Bhs + Tax Credits

[spyguy]

Worthy of its own thread as I rarely see any mention of tax credits and their cost in any media, ever.

Wail article on BHS - Lord Shifty and all that.

http://www.dailymail.co.uk/news/article-3641997/My-regrets-man-helped-make-Sir-Shifty-knight-Former-honours-committee-chief-says-block-accolade-concerns-former-BHS-owner-s-integrity.html

Mails looking for as much rope as possible on this.

They have someone's figures on tax credit costs:

'Sir John’s comments come as it was calculated that taxpayers had to pay out £367million to subsidise the low wages paid to BHS employees during the 15 years he owned the chain.

The sum consists of government tax credits used to give thousands of staff paid the minimum wage or just above, a basic standard of living.'

So, thats a medium sized retailer, with ~10k staff.

That's 24M/year going into the business to sub the staff.

On a per head basis thats ~2500k.

Bare in mind that only half the staff will be on TC, so the sub is in the line of 5k/head/year.

*TAX CREDITS FCKING RIDICULOUS****

Thats why the UK, despite have 'record numbers in employment' is running a 5% budget deficit.

Thats why half of EE families have decamped to the UK to hand wash cars or do 16h on the till.

[DEATH]

Isn't the tax payer picking up the pension fund/redundancy payments too?

Edited June 15, 2016 by DEATH

[SarahBell]

So who do you send a FOI to to get all tax credits totals paid to huge UK companies...

[canbuywontbuy]

So, thats a medium sized retailer, with ~10k staff.

That's 24M/year going into the business to sub the staff.

On a per head basis thats ~2500k.

Bare in mind that only half the staff will be on TC, so the sub is in the line of 5k/head/year.

*TAX CREDITS FCKING RIDICULOUS****

Thats why the UK, despite have 'record numbers in employment' is running a 5% budget deficit.

Thats why half of EE families have decamped to the UK to hand wash cars or do 16h on the till.

Yep. £5000 of wages per head paid not by the employer, but by our taxes. That's a big reason why Osborne borrows £10Bn a month. We can't afford to employ so many people, so we borrow-to-employ.

Tax credits are simply Help to Employ. Except the tax payer can't even afford HTE, so we borrow, borrow, borrow. Borrow from the future which is utterly shafting the younger generations, who are perfectly happy with everything, so long as we don't leave the EU.

[Motor_Blade]

If politicians are stupid enough to implement ridiculous ideas like tax credits, we shouldn't blame business or individuals for taking advantage.

[Agentimmo]

I don't see a Brexit changing this policy. Big business will still demand their subsidies from govt.

[Caveat Mortgagor]

For the sake of accuracy I will point out it doesnt specify what benefits were paid out, could include HB also.

All the same, it is pretty damning that his divis are similar in the amount of state subsidy to his employees.

[Errol]

If politicians are stupid enough to implement ridiculous ideas like tax credits, we shouldn't blame business or individuals for taking advantage.

Yes, and if the electorate is stupid enough to continue voting for said politicians (and/or the EU) they deserve everything they get.

[Frugal Git]

If politicians are stupid enough to implement ridiculous ideas like tax credits, we shouldn't blame business or individuals for taking advantage.

The politicians aren't necessarily stupid - more likely they are just power crazed loonies.

Get enough people suckling on the states nipple and mother cow stays on rather than heading to the abattoir.

As for businesses taking advantage - well their upper echelons are equally happy with this scenario on all sorts of levels. Not only are they subsidised, but better still there is literally no incentive for people to fight for more because any tiny payrise from the employer would only be offset by a drop in tax credits anyway.

Meanwhile, the people are pushed to blaming mr and mrs immigrant or the permanently unemployed and their 'benefits'.

Lovely jubbly.

Edited June 15, 2016 by Frugal Git

[Motor_Blade]

Yes, and if the electorate is stupid enough to continue voting for said politicians (and/or the EU) they deserve everything they get.

No argument there, the trouble is deciding who is best to run the country is a bit like trying to decide what your favourite std is - in that all the options are rubbish.

[Motor_Blade]

The politicians aren't necessarily stupid - more likely they are just power crazed loonies.

Either way the end result is the same, they make decisions for their short term gain with no real consideration for the longer term consequences.

[LivingWithTheInlaws]

Trouble is, if you try and suggest tax credits should be reduced or abolished, it's the left and the unions that start complaining the most even though it's the owners and the shareholders that really benefit.

[Snugglybear]

This government has tried to make employers pay a greater proportion of wages from their own coffers, by introducing the "National Living Wage". (Even at full-time hours, nobody could actually pay their own pay on it, but that's by-the-by for now.)

So what do many employers do? Cut perks, recruit fewer workers (https://www.theguardian.com/business/2016/jun/14/retail-jobs-fall-five-year-low-shops-recoup-living-wage) and no doubt give their legions of casual staff fewer hours.

Of course, not only do tax credits help employers make more profits, they also help to make the un/employment figures look so-o-o much better.

Cut tax credits and I guarantee that the unemployment figures would rise dramatically. Because the UK has precious few proper jobs any more, in a global market. Politicians of all hues know that and they don't want the truth coming out on their watch.

[Quicken]

Worth posting this link again:

http://webarchive.nationalarchives.gov.uk/20160105160709/http://www.ons.gov.uk/ons/dcp171776_341133.pdf

Middle Income Households, 1977-2011/12

Figure 4: Composition of gross income for the middle income quintile of non-retired households

Between 2007/08 and 2011/12 original income, which is the income households get from employment and investments, fell from £37,900 to £32,600, while cash benefits rose from £3,100 to £4,600 over the same period.

That's the middle quintile of incomes.

Across quintiles:

http://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/bulletins/householddisposableincomeandinequality/financialyearending2015

Figure 11 shows how the proportion of non-retired households’ gross income coming from cash benefits has changed over time. In 1977, cash benefits accounted for 25.4% of the gross income of the poorest fifth of households. With the exception of a fall in the late 1980s, this proportion grew over the following 16 years, reaching a peak of 61.5% in 1993. Since then, the broad trend for this group has been downwards. The proportion of income coming from cash benefits for the second fifth also reached a peak in 1993, rising from 11.1% in 1977 to 23.1%, before falling again. However, unlike the poorest group, the proportion of income from cash benefits for the second fifth started to increase again after 2004/05, rising from 17.0% in that year to 24.5% in 2014/15.

[durhamborn]

This was the plan.It was supposed to do this.Labour didnt want an industrial policy for decent paid manufacturing jobs.They decided instead to unleash the city who promised them massive taxes they could then send to the regions through tax credits.They just needed plenty of 16 hour service jobs to do the trick.

Of course they also forgot we had open borders,so they ended up importing all the workers to do the 16 hour jobs and the locals just kept on out of work benefits/tax credits.Thats why the likes of my local Aldi has 8 Polish/Eastern European staff 50 yards from a council estate with 289 unemployed single parents 248 ESA/disability claims.

They also didnt bank on profits from a finance ponzi might stop rolling in,but the £60 billion tax credit/housing benefit bill would still need paying.

Its amazing to hear Brown on TV talking for remain.His tax credits were the main draw for European workers,the main reason wages were kept low for the middle,and the main reason the government is skint so you cant get in A and E.

Osborne bottled reforming them at the first sign of trouble.

Edited June 15, 2016 by durhamborn

[andygivenup]

This was the plan.It was supposed to do this.Labour didnt want an industrial policy for decent paid manufacturing jobs.They decided instead to unleash the city who promised them massive taxes they could then send to the regions through tax credits.They just needed plenty of 16 hour service jobs to do the trick.

Of course they also forgot we had open borders,so they ended up importing all the workers to do the 16 hour jobs and the locals just kept on out of work benefits/tax credits.Thats why the likes of my local Aldi has 8 Polish/Eastern European staff 50 yards from a council estate with 289 unemployed single parents 248 ESA/disability claims.

They also didnt bank on profits from a finance ponzi might stop rolling in,but the £60 billion tax credit/housing benefit bill would still need paying.

Its amazing to hear Brown on TV talking for remain.His tax credits were the main draw for European workers,the main reason wages were kept low for the middle,and the main reason the government is skint so you cant get in A and E.

Osborne bottled reforming them at the first sign of trouble.

Spot on. They are running out of time the bankers will pull the pin at some point that's the only thing that will sort

this the people are hooked.

[janch]

This was the plan.It was supposed to do this.Labour didnt want an industrial policy for decent paid manufacturing jobs.They decided instead to unleash the city who promised them massive taxes they could then send to the regions through tax credits.They just needed plenty of 16 hour service jobs to do the trick.

Of course they also forgot we had open borders,so they ended up importing all the workers to do the 16 hour jobs and the locals just kept on out of work benefits/tax credits.Thats why the likes of my local Aldi has 8 Polish/Eastern European staff 50 yards from a council estate with 289 unemployed single parents 248 ESA/disability claims.

They also didnt bank on profits from a finance ponzi might stop rolling in,but the £60 billion tax credit/housing benefit bill would still need paying.

Its amazing to hear Brown on TV talking for remain.His tax credits were the main draw for European workers,the main reason wages were kept low for the middle,and the main reason the government is skint so you cant get in A and E.

Osborne bottled reforming them at the first sign of trouble.

Agree 100%