AIBU to very nervous about what Reeves is doing to the economy?

[ProudAmberTurtle]

The data for the last financial year is out and, for the first time in British history, the benefits bill (£333 billion) was higher than income tax receipts (£331 billion).

This didn't even happen during financial crises like when the banks were bailed out in 2008-09, or during Covid when the government paid private sector staff's wages.

What's worse is that the government did not predict this and the benefits bill is projected to rise significantly over the next three years to about £390 billion.

In fact, from what I can understand, income tax receipts have always been significantly higher than the benefits bill, and there's always been an understanding between the two main parties since the 1940s that that needs to be the case for an economy to function properly.

I've worked very hard for more than a quarter of a century and always plan for the future, ie paying the maximum in NI so that my partner and I will receive the full state pension. For the first time in my life, this year the amount I'm earning in savings is going up at below the rate of inflation, even though I've got the highest interest rate available, because I've hit an income tax threshold (£50k) which means 40% of everything I gain in interest goes to the Treasury. This means my savings are actually depreciating in value.

AIBU to think this is just the start? That it's inevitable that taxes will have to rise even further and the state pension will be cut?

www.telegraph.co.uk/news/2026/04/04/labour-welfare-bill-income-tax-revenue/

How did you reach your conclusion that,
"It's statistically impossible for over 6% of working age adults, one in 16 people, to be so ill they can't do any job at all, even part time."?
I'd be interested to understand more. What is the upper limit of possibility?

What are the figures that show people in the LCW/LCRWA groups do not work at all, not even part time.
I know several people in those groups who do have part time jobs, or are self employed with something that works around their disabilities. People in those group have a work allowance where they can earn so much before the taper starts.

Where are you stats showing that people in those groups are faking.

There is nothing for me to post on her thread. She's doing what's right for her. The same as every other poster on the threads I posted. The same as higher earners reducing their hours to avoid tax trap.

My point is that our system discourages work at every level.

It will also cover people like myself who aren't ill at all but care for their disabled child so don't have work requirements.

This is clearly untrue.

Why do you think that a government would be invested in ensuring that as few of its citizens as possible were in work? What would be the reasoning behind such policy?

Sorry, I wrote this earlier, and the debate has moved on but I had to go out....

There's a world of difference between poverty, which existed in the UK as recently as the 1970s (happy to be corrected on this), and relative poverty which is defined as less than 60% of median household income.

I don't want to see child poverty here because I have seen it for real in Africa and Asia. We've all read and been horrified by child abuse cases in the press, but those are caused by amoral, depraved, ignorant people: the people who gave my senior social worker friend long days and sleepless nights.

I think there's a growing paucity of ambition and opportunity, some of which is down to a deterioration in parenting skills, which may have been affected by the withdrawal of Sure Start and similar programmes. Surmountable for intelligent, educated and kind people -- but not universal.

Without wanting to be patronising, the standard of discussion on this thread is much more nuanced and constructive than most of what I read in the serious press and other media. It's why I like MN. Thanks all.

I think the posts below on you’re either a decent person and increase benefits or not is similar to some backbenchers.

So they’ll not think of economic outcomes and push through policies that have adverse effects. Eg all the policies leading to job losses, they may not want that but it’s the outcome.

Although Labour do better if more are state dependent so maybe that’s an issue too.

In answer to your question for several reasons:

1. Firstly prioritising a left wing political ideology over economic reality (often combined with an outright lack of economic knowledge). The Green Party are by far the worst culprit here. Left wing politics, going back to Marx is rooted in the oppressor and the oppressed, proletariat and bourgeoisie, rich and poor. So it's better that there is more equality than inequality even if that means everyone is actually worse off.

2. The more people that depend on the state, the more likely they are to vote for a party that promises to either keep or increase those benefits, rather than a right wing party that promises to cut them. Clearly this is not economically sustainable but when this inevitably results in a fiscal crisis, a right wing party is elected that cuts Government spending which is electorally very unpopular and then results in a left wing party being elected next.

So it's not necessarily that the Government wants as few as its citizens in work but a question of wanting more of it's citizens in receipt of benefits and dependent on the state.

you clearly ignored all the posts above which explained it so I won't bother to answer. Search up this very thread tax calculations, that you only get to keep 29p out of every £ earned in tax bracket 100-125k. Re-read the post about nurse and 22.5 hours.

Governments, esp the current one, don't try to discourage work as such. But they fail to take into account impact of taxes and benefits on behavior. So their policies make people better off when they work less.

At the lowest pay scale you need to fake or exaggerate health issue and you'll get almost the same as NMW but without drudgery of doing low paid work. Esp if you have kids.

At the higher scale you can work part time and have almost the same as working full time because of taxes. To illustrate, if you're on 125k and pay plan 4 of 5 student loan working FT your monthly take home is £5800. You drop 1 day a week to get 100k pa and your take home is £5200 monthly. You get only £600 per month difference for 20% of extra working time, this is before commute time and cost. And this is assuming 37.5h working week, ignoring how much overtime people on this salaries usually work. If God forbid you are in you childcare paying years than you'd be in negative, it will cost you more to work.

Also, one topic discussed on Times Radio between 9 and 9:30 was the triple lock and means-testing universal state pension... Steve Webb, who introduced the triple lock was asked recently whether he felt it should change. He was quoted as having answered that it needed a few more years, because the basic figure remains niggardly, but it should be gradually withdrawn and restricted in a manner that protected the lowest earners (by the median of all three inputs) and clawed back at the highest levels via income tax. (He wasn't on the show today FTR.)

You're seriously saying it's ridiculous to not vote for politicians just because they pretend that men can become women?

To be honest I think if you're going to talk about Marx, it's really important to understand Marxist theory. This is not intended to be condescending; my understanding of Marx is not comprehensive. But talking about ideology as you do really needs an understanding of Marx's concept of ideology because otherwise your argument is rendered pretty meaningless.

Anyway, if you could start by explaining the link between left wing belief and benefit dependency, that would be helpful in understanding your viewpoint.

Yes I have seen the stats posted (not had time to fully look into them and contextualise) but that wasn't what I was asking.

It is ridiculous to imagine that socio-economic structure can be predicated on personal bias and prejudice, yes. There is no point in your trying to argue further because again, what I am saying is objectively true.

VAT on insulation and domestic energy efficiency measure can only be 0% due to Brexit. Thanks Brexit for making energy efficiency upgrades cheaper for consumers.

There is no way I’m ever voting for a politician or political who thinks that men can become women, because it’s tactically untrue. So I weed these idiots out first and then weigh up the rest.

If Ed Davy thinks men can become women what other ludicrously unscientific, misogynistic beliefs might he have?

"Although Labour do better if more are state dependent so maybe that’s an issue too."

Can you explain who you mean with this sentence?

And do you have evidence for this statement?

On the flip side are you saying women must accept Self ID and that it’s the same as accepting or not gay rights or children’s rights?

Clearly the government agree which is why they have reduced LCW/LCWRA for new claimants. So what else are you suggesting they should have done?

Personal prejudice and assumptions for not make for robust policy decisions.

Quite an extrapolation from you there.

I was wondering why you’d bring them up in that context. Of course anyone can say no to self ID, it’s enough of a reason in its own right.

And the ‘personal prejudice’ part is that women saying no to it?

The reason for raising them was, as always, for context.

That's a really good point - being an idiot in one area is a good predictor. It's like filtering by IQ (or honesty). So that's Lib Dems are out for me.

"Being an idiot" is of course, subjective, rooted in time. At one point you would have been thought an idiot if you believed women should be able to vote, to take out financial products, to work after motherhood. Fortunately people didn't rule out voting for parties and policies that rejected those ideas.