A worker on £40k per year is £39 pw better off than his unemployed counterpart.

[orwellian]

I find this astounding.

A nuclear family in one of the outer London boroughs (2 parents, 2 kids) with husband sole breadwinner will have an income of £30,007 (£577 per week) on a £40k wage plus child benefit of £1,750 per year or £33 per week. Council tax is approx £30 pw. A travelcard from zone 4 into town is £43.60 per week.
Pay in full for school meals.
Pay in full for prescriptions.

Weekly total (minus council tax and travelcard) of: £536.

A nuclear family where both parents are unemployed in London would get;

child benefit x 2: £33
child tax credits x 2: £115
2 bedroom LHA allowance (outer London) of: £236 or 3 bed if children are different sexes and over a certain age: £300
income support/jobseekers allowance: £112.55.
No or little council tax to pay.
Free school meals.
Free prescriptions.

Weekly total of: £497 (2 children both same sex) or £560 (if different sexes or one over ten).

So, the household with one earner on £40k per week is at the most £39 a week better off than their unemployed counterpart and the unemployed family is not affected by the benefit cap unless they claim the 3 bedroom rate of LHA.

Work really doesn't pay does it.

PMSL @ £40k being enough outside London. There are several cities in the UK that rival London for house prices and low wages.

MrJudgeyPants, I would answer your post if I had any idea what you said. It didn't seem to have anything to do with what I said.

KiplingBag you said being on bens and then increasing the family is just plain irresponsible

My instinct is to agree with you there. I certainly wouldn't be trying to have a large family in that situation.

Then again nearly everyone I know who is working full time is also on benefits of one kind or another. Should I frown on them having children too? They will get more benefit if they do so that's a drain on the system.

What about someone who can't work because of a disability? Should they have less right to breed than a banker? It gets tricky.

Some newspapers created an image of people saying "Hey, I don't think I'll work any more. I'm going to have a whole bunch of kids to milk the system and spend the extra food money on a big TV and lots of beer".

Such people do exist, but I suspect in tiny numbers - they are just too good a front page story to resist.

I think most people are just trying to get by and can't work because there are 100s applying for every job.

I did suggest once that we pass a law limiting all families to 2 children. That way it is fair and limiting the population growth makes good sense if there's not enough jobs and homes to go around.

We managed very much nicely on 40k in the SE a few years ago.

Now we struggle a bit on nearly twice that.

My diamond shoes must be pinching a bit

The cost if living has far outstripped wages in the last few years.

I am not an accountant but think there needs to be a massive increase in the minimum wage and then an increase in wages (if there cannot be a massive decrease in the cost of living).

Once the minimum wage is hugely increased then what about this for an idea - rather than giving tax credits to people (who wouldn't need it as everybody would be getting a living wage) the government could give a type of tax credit to any company that can prove it is unsustainable for it to pay the minimum wage. Therefore subsidising those companies genuinely struggling paying a liveable wage and thereby keeping the economy going while artificially enhancing wages. But not subsidising those companies able to pay more in wages with still a good profit like we do at the moment (I wonder how many people working in the UK for the energy giants get working tax credit - yet the companies are making millions in profits. Same with supermarkets. It really doesnt currently make any sense how it is).

With benefits and child support my income is nearly 40k. I'm doing ok but certainly even with the help 2 buy scheme I can't see owning a suitable family home a realistic goal anytime soon. And I have been in continuous employment, including whilst at university, since I was 15.

When did you buy mrsdv?

It's not the mortgage payments. Those would be less than my rent. It's the deposit.

The cost of private renting is enormous and usually far more than a mortgage .

If your outside of London mintyy 40k is more than enough

Absolute bullshit. We live in a very prosperous, very very expensive city in the east and bring home under £35K between us. We get hardly any tax credits - £40 a month or something stupid, pay dinner money, actually have started to give them packed lunches, I daren't get my eyes tested till recently because of the cost of new glasses, dh never goes to the dentist now, because we can only really afford for one of us to pay for it and our outgoings including bloody council tax are huge, I get so cross when it is assumed we are laughing all the way to the bank because of where we live, because we have a mortgage here, in the city, as opposed to a nearby village which is where most of my colleagues live, (interest only, so are fucked in about 15 years unless things improve) It's incredibly hard whether in London or not.

Do you mean your income including all benefits is nowhere near £40k Mrs DV? Perhaps your housing costs are not all that high?

If someone has discredited the "facts" in the op post then can I be directed to the post?. I confess to not understanding all the ins and outs of benefits, especially housing benefit, but I come at this from the pov that £40,000 to support a family is not a high income, rather than benefits are too generous.

I used to think £30K was a fabulous income, but it just isn't any more. It's not the fault of the 'benefits system', it's the rocketing of the cost of living!

I agree, EETraceyluv, and the cost of housing is the worst of all. How did we get into the situation where so much of income goes on just putting a roof over people's heads? When our parents' generation were buying houses they could afford to do it on one very average income - factory workers, rail workers (like my father), postal workers ... everyone could afford to house their families. And now you have the ridiculous situation where even dual-income families struggle and housing benefit costs £21bn a year (a year! ffs).

I don't mind not having holidays like we used to, and I don't give a monkeys about going out or takeaways, but it's just awful when we literally cannot afford new clothes or shoes for the children when they need them - that's not meant to sound pitiful or pathetic, it is just a fact now :(

Frogwatcher. For many privately owned small and medium sized businesses
they would need to be massive cuts in VAT and local business rates.

Housing costs are a disgrace, that's why I am unsure about the govt help to buy scheme. Why is our govt propping up unsustainable house prices? I do have sympathy with those who are struggling to get on the housing market now and count myself very lucky to have bought my first house 2 bedroom house in Edinburgh for 68k in 97. I do recognise the personal tragedy of those who want to buy and can't but fear that propping up the big builders will only sustain the unaffordability of housing in the uk. Surely on a basic case of supply and demand, if customers cannot afford to buy then prices (at some point) must come down?

Soul2000 - sorry I don't understand. Would that be the case if the NMW was increased and they could apply to pay the increase out of some form of tax credit so that it didn't affect those companies not making massive profit.?

I think it would be impossible to increase the NMW dramatically without protecting the lower profit companies as they wouldn't be-able to afford to pay people. But at the moment the government is giving benefits to people who are working but on low wages. Surely for the high profit companies who benefit from this by having low paid workers that is wrong.

There would need to be massive cuts in VAT and local councils would need to reduce business rates massively. Many business in catering cant even afford the minimum wage that is set now £6.23 Per Hour. Most pubs cant even afford to pay their staff the minimum wage. I am sure catering is not the only industry in the country that is struggling to survive.

I know it's not a hardship, it's just that we always used to have the choice.

Sorry Frog. what does NMW stand for.

Soul - what I am suggesting though is that for those companies really struggling they would get help paying the minimum wage so they would be better off even though the NMW would be a lot higher.

So a win win. Workers would get their full wage from the company they work for, companies struggling to pay it would get help in the form of tax credits (which used to go direct to those workers), but the very rich companies wouldn't get help paying their wage bill and so the government makes a saving for those workers who worked for the high profit companies but now are fully paid by them and not tax credits.

To me it seems a good idea !

Cross post - National Minimum Wage.

Sorry. I thought you were talking about a term for VAT threshold .

STUPID ME.