The Welfare Reform Bill

[omaoma]

she's called Mrs Pat O'Nions see here

Only 6,000 people have signed her petition because... I don't know why anybody wouldn't sign it, so hoping it's just lack of awareness and am posting here.

The following blog post - Where's the Benefit - by Lisa, about how the government's proposed and imminent welfare reforms are going to affect real, breathing people, is what got my attention:

"The Welfare Reform Bill is only one Lords reading short of Royal Assent. Then that's it, all hope is lost and I have that deadline of 2013 when my life will actually become unliveable. I don't want to die; I may not have grand dreams any more but there are simple things I still want to do in life: I want to learn to sing, I want to go to Comic Con. Things I can't afford to do even now... I've got a feeling of this ominous deadline when I lose my DLA in 2013... It's almost impossible for me to even visualise 2014... I just see darkness.
"The current feeling of sadness is compounded by the fact that it doesn't need to be this way. People could have fought against the Welfare Reform Bill but they chose not to. I've always been acutely aware of how much society hates me because I'm disabled; the disablist-motivated abuse when I was in primary school made sure I had it drummed into me for life that I am a second-class citizen. I had thought things were getting better in recent years with things like the Disability Discrimination Act, but clearly I was a gullible fool.
"This year has seen a cornucopia of anti-cuts activity, but most of it has been geared towards saving libraries and trees. I don't see it as a zero sum game, I've campaigned about issues other than the WRB. But apparently the mainstream left does see it that way: The anti-cuts movement chose to fight to save libraries rather than lives. There's nothing quite like that knowledge to really make you feel despised."

"I beg of you, please don't just read, be horrified and pass on. Please do something."

Provocative? Yes. Worth 2 minutes of your time? Surely.

The cuts are sad. I dearly wish we didn't have to make cuts. I honestly do.

But unfortunately we simply cannot afford many of the things we're currently paying for. Who we blame for the mess is rather irrelevant. We are where we are. Which is up to our ears in debt.

If anyone has spent a bit of time looking at how much money we're overspending by each year relative to how much money we get through tax, it's obvious that the gap is so big that we cannot plug it by shaving a little here and there or raising taxes on the rich a bit. There simply isn't enough rich people in the country to plug a £160 billion gap every year.

So cuts are inevitable. Now I don't envy the government's job at all to find these savings. Every single cut is opposed by someone. I've yet to hear of a cut where everyone agrees.

For a long time now, we've gotten used to a standard of living based on borrowed money. So another way of looking at it is that whilst it's tragic to have to cut DLA by 20%, were we able to afford the amount we were paying in DLA in the first place?? The answer is no. We couldn't.

So if we don't cut DLA, where does the money come from to pay for it? NHS? Pensions? What? And therein lies the problem.

Squawking about how unfair the cuts are is rather pointless unless you have a better plan. We either cut now under our control or markets force us to make deeper cuts and take more pain later (ala Greece).

niceguy2 you have a point - up to a point. Why is this government picking on DLA as a first option first, though? What about HMRC's cosy deals supporting tax avoidance by big corporations? What about the budget increase for the Olympics? What about wars in Lybia and Afghanistan? What about the amounts of money splurged on free schools?

Why is it always the most vulnerable who get shot down first? Because politicians of any stripe will always go for the easy targets first, and this lot are the worst since Thatcher.

The cuts aren't sad. The targeting of the sick and the disabled is.

oh come on Niceguy, there are heaps of other ways to make cuts, that don't target people with no choice of voice, they are just the soft target

cutting DLA will lead to disabled people going into care homes. This will cot more. duh

I really don't think that DLA was the first cut. Do you? It certainly won't be the last either. There's been a plethora of cuts. Child Benefit will be cut. Tax Credits to name two cuts just off the top of my head. Income tax for high earners went to 50% and their tax free allowance vanished. VAT of course went to 20%. DLA is way down the list.

The tax avoidance issue is being clamped down on and isn't a simple issue as you can read on other threads on MN. The govt isn't always right and in the case of Vodafone, from what I read, they had a bloody good case and there's some who think we were lucky to get the £1billion off them.

The wars, I agree on. We shouldn't be bloody sending our armies off to fight wars unless we or our NATO allies are attacked. That said....it was Labour who got us into Afghanistan and once you've created a big clusterfuck you can't just be irresponsible and bugger off. Libya thankfully was short and costs are estimated to have been £300 million as a one off cost. Not chump change but it's spending we spend every year which is what's important right now. One off costs are not so.

So whilst I think its unfortunate that the sick & vulnerable are facing cuts, it's totally untrue to suggest they are in some way being targeted or are first.

oh come on Niceguy, there are heaps of other ways to make cuts, that don't target people with no choice of voice, they are just the soft target

Of course there are other ways. There's always another way. But they will be just equally as unpopular. What should we do? Cut pensions perhaps? We spend an obscene amount of money on pensioners. Would you rather see pensions cut to keep the DLA levels as it is? You might....I suspect pensioners would disagree quite vocally.

taking money of vulnerable disabled people it not a good idea, all that will happen is that their families will have to give up, the person will end up in a home, costing thousands.
stupid, stupid short sighted idea, to save what the very small amount of money claimed by fraud.

what sevenfold is. If families cannot care because of ridiculous workfare rules then the disabled person will go into a £3000 a week residential home

Just noticed this thread.

1. While benefit fraud undoubtedly exists, it is not on the scale tht the public generally believes.

1. The government and the opposition know this but still promote the 'benefit scam' impression that the public have

1. Take housing benefit for example - £20 BN - but only 1 in 8 goes to unemployed. 55% goes to the working poor, who cannot afford their rent.

1. DLA / ESA discussion - if the wish is to cut 20% and the fraud rate is low - where are we cutting?

1. Benefits are being used in uk to plug the gap between wages and living cost. A person working full time on national minimal wage is earning just over £10k. How is he supposed to survive on that? Even working an extra job would not be enough to survive on.

It doesn't matter whether the housing benefit goes to those in work or out of work. Either way £20bn is an obscene sum of tax payer money to pay to BTL landlords each year.

What this country needs is not more benefits or higher wages. More benefits just propagate an unsustainable debt burden. Higher wages just make us uncompetitive globally.

What we need is a lower cost of living ... in particular a lower cost of housing. Hence reducing housing benefit is a good idea since it kicks away another artificial prop to house prices and rentals in this country.

Mme.

I agree that benefit fraud rates are lower than perhaps most people expect. And yes this is by & large fueled by the likes of the tabloid/DM press.

BUT. This doesn't mean that we should ignore it. And to be fair, I don't see the govt banging on about this. More the press.

I've also not read anything from the govt to say they are planning a 20% reduction due to fraud. I suspect the main aim is to reduce the overall bill (out of necessity) and leaving the press to pick up on fraud. Just in the same way they often tax us whilst claiming they are doing it for the environment/our health etc.

The problem with saying the NMW isn't enough for someone to live on is the assumption that everyone is in the same situation. When I was younger, just entering the job market, a salary like that would have been more than enough. I only had me to worry about, I lived in a shared house with a few friends. It was enough beer tokens for me. Naturally as time went on and I started a family it wasn't enough. But that's why I worked hard to work my way up. What I didn't expect was the govt to change the NMW to suit me.

There will always be a need to fill the NMW jobs though. Simply saying people can work their way out of NMW ignores the fact we will always need these jobs in society.

Housing as many have said is the biggest issue. I am a Carer and am fortunate enough to have a 2 bed HA home at £377 a month. I work so pay this rent myself but if I had to rely on the private rental market I'd be looking at a minimum of £700 a month for the same property. No way could I pay that.....

Fluffy
If landlords would then reduce rents, then yes, cut HB. But some won't and some can't reduce rent as they will not cover their mortgage.

Then what do we do?

As to competitive wages - that is a load of rubbish. Germany has the highest wages in EU but still manage to be competitive. (I wrote about this on the blog that Isla linked to earlier - thanks Isla, btw).

Germany however has much lower housing costs, stronger tenant rights and no stigma attached to rentals.

Niceguy
That is great that you worked your way out of NWM jobs. What about people like my brother - lovely guy but not ambitious. He is a great chef and could be head chef, but he hates paperwork.

He will never earn much above NMW. His luck is that he lives in Scotland. He moved to England for a couple of years and it almost bankrupted him.

MmeLindor

First, most landlords can easily cover their mortgage given current interest rates so this is not really an issue. Rental yields in many areas of London for example are 5%+.
Second, so what if landlords can't cover their mortgage. They speculated on property and got it wrong. Tough. Their house gets repo'ed or they are forced sellers ... reducing house prices.

As for wages. Using Germany is a terrible example. The UK is not in the same position as Germany. We are more service focussed and that is far easier to replace with lower wage competition in EM economies.

Germany created a strong epxort industry is areas such a precision engineering. More importantly it has done phenomenally well exporting inside the Euro area (exploiting Southern European peripherals such as Spain, Italy etc) due to a fixed exchange rate. If they had the Deutschmark, their export industry would have been slaughtered by the strength of their currency.

Fluffy
but why would landlords accept lower rents? Especially if they are making a loss. I don't think so.

And even if you don't use Germany as an example - UK has much lower wages than many other EU states. With such low wages, we should be manufacturing and exporting like mad.

Oh, but wait. Our governments over the past 40 years have killed off the manufacturing industry and concentrated on service industries, and so we have no advantage over other countries. Dumb.

MmeLindor

Landlords will reduce rents because they are still making good profits right now and it is better to make a smaller profit renting out at a lower rent than having a vacant period.

If the landlord defaults on their mortgage then all the better since the house get sold probably at a lower price and somebody new can buy to live in it or rent it out at a lower rent and earn the same yield.

It is very clear that the housing benefit bill has been spiralling out of control for 10 years. It has pushed up house prices, pushing up wage costs. It has been nothing more than a transfer of wealth from the tax payer to BTL landlords.

MmeLindor

Why are you so fussed about benefits in the UK? Aren't you living in Switzerland (Germany soon).

Fluffy you ask a good question about landlords. So what if their properties get repossessed or they're forced to sell? Well the consequences of that are tenant evictions and homelessness. Neither of which is desirable or cheaper for the public purse. See this blog here: toomanycuts.blogspot.com/2011/12/under-six-and-homeless.html

I do agree buy-to-let and greed have fuelled the problem and it's wrong the government picks up the tab but cutting off housing benefit is short-sighted and expensive for the reasons given. A better option is more social housing. A ban on right-to-buy and regular reassessment of tenants' circumstances so we don't have single occupants/couples in 2/3/4 bedroom properties while families are squeezed into inadequate housing. There should also be an investigation into whether rent control legislation might be a good idea too.

ihatebabyjake
I live in Switzerland at present, and will be moving to Scotland soon. Although I don't see why that means I am not allowed to be concerned about what is happening in my native country.

As it happens, I am unlikely to ever have to rely on housing benefit (or any other benefits) unless something drastic happens to our family, but I believe in the welfare state being reformed in a fair and honest way.

And I believe that if the government wanted to bring housing prices down, they would go about it in a different way than sweeping drastic reforms that will see thousands priced our of their homes.

If you want to create affordable homes, why bring back right to buy, so depleting the already almost empty council house stock?