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/

I know multiple people claiming DLA who do not need it. It’s quite easy to lie and cheat the system. There are forums, videos etc advising people what to say to get approved

People can be advised to say all they like but they also need medical evidence to back up what they have said.

Also, are you talking about DLA or PIP? It's funny how many people on here know for definite that someone shouldn't get DLA or PIP despite clearly knowing so little about how it works that they don't even know the difference between them.

I’m talking about DLA. I guess you’re claiming it?

I also work in a job dealing with medical reports myself - majority of which are for fraudulent car insurance claims. These reports aren’t worth the paper they’re written on as all the medical expert will report on is what they’re being told

Do you really think every single person claiming DLA is claiming it for a genuine need?

Thanks for that. Mother was awarded it today. She is 89. She has a meningioma, has been having silent strokes, has a severe tremor. She had a TAVI two years ago which saved her from heart failure.

She no longer goes out alone, she no longer cooks, her condition is progressive. She stumbles. She needs help in the shower.

Step (83, with his own conditions) now does all the shopping, cooking, appointments, helps her with personal care. To prevent him getting exhausted and to avoid them both having expensive hospital hospital stays, the AA can be spent on extra cleaning and gardening and taxis.

Yes they are well off. However, clinically mother is frail and this is a lifeline. Step worked from 15 to 72; mother from 17 to 70. They contributed masses.

If AA isn't awarded on the basis of clinical need, then perhaps clinical NHS care for those in need shouldn't be allowed either.

Perhaps those of us who pay shedloads of tax should put our foot down and refuse to subsidise those who have eaten themselves to diabetes and obesity from having weightloss jabs and smokers from receiving state funded palliative care for cancer.

Also, AA isn't easy to apply for. It's a 32 page complex form, requiring significant details about medical conditions and capability, lists of conditions, lists of meds and the inclusion of multiple medical reports.

Mother has been awarded the lower rate, £76ish pw. She's nearly 90 and I doubt she'll get it for long.

@Pickledonion1999 you sound resentful and downright nasty. I assume you're about 26/27. I hope in a few decades ypu may have learnt a little more about life.

DLA aren't interested in generic medical reports from the GP.

Neither are insurers…

We must be talking about very different reports then because the medical evidence I sent to DLA had nothing to do with medical professionals just parroting things I had said.

So why does she need to claim if they are well off ? Just because they can? How is it a lifeline if they are well off ?
My age is irrelevant. I am resigned that there will be nothing left in the pot by the time I get to pension age.

In which case you are arguing to make the NHS means tested instead of being based on clinical need. Why stop there, why not make education. and every other service means tested.

AA is not easy to get, I’ve filled in those endless bloody forms for it in the past. If you know so much about it I’m surprised you are not aware of this or that anyone eligible for AA is likely to have other care needs which they do have to pay for themselves if they have more than a fiver in savings, even if they have spent 50 years as a net contributor to the system.

I’m also always amazed that MN, supposedly a women centred forum, considers women who spend their time on caring responsibilities to be “not working” but every time there is a thread on older people someone pipes up about the female relative who never “worked”.

Apparently a few little bits of paperworks and declaration can bring down an entire economy.

I know 6 people who were all higher rate taxpayers who have retired early since covid in 2020. None of them receive benefits and all have very good work pensions that will easily tide them over will before getting state pension. They will all very probably still pay tax on their pensions but no where near as much as they did. That was a direct result of covid just shaking stuff up so there was very much a feeling of what’s the point.

That’s great for the economy though - if DH works less he can evidently afford to, and either someone else is employed to cover the fifth day, or he wasn’t doing much and productivity goes up. Win win.

As a family earning £200k plus and in the 45% rate we aren't happy with the benefits bill here.

I don't blame disabled people. However I feel there is excessive claiming for MH benefits. There's always this one poster here who hasn't worked since the noughties due to "mental health" and just claims UC and spends everyday commenting on MH. Honestly if I was in government, I'd definitely take another look at that.

I have more respect for those working FT who claim UC. Some probably need it for kids. Some are sadly single mums with an absent father.

But to me, barring health issues for yourself or for dependents a working couple should be able to provide for themselves without state assistance. I believe and always will in personal responsibility. UC should be time limited to help you get back to your feet. You shouldn't just treat top ups as part of "your income" that you budget like it's yours. It's temporary assistance.

Because the contribution via AA keeps them independent for l9nger and reduces reluance on the state. Clinical care for clinical diseases which mean an individual is no longer able to be independent is state funded. If step keels over that's probably four weeks in hospital and mother would be entitled to receive a funded placement based on clinical rather than social need. But you should know that already.

Similarly, if dh or I were to receive a cancer diagnosis, would we not be entitled to treatment from the NHS because we are wealthy. The extension of your argument is the end of the NHS. Personally I'd be happy with that, providing I got a tax rebate, but millions wouldn't.

Based on your own loaded comments about obesity, diabetes and smoking-related illnesses, would that then depend on the type of cancer diagnosed? And where does that type of judgement begin and end, I wonder…

There is quite clearly an informed, nuanced and compassionate debate to be had about the welfare system and much-needed reforms, but let’s not confuse wealth / tax payments with moral superiority or entitlement to access essential healthcare.

Regardless, I hope your relatives get all of the support during what must be a very tricky time.

In most countries, what you get out in job seekers, pensions etc related to what you’ve paid in when you were working. This incentivises work. We’re going wrong in this country by not incentivising work, amd the workers are sick of it.

Over the threshold for what?

IHT doesn’t bring in much tax. It’s chicken feed in comparison to income tax, NICs and VAT. And it’s easily avoided by giving away wealth early, so doubling it won’t raise more tax. Economists suggest that dropping IHT from 40% to say 5-10% would raise more as the ultra wealthy wouldn’t dodge it as much.

If you have £100m and you die your estate will pay £40m in IHT. But who needs £100m to live off in later years? Why not give away £95m early and live off £5m and then you’ll only pay £2m IHT. This is v simple planning. We haven’t even got on to trusts yet.

The OP is very misleading.

"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" makes it sound like the bank bailout and the Covid furlough scheme were classed as welfare spending or benefits, which neither were.

The main drivers of the increase is benefit spending over the last 10 years are increases in pension spending (due to an aging population) and a large increase in the number of people claiming benefits, which largely occurred under the Tories.

Labour havent solved the issue, and have increased welfare spending elsewhere (at a time where it needs cutting), largely because the PLP resisted Starmer and Reeves' policy aims.

In any event, if we're looking to increase the numbers in the workforce, then policies like lifting the two child tax credit cap make the most long term sense. The elephant in the room is the aging population and the unsustainability of the state pension.

Bearing in mind that Labour were forced into a u-turn over making the winter fuel allowance means-tested, such was the degree of public backlash, I think we can safely say there's no realistic prospect of pension reform soon - we'll just wait for the cliff edge collapse.

They also reduced LCW & LCWRA for new claimants - so not increases all round. UC only increased in line with inflation like all benefits do every year (except the state pension which was raised above inflation again).

But as I said, none of that will be showing in last years figures which is what the OP is referencing.

The WFA is means tested but the threshold for eligibility is ridiculously high.

Were we going great guns as a country prior to July 24 then?

I really dont think you can blame the current government (less than 2 years) for lack of funding the Navy over a much longer period.

Yes cos that's the impact of brexit. Just a bit of paperwork.

Aren't you embarrassed typing that out?

Given it's still a free trade deal, yes. That's all it is. Paperwork.

No loss of freedom of movement then? As a single example