AIBU about Tax Credits cuts,

[Weathergames]

Commons back Osborne plan for tax credit cuts
www.bbc.co.uk/news/uk-politics-34260902

I don't claim anymore because I now earn enough to support myself - because I could work and progress my career as well as my life while being a single parent.

AIBU to think this is a total travesty and so many single parents are going to have their life's devastated by this - and what about people in domestic abuse situations who will now be more unable to leave?

Maybe I some benefits scrounger - but the tax credits enabled me to be a good parent and role model to my kids - without their feckless father affecting that .... AIBU?!

Because of the benefit cap it is likely that the amounts received in both areas would not be wildly different obviously there may very well be differences due to the LHA but because the cap jumps in it would be quite unusual for the difference to be worthy of a rule change to prevent it happening.

well, then my point stands as I can tell the rent in south kensington is very different from swanage.

I'm finding reds posts quite interesting (although I don't agree with all her points). Do you think your nationality has an influence on your opinions, Red (genuine question)? I understand American culture to be far more fixated on a meritocratic viewpoint, where people who earn well are considered to deserve their money and privileges while those who don't have done something wrong along the way and are more to be blamed than pitied.

Rents and house prices in the SE are ridiculous, but kicking low income locals out of their houses so the property can be sold to the more 'deserving' isn't going to make any real impact. Someone whose rent goes down by 1 or 2% because of the new relative affordability of housing is not going to see any lifestyle improvement because of it.

It's also tangentially relevant that your scenario (sorry if not yours!) of someone going to live in an affluent area on LHA because they want to would never, ever happen. This is because landlords would never accept someone on housing benefit. Even down here in zone 3/4 it is incredibly difficult to find anywhere at all to live in that situation. Banks don't lent to BTL landlords unless they agree not to rent to LHA claimants and insurance companies will refuse to cover them.

So the solutions would have to include making this kind of discrimination on the part of major companies and financial institutions illegal, so that people actually can move out of more expensive areas. You see, even though sc would like to move away, she has very limited options because I can assure you she won't find a private LL within central or greater London who will accept her as a tenant.

Oh, and investing in an area includes spending money in local shops to support the local economy, donating your time to local charities and endeavours and of course paying council tax (as everyone on benefits now has to do in part, thus saving the treasury a fortune). Maybe joining in the neighbourhood watch scheme, helping out in schools, keeping an eye on elderly neighbours. It has very little to do with physical money. Someone who is actively helping out is far more valuable to an area than someone who considers paying council tax to be the beginning and end of their involvement.

investing in an area includes

does that apply to private tenants? i.e. are their investments counted?

@ Cateyeflick

nice.

Do you think your nationality has an influence on your opinions, Red (genuine question)? I understand American culture to be far more fixated on a meritocratic viewpoint, where people who earn well are considered to deserve their money and privileges while those who don't have done something wrong along the way and are more to be blamed than pitied.

possibly. I am a leftist back home, and in fact most of my political views, even here, would be considered left. I am completely against the tory party, and would never vote for them, nor have I.

again, anyone who has read my posts will see I am not blaming the poor. nor have I called them feckless. I see what's happening in the SE not being mitigated by things like HB and SH, but partly because of them (and that's in fact back by studies. People receiving HB saw their rents rise faster than others a few years ago. that's likely changed because of the caps). I see those things as part of a bigger problem.

But that's because I see the people hurt by high prices as a much bigger group than just the poor. Most of my friends are young professionals (great education, good jobs, both parts of a couple in work) completely locked out of the housing market. And that's 30 something professionals who managed to get out of education with no debt. Forget people younger than them. They have absolutely no hope whatsoever. What about them?

Yes, private tenant's and homeowner's investments in the area are equally important. Just not more important.

I completely agree with all you say above. I just feel you're attributing an amount of weight to the problem that it doesn't merit. Certainly every time housing benefit rates have gone up, landlords have raised rents to take advantage. And yes, it has an impact because so many people are on at least partial housing benefit... because prices are so unaffordable... it's been a vicious circle.

But there are other factors which have far more impact- people who buy property as an investment, London deliberately being made the most attractive place for large businesses to cluster, causing more and more people to crowd into the area with no choice but to pay high prices if they want to be where the work is... fiddling around with a few thousand social housing tenants, the majority of whom work anyway, isn't going to make a dent.

The problems of young people needing housing are huge and they impact on all but the wealthiest. As you point out, people who have spent fortunes on their education and starting from the bottom can't afford homes. At the other extreme are people like my daughter, who can't find a private let because she will be on partial housing benefit... due to ridiculous rents.

So do we control rents, build more housing, or both? And how do we deal with the reluctance of the government to either curb investment or spend money?

FWIW (ie, zero) my first action would be to prevent banks and insurance agents discriminating against LHA tenants. Secondly, I would legislate that at least 15% of any letting agent's properties must be available to LHA tenants so that they will start encouraging landlords to accept them rather than making a virtue out of only attracting 'professionals'. This would allow people on low incomes to move out of London if they wished. It would also make BTL less of an attractive proposition, freeing up more stock for homebuyers.

Then would come the taxes on empty properties owned by overseas investors... with that money you could probably build social housing for all that need or want it. Or else the sudden flood of ex-overseas-investor properties onto the market would correct prices!

I just feel you're attributing an amount of weight to the problem that it doesn't merit.

I see that it can sound like that, but there was a thread (about a month ago) about what I thought of the current Tory policies that are exacerbating the problem (right to buy, help to buy, raising the inheritance tax threshold for property etc). of course I don't expect you to know that thread, but it sounds one sided here because that's the topic of this thread.

And I am pretty much for every one of your suggestions, including making it illegal to discriminate against LHA tenants and discouraging overseas buyers.

But I don't think any one of the them will work because the problem is completely out of control. we have to throw the kitchen sink at the problem (including what I suggest). it wouldn't surprise me if two teachers couldn't afford to buy a 3 bed anywhere in zones 1-3. it's totally out of control.

You are right that there is no political will to solve the problem. the trouble is that no party wants to be in power when prices start falling, which is what I think needs to happen in the SE (it would oddly be seen as bad having an essential good drop in price. property is the only thing like that). of course, not to mention, many politicians themselves have a finger or two in property. What they (and it seems everyone else) want isn't great for the country; they want to keep prices high (totally screwing non-homeowners), keep public money flowing to BTLs, but not have homelessness (which is of course good). well, we have the perfect system for that.

well, then my point stands as I can tell the rent in south kensington is very different from swanage

You appear to be misunderstanding, the benefit cap is likely to negate the ability to recieve the entire amount of the LHA so the rents being higher will not matter a huge amount.

In Kensington the higher rents are likely to mean the total benefit amounts are significantly over the cap so the cap cuts in and removes the "excess" amount.
In swanage the low rents are likely to make the total benefit amounts are either just under, on or very slightly over, just under or on the cap won't remove anything but just over and it will. So two claiments with the same circumstances but one living in Kensington the other in swanage are fairly likely to be receiving exactly the same amount of benefit in total or if not the difference is not likely to be much and certainly not enough to justify the governmental expense of pissing about with the system and/or additional costs associated with housing applications and homelessness assessments

If it's any comfort 2 teachers 30 years ago couldn't. My children's father is a teacher. So hard was it to attract teachers to his school (zone 5) in that period they had to buy houses and provide staff accommodation which is where we started married life. We then did buy in zone 5 ( we paid 12% mortgage interest and only young professionals like us could really afford to buy) but only because he'd had a house in the North he could sell and we both worked full time and I look no maternity leaves. It's never been easy. 30 years ago I worked with very senior partners who commuted nito London from Kent and Brighton and elsewhere every day for work because they could not afford to buy in Central london. I don't think it's a new issue but it's certainly difficult at present even in outer London.

Where there are no jobs it's not difficult at all. The house my mother grew up in in the NE costs £50k to buy today. People will have to go with what has always been in the UK norm I suppose and live with parents. My grandfather moved into a lodging house to escape his parents . In 1901 he was sleeping with 26 young men in a boarding house. We are certanlyi all largely better off than that now and he couldn't have chidlren or a wife until he was over 40 because could not afford it. My parents waited 10 years of marriage before having children too because they wanted to afford to buy a house.

I just did a zoopla search which was interesting - house prices over last 5 years:

1. My late parents' house, desirable detached near NE city centre, went up 7%
2. My house 35%
3. One daughter's London flat zone 2 54% (although she hasn't owned it as long as 5 years).
4. Other one's zone 1 47% (again not owned for as long as 5 years).

Although presently inner London is not increasing as much as outer as families move out to get more space.

What regional changes! I am very impressed with Osborne's China trip and he has with him Northern businessmen trying to get our Northern powerhouse going again. That could be the key to all this. If there were jobs a plenty near Manchester and Newcastle people could buy nice big prices up there for relatively cheap prices.

(..nice big houses !! not prices)

I was a teacher in the West Midlands in the early 1990s (before the bottom conveniently fell out of the housing market which hopefully it will again) and on my wages, I was unmortgagable. And that wasn't in London - in the Midlands, FFS. Even in the recent past it hasn't always been easy.

That said in 1980 my brother bought a large terraced house for £10,000. In 1955 my parents bought a 5 bed house with loads of outbuildings,an acre of land, an orchard etc for £1000.

Grazia I am absolutely sure that two teachers could have bought in parts of London 30 years ago. My OH and I bought our first property (a two bed maisonette in South Tottenham ie zone 3, a few mins walk from the Piccadilly line) in 1987 for £55k at what was then the peak of the market, and you could have bought much cheaper in the slightly nastier parts of Haringey at the time, and cheaper still a couple of years later! (We were in negative equity for the best part of a decade). While teachers' salaries were low at the time, they weren't that low (we were in a joint salary of £22k).

Like it or not, times have changed!

she had switched cc providers mid year they doubled her cc costs leading to paying her loads of money so she lost her housing benefit she kept trying to get them to stop paying her they refused to stop or change the info as apparently they are not allowed to if you are having a compliance check, finally after 8 weeks they stopped. Didn't issue an over payment notice just re adjusted her award with a you are entitled to x we have already paid you x this is what's left, so her weekly money plummeted

This is what has happened to me. My circumstances changed but they couldn't update my file because I was waiting for Concentrix to finish their compliance check on last years childcare costs. Concentrix decided there was an £800 overpayment from last year that the HMRC have taken straight off this years award without even giving me the chance to repay it in installments as they are supposed to and there was an overpayment (which they're classing as an early payment so I can't even challenge it, as it's not my fault it was down to them not being able to update my file) this year due to them not being able to update my account so my payments have all but stopped. We'd be surviving on £524 a month (apart from HB which we don't see anyway as it goes straight to the HA) if not for the money I receive from the CSA, which I'm told not to rely on because it could stop at any time (and has done twice in the past three years)

I have told my children things will be tight, but they don't know how tight. I am living life on a knife's edge, I can't sleep for the worry that my ex will stop paying the child maintenance again and we will starve.

Like it or not, times have changed!

apparently, in the 70s, the average mortgage took 8 years to pay off. now it's 20. also, the multiple of income a house costs is much higher now.

What happened was that Thatcher removed the states role in building homes, but didn't make space for the private sector to fill the void. While private sector building has declined slightly since the 70s and 80s (which itself is shocking), state homes building has collapsed.

In London, about 25% of households receive housing benefit, so a significant impact on rents.
When comparing historic mortgages, you need to consider interest rates and inflation. The monthly amount paid at the start of the mortgage as a % on income has always been about the same, with higher interest rates causing lower prices. Inflation then eats away at the value of the outstanding amount, meaning the payment reduces as % of income.
Also, until 1971, you could only get a mortgage from your local building society if you had shown you could save the relevant amount for a period of time. Banks were unable to provide mortgages.

scarymary

We have found several more claiments who have had this happen, without fail every single one can prove that all info they provided was bang on everything was reported in good time and all made many attempts to get HMRC to stop making the error they made,that the error was made during a compliance check and prior to that error being made the award was spot on.

I'm attempting to take the issue higher as the situation breaches the compliance rules,if you are intrested in using none media methods of attempting to resolve it and prevent it happening in future feel free to PM me

Thanks Needs I have messaged you

www.kpmg.com/uk/en/services/tax/summer-budget-2015/pages/summer-budget-calculator-2015.aspx

KPMG have reissued their simplified budget calculator (it had been removed as no-one knew entirely what was going on). I posted one earlier in the thread but hopefully this will let people have a better idea of where they will stand in April.

I'm not affected but f*ck me that calculator is scary! Out of curiosity I pretended to be a single parent of two, working full time on the national average income of around £24k, and if I'm reading it right, I would be £200 a month worse off!

Serious question - how are people going to manage?

Even more shocking, if I put in my actual salary (which is quite a bit higher) I would actually gain £140 a year. How can anyone think that's right?

I know misti, we stand to gain, if I hadn't met and married dh, and was still working full time as a single mother, then I would be losing about £200 a month.

There would be no more hours that I could have worked.

There were no family holidays to cut to save money. I don't know what I would have done.

Aren't I lucky, now I'm no longer vulnerable, and am quite comfortable, that I get an increase?

:(

I keyed in my son and that is better off by £80 and he is on a low income so no need for people to be too scared although it never hurts to start working at weekends too to provide for your future or taking on extra over time. Many of us do work 6 ot 7 day weeks as it is to fund our tax bills etc.

How on earth does a single parent with no family support find regular child care for weekends?!