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Supermarket Workers Have To Claim £11Bn Benefits, Charity Says

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http://www.bbc.co.uk/news/uk-32272817

Supermarket workers paid the national minimum wage are forced to claim state benefits totalling £11bn a year, according to a charity.

....with many of these supermarkets already struggling and downsizing.

I think it's fair to say that certain sectors of the economy are not enjoying the robust and sustained recovery we keep hearing about.

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You cant blame employers for this.If one didnt take advantage they would be put out of business by the others.

Its mostly tax credits of course.Brown decided/was told the financial system if let loose would pay the tax to cover the £30 billion cost of tax credits.He thought it was the perfect way to re-distribute tax take from the city to the regions.

When Labour were elected they knew decent paid jobs were going around most of the country.They needed an industrial policy or a way to boost wages through benefits.They went for the second choice.The problem of course was once the financial system went down the pan the huge benefits bill had to be paid from borrowing.

Its going to be very difficult to pull back now,but lower child limits (2 or 3) are almost certain at some point,as are increased hours rules,frozen levels before means testing begins etc.

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Fag packet maths, but this can't all be tax credits.

That 11 billion figure is around one third of the tax credit bill.

Supermarket workers constitute 3% of the UK workforce.

Are we really saying 3% of the UK workforce claim 33% of tax credits?

I reckon there's a fair amount of Housing Benefit and probably disability/elderly benefits mixed in here (my supermarkets staff all seem to be a very broad mix, from kids all the way up to 70+ oldies, and many a "special" trolley pusher in between).

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Tax credits was always a double edged sword, clearly implemented to try and avoid deflation, but once introduced more and more companies would offer low wages knowing the tax system makes it up.

Even better once introduced the tax system becomes very complicated because you can't eliminate it without have a huge impact on the low paid who now factor this into their finances.

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You cant blame employers for this.If one didnt take advantage they would be put out of business by the others.

Its mostly tax credits of course.Brown decided/was told the financial system if let loose would pay the tax to cover the £30 billion cost of tax credits.He thought it was the perfect way to re-distribute tax take from the city to the regions.

When Labour were elected they knew decent paid jobs were going around most of the country.They needed an industrial policy or a way to boost wages through benefits.They went for the second choice.The problem of course was once the financial system went down the pan the huge benefits bill had to be paid from borrowing.

Its going to be very difficult to pull back now,but lower child limits (2 or 3) are almost certain at some point,as are increased hours rules,frozen levels before means testing begins etc.

Curious feature of capitalism being that competition reduces profits to zero and leaves most people worse off. Well spotted Mr MArx.

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Tax credits was always a double edged sword, clearly implemented to try and avoid deflation, but once introduced more and more companies would offer low wages knowing the tax system makes it up.

Even better once introduced the tax system becomes very complicated because you can't eliminate it without have a huge impact on the low paid who now factor this into their finances.

That has little to do with tax credits. That's just the symptom of the failure at the heart of capitalism. i.e. profits and wages must tend to zero.

You could junk tax credits and see wages fall to victorian levels if you wanted. Not sure why anyone believes that would improve people's living standards though.

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Just heard a Tory on Radio 5 saying the £8Bn extra per year for the NHS will be funded by economic growth. He then explained about the growth in jobs over the last 5 years. No mention of DROP in tax receipts or £90B per year deficit. A low paid job is a net LOSS to the treasury. More of those will result in further tax receipt losses.....which will supposedly help fund an extra £8Bn for the NHS. Defies logic.

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Nothing to do with tax credits etc. Rent seeking is squeezing wages into non existence. No co-incidence that Tesco etc are basically rentiers with grocery businesses attached.

Tax credits / in work benefits are a manifestation or 'solution' for a rent seeking culture.

Good luck growing a rentier economy!

Edited by RentierParadisio

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http://www.bbc.co.uk/news/uk-32272817

....with many of these supermarkets already struggling and downsizing.

I think it's fair to say that certain sectors of the economy are not enjoying the robust and sustained recovery we keep hearing about.

But house prices and equities stay strong/rising, which is what really matters to the people for whose interests the government actually work for.

Edited by Sour Mash

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Just heard a Tory on Radio 5 saying the £8Bn extra per year for the NHS will be funded by economic growth. He then explained about the growth in jobs over the last 5 years. No mention of DROP in tax receipts or £90B per year deficit. A low paid job is a net LOSS to the treasury. More of those will result in further tax receipt losses.....which will supposedly help fund an extra £8Bn for the NHS. Defies logic.

It's what Balls has always said. Including as far back as 2004/5 when they put in the stimulus on steroids and Brown's rhetoric moved from "balance the budget" to "balance the budget over the economic cycle".

The Tories are now outbidding Balls in the loony-socialist stakes, and Miliband suddenly looks the clear lesser of evils.

Four legs good, two legs badbetter.

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If Labour were in power between 2010 and 2015 and had added another £500B to the deficit in that time AND promised to have zero yearly deficit by 2015/16, but instead had one of £90B....they'd be called out by the Tories as being foolish with money. When the Tories do it, they call it "paying down the debt". Stangely, Labour and the MSM are sanguine about all of this - rarely calling out the Tories about this. I guess because the economy's on a one-way ticket no matter who's in power.

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Not just supermarket workers: but nurses, physiotherapists, teachers, hotel managers, chefs, mechanics etc.

As a qualified GP 15 years ago, I was earning an amount that would now, with 2 children, put me line for help from the state to house and feed my family. The welfare net has been cast wider and deeper than anyone could have imagined. And with housing assistance now going to folks buying £600k houses it is pretty obvious that government is financially supporting tiers of society that would have been deemed self sufficient 15 years ago. This has increased under the Tories, but all parties seem to have the same model to work to. And if house prices have to rise relative to pay (which is a OBR assumption) then more and more people will be relying on state subsidies. There is no such thing as "private sector". A supermarket worker is as much reliant on the state for income as is a NHS porter.

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Just heard a Tory on Radio 5 saying the £8Bn extra per year for the NHS will be funded by economic growth. He then explained about the growth in jobs over the last 5 years. No mention of DROP in tax receipts or £90B per year deficit. A low paid job is a net LOSS to the treasury. More of those will result in further tax receipt losses.....which will supposedly help fund an extra £8Bn for the NHS. Defies logic.

It defies logic if you look below the surface but it can sound convincing on the surface because it's got a form of logic based on two statistics that are easily manipulated for a period upto the election.

The GDP (growth) figure which is easily boosted in the short term and the employment figure - employment which can be increased almost overnight if you reduce the number of hours a week needed to claim tax credits with a zero hour contract and to stay off the jobless register (and other figure fiddling).

It's only necessary to convince people for the election.

Edited by billybong

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Not just supermarket workers: but nurses, physiotherapists, teachers, hotel managers, chefs, mechanics etc.

As a qualified GP 15 years ago, I was earning an amount that would now, with 2 children, put me line for help from the state to house and feed my family. The welfare net has been cast wider and deeper than anyone could have imagined. And with housing assistance now going to folks buying £600k houses it is pretty obvious that government is financially supporting tiers of society that would have been deemed self sufficient 15 years ago. This has increased under the Tories, but all parties seem to have the same model to work to. And if house prices have to rise relative to pay (which is a OBR assumption) then more and more people will be relying on state subsidies. There is no such thing as "private sector". A supermarket worker is as much reliant on the state for income as is a NHS porter.

My bold and italics.

Mention the word Tory and a presumed political attitude still springs to mind but it doesn't apply these days. The Tory brand is a flag of convenience covering any sort of politically expedient policy being used by the LibLabCon at any one time mainly to self serve themselves.

Edited by billybong

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Exactly. The difference between all parties amount to a debate about how to rearrange of deckchairs on a ship heading for an iceberg. Nobody is suggesting a change of course. The Tories have arguably extended the welfare state to protect people who never before needed protection: investors, landlords, people in 1 million pound homes. I don't think Aneurin Bevan could have envisaged this outcome. Welfare spending going on doctors and teachers to assist them with buying homes for over 1/2 a million and to contribute to BTL portfolios.

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Not just supermarket workers: but nurses, physiotherapists, teachers, hotel managers, chefs, mechanics etc.

As a qualified GP 15 years ago, I was earning an amount that would now, with 2 children, put me line for help from the state to house and feed my family. The welfare net has been cast wider and deeper than anyone could have imagined. And with housing assistance now going to folks buying £600k houses it is pretty obvious that government is financially supporting tiers of society that would have been deemed self sufficient 15 years ago. This has increased under the Tories, but all parties seem to have the same model to work to. And if house prices have to rise relative to pay (which is a OBR assumption) then more and more people will be relying on state subsidies. There is no such thing as "private sector". A supermarket worker is as much reliant on the state for income as is a NHS porter.

Housing aside, I wonder if its always been the case that slightly better off have often done well out of the taxpayer subsidising the arts etc. In addition, take into account the average middle classer's ability to grab the best of what the NHS, elderly care and state education has to offer - and I can't help wondering if this is just the latest in a long line of supporting them? Would be interesting to see who gets what per capita across different income levels.

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Exactly. The difference between all parties amount to a debate about how to rearrange of deckchairs on a ship heading for an iceberg. Nobody is suggesting a change of course. The Tories have arguably extended the welfare state to protect people who never before needed protection: investors, landlords, people in 1 million pound homes. I don't think Aneurin Bevan could have envisaged this outcome. Welfare spending going on doctors and teachers to assist them with buying homes for over 1/2 a million and to contribute to BTL portfolios.

Yup it`s past the point of no return now IMO theres no way of unwinding this mess now it`s a case of full steam ahead until we hit the iceberg

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Exactly. The difference between all parties amount to a debate about how to rearrange of deckchairs on a ship heading for an iceberg.

No, Britain hit the iceberg years ago. They're pretending to rearrange the deckchairs on a sinking ship, while casing out their spot in a lifeboat and picking the pockets of the people making snowballs out of the ice on deck. Nothing they're doing will stop the ship sinking, and the longer they keep doing it, the less chance their is of anything remaining afloat.

As for the thread, the real title should surely be 'taxpayers subsidize supermarkets by 11 billion a year so they don't have to pay employees enough to live on'.

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Yup it`s past the point of no return now IMO theres no way of unwinding this mess now it`s a case of full steam ahead until we hit the iceberg

There's definitely a lack of appetite amongst the main parties to fight this election. Even more so when talking about the economy. Nobody attacks the Tories on their £500Bn borrowing in 5 years, and abject failure to eliminate the deficit by 2015 (their promise in 2010). Instead the Tories outright lie with impunity by pretending they've got spending under control. They all know about some meteor (be it real, or economic) heading the UK's way and don't see the point in arguing over the details when no party's going to change the course of it.

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There's definitely a lack of appetite amongst the main parties to fight this election. Even more so when talking about the economy. Nobody attacks the Tories on their £500Bn borrowing in 5 years, and abject failure to eliminate the deficit by 2015 (their promise in 2010). Instead the Tories outright lie with impunity by pretending they've got spending under control. They all know about some meteor (be it real, or economic) heading the UK's way and don't see the point in arguing over the details when no party's going to change the course of it.

None of them will change it because they can't change it......they do not have the guts knowing that none of them would work again and the country would never be the same again. ;)

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It's a bit like the 1970s when we had British Leyland, where a few thousand workers were paid by the state.

We now have millions of workers being paid by the state if we include all the large banks and all the businesses (not just supermarkets) whose wage costs are subsidized by government. Such policies used to be the preserve of Militant Tendency and the Socialist Workers Party. They are now mainstream Tory orthodoxy.

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It's a bit like the 1970s when we had British Leyland, where a few thousand workers were paid by the state.

We now have millions of workers being paid by the state if we include all the large banks and all the businesses (not just supermarkets) whose wage costs are subsidized by government. Such policies used to be the preserve of Militant Tendency and the Socialist Workers Party. They are now mainstream Tory orthodoxy.

Incredible really isnt it.The idea was to give lots of people around £40 a month in tax credits so they wouldnt complain when Labour gave £1000+ to the "poor".

However, Brown increased the rates so much that with wages falling/level at best and the way the means test works tax credits shot up the income scale.

Fiscal drag is probably the only way to lower the cost,but with deflation/low inflation thats not working out very well.

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Brown was a truly extraordinary politician.

Most just tweak a couple of things, here and there and hope they work out.

Brown went full on with loads of stuff.

Problems in Scotland? OK, lets set up a parliament. 15 years down the line - Bang! Labour are about to get wiped out in Scotland.

Want to increase public spending and keep it off the books. PFI! 15 years down the line, billions of pounds later, uselss hopsital + schools which we will be paying for for the next 20 odd years.

Help for low paid (the more generous view) / create client state (less generous view) - tax credits. Oops, made them so complex that no-one - claimant or tax office know how to administer them. Newspaper running stories about single mums owing HMRC several 10k in benefit. Quick - bump up the money given out! Whomp - all low and middle paid families move out of full-time job and into 16h/week client state.

Productivity falls off cliff as very few people working in skilled, FT jobs. Europe opens up (this one's Blair's), almost entire population of Poland, etc move to UK to take advantage of out cretinous 'needs based' benefit system. Massive - and I mean - massive budget deficit.

Quick, how do we pay for all this extra public spend. Brown: Using my economic genius, I shall bring in light tax financial regulation, allowing the UK financial sector to grow and draw tax to pay for my social policies. 2007 - Whoops - rather than paying in money, UK finance needs billions to keep it afloat.

All that, and people do not still release what a grubby, dirty political operator he really was. Or that the two Eds were at the centre of it all.

A lot of Labour MPs - not just the Blairites - have a genuine, strong hatred of Brown. Brown has probably destroyed the Labour party. If Labour do not form the next government then they will probably be over. His reputation is not limited to just the UK - just look at all the international orgs that are falling over themselves NOT to give a job. Unheard of for a (relative) young senior politician - there's always some body that needs a chair or someone with a contact book. Brown - a total political pariah.

The books on Brown have not be written yet. I think Darling was going to write one but put it on hold whilst he tried to save the Union.

I still think Brown is going to be found hanging in a closet in a few years.

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The report doesn't say if these are full time or part time workers. Why not? Of course it is not supermarkets fault that relative to other costs housing is so much more expensive than it was.

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