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Tax Credit Cuts That Escaped Osborne's U-Turn To Hit 800,000 Workers

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http://www.theguardian.com/money/2016/feb/07/tax-credit-cuts-escaped-osbornes-u-turn-hit-800000

About 800,000 people will still be hit by tax credit cuts from April because of a little-noticed change that survived the government’s controversial U-turn on the policy last year.

Labour said the scale of those affected by the cut would come as a surprise to those who thought the chancellor had abandoned attempts to reduce tax credits under pressure from the opposition and some Tory MPs.

..

The Treasury is proceeding with a cut to the so-called “income-rise disregard”, which could cost affected households £200 to £300 a year on average, despite the measure being among those blocked by the House of Lords in October.

Under the changes, laid out in a draft statutory instrument, people will have their tax credits cut sooner when their employment income rises by more than £2,500 in a year, reducing the incentive to take on extra work or responsibilities, and raising the risk of overpayments.

It means people benefiting from the rise in Osborne’s “national living wage” will be particularly vulnerable to seeing their tax credits cut or clawed back if they happen to take on more hours or get a promotion.

I wonder how soon we'll see people squealing over this draft?

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Anecdotally, I know a single person who's been on WTC for 10 + yrs, declaring a pseudo business to avoid the dole sign on aggro, as they are virtually unemployable.

They say they are being called in for an interview to examine whether they have a "proper business" . Got them a bit worried.

A fact that often gets missed re: single folks on WTC v UB imo .

On UB they would get £73 as an adult, on WTC they get just over £50, so they lose nearly 30% income to get the Jc off their back. Obviously the real winner is the Gov as it fiddles unemployment figures

Hb is payable in both cases, though I understand its harder re: WTC

Edited by Saving For a Space Ship

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Anecdotally, I know a single person who's been on WTC for 10 + yrs, declaring a pseudo business to avoid the dole sign on aggro, as they are virtually unemployable.

They say they are being called in for an interview to examine whether they have a "proper business" . Got them a bit worried.

A fact that often gets missed re: single folks on WTC v UB imo .

On UB they would get £73 as an adult, on WTC they get just over £50, so they lose nearly 30% income to get the Jc off their back. Obviously the real winner is the Gov as it fiddles unemployment figures

Hb is payable in both cases, though I understand its harder re: WTC

100 years ago, this sort of person would have starved/been in prison.

I'll leave it up to you to decided if we've progressed or regressed.

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100 years ago, this sort of person would have starved/been in prison.

I'll leave it up to you to decided if we've progressed or regressed.

Since all land, property and means of production have been captured and denied to the vast majority...

Unless you're advocating madam guillotine?

Maybe when people actually have the means to look after them selves, we can look into removing props.

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100 years ago, this sort of person would have starved/been in prison.

I'll leave it up to you to decided if we've progressed or regressed.

If I find the time I'll do some web research to fathom:

A. percentage of population starved/imprisoned in 1916

B. percentage of population on benefits/tax credits/sick/etc

My suspicion (but I'm willing to prove myself wrong) is that B > A which would imply that there's a third option: "100 years ago, a lot of this type of person would have provided for themselves and gained the material and emotional benefits that arise from not being dependent on handouts and charity!.

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100 years ago, this sort of person would have starved/been in prison.

I'll leave it up to you to decided if we've progressed or regressed.

Give Osborne another 10 years and you might not want to ask that question.

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If I find the time I'll do some web research to fathom:

A. percentage of population starved/imprisoned in 1916

B. percentage of population on benefits/tax credits/sick/etc

My suspicion (but I'm willing to prove myself wrong) is that B > A which would imply that there's a third option: "100 years ago, a lot of this type of person would have provided for themselves and gained the material and emotional benefits that arise from not being dependent on handouts and charity!.

Boom

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If I find the time I'll do some web research to fathom:

A. percentage of population starved/imprisoned in 1916

B. percentage of population on benefits/tax credits/sick/etc

My suspicion (but I'm willing to prove myself wrong) is that B > A which would imply that there's a third option: "100 years ago, a lot of this type of person would have provided for themselves and gained the material and emotional benefits that arise from not being dependent on handouts and charity!.

You really don't read much history, do you?

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Maybe he picked an awful target timeframe but his point is that people were more humble, needed less, had more in many ways etc

Might want to go back a bit further, maybe before banking.

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As comparisons go, it's up there with the worst.

If I find the time I'll do some web research to fathom:

A. percentage of population starved/imprisoned in 1916

B. percentage of population on benefits/tax credits/sick/etc

My suspicion (but I'm willing to prove myself wrong) is that B > A which would imply that there's a third option: "100 years ago, a lot of this type of person would have provided for themselves and gained the material and emotional benefits that arise from not being dependent on handouts and charity!.

Is someone able to provide some historical record which proves this to be wrong, rather than making glib statements to the effect that it is wrong?

I've no evidence which supports either view but I believe that it is a matter of record that 100 years ago, most people had no contact with 'the state' and wealth and income were more polarised than they are now.

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Is someone able to provide some historical record which proves this to be wrong, rather than making glib statements to the effect that it is wrong?

I've no evidence which supports either view but I believe that it is a matter of record that 100 years ago, most people had no contact with 'the state' and wealth and income were more polarised than they are now.

There's the small matter of a world war for starters

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100 years ago, this sort of person would have starved/been in prison.

I'll leave it up to you to decided if we've progressed or regressed.

He's 61, so 100 yrs ago he'd have been dead at age of 51 (on avg.) before claiming WTc for 10 yrs ..

Perhaps the higher risk of being robbed or killed by a starving poor person at night / in woods etc should be taken into account. Those benefits are also there for such reasons

Although most babies born in 1900 did not live past age 50, life expectancy at birth now exceeds 83 years in Japan—the current leader—and is at least 81 years in several other countries.
Edited by Saving For a Space Ship

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He's 61, so 100 yrs ago he'd have been dead at age of 51 (on avg.) before claiming WTc for 10 yrs ..

Perhaps the higher risk of being robbed or killed by a starving poor person at night / in woods etc should be taken into account. Those benefits are also there for such reasons

I suppose that you really should be comparing lafe expediencies from say the age of 14 or so, to sort of age at which someone could reasonably be expected to be able to fare from themselves. At that sort of age the period of risk from childhood illnesses is over.

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The whole benefits/welfare system in its current form needs scrapping & starting again from scratch. Welfare reforms are increasingly falling into the "trying to improve a rubbish system just results in a more efficient rubbish system" trap. Trouble is, the chances of any political party 1) being elected for making such a proposal, 2) being able to get it passed into law & 3) not end up making a complete c**k up of it are probably next to nil....

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Good thread, yes there are quite a few parts of the Tax Credit reforms that are still going ahead, i was surprised they didnt ditch the NMW wage rises as they were part of of the tax credit reductions (get employers to pay rather than gov.)

I suppose Osborne couldn't u-turn that as they made such a fanfare trumpeting it.

Also alot of these selfemployed businesses set up for tax credits are being probed by HMRC / DWP

unlikley many will survive the conditionality criteria once moved over to UC

The investigations have been contracted out to a private company called Concentrix who seem very good at their job.

Edited by workingpoor

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Good thread, yes there are quite a few parts of the Tax Credit reforms that are still going ahead, i was surprised they didnt ditch the NMW wage rises as they were part of of the tax credit reductions (get employers to pay rather than gov.)

I suppose Osborne couldn't u-turn that as they made such a fanfare trumpeting it.

Also alot of these selfemployed businesses set up for tax credits are being probed by HMRC / DWP

unlikley many will survive the conditionality criteria once moved over to UC

The investigations have been contracted out to a private company called Concentrix who seem very good at their job.

It's amazing how much tax gets thrown at dole figure fudging.

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Good thread, yes there are quite a few parts of the Tax Credit reforms that are still going ahead, i was surprised they didnt ditch the NMW wage rises as they were part of of the tax credit reductions (get employers to pay rather than gov.)

I suppose Osborne couldn't u-turn that as they made such a fanfare trumpeting it.

Also alot of these selfemployed businesses set up for tax credits are being probed by HMRC / DWP

unlikley many will survive the conditionality criteria once moved over to UC

The investigations have been contracted out to a private company called Concentrix who seem very good at their job.

I notice this article from a yr ago..

http://www.independent.co.uk/news/uk/home-news/people-in-need-at-risk-of-losing-tax-credits-after-being-wrongly-accused-of-cheating-10060745.html

People in need at risk of losing tax credits after being wrongly accused of cheating
Thousands unfairly hounded over tax credits by US services company working for HMRC .
...Concentrix, part of a multi-billion pound US business services company, has been accused of going on a vast “fishing expedition” as part of a controversial contract with HM Revenue and Customs to outsource its fraud and error detection.

Staff working at Concentrix have told The Independent that they are under pressure to open between 40 and 50 new tax-credit investigations every day and often don’t have time to check whether the allegations they are making stack up....

...Meanwhile, worried claimants have been taking to internet message forums to ask for advice for dealing with the false allegations being made against them.

Many said they believed the letters to be hoaxes as they asked for personal financial information such as bank and mortgage statements to be sent to the company within 30 days. Those who ignore the letters risk having their tax credits halted. In the last quarter, the Citizens Advice Bureau said it helped 20 per cent more people with tax credit problems than in the same period in 2013.

However, it said it did not know the cause of the rise. One concerned charity worker contacted The Independent after seeing a client who was confused and frightened by the letter. The worker was worried that many people will ignore or not understand such letters and consequently have their tax credit cut.

“A lot of people might have got these letters and ignored them because they think they look like a scam,” said the charity worker, ...

Edited by Saving For a Space Ship

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He's 61, so 100 yrs ago he'd have been dead at age of 51 (on avg.) before claiming WTc for 10 yrs ..

Perhaps the higher risk of being robbed or killed by a starving poor person at night / in woods etc should be taken into account. Those benefits are also there for such reasons

if he hangs on a few more years he will get pension credit and its freebies (£150+ per week )- at age 63 I think and if he has a partner it is as much as £230 pw

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Sounds like a feck up with compensation payouts to follow. Seems the game plan is to make as many allegations as possible in the hope people stop claiming.

What could possible go wrong hiring a private company seeking profit!

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