Be Excellent To Each Other

But the growth in unemployment is negligible Curio, as per that piece, and here's an interesting graph, again from the same article. Fairly self explanatory and positive, I feel.

My impression is that there's a hell of a lot more of the employed at minimum wage (or so close as makes no difference) on a zero or tiny hours contract compared to five years ago.

The whole zero hours contract thing was debunked as grossly exaggerated (to the point of out and out lying) at the last GE, but the minimum wage thing may well be a different matter. Still, even if true, working in minimum wage employment > unemployment.

Though with the removal of working tax credits, the government are making minimum wage jobs less attractive!

I don't understand working tax credits

I was so relieved to get back to work even when it was minimum wage after 5 months on the dole. I think it was perhaps one of the most miserable periods of my life.

Agreed, and personally I think that sucks. I'd cut all manner of other things first, before cutting 'make work pay' in-work benefits, personally.
That said, to be fair, the tax credits budget was spiraling out of control and the whole thing was stupidly complex (as befitting of Gordon Brown). It's got to be right that we, the taxpayers, are not expected to subsidise the likes of Tesco to pay people sub-living wages in dead end jobs. It's one thing paying young apprentices in genuine training employment, with college, low wages (but with the promise of a good education and Trade in return), but shelf-stackers? Nah.

Exactly, Mali. At least the economy is generating more jobs than ever before - ever - even if some of them aren't (yet) of the payscale and calibre we'd ideally like. That's a darn sight better than the obscene 50%, 60%+ unemployment rates they've got in the Eurozone, which are immoral as they are absurd and socially/politically unsustainable.

Yep. Agree with that.

The problem with having simple tax systems is that then someone inevitably points out a way in which it unfair, which leads to an exemption, which leads to loopholes that unscrupulous people exploit. Alas, humans being humans, there won't wee be a perfect way, but we're probably too far in the complex direction at present. I have no actual facts to back this up though

FTFY

Thank god it isn't based on RocketBall.

But what good does lowering tax credits do? Tesco are still going to pay people sub-living wages in dead end jobs. People will still do them, because they're desperate and have no other way to earn.

It's all well and good them saying they'll implement a living wage to compensate, but a) it's nowhere near to a living wage and b) that's not going to be on the scene til what.. 2020 I think was originally said? The two things need to happen side by side or not at all. In the mean time, the government make money out of people who can least afford to sacrifice it.

"ISIS don't queue and steal my shoes".

That almost reads like something that could be in Four Lions. And I mean that in a good way in regard of how fucking brilliant Four Lions is.

What are the numbers of people on workfare? Presumably they aren't counted as unemployed for reasons.

Well, as I said before Jem, I'm personally queasy about this and, call me old-fashioned but I'd be cutting stuff like useless, vanity Cold War nuke programmes, so-called green subsidies shite (and an awful lot of foreign aid to boot) before taking the food out of people's mouths who WANT to work and are trying to make a living. But hey, that's just me.

To try to answer your post, though, well, lowering tax credits lowers the burden on the over-stretched public purse and taxpayer, which IN ISOLATION is obviously a good thing, right? Of course, the (big) downside in this case is that in so doing, people at the bottom end of the pay scale are going to lose out and likely be forced back into 'full time' unemployment/benefits. The Tories have tried to counter this with insipid minimum wage increases to compensate, and although helpful they're obviously not enough. Again, though, being economically competent they well realise that they can't just whack this up without killing the fragile (especially youth) jobs market in the UK, else we end up like France, Spain, Greece and all the rest of 'em in Europe with 50% or more youth unemployment, which is worse than anything we are discussing here.

With respect, then, it's all very well saying 'The two things need to happen side by side or not at all.' but words are cheap, we cannot do this sustainably in economic terms (and still retain shite like Trident, big Defence budget, green subsidies etc.). We can't let the welfare budget spiral even more out of control than it already has, either. So, it's a case of having to make tough, unpopular, difficult decisions and actions, be they stuff like this, cutting down the public sector pensions liability or whatever else, all stuff that Labour funked time and again, and creating the conditions for the economy to grow itself out of trouble. If we carry on with 3-4% growth year on year for the next 5-10 years, with unemployment falling as it has, we should by then have a gamut of much higher paying and higher skilled jobs on offer by the expanded economy (let's hope our useless, utterly hamstrung education systems can generate the commensurate number of well educated young people to feed this machine, as opposed to having to 'import' skilled and semi-skilled people en masse in their hundreds of thousands as we have had to do thus far).

Being an effective, reforming government, getting undeniable economic results as against a supremely challenging economic backdrop was never going to be easy, or pleasant.

I'll really take some convincing that Cameron et al find any of this difficult or unpleasant. But regardless of that it's short-sighted and idiotic, even from a capitalist perspective Just more young people raised in circumstances which mean they are less likely to grow up to become efficient little economic units.

Could anyone explain this tax credit stuff to me?

Surely you must concede that our unemployment rates, including youth unemployment rates, compare (incredibly) favourably to most of the rest of Europe, most notably the so-called 'social democratic' left of centre ones that chaps like you, Mark, are presumably admirers of? Seriously, how can 50-60% youth unemployment ever be even remotely sustainable; you can make the minimum wage as high as you like and have all the fancy employment laws, protections and unions one could ever desire - it's still unsustainable, immoral shite?

I refer you to Mali's earlier post about being unemployed; I, too, was made redundant in the 80s and was out of a job for 6 weeks which, OK, isn't a massively long time but at a period where we had 3 million+ unemployment, I was prepared to sweep the bloody streets towards the end. Not nice.

The basic point I'm making, which could hardly be denied given we have more people working now than we ever have had in our history (and vastly more than 2008-10 btw), is that at least people have a decent chance of employment now. OK it might not be the employment they want but it's a heck of a lot better, and less soul-destroying, than having no chance of ANY employment, no matter how hard you study at school or whatever. Most people I know (not having come from a particularly collegiate background ), myself included, all started working life with a shit, menial, incredibly low-paid job, but it was our first rung on the ladder.

Poor people are going to have to pay more tax.

Yes, but the second and subsequent rungs of the ladder are increasingly crowded. It's a bit like blaming people for their own failing in a game of musical chairs.

But I'm not blaming anyone for anything Mark. I just want to give people - ALL people - as much of a chance as possible of making a go at their lives. Yes, you can scoff at me for thinking it's all about being 'an economic unit' but to simple souls like me, having a good job, having forged a half-decent career and keeping a basic roof over you and your family's heads is something to be proud of and a worthy, realistic objective.

The thought which upsets me more than anything else is that of some kid who's done their reasonable best at school, got reasonable GCSEs and never even gets to work in any job, ever, because there are none. That thought breaks my heart more than most.

How does that work?

I do not understand how tax credits work.

If you don't earn very much, then the government returns some of the tax that you pay, because you likely need it, and it has the effect of increasing your wages. As such, it makes paid work more attractive than if you paid a full whack of tax.

Likewise, they do the same if you have kids, to encourage you to return to work.

These are being reduced to cut down on the welfare bill that is mostly pensions anyway, but that they daren't cut for reasons of not wanting to lose votes from old, rich people who don't need the winter fuel allowance.

Simultaneously, they are telling us that this makes work more attractive than benefits, despite it being a pay cut affecting only the poorest in society.

I wasn't saying that you were blaming anyone but when you keep on saying how you started with a low-paid job and now you're a millionaire then there is some implicit notion that this is what others can do as well. And for sure some can and should be encouraged to do so but this model does not provide for the masses who find themselves on the shitty end of this latest stick.

I left school and started with a rubbish job too, but looking around I regard myself as fortunate that I started when I did rather than better than those who are struggling now. Even more so when it comes to things like having a house which we actually own. Things seem to be getting shitter by the day for the worse off and these tax changes are only going to exacerbate that. I think this is bad both from a moral and a hard-headed economic long-term perspective which was where my "economic units" comment came in, it had nothing to do with you.

Isn't it the case that some (many?) people actually get much more "back" than any tax they've paid in the first place, even including any tax/NI their employers have paid?

If so, then, it isn't a case of giving people back some of their tax, but actually all of it, plus a bunch of other people's taxes as well? Which, I thought, was kind of the problem, spiralling out of control?

Sorry, I'm not taking stuff personally here, apologies if that's how it's coming across.

I'm not, of course, saying that anyone can become a millionaire and all they need is a job and much hard study and graft (although clearly, they both help, lots). But I am saying having a job is important, as the vehicle to achieve the sort of reasonable objectives in life that I did describe, so the very worst scenario for me at least is any system which prices out low-paid, start up type jobs especially for young people. Seems reasonable?

I disagree with your 'things are getting shitter by the day' assertion; this isn't backed up by the economic facts and undeniably massively falling unemployment over the last 3 years. My OP even now cites the last piece of the jigsaw - significantly rising earnings (as against flat inflation) - which I'm sorry, just have to be good news. This is not to say, of course, that it's all honey and roses or that everything has been handled perfectly by the Tories, very far from it. But, if you'd have offered me this current position/outcome back in the dark, desperate days of 2008-2010, I would've bitten your hand off, and so would anyone else I know. At one stage it really did look like we were all of us going down, for real.

Well things definitely did get significantly shitter for quite a lot of people yesterday.

You can earn 223 quid a week to hit the person allowance, which is 32 hours at £7.

So where does it kick in?

No idea mate. Peeps like APoD would run rings around little ol' me here, hopefully we may get some clarification.

Personal allowance is from next year fixed at Minimum wage for a 30 hour week, so we're not quite there yet.

However, tax isn't the big issue there, as National Insurance kicks in at 12% on income over £155 per week, and isn't a tax, so tax credits don't get it repaid.

BBC says



So, not working for 19 hours a week is worth c £18k? That is £21 an hour for not working?

Is that cash, put into to their account?

The Childcare element would match the amount you are paying for childcare. So although you get that money, it's all gone on paying the child care bills.

So, £24,000 back off £5,400 earnings...? Is that right?

They would not get £11,000 for childcare for 16 hours a week.

Even at £10 an hour that's only £8,320 and I think most childcare is cheaper than that. Plus I don't think that you get 100% of the childcare cost, I think you get a maximum of 90% or something

11k for a year and 3 kids works out as £39 a day per kid. Which seems about right at a fiver an hour.

((11k/(47×2))/3

Ah yes, I forgot that there were three kids; either way the parent doesn't really see that money.

In fairness, MrsA and I don't see the £600 a month we pay nursery.

Wait till the second one comes along

I'm still reeling at those numbers that BBC piece quotes - 19 hours a week in a totally unskilled, in all likelihood zero stress, minimum wage job gives £5400 income per annum, which would be entirely untaxed. You then have fully £24000 tax credits (excluding child benefit, housing benefit and any other benefits due) on top of that, which gives £30000 per annum income IN HAND.

To earn £30k pa in hand, you need to actually earn £50k pa or thereabouts. But don't forget this is for only 19 hours per week (totally unskilled, unstressed work), so you could say that, pro-rata for a 38 hour week, it's the same as earning £100k pa. For totally zero stress, unskilled work.

Man, and we wonder why the tax credit bill is spiralling out of hand? This seems a long, long way from Curio's 'they're just getting some of their tax back' comment.

I had no idea we were talking these sort of numbers.

That's can't be right. Is that right?!

If it is... I'm fucking quitting.

I haven't been following this thread regularly, but just being employed isn't the answer to all woes, as many on zero hours contracts will testify.

We've taken on quite a few of these people in the last couple of years and our basic is only £14.2k, with bonuses at the lower end making them up to £16.7k and the top end around £25k (but they flog themselves hard to achieve that). These guys are grateful to at least know they'll get their basic every month, even if we're having a quiet time on projects. And there are increasing numbers who can only get part time work (not with my company) and are struggling on what they earn, or have two part time jobs that they have to juggle with their home life. That still reduces the unemployment figures but we shouldn't be complacent about it.

I agree that it's psychologically better to be working than not, but it doesn't take long to become dissatisfied with your job, even if you enjoy it, if you're struggling to pay the bills and keep a roof over your head.

Damn straight, me too.

If you're working 16 hours a week, you're unlikely to need that much childcare across three kids, particularly as at least one of them will probably be of school age. £11k is the statutory max.

You don't keep the childcare costs, even in the BBC's hyopthetical best/worst case scenario. You're actually trying to clothe and feed three kids plus yourself, with no partner around, on £18k a year. That doesn't sound like a zero stress scenario to me.

So which alternative do you support: (a) cutting these benefits and making it uneconomical for people to work, forcing them into unemployment; (b) letting kids live in poverty, which has been proven in endless studies to be a blocker for their achievements for the rest of their life; or (c) sterilising poor people? This is hyperbolic, but I don't see any other choices. Do you have any?

I also note:
State pensions are circa £75bn. Why aren't we cutting those? They've been completely untouched by austerity.

You also have to play the long game. In that moment, in that contrived scenario, that person is highly dependent on the state. But if they are working, then in ten years, they are likely to be much less so; and their children will be in a better place to be good little economic units. If you remove that benefit, force them into poverty now, and then extend out ten years into the future -- are they more or less likely to be in as good a position?

Tax credits = benefit paid by HMRC rather than the DWP. Child Tax credit is basically the child allowance that Income based benefits used to pay (income support mostly), and Working Tax credit is basically benefits paid to you so that Tesco doesn't have to pay you a fair wage.

They are called tax credits because politicians need a slap.

I wouldn't equate low paid=low stress work.

While you certainly can get stressful low paid jobs, you can certainly get low stress ones too.

It works better other way around, really, low stress generally equals low wage.

Whoa there, no-one was saying being a single parent with three kids was zero stress - just that a job paying £6.50 per hour was very likely to be low or zero stress (as compared, say, to a £100k pa job which you can bet your fucking last dollar will be mega stress).



Fuck sake, is this for real Doc? Read what I actually have said, yeah, before going off at the deep end. I merely expressed amazement at the apparent fact that someone can get £25k in tax credits alone off the back of £5k (untaxed) income doing a part time job, with child benefit and potentially other stuff like housing benefit as well on top of that. We're just in the process of even working out if that's right, so let's hold off talk about enforced sterilization yeah?



Yup, I'm sure there's plenty of discussion to be had about why young people get such a bum deal as compared to 'the grey vote'. I'm quite happy to have that discussion myself, but let's turn the dial down a bit.

That would seem to be a perfectly reasonable generalisation?