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A Simple Rule For Social Welfare Reform ......

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It seems that there will only be two sacred cows for this government : International Aid and the NHS.

State support for individuals is clearly going to be restructured. I would like to propose a very simple guiding principle :

No-one in full time work who makes a net contribution of funds to state coffers should suffer from a standard of living below that enjoyed by net recipients of funds from state coffers.

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It seems that there will only be two sacred cows for this government : International Aid and the NHS.

State support for individuals is clearly going to be restructured. I would like to propose a very simple guiding principle :

No-one in full time work who makes a net contribution of funds to state coffers should suffer from a standard of living below that enjoyed by net recipients of funds from state coffers.

That should bring Absolute Zero out to play. Quango bosses on less than 10K a year is an interesting and laudable proposal.

p-o-p

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It seems that there will only be two sacred cows for this government : International Aid and the NHS.

State support for individuals is clearly going to be restructured. I would like to propose a very simple guiding principle :

No-one in full time work who makes a net contribution of funds to state coffers should suffer from a standard of living below that enjoyed by net recipients of funds from state coffers.

I agree, I'm sure all governments would want that to be true but I don't think it's as simple as that as I think its hard to measure "standard of living".

Someone very lazy for example might prefer to have a lower standard of living and not work at all, than have slightly more money and have to work full-time.

Someone with a good work ethic would be happy to work full-time even if only marginally financially better off.

In terms of net contribution to fund, do you mean income tax / NI or all taxes, including VAT.

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It seems that there will only be two sacred cows for this government : International Aid and the NHS.

State support for individuals is clearly going to be restructured. I would like to propose a very simple guiding principle :

No-one in full time work who makes a net contribution of funds to state coffers should suffer from a standard of living below that enjoyed by net recipients of funds from state coffers.

Can you give an example of where this is not the case at present? Isn't this really about HB and child benefit?

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I agree, I'm sure all governments would want that to be true but I don't think it's as simple as that as I think its hard to measure "standard of living".

Someone very lazy for example might prefer to have a lower standard of living and not work at all, than have slightly more money and have to work full-time.

Someone with a good work ethic would be happy to work full-time even if only marginally financially better off.

In terms of net contribution to fund, do you mean income tax / NI or all taxes, including VAT.

I hope he means receives less from the public purse than is paid in. Receipt from the public purse is not limited to benefits. Public sector salaries meet the criteria too.

p-o-p

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The NHS is not sacred anymore. Cameron deliberately stated this morning that the number of managers in the NHS has doubled. They will drastically cut the managers but not tell anybody they are going to do it. When done they will say look that was painless to your healthcare, we did not cut any nurses or doctors yet saved xx billions.

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I agree, I'm sure all governments would want that to be true but I don't think it's as simple as that as I think its hard to measure "standard of living".

Someone very lazy for example might prefer to have a lower standard of living and not work at all, than have slightly more money and have to work full-time.

Someone with a good work ethic would be happy to work full-time even if only marginally financially better off.

In terms of net contribution to fund, do you mean income tax / NI or all taxes, including VAT.

Measurement is a problem. Having a simple guiding principal should make it easier to reach the decisions that all of the policy wonks who know a lot more about the problems and nuances than I do are going to have to consider.

I personally don't have a problem with someone lazy who doesn't want to work. I think that society as a whole has the right to determine the standard of living that the lazy person enjoys. I certainly don't think that it should be better than someone in full time work. Obviously, there are members of our society who are genuinely unable to fend for themselves who deserve a better standard of living than they currently enjoy.

The transition from benefits to work needs to be fine tuned as well. People who recieve benefits in some form or another and do some work should always be better off than those who do no work at all.

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Can you give an example of where this is not the case at present? Isn't this really about HB and child benefit?

HB and the child benefit are clearly the starting points.

I don't know whether there are other areas of social spending that violate the guiding principle that I suggested. I think that every program ought to be tested against the principal to ensure that the rights of workers aren't violated.

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I hope he means receives less from the public purse than is paid in. Receipt from the public purse is not limited to benefits. Public sector salaries meet the criteria too.

p-o-p

I am sorry to disappoint.

I think that teachers and nurses are probably underpaid.

There are too many managers and people in non-jobs who are massively overpaid.

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The NHS is not sacred anymore. Cameron deliberately stated this morning that the number of managers in the NHS has doubled. They will drastically cut the managers but not tell anybody they are going to do it. When done they will say look that was painless to your healthcare, we did not cut any nurses or doctors yet saved xx billions.

I have yet to meet a single nurse, physician, clinician or surgeon who is of the opinion that the level of health care is in any way positively related to the number of managers etc in the NHS.

Most of them feel that they waste 25% to 35% of their time filling out forms rather than delivering care to their patients.

Getting rid of waste (read unnecessary management) in the NHS would allow for a 25% improvement in care at no additional total cost of service.

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I am sorry to disappoint.

I think that teachers and nurses are probably underpaid.

There are too many managers and people in non-jobs who are massively overpaid.

Oh dear. Could you change the maxim then?

p-o-p

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Oh dear. Could you change the maxim then?

p-o-p

It was proposed as a principal against which social welfare reform could be undertaken.

There are some services that the state can undertake more efficiently than individuals or businesses due to the state's lower cost of capital and the social utility of those services.

As a result, I do not see all taxpayers funded salaries (which exist in both the public and private sector when using commonly accepted definitions) as social welfare.

That said, a lot of wasteful spending on quangoes, unnecessary layers of management etc is a convoluted form of excessive, very expensive social welfare.

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It seems that there will only be two sacred cows for this government : International Aid and the NHS.

State support for individuals is clearly going to be restructured. I would like to propose a very simple guiding principle :

No-one in full time work who makes a net contribution of funds to state coffers should suffer from a standard of living below that enjoyed by net recipients of funds from state coffers.

The principle sounds reasonable but almost impossible to implement. Too many variables.

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The principle sounds reasonable but almost impossible to implement. Too many variables.

I think that one of Cameron's lines is that he wants to make work pay.

The principle gives him a very simple way to explain why some social welfare programs are being cut / capped.

"We have set a cap on HB of 80% of the median private sector rents for similar accomodation as determined by an indepenant panel of the three surveyors. We want people paying their own way to better off than those who rely on the state. Work pays."

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No-one in full time work who makes a net contribution of funds to state coffers should suffer from a standard of living below that enjoyed by net recipients of funds from state coffers.

To rephrase in a way that makes ersatz socialists such as myself happy:

No-one claiming legally entitled benefits should find themselves suffering a reduced standard of living when they are in work.

Personally, I'm sticking by the notion that a universal tax-exempt citizen's wage is the least complicated way to ensure this...

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I hope he means receives less from the public purse than is paid in. Receipt from the public purse is not limited to benefits. Public sector salaries meet the criteria too.

How do you propose to make this work? Say a public servant is paid 30k. You would need to find a way to assign a monetary value to the benefit of the work they do, then work out if this value is more or less than 30k.

Clearly an impossible task. What is the monetary equivalent value of a single soldier's contribution to the wellbeing of the nation, for instance?

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The transition from benefits to work needs to be fine tuned as well. People who recieve benefits in some form or another and do some work should always be better off than those who do no work at all.

Guiding principle: your effective rate of tax, being the sum of actual tax paid and loss of means-tested benefits, should never exceed the standard rate of income tax (currently 44% including both parts of NI).

Tax of more than 44% on earned income is bad enough. Effective tax of more than 100% is what drives the poverty/benefits traps. Along with the difficulty in signing on and off for benefits, so you don't dare take seasonal fruit-picking work lest you be left with nothing at all when the season is over.

This is why the world is watching Messrs Duncan-Smith and Field, both of whom appear to understand there's a problem.

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To rephrase in a way that makes ersatz socialists such as myself happy:

No-one claiming legally entitled benefits should find themselves suffering a reduced standard of living when they are in work.

Personally, I'm sticking by the notion that a universal tax-exempt citizen's wage is the least complicated way to ensure this...

I agree with you on the negative income tax idea if and only if it completely replaces all social spending programs. It would be nice if it were also accompanied by a flat tax on all sources of income with no loopholes.

Is there any irony in the fact that an ersatz socialist supports the notion championed by the very conservative Chicago School?

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I have yet to meet a single nurse, physician, clinician or surgeon who is of the opinion that the level of health care is in any way positively related to the number of managers etc in the NHS.

Most of them feel that they waste 25% to 35% of their time filling out forms rather than delivering care to their patients.

Getting rid of waste (read unnecessary management) in the NHS would allow for a 25% improvement in care at no additional total cost of service.

Yeah your right about NHS management and admin as far as I can see. (wife works for NHS)

...but anyway, lets take an example of a couple, one a teacher the other a nurse on starting pay of 20K each. Take home pay 600 per week, rent 200, council tax 30 leaving 370 for all else.

Compare this to a couple on the dole. JSA for both = 128 quid, 200 rent and CT paid almost entirely by benefits leaving around 110 per week for all else. Looks like a result?

Couple number 3 on near minimum wage with same rent and CT would be left with 180 per week....not good but the increase of the personal allowance to 10k should help a bit.

What do you suggest to improve this situation?

Maybe someone can give 2 examples of sprogged-up couples... working and non-working?

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Guiding principle: your effective rate of tax, being the sum of actual tax paid and loss of means-tested benefits, should never exceed the standard rate of income tax (currently 44% including both parts of NI).

Tax of more than 44% on earned income is bad enough. Effective tax of more than 100% is what drives the poverty/benefits traps. Along with the difficulty in signing on and off for benefits, so you don't dare take seasonal fruit-picking work lest you be left with nothing at all when the season is over.

This is why the world is watching Messrs Duncan-Smith and Field, both of whom appear to understand there's a problem.

You are right.

Making the transition less binary is clearly in the best interest of the individuals involved as well as the economy as a whole.

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It seems that there will only be two sacred cows for this government : International Aid and the NHS.

State support for individuals is clearly going to be restructured. I would like to propose a very simple guiding principle :

No-one in full time work who makes a net contribution of funds to state coffers should suffer from a standard of living below that enjoyed by net recipients of funds from state coffers.

Excellent point! / post!

You have started from a very clear ethical principle. And there is no better starting point for a government policy/program.

Well done! (Again!) Not bad!

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How do you propose to make this work? Say a public servant is paid 30k. You would need to find a way to assign a monetary value to the benefit of the work they do, then work out if this value is more or less than 30k.

Clearly an impossible task. What is the monetary equivalent value of a single soldier's contribution to the wellbeing of the nation, for instance?

I was responding lightly to a maxim that had a flaw in that it meant that public sector workers could not earn more than the lowest paid members of the private sector.

However, the fact remains that the country cannot afford the level of public expenditure it has.

Reducing the deficit is not enough. The horrific truth will have to out. If you are able to work you will have to. Unfortunately there are not enough jobs to go round. This is the reality that will have to be faced. A large sector of the population are going to have to depend on families and charity.

There is insufficient revenue to pay for the welfare state. It has failed.

p-o-p

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Yeah your right about NHS management and admin as far as I can see. (wife works for NHS)

...but anyway, lets take an example of a couple, one a teacher the other a nurse on starting pay of 20K each. Take home pay 600 per week, rent 200, council tax 30 leaving 370 for all else.

Compare this to a couple on the dole. JSA for both = 128 quid, 200 rent and CT paid almost entirely by benefits leaving around 110 per week for all else. Looks like a result?

Couple number 3 on near minimum wage with same rent and CT would be left with 180 per week....not good but the increase of the personal allowance to 10k should help a bit.

What do you suggest to improve this situation?

Maybe someone can give 2 examples of sprogged-up couples... working and non-working?

The amount of money available to the couple on the dole for rent should be less than the teacher and nurse can afford to pay privately.

We can argue about the percentages but I would suggest that they don't get any more than 150 per week. It seems odd to me that a couple on the dole can enjoy the same quality of accomodation as a couple who both work.

In essence the taxes paid by the working couple are driving up the rents that they have to pay because landlords enjoy a floor set by the level of HB. The lower the floor, the better off private renters will be.

I know that my proposal is fraught with very difficult implementation problems. Thinking of it as guidance rather than a rule makes it easier.

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Is there any irony in the fact that an ersatz socialist supports the notion championed by the very conservative Chicago School?

Only if they support a higher citizen's wage than me ;)

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Can you give an example of where this is not the case at present? Isn't this really about HB and child benefit?

Haven't you read this letter, by "tomandlu"? It is very clear, and very good = fair.

Well, I've given it a go... (cc'd to Eric Pickles and Grant Shapps)

- - -

Dear Mr Khan,

Firstly, congratulations on your re-election.

Moving on, I am writing to express my confusion over housing benefit.

To clarify, I am married with two children - a boy aged 12 and a girl aged 8. As far as I can tell, if I were claiming housing benefit, I would be entitled to a 3 bedroom property, costing up to £375 a week. However, I am not claiming housing benefit, since I am in full employment, and therefore the most I can afford is somewhat less than this. Consequently, my wife and I rent a two-bedroom property costing £275 a week, and share a sofa-bed in order to ensure that the children each have their own room.

Since this is perfectly acceptable for my wife and I, can you explain why it is not acceptable for a similar family on benefits? To put it bluntly, would I be correct in thinking that I'm paying additional tax in order to ensure that those claiming housing benefit can afford to live somewhere with more rooms than me?

In addition, it occurs to me that this relatively high benefit might explain why the local rents for properties with more bedrooms aren't more affordable for my family. Why would landlords lower rents to levels that could be paid by those not claiming housing benefit when they can get more from housing benefit claimants?

So, to summarise...

* My family pay a level of tax that means we can only afford to rent a property with two bedrooms in order to ensure that a similar family claiming housing benefit can afford to rent a property with three bedrooms

* The relatively high level of housing benefit available may go some way to explaining how rents in this area are not affordable for working families

Obviously, I'm delighted for the tenants and the landlords who are benefiting from the above arrangement, but I can't help but feel a little hard done by on my own behalf. If I have misunderstood something, or there is a reasonable explanation for this slightly peculiar state of affairs, I would be delighted to hear it. If, on the other hand, the above is largely correct, could you explain what you intend to do about this ridiculous state of affairs?

A couple of suggestions:

* As I can testify, a couple with children do not require their own bedroom - a sofa-bed in the sitting room is fine (I can even recommend a relatively cheap one from Ikea)

* Housing benefit should be set at less than the median for rentals in each area - say 90%. This will ensure that housing benefit does not force up the cost of local rents in what is otherwise an inflationary spiral. (I believe that the benefit is currently set at the median).

I await your reply with interest.

All the best,

http://www.housepricecrash.co.uk/forum/index.php?showtopic=143597&view=findpost&p=2537500

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  • 259 Brexit, House prices and Summer 2020

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