('trickle down') economics was promoted in the 80's.

Wealthier people spend a far smaller proportion of their income on consumption. VAT is regressive, it disproportionately impacts lower earners who spend a higher proportion of their incomes on day to day spend and spend more over time due to not having the luxury of being able to fly abroad to go shopping, having to buy cheaper goods which need replacing more often and buy things on credit which ultimately costs more.

Terry Pratchett explained it well through the Sam Vimes theory of socioeconomic unfairness (boots theory)

No one with any basic understanding of simple economics and maths can think that bringing in policies encouraging those that contribute the most to the tax system to leave will improve the economic situation in the UK.

Anyone with a basic understanding of economics would know that the arguement that raising taxes encourages higher earners to leave the country is a myth!

The uber wealthy take a lot more from this country than they give. Look at Michelle Mone with the PPE scandal, Lord Rothmere who makes a fortune off influencing society (imo for the worse) through the Daily Mail, the biggest selling daily paper, yet hives all that money off in his offshore accounts, Lord Ashcroft who was happy to be chairman of the Tories while paying virtually no tax.

Even Sir James Dyson - he is one of the biggest tax payers in the UK (including his business taxes) and that is with using every loophole possible to reduce his tax burden, including shifting production to Singapore which to date has led to the loss of over 1000 jobs in the UK.

The idea that the wealthy will leave if taxes are increased has been disproved time and time again - most recently in the UK when the non-dom loopholes was closed. Everyone warned that would cause an exodus which never happened.

Denmark has a top marginal rate of 55%. Someone earning the equivalent of £150,000 there would pay over £70,000 in tax (compared to £48,000 in this country under current tax rates). Around 8% of the Danish population are millionaires compared with just under 5% of the UK population, again showing that high taxes do not cause wealthy people to leave the country.

We have to stop swallowing that myth

What's your point, exactly? That people have other options? So what? Lots of us have other options.

I'm also in a mixed marriage and we have several alternatives for where we could move to. The same applies to many of my friends - I find that people with international experience frequently tend to gravitate towards each other. However, not all are resentful of paying taxes! Quite the opposite, in fact - many of us are happy to contribute.

There are plenty of things that are wrong with this country, and we may yet decide to move away ourselves at some point. And we're lucky to be able to have those choices. But we also recognise that the grass isn't always greener.

If your friends are pissed off with life in the UK, then they're free to leave. Perhaps they will find their utopia elsewhere, or perhaps they will become those people who seem to spend life serially complaining about wherever they live and how life would be much better somewhere else. Whatever.

And when they do move on, there will be plenty of other highly skilled professionals from other countries queuing up to take their place...perhaps on their own never-ending journeys in search of a utopia.

Has anyone mentioned WASPI women & the restitution/compensation that didn't happen? It doesn't matter whether anyone here thinks it should or shouldn't have happened: that's not what the OP asked. This government refused to pay WASPI women anything. Therefore WASPI women lost money as a direct result of this government.

Of course, the blame also lies with the successive governments who took the money off WASPI women & then refused to give it back. But recommendations were made for compensation (too low) which this government refused to fulfil.

And why, OP, do you say that the Winter Fuel Payment cut didn't happen? It did last year, surely. And I don't think it's fully restored this year. Do you have the figures?

so are you are part of the scheme where people people make voluntary donations to government? https://www.gov.uk/guidance/voluntary-payments-donations-to-government

seems like not many are..... this from an FOI request posted at Whar Do They Know. edit: image below

image

Good news. You can. Link below.

Don’t wait, Starmer and Reeves need all the help they can get.

I never knew that this existed!!! I suspect that most don't.

The housing stock was a good thing but there should have been rules put in place also the stock should have been replaced.

Utilities and the like. A very poor decision. If only the Lib Dems had been able to channel the best of the right and the best of the left.

Missed opportunity.

No, this always gets brought up. I'm not claiming to be a saint, but I'm willing to pay more and I want others to pay more as well, because a bit more tax from me alone will be a drop in the ocean. We need to make it mandatory.

What weird logic. Being happy to pay taxes along with everyone else is different to paying extra tax.

The winter fuel allowance is now means tested, so I don't get it. Tax thresholds are frozen so the % of my income that is taxed has gone up. Taxes on businesses have gone up hugely and that has pushed up the price of almost everything and reduced the number of jobs available.

If the government says they warned WASPI women they weren't getting a pension at 60, why would they pay restitution?