Universal Credit - how can this be right?

[beentheretoo]

I’ll admit I know very little about Universal Credit apart from what you hear on the news thankfully (touch wood) never had to claim).

A friend recently got a new job 2 days a week I congratulated her and said it’s the type of job they are always looking for people I bet they’ll be offering you more days in no time. She then said oh I don’t want more days it’ll affect my UC, I’m allowed to work up to 16 hours before they take money off me and besides I’m really looking forward to having 3 days to myself once the kids are back in school. She’s a single parent her DH left her when she was a SAHM she was on full UC for a bit then had another PT job now this new one (she has a degree but doesn’t want to go back into that field).

I was thinking about it how can they be right that if you work 16 hours you get full UC but if you work 20 you get money taken away? Where’s the incentive to work more hours? My friends DC are older so doesn’t need childcare and I’m sure loads of people would love 3 days to themselves I bloody would.

Am I getting it correct then?

if you've also been a lone parent why are you even asking this question? Presumably you had to do all these complex financial/time calculations when you were? Or did you just not work at all?

Do you somehow assume that all single parents are on benefits?

@UhtredRagnarson and how would you pay for your mortgage or the upkeep of your home?
UC is there to help you out not to acumelate assets/ wealth.

Where would the incentive be for people who work FT and just about manage to save for their deposit? When really all one needs to do is work less and claim more UC to achieve the same.

[quote Ylvamoon]@UhtredRagnarson and how would you pay for your mortgage or the upkeep of your home?
UC is there to help you out not to acumelate assets/ wealth.

Where would the incentive be for people who work FT and just about manage to save for their deposit? When really all one needs to do is work less and claim more UC to achieve the same.[/quote]
....is the attitude that entrenches the trap

get £438 per month from UC towards my rent. If I can’t save whilst on UC I can never get a mortgage. Never. So that £438 per month is a continuing cost to the government of housing me. Whereas if I am allowed to save a deposit for a mortgage the government will then be saving that £438 per month. Does that not make sense?

No. Because if you can save hundreds a month for a deposit, you don't need the help to pay your rent, you can pay it yourself. If you can't save it without the help (whereby you are saving taxpayers money to buy a house) then you can't afford a mortgage anyway.

@DontTouchMyHairISwear

get £438 per month from UC towards my rent. If I can’t save whilst on UC I can never get a mortgage. Never. So that £438 per month is a continuing cost to the government of housing me. Whereas if I am allowed to save a deposit for a mortgage the government will then be saving that £438 per month. Does that not make sense?

No. Because if you can save hundreds a month for a deposit, you don't need the help to pay your rent, you can pay it yourself. If you can't save it without the help (whereby you are saving taxpayers money to buy a house) then you can't afford a mortgage anyway.

....Is that attitude the powers that be rely upon to entrench the trap

Think about what you're saying. It's a vicious spiral that you can never then get out of, because the incentive to earn incrementally more is reduced.

Surely the glaringly obvious difference is that if you scrape to get a mortgage you will one day own thay home and cease making payments on it!! If I don't proactively try to save out of renting I will never own a home. In 18 years when I have no dependents I will not be entitled to anywhere near the level of help towards renting costs.

So in 25 years those who have put in to buy their home will have low housing costs and a large asset. Renters on benefits on the other hand will still have the huge outgoing of rent but many especially women will see their entitlement to financial support drop dramatically.

People get so caught up by the fact that our benefits system for people with children at least does not leave us in Victorian workhouse conditions and seem to take umbrage with that. What they don't see is that it's an absolute ticking time bomb to actually live that way and an insecure way of living.

There's also a big incentive for the government to encourage low paid renters to save into a pension as in the end when those renters retire they will be costing the state less if they don't qualify for pension credit Hb CTS and so on.

...and yet some posters are still horrified by the idea that someone on benefits might try and save toward a deposit and be sad that they are limited by the capital cap in being able to do so.

The retired renters themselves won't have any more disposable income ofc. Sometimes they'll have less than if they didn't have any personal pension provision (again, complex tapers and entitlements etc). So yeah you're fucked regardless.

@DogsAreShit

The retired renters themselves won't have any more disposable income ofc. Sometimes they'll have less than if they didn't have any personal pension provision (again, complex tapers and entitlements etc). So yeah you're fucked regardless.

I dunno, I plan on having the LTA in mine

Do any of you honestly think that if by some miracle the benefits bill was halved tomorrow, we'd all be suddenly paying less tax?
If someone comes off benefits because they can now earn enough to live without them, does anyone get a tax rebate? No.
The money would be redirected somewhere else. Probably not into the NHS, or education or anything worthy, but likely someone's back pocket or a larger pay increase for MPs.
Personally I'd rather what little bit of tax I do pay goes to my peers, minimum wage and screwed over than people who are already earning more in a week than I do in a year.

@PearlescentIridescent

...and yet some posters are still horrified by the idea that someone on benefits might try and save toward a deposit and be sad that they are limited by the capital cap in being able to do so.

Amazing isn't it?

Again, another way of putting why it's a trap.

Let's say you earn minimum wage - 18k ish. It's an hourly paid job, with not much responsibilites. You have potential, but life has dealt you a shitty hand. You have kids.

You are approached for a job - 27k with a view to earn 40k in a few years.

Great opportunity - except 'by the way you'll need a car, and this is a salaried position so we expect you to stay until you get the job done'. I.e. unpaid overtime that takes you away from family life.

And on top of that, all that extra income is tapered.

Why would you bother? 75k, and we'll talk.

...and yet some posters are still horrified by the idea that someone on benefits might try and save toward a deposit and be sad that they are limited by the capital cap in being able to do so

i don't think anyone is horrified at all. They are just saying it doesn't make a lot of sense.
Say you can't afford private rent so you get 500 a month from benefits for your rent. That's good, that's what benefits are for, when you can't earn enough to support yourself.
But if you can then put 500 a month into a savings account for a mortgage, you are stating you don't need help with your rent. As you are clearly paying the full rent and saving the 500 a month from benefits. You are saving for your mortgage with free money that you don't need.
You can put it how you like, but that's the sum of it. Lots of people can't afford to save for a mortgage and would like free money to save every month towards it, but that wouldn't work, would it?

Why would you bother? 75k, and we'll talk

Jesus, entitled much? Offered a job that would more than double your income and get you off benefits but you can't be fucked? That's not a trap, it's an attitude problem.

@DontTouchMyHairISwear

Why would you bother? 75k, and we'll talk

Jesus, entitled much? Offered a job that would more than double your income and get you off benefits but you can't be fucked? That's not a trap, it's an attitude problem.

Try and think rationally, and you'll understand why some people don't think it's worth the bother.

• The job is likely to be more stressful
• You end up with barely more income.

Again, who's the mug?

@DontTouchMyHairISwear why are you assuming that the benefit claimant would be able to save £500? That's so reductive and unrealistic. If that's the scenario you choose to hold in your head then fine. But obviously most people will be saving a fraction of their income.

I receive working and child tax credits and I work. Who are you or anyone to say that I as a working mother should not be able to have any disposable income? And since I do have some disposable income, why should I not be able to save that money to get myself out of renting which has absolutely no long term benefit for me and leaves me vulnerable when I am older, despite having worked my whole life.

And that's just the emotive/moral argument. It makes no economic sense to keep people as downtrodden as possible. At present NONE of the money I have is saved. I'm not rich. I don't hoard money. All of my money goes straight back into the economy.

Most people not claiming benefits can't save anywhere near £500 a month. So now the argument is lets increase benefits so folk can save £500 a month.

@DontTouchMyHairISwear

Why would you bother? 75k, and we'll talk

Jesus, entitled much? Offered a job that would more than double your income and get you off benefits but you can't be fucked? That's not a trap, it's an attitude problem.

Don't get me wrong, i earn decent money - double that 75k. But I don't look down on people for doing what's best for their family given the absolute shitshow that corporate welfare and UK Plc's dependence on house prices has created.

Try and think rationally, and you'll understand why some people don't think it's worth the bother

Because they are lazy and can't be arsed doing what other people do, supporting their own families through work.
Hate to break it to you, but if you are on 18k no-one is ever handing you a 75k job.

It is all down to the way UC has been set up.

Many people made the point beforehand how much it would negatively impact people but it didn't matter to lots.

I have noticed that since many people have lost their jobs since Covid there have been lots saying that the current amount is not enough but beforehand were quite content to look down on people who needed to claim and didn't care about how shocking the UC system is.

Even though it is 66p for each pound the knock on doesn't make it worth it for many. They then have to magically conjure up other money to cover other costs which does leave out of pocket compared to the amount of UC they would receive if not working or around the same level but with so much juggling to do nonstop.

@Viviennemary exactly. Whenever they are presented with logic they just move the goal posts to try and make themselves right again.

I don't know why I bother engaging at all.

why are you assuming that the benefit claimant would be able to save £500? That's so reductive and unrealistic. If that's the scenario you choose to hold in your head then fine. But obviously most people will be saving a fraction of their income

I'm not, obviously, it's just a placeholder number. Substitute any relevant number.

1 in 4 people in the Uk have no savings even those in full time work and they are not saving anything on top of their rent or mortgage so I do not see why we should increase benefits to pay for savings. However I would support a universal income for all of exactly the same amount (not children under 18 however).

I don't know anything about UC but I assume once kids leave school it must drop so building up your earning power is probably worth it in the long run? Maybe I'm missing something.

There's pensions as well. I bet I wasn't working for much when my kids were little but now I get a pension from that job which makes my life easier now.

I tried to post this earlier but Mn went down for a while and my post hasn’t been saved.

I did some calculations on entitled to for a single parent on minimum wage with one child under 3 in my area. I used the nearest nursery’s rate of £35 per day (no reduction for using more days) and travel cost of £8/day.

Basically it worked out as follows that with take home + UC minus childcare and travel

Working 7.5 hours you’re left with £288.29 a week

Working 16 hours you’re left with £317.66 a week

Working 25 hours you’re left with £331.88 a week

Working 35 hours you’re left with £329.01 a week.

So you’re actually taking home less money working 35 hours a week than you are working 25 hours a week.

The financial difference between working 7.5 hours and 35 hours is £40.72. So for working those extra 27.5 hours you are essentially working for £1.48 an hour.

And this is only with one child and without taking into account the council tax/rates Reba the reductions.

I can see why people don’t see the point in working more.

I can also assure those frothing at the idea that I am stashing away all my UC to buy a house that I am not. They don’t pay enough to enable me to I’m sure that will make you very happy to know.