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Whats everyone's views on the potential huge increase in the number of people that will potentially be signing up to universal credit due to the ending of furlough and subsequently paying mortgage / rent etc.

Seems like alot of people may struggle to claim due to the savings capped at £16k?

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1 hour ago, Voltron said:

Whats everyone's views on the potential huge increase in the number of people that will potentially be signing up to universal credit due to the ending of furlough and subsequently paying mortgage / rent etc.

Seems like alot of people may struggle to claim due to the savings capped at £16k?


Those on the lowest rung of the ladder have had to put up with this crap on and off for years. They have very little voice.

Those with a buy to let or a second home will not be eligible for Universal Credit. The only exception I can think of are park homes. That's the risk they took when they bought a second home. Life's tough, get use to it. 

But of course the likelihood is that the capital limit will be removed because of how much it will affect the middle class. Forget about how much it affects the ability of the poor to build up capital. Can't have the poor people shopping in Marks and Spencer. 

Edited by spacedin
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There's been a little movement on this recently, it's Resolution Foundation who are putting the most pressure on government to change capital rules. 

https://inews.co.uk/news/uk/universal-credit-sunak-uk-economy-mini-budget-497746

I must reiterate how outdated the capital rules are anyway. I believe the last time they were changed was around 2006 so a permanent change is long overdue.

Whilst I can understand the reasoning behind capital limits, it's ridiculous to suggest that every £250 of capital generates £1/week of income. I can't think of many investments that would do this. 

Worse still, if you're of pension age the figure above is £500 and there is no upper capital limit either. Whilst I appreciate the need to treat pensioners differently, an 18 year old should not be treated as say someone who's middle aged.

Edited by spacedin
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On 09/07/2020 at 17:16, spacedin said:

But of course the likelihood is that the capital limit will be removed because of how much it will affect the middle class.

I can't see that myself. This was the absurdity of a cash rich individual claiming tax credits from the Brown era that universal credit was stopping. 

1 hour ago, spacedin said:

I must reiterate how outdated the capital rules are anyway. I believe the last time they were changed was around 2006 so a permanent change is long overdue.

I dislike two things about capital rules. 1) A homeowner in a 200k paid off house with no cash vs. a renter with 200K cash. They should be treated equally but they are not. 2) Having capital rules rewards the feckless and discourages the prudent.

All that being said. I think it would be an odd system if someone with no income but a sizeable sum of money sitting in a bank account would be eligible for income support. 

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  • 1 month later...
4 minutes ago, Saving For a Space Ship said:

Covid 'Devastating' Families As 60% Of Single Parents Claim Universal Credit

https://www.huffingtonpost.co.uk/entry/single-parents-universal-credit-coronavirus_uk_5f32badbc5b6fc009a5defc9

Find the whole plea to raise the benefit cap above the median average wage somewhat bizaree. 

Whole point was to stop families on benefits being housed in locations where taxpayers funding it could only dream ala Kensington etc. 

Additionally if the median wage means you are in poverty.. What does that mean for the 49% that earn less by erm working? 

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On 7/9/2020 at 4:49 PM, Voltron said:

Whats everyone's views on the potential huge increase in the number of people that will potentially be signing up to universal credit due to the ending of furlough and subsequently paying mortgage / rent etc.

Seems like alot of people may struggle to claim due to the savings capped at £16k?

In theory if you have over £16k of cash savings those are used first then, you claim.

For housing its stikl shockingly generous its 2k a month limit in london zone 1 to 3ish for 3 bed property 

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On 11/07/2020 at 20:07, sammersmith said:

I can't see that myself. This was the absurdity of a cash rich individual claiming tax credits from the Brown era that universal credit was stopping. 

I dislike two things about capital rules. 1) A homeowner in a 200k paid off house with no cash vs. a renter with 200K cash. They should be treated equally but they are not. 2) Having capital rules rewards the feckless and discourages the prudent.

All that being said. I think it would be an odd system if someone with no income but a sizeable sum of money sitting in a bank account would be eligible for income support. 

The problem is that it discourages savings.  I know someone who gets benefits, she has spent a fortune on cars, that she doesn't need (she could easily cycle to work).  If she did cycle and saved she would have to pay more of her rent.

 

Edited by iamnumerate
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47 minutes ago, iamnumerate said:

The problem is that it discourages savings.  I know someone who gets benefits, she has spent a fortune on cars, that she doesn't need (she could easily cycle to work).  If she did cycle and saved she would have to pay more of her rent.

 

Luckily these people don't buy precious, crypto or fine wine - so they stay trapped and dependent. 

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16 hours ago, iamnumerate said:

The problem is that it discourages savings.  I know someone who gets benefits, she has spent a fortune on cars, that she doesn't need (she could easily cycle to work).  If she did cycle and saved she would have to pay more of her rent.

My wife used to work with adults with disabilities and a core part of her job was making sure they spent enough money not to exceed the savings threshold. The logic given was losing benefits, then having to live on a small pot of cash while waiting months to go through a reassessment at dwp would be traumatic, and they could lose their secured sheltered and supportef housing place. 

What that meant in reality was a young 18yo man with severe cerebral palsy was walked into a showroom by his helper, was asked to pick the car he liked, and left with a soft top Peugeot 306/307 (iirc, about 12 years ago) . His careworkers saw the benefit of that car, not him. 

It also meant new toys for everyone every month. Laptop has a virus? - buy a new one. Like taking pictures with your phone? - let's buy you a £800 dslr. Want to go to the beach? - let's book you a week in Scarborough for you and 2 carers. 

If someone got near the cash limit there would be an emergency staff meeting and they would brainstorm ways to spend money. Maybe he needs new curtains... If we buy them at John Lewis they'll be good quality and cost more.... Blackout blinds might be useful too... Maybe with nice tassels to hold the curtains back, he likes shiny things... maybe we can get 2 sets if curtains, and put different colours up depending how he feels that day. 

Edited by regprentice
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Yep, perverse incentives but what can you do?

The second you start saving seriously to escape  the benefit trap - for instance for a house deposit, your effectively hourly rate starts being slashed. 

Escape velocity from the benefits system (by which I mean that you start being genuinely better off, and keeping at least more than 50% of any extra hourly income) for those with a family and renting is only really achieved at very high income levels. This is because of the income taper, let alone the savings one. 

Mugs game to work, mugs game to save unless you can earn 100k+.

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36 minutes ago, Frugal Git said:

Yep, perverse incentives but what can you do?

The second you start saving seriously to escape  the benefit trap - for instance for a house deposit, your effectively hourly rate starts being slashed. 

Escape velocity from the benefits system (by which I mean that you start being genuinely better off, and keeping at least more than 50% of any extra hourly income) for those with a family and renting is only really achieved at very high income levels. This is because of the income taper, let alone the savings one. 

Mugs game to work, mugs game to save unless you can earn 100k+.

Workfare might be the solution, difficult to implement though.

 

1 hour ago, regprentice said:

My wife used to work with adults with disabilities and a core part of her job was making sure they spent enough money not to exceed the savings threshold. The logic given was losing benefits, then having to live on a small pot of cash while waiting months to go through a reassessment at dwp would be traumatic, and they could lose their secured sheltered and supportef housing place. 

What that meant in reality was a young 18yo man with severe cerebral palsy was walked into a showroom by his helper, was asked to pick the car he liked, and left with a soft top Peugeot 306/307 (iirc, about 12 years ago) . His careworkers saw the benefit of that car, not him. 

It also meant new toys for everyone every month. Laptop has a virus? - buy a new one. Like taking pictures with your phone? - let's buy you a £800 dslr. Want to go to the beach? - let's book you a week in Scarborough for you and 2 carers. 

If someone got near the cash limit there would be an emergency staff meeting and they would brainstorm ways to spend money. Maybe he needs new curtains... If we buy them at John Lewis they'll be good quality and cost more.... Blackout blinds might be useful too... Maybe with nice tassels to hold the curtains back, he likes shiny things... maybe we can get 2 sets if curtains, and put different colours up depending how he feels that day. 

Thanks for that, I think many people wouldn't believe you - I do though

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