Universal Credit. 20-30% don't pay the rent.

[CogitoErgoSometimes]

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Anyone pick up on this story? As part of the move to Universal Credit where claimants are given a sum of money each month and expected to manage it, a pilot study showed that about 20 - 30% of recipients failed to pay the rent on time. Given cash rather than the money going directly to the landlord, a surprising number defaulted on the rent. Extrapolated up a 20 -30% failure rate would be disastrous and plans are having to be drawn on how to support people in running household budgets and setting priorities.

I'm largely a supporter of UC as I think the current system is over-complex. I also realise that money-management doesn't come naturally to many. But if such a large percentage of people would struggle to manage a monthly benefit income this way, how would they make the transition to paid employment?

^UC will improve, not make worse, things for those trying to get back into full time work.

By taking money off them? That's a new meaning to the word 'improve' for me?

And the self-employed will be hit as well, if they don't make minimum wage x 35 each week. So it's bye-bye to entreprenuership.

Yes only the already rich or women hooked up to indulgent middle earning hubbies can now be entrepreneurial. Makes a mockery out of freedom under freemarkets.

The plan is that the self employed have one year to get their business going before there are problems with UC I think. That was said in Parliament as far as I remember so it shoudl be better not worse to be self employed under UC. Anyway if they need th emoney they might work harder at their self employed work rather thanjust messing around and if we can make the benefits thing much harder for all then the masses of scroungers we all know that there are will just not bother to claim and live on the money they already earn on the side.

Yes, yes, there are 'masses of scroungers'.

Even the left acknowledge there are. Loads of them claim to have non physical illnesses they don't have to claim higher benefits too. Anyway the difficulty is working out who could work and who is avoiding it and who is working and claiming when they ought not to. There is a veritable army of people out there who never do a day's work in their lives If we can make benefits so very unpleasant at least some of those might be forced back into doing an honest day's toil.

Where are these jobs going to come from Xenia?

There are masses of scroungers; they are called bankers. And more broadly the super-rich who don't bother paying tax like the little people. And multi-billion pound corporations ditto.

Amazon, for instance, who claim all their profits are made in Luxembourg on sales in England, yet don't allow their staff to apply the same flexible attitude to the rules. If someone working in a minimum wage job at Amazon is late three times, they can be sacked, without even being allowed to attend the meeting that decides their fate. One rule for the workers, another for the bosses...

There are hardly any high paid bankers in the UK. Most people who work for banks are not on very high sums. Very very few leading bankers work short hours. Most bankers are good. Most of the super rich pay much more tax than the poor.

Amazon is able to pay its staff because it runs the company well and we all benefit from that.

Boris J in India this week suggested we have a top rate of tax of 30% as they have in India (and they have there a 10% rate for freelancers). He seems the only politician with sense and a clear view of how to ensure business starts to do better in the UK which of course it the only thing that will really benefit the poor.

'One of the most common stumbling blocks to recruitment for my OH's company is that people cannot work on 0 hour contracts because they'd lose their benefits and if work dried up, they'd have a huge delay not to mention complication in getting their new application going.

I'm sure there are no shortage of good people out there who could work and would be willing to as long as they didn't face a suicidal cashflow issue if things didn't work out.'

0 hours contracts don't work even if you're not on benefits! How are you supposed to pay your rent and bills if you have no idea what your cashflow will be? How do you even get a flat with that? No landlord or agency is going to take a tenant like that.

0 hours contracts have nothing to do with benefits and everything to do with treating employees like shit. People work for money, not the potential of it.

'Oh and travel. People don't like traveling around believe it or not.'

From the threads on here from people working in this industry, people don't like to lose money in work for travelling on the job in their own vehicle with no compensation (especially because using your car for work means you have to pay higher insurance premiums). This industry commonly expects employees to use their own car to travel not insignificant distances to appointments with no compensation. So this drags their peanuts pay even lower.

The self employed though have to live like this. I am on zero hours contracts ni a sense. No one owes anyone a particular life or living. If the state has no money to pay the poor or voters choose not to pay the poor so much then that is how it is and then people vote with their feet and eg the Irish are back emigrating again. It is simply how things are. If we got the economy going and good workers couldn't be had for work nor money zero hours contracts woudl go as everyone would be snapping up every free worker there is. Sadly we are not in that position now.

Boris J in India this week suggested we have a top rate of tax of 30% as they have in India

Income inequality in India is far in excess of the problem here and in many other parts of the world. The poor live on less than $2 a day, have no access to health, education and welfare. The place is full of disease but has some of the best hospitals in world, hospitals that do not serve the needs of it's impoverished people. Xenia.......you want India?????? If you lack the money for the one way fare, I'll pay for you to go, I can even put you up for free.

World income inequalities over the past century? Studies using longer time series conclude that income inequality has been constantly increasing since the early 19th century. Milanovic (20090) ooh what happened here in the 19th century.....?

"Global income inequality rose steadily from 1820 to 2002, with asignificant increase from 1980 onwards" who came to power in 1979?

Inequality increased globally between the early 1980s and 1990s thanks to Thatcher and Regan.

approximately 1.2 billion were living on less than $1.25 per day in 2007 (22 percent of the world population) and about 2.2 billion on less than $2 per day (or about 40 percent of the world population).The wealthiest 61 million individuals (or one percent of the global population) had the same amount of income as the poorest 3.5 billion (or 56 percent) as of 2007

China and India?the most populous countries in the world?stand as examples of high growth (average annual GDP per capita growth rates of 10.1 and 6.3 percent, respectively, between 1990 and 2008/9)and increasing income inequality

Which proves there is no link between fostering a good business environment, high profits and deregulated markets with the welbeing or wealth of a country and it's citizens.

The fact is, if you impoverish workers you will prevent growth, both India and China rely upon exports to increase GDP but their states collect little in tax and therefore provide little in the way of welfare.

A country that provides a good place for business isn't the same as a rich country, the two are actually under neo-liberalisation not the same.

www.unicef.org/socialpolicy/files/Global_Inequality.pdf

I really do fear that people on the right are thick, thick thick. or wilfully blind because it suits them?

My taxes pay for a good few benefits claimants. If you drive people like me from the UK the poor who are left behind can smile because everyone earns £20k or less but the poor will starve.

Yes, I know that China Communist has 34- 1 income inquality and we only have 1 - 5 or something here and in the US. That is the amazing thing. Thus capitalism one can conclude is best and ensures best income inequalities do not exist.

I agree that the rural poor in China and India are not well provided for. However their economies are doing pretty well and it we do need more business and trade. If Boris J is out there banging the drum for teh UK (and Prince Andrew has done a very good similar job in the Middle East) that can help the British poor a lot more than other things. Meanwhile the new socialist Government in France is messing it up so much that the French are flocking to London.

Your taxes also cover the taxes of the rich buggers who use every trick in the book to avoid paying their fair share - individuals and corporations.

The rich pay much more tax than the poor. In fact 25% of us only are net payers and a whopping 75% of British people take out more than they put in (but clearly do not appreciate the 25% at all of course).

Inequality and taxation needs a global response, it won't get one because capitalism (or rather neo-liberal capitalism and globalisation) will not allow this. The reason is simple, globalisation and capitalism is about competition between individuals, between businesses and between states. Despite the rhetoric about shrinking the state, the state is very much alive and kicking in the form of the public private security nexus. Right wing states are very keen to spend on wars and national security.

Xenia, you have been keen in past to say you are in favour of libertarianism?

The problem with the system we have now is that huge levels of inequality lead to social unrest ultimately. New laws are being passed all the time that interfere with peoples liberty and freedom whilst banks & corporations are cut free from all regulation. In the states they have detention centres all over the place, hidden hoards of plastic coffins to cart off the dead, they spy on their citizens and they have the right to lock you up indefinately because of your political views. They could wipe out their population very easily with something as innocent seeming as a vaccine. Vaccination is mandatory in the states. Does that sound like a free country?

It is the interference in the free market which causes the problems not that banks have no regulation. We have very regulated banks. We don't even allow them to fail.

Competition is a good, both between people and more generally.

I don't sing the praises of the USA either although it is a lot better than plenty of other nations such as Russia, China and Saudi.

The rich have more money than the poor, so of course they pay more if you literally count the units. That's hardly surprising, I don't know why you think it's worth saying. But more as a share of income is another thing entirely. I believe the highest marginal rate of tax (or deduction, call it what you will) is paid by people coming off benefits and starting to work, or increasing their hours - for some people, I believe something like 90p out of every pound can be taken.

Over the past three or four decades the rich have been getting vastly richer, the middle staying about the same in terms of purchasing power and the poor getting even poorer. The 'boom' years were a boom for the rich, and in theory for those with houses. Sob stories from the rich about how deserving they are and how much they contribute are just rubbish.

The UK is incredibly generous to, for example, non-doms - it is considered a tax haven on some measures. Germany taxes people on their worldwide income, yet all the people who constantly tell us we can't tax the rich also hold up Germany as an economic model.

It really depends, what people want, freedom for or freedom from.

Put simply, do you want freedom to make a million dollars when you are educationally disadvantaged, unable to get investors to back you, don't have a great idea, live in a shack in the mid west, or a tent along the roadside, or do you want FREEDOM FROM hunger, poverty, the cold, disease......

Now, all of human existence has been about creating the conditions in which we are FREE FROM. All human need can be met using this as a starting point. I don't want freedom to watch 50 TV channels or buy 50 pairs of shoes, I'm neither dumb or a centipede.

Capitalism is great at creating the conditions which create the need, in the same way that capitalism can create a commodity to fulfil a need. What it isn't though is sustainable.

edam, it is worth saying because it is arguably unjust. If you had a capped flat tax and you kept every penny over a certain amount of tax paid that would be much fairer and encourage people to work harder and thus the poor would benefit.

I certainly suppose today's leak that pension tax relief may be limited as any movement to simple flat taxes without tax breaks and rebates and allowances is good news.

It does not matter if capitalism is not sustainable. The fact China and India will want what the US/UK have will simply reduce slightly the short tiny period of time mankind is on the planet. We are here for just a eye blink of time.

Flat taxes are clearly not fair because everyone would have to pay the same rate, whether they were a prince or a pauper.

This wont work on top of claimants having to pay council tax and bedroom tax if they choose to stay in their homes. I not sure any of the reforms will work.93% of new claiments are in work. ATOS has already cost 25m in appeals for the first half of 2012. Figures show benefit fraud 1.2bn, unclaimed benefits 16bn, tax avoidance 100+bn.

Theres also the HB cap, so if you cant find a property in a high rent area from your UC you will need to cover the extra from the benefit to top it up.

All this is through lack of affordable housing. We had more social housing than any country but it got sold off on the RTB scheme which raised 18bn, non of which got put into new builds. This is the legacy, a 2bn HB bill. A 2 bed ex local authority in London was coming up as between 250pw and up to 400pw. A family of 4 gets 252 per week + HB and CT benefits.

Fifi I agree entirely, I would add the chronic rush to the bottom in pay and working hours. We work longer than most European countries yet we remain one of the worse for personal debt, children's happiness, low wages etc.

Most middle class people cannot afford to liver in central London so I don't see why those hard working tax payers should pay taxes to support housing benefit claimants in expensive bits of London.

Tax avoidance is lawful. Every mumsnetter who claims her single person allowance and sticks money in an ISA tax avoids and good for them. So to assess the loss of tax avoidance is a bit pointless. If the state want to restrict tax relief on pensions as it is about to do then it changes the law to ensure the relief is restricted.

Flat taxes are the fairest of all. If say everyone pays 20% flat tax with a cap of say a maximum tax of £100k a year you still have some lazy so and so earning little and paying hardly any tax and still getting the same NHS benefits and roads as someone working 50 weeks a year as I do who might be paying loads of that capped flat tax - still unfair but better than now.