Call to end "middle class" benefits

[AtheneNoctua]

news.bbc.co.uk/1/hi/uk_politics/8319646.stm

"It defines middle class as a household where every adult has an annual income of at least £15,000 and every child £5,000. "

Emma, it doesn't mean 'travelling an hour or two to get to work' - of course that would be easy - my DH travels an hour or two to work every day now. He just wouldn't be able to get the work if we lived elsewhere, as the work isn't in one place, it's all over the city - he's freelance. He couldn't get to Banstead by 8.30am if we lived outside of London to the north of it, and he wouldn't be able to get to Harrow by 8.30am if we lived outside of London to the south of it. So we live in the middle-ish (well, NW with good transport links as we can't afford a car).

I'm not saying we're unhappy with our life - we love our life the way it is. It's only the 'well, I know all about your life and could sort it all out for you by just making a few simple choices that you haven't thought of' attitude which has my back up.

Gracie - accepting negative equity has a cost and will mean that you have no house if you sell and a debt still to pay to the bank, so you are stuffed for a deposit for rent, or to buy somewhere else. You also have not factored in the costs associated with moving, probably 10k with legal fees, removers, bills to settle etc before you even start again.

Renting out and renting somewhere smaller also has costs attached with legal fees, mortgage changes, tax to pay etc. There is no simple solution. You can't get HB if you have an income from renting out your own place as it will be counted as income. You have to rent out for enough to cover your mortgage and costs and then the rent on your new place as well to make a profit, and it is not feasible. I rent my house out, and I don't make anywhere near the mortgage costs, as the house is in Cornwall and you just can't get high rents there.

If it were as simple as you posit, don't you think everyone would be doing it?

You can only remortage if a)your bank agrees to the loan b)you're not tied into a deal and c)if you can afford the charges for remortgaging.

Gracie - do you have a morgage, because you don't really seem to understand how it all works.

gracie - negative equity means that if someone moves, they have to pay a lump sum (potentially tens of thousands of pounds) to the mortgage co when they move out. I'm not aware of any such clause in a rental agreement

Emma:that still completely avoids the area of people who become poor after their kids.

And the fact that there are simply not enough jobs- maybe we should have a job lottery and only winners can have children?

Why ridiculous? It would give you cheaper council tax, food, utilities, petrol that could very well more than cover the cost of moving. You could also move to a smaller house - or a bigger but cheaper one if it's a very cheap area.

If the area got nice around you, presumably you paid less for your house than your neighbour did, so it should be relatively easier for you to sell than for them.

I like how people who have never done it think it's ridiculous, but can't accept that it works from someone who has...

Gracie, if I move to your cheap area, and 1000 other people did the same, the demand for property would mean house prices and rents (ncluding yours) would increase.

Then you would be paying out more than you are now, on the same income you recieve now. And everyone who had moved for cheaper rent/house prices would also be paying more.

That s why your theory wouldn't work.

(N.B not to mention the cost of everything would also rise but thats another conversation that I haven't got the motivaton for)

Working Pt 16 hours a week = for me exactly the same as statutory maternity pay. If they were to cut maternity pay (I heard this mentioned on Radio 2 this morning on the news) then when/if I was on maternity leave we would be without my wage. Which pays for most of the bills.
My partners wage is just under £30k but with huge travel costs (distance, time & money) and a South East of England mortage he brings home peanuts at the end of the month.

If he was to give up his job, and we were to sell the house and start again on the council list and him work in a lower paid job & me not work at all, then we would probably have a better quality of life than we do now.

They can't make sweeping judgements on incomes. One persons £30k is different from anothers depending on their circumstances.

It makes me want to move to Australia. Where they apparently pay you $2,000 to have a child and give you $24,000 towards your first house.

But not everyone's negative equity is tens of thousands allnew. Those that are took a gamble. They could have got out long before it got that bad. If it is so bad that you can't afford to wait it out and cant afford to move, then declare honest bankruptcy and don't pay anything back. That puts you back in the same position as the renter.

TheFringe - that's EXACTLY what's happened round here.

I'm still wondering where this housing market is that allows you to actually sell your house. I've got friends in this are who have had their (nice)houses on the market for much less than they'd like for over 18 months -

Thefringe - can you honestly see the entire population of london moving to northumbria? Probably not, here is a loop you could take advantage of if you choose to, and apologies in advance if the whole country follows you, but it seems unlikely.

Not least because some people in London can actually afford to live there...

Declare bankruptcy because you can't afford to move???

Gracie, have you any idea how serious declaring yourself bankrupt actually is?

I'm repeating myself here but just so everyone is sure "I?m not saying you shouldn't have children but if you do have children you should be able to support yourselves financially" this does not mean that the unemployed and poor people shouldn't have children because as I have said earlier there will always be people that need benefits to survive and I do not have a problem with this, I?m a tax payer and I do not mind that my money helps out those in need. But I do mind my money helping out those not in need. there will always be poor people and people who simply cant work cutting benefits for the middle class would not affect them however my argument is for those that do earn the govt should not help pay for their living costs, I argue that this should be means tested and possibly area tested and in the long run the govt should aim towards giving something back to parents who earn, not in cash payouts but possibly a govt funded childcare system for working families. There will always be people who fall just short of the threshold and they will always be the ones hit hardest by changes but that?s just the way it is there has to be a cut off somewhere.

My home is in Cornwall Gracie, a supposedly 'cheaper' area. We have the highest water bills in the UK; the CTAX is massive as well; the new Unitary authority has just announced it is £500 million in debt; we pay more for petrol as it has to be transported; childcare is not cheap; and I never noticed that there was a special electricity tariff with 'cheaper 'cos it's Cornwall' on it. Get real. I'd love to know where the cheaper food comes from as well.

aah, so the solution is for everyone to declare themselves bankrupt

and btw moving to a smaller house may cost more than a current mortgage - despite the house price fall, prices are still more expensive than they were 6 years ago, so a smaller house may actually cost a whole lot more

gracie your view is too naive for me to communicate with any longer, bye

Emma - there is a govt (taxpayer) funded childcare system that starts at rising 5 and goes on to 18. It's called school.

Cornwall is like the part of Somerset i come from:itc cheaper for rent but thats becuase all the jobs there pay far below the average. And as you say, other bills are the same as everywhere else and you don't have the option of not running a car eitehr, with the way rural transport links are.

The national sit varies so much.

There is a huge assumption here that if you have a mortgage you are able to pay it off. Has no one on this thread heard of an interest only mortgage which means that you only pay the interest for the term of the mortgage and at the end of it still owe all the money that you borrowed to start off with. Therefore your money is going into a black hole and at the end of the day you don't own your house.

So if I default on my mortgage and get made homeless, not only do I lose my initial investment in the property (what was the point in saving all those years for a deposit?), I lose my ability to get another mortgage, I lose credibility to rent and still wouldn't get HB. Yes that is a fair system, when there is someone sitting down the road on their fat a taking all the benefits under the sun whilst watching Sky+ HD, playing on their Nintendo Wii and buying their kids ££££ worth of expensive gifts - which all come from my taxation. They might be the few and far between (my own big fat a) but they are the ones that rile the public and frankly rightly so. They ruin it for those who truly need it and there are one hell of a lot of them smoking themselves and eating themselves to death and then complaining about fucking waiting lists on the NHS.

So frankly, if I am middle class as the thread suggests I should be having a "better" life like everyone else who follows the mould on this thread and that is just plain bollocks.

What's a transport link Peachy? Oh, the one bus a day which goes in the wrong direction!

www.timesonline.co.uk/tol/comment/columnists/guest_contributors/article6884549.ece

Here is the Director of Reform (who produced the original report), writing on the subject in slightly more depth.

Very interesting reading...

That's why we bit the bullet and had a split repayment /interest only a while back. It hurts, but will clear the debt by the time I'm 53.

We don't get very much from the govt. But if they cut the benefits we DO get;

ds2 would have to give up playgroup (if they ditched the free nursery place for 3+) - we can not afford to pay for it, so he would have no playgroup, yet people who do no work would have the place paid for.

we would lose the child benefit - at the moment this helps pay for school uniform and shoes . They have to have those, so maybe we'll just have to not feed ourselves 1 day a week instead.

if they reduce the cap on uni fees for middle income families, our children will not be able to go to university, despite them all being very bright and intelligent - dd wants to be a doctor, but she won't be able to be if they do this, she will have to have a non-graduate career.

HOW IS THIS FAIR? How is it fair that people like us who are totally stretched already, with NO disposable income for luxuries can then be hit harder, when people who can afford holidays abroad, big tvs, and expensive clothes don't? Their children will be able to go to playgroup, have decent clothes for school and go to university if they want to, because as a result of being on benefits, they get these paid for, or partially paid for.

I know this is getting a bit Daily Mail-esque, but it really is getting to me. In fact, I asked Gordon Brown about it when he was here, and this is what he said;

"GordonBrown: LilyBolero, child tax credits are designed to help middle-income earners back up Child Benefit. Six million families will be receiving about £30 per week from Child Benefit and Child Tax Credit for the first child. So we are trying to help where we can with some of the costs of bringing up a child. There's further help if your child is under one, and many people receive tax credits on top. We've brought the basic income tax rate from 23p a few years to 20p now."

Which was a bit then - didn't think it addressed the issue of when the children are older etc. Never mind council tax bills going up uncontrollably.

Tell me about it ST LOL!

We did ahve hourly buses but by the time it got to us it was usually full which equalled useless in reality. I used to be able to get both kids out of the village on the 7.15am, but getting back again sometimes involved a seven mile walk alongside a main road in the dark winter evenings with 2 under 2- which is when I gave up and bought the second car even though in reality we couldn't afford it.

Scary, would love to have done that but weren't able to afford to at the moment, was just trying to make a point to those who think that everyone with a mortgage must be loaded, we pay what we can afford to currently and hope that we can change this if we are able to pay more in the future. But sadly even if we do I will be pushing 65 if not more!