Boris on the money when it comes to Tax Credits!

Discussion in 'Politics & The Economy' started by Cliff, Jun 25, 2015.

  1. Cliff

    Cliff
    Distinguished Member

    Joined:
    Mar 17, 2001
    Messages:
    6,856
    Products Owned:
    0
    Products Wanted:
    0
    Trophy Points:
    167
    Location:
    Kent Accra Rub Al Khali
    Ratings:
    +4,358
    Boris has warned the PM not to be too hasty with cuts but he didn't mince words when it came to big companies being subsidised by the tax payer.

    He said it was 'scandalous' that private companies were paying their workers so poorly that the government needed to top up their wages with tax credits.

    Tesco, Asda, Sainsbury's, Morrison's and Next – reportedly receive £1billion-a-year in taxpayer-funded subsidies for their wages bill.

    He added: 'I do think the London living wage is absolutely vital'

    Boris Johnson warns David Cameron and George Osborne about tax credits | Daily Mail Online


    That's one thing about Boris. Cut to the chase.
    And he is absolutely right !
     
  2. EarthRod

    EarthRod
    Distinguished Member

    Joined:
    Jul 15, 2008
    Messages:
    17,957
    Products Owned:
    0
    Products Wanted:
    0
    Trophy Points:
    166
    Location:
    England
    Ratings:
    +8,076
    More kids are likely to be below the breadline if Cameron implements tax credit cuts as part of his plans to cut the welfare bill by £12 billion.

    Boris's warning regarding poor wages comes before new figures which could show a rise in the number of children living in poverty from 2.3 million to 2.5 million.

    Also, homelessness went up 8% in 2014 and the number of families living in Bed & Breakfast accommodation is now about 35%.

    The number of households with at least one child classed as 'fuel poor' increased from 988,000 to nearly 1.1 million between 2010 and 2013.

    However, Cameron has said he is on the side of working people, so all is sweetness and light.
     
    • Like Like x 1
    • Funny Funny x 1
    • List
  3. Greg Hook

    Greg Hook
    Moderator & Reviewer

    Joined:
    Nov 25, 2001
    Messages:
    24,626
    Products Owned:
    2
    Products Wanted:
    1
    Trophy Points:
    166
    Location:
    In a secret location with Jennifer Lawrence
    Ratings:
    +12,086
    Just checking that one. 35% of what?
     
  4. fluxo

    fluxo
    Distinguished Member

    Joined:
    Oct 30, 2011
    Messages:
    7,185
    Products Owned:
    0
    Products Wanted:
    0
    Trophy Points:
    163
    Ratings:
    +2,351
    The government is coercing people into working at some of these companies. If the state forces people to work for companies that do not pay people enough to live on, then it is obligated to top up their wages. It has to take moral responsibility for its actions.

    The government needs to stop interfering with the jobs market. That means not providing tax credits, but also not punishing people who do not take on poorly paid work.

    In the natural course of things, nobody would take on a job that did not pay enough to live on (lacking an extra source of income). Companies would have to present a realistic wage offer. That is the operation of a normal market: in a market you offer something (e.g., wages) at a price (e.g., work) that attracts bids. It is not the job of government to interfere with that process, whether that be by forcing bids with the threat of punitive sanctions or by altering the the offer with top-ups for wages. That type of market distortion has all sorts of negative consquences, from the cost to the tax payer to making companies inefficient by levering in people who are not suited to the work done there.
     
  5. tapzilla2k

    tapzilla2k
    Distinguished Member

    Joined:
    Dec 7, 2005
    Messages:
    7,631
    Products Owned:
    1
    Products Wanted:
    0
    Trophy Points:
    166
    Location:
    Oxford
    Ratings:
    +2,853
    Boris is doing two things here -
    1. He understands the idiotic nature of reducing tax credits when you haven't first ensured
    that companies start paying workers a proper wage (we can debate what that is until the cows come home).
    2. Positioning his opposition to the policy in case it goes utterly pearshaped for Cameron and causes a strong reaction from those who have their working tax credits cut. At which point Boris can challenge for the leadership via a stalking horse.

    This policy is probably going to cause a lot of anger by those who need working tax credits to keep their heads above water. Until the issue of wage levels are sorted out, I don't think it's sensible to cut working tax credits, as I expect it will have an effect on the Economy i.e. people will have less money to spend in the shops dragging down growth and annoying the bond markets. All in all this could be the first big mistake of Cameron's second term. The Tories are good at not thinking a policy through and steam rolling ahead with it, then wondering why people are angry for.

    Cameron is looking more and more like Tim Nice But Dim.
     
  6. Squiffy

    Squiffy
    Distinguished Member

    Joined:
    May 23, 2002
    Messages:
    14,528
    Products Owned:
    1
    Products Wanted:
    0
    Trophy Points:
    166
    Location:
    Ashford, Kent
    Ratings:
    +7,531
    All very right-on.

    How do we push those who would be content to live on welfare into taking jobs?
     
  7. fluxo

    fluxo
    Distinguished Member

    Joined:
    Oct 30, 2011
    Messages:
    7,185
    Products Owned:
    0
    Products Wanted:
    0
    Trophy Points:
    163
    Ratings:
    +2,351
    It is not for government to be pushing people about. That is the stuff of totalitarian states and straight out of the hard-left rulebook.

    In a free society with opportunities to improve their lives most people will do just that. The few who don't are too small a number to worry about.

    What sort of misanthropist would force people into jobs they cannot do properly and that do not pay enough to live on? It's completely misguided to think that some government beaurucrat knows best how to match people to jobs and only a naive idealist would think otherwise.
     
  8. tapzilla2k

    tapzilla2k
    Distinguished Member

    Joined:
    Dec 7, 2005
    Messages:
    7,631
    Products Owned:
    1
    Products Wanted:
    0
    Trophy Points:
    166
    Location:
    Oxford
    Ratings:
    +2,853
    These cuts will effect those who are in work, but are on low pay. I've been on benefits, it's a degrading experience and I was not content to live on them. The brutal truth is, there is not much support from Government to help people deal with problems that prevent them from working. Mental Health is a prime example of that, you get dumped on Benefits, then have to struggle to get a diagnosis and treatment. Neither of which helps you get well and then be in a position to find work. I speak from personal experiences here.

    You can't push people into taking jobs, providing there are actually jobs out there that they can do in terms of their skill level. You have to look at people on an individual basis, work out what needs they have in terms of education, skills and health. Work out a plan to help them overcome those needs and then be in a position to help them find a job and if necessary monitor how they are doing and provide support. The private sector has done a very poor job of helping people find work in exchange for a lot of taxpayers cash.
    You also have to accept that there are some people out there, through no fault of their own, who will never be able to work. And we need to do more to keep them engaged with society, not locked away in their own homes due to things like the independent living fund being axed.
    But that's too much like common sense, lets carry on bashing the vulnerable and poor cos I'm alright and don't need the safety net etc.
     
  9. EarthRod

    EarthRod
    Distinguished Member

    Joined:
    Jul 15, 2008
    Messages:
    17,957
    Products Owned:
    0
    Products Wanted:
    0
    Trophy Points:
    166
    Location:
    England
    Ratings:
    +8,076
    That would be about 35% of homeless families living in B & B accommodation.
     
  10. Derek S-H

    Derek S-H
    Distinguished Member

    Joined:
    Jan 2, 2005
    Messages:
    3,921
    Products Owned:
    2
    Products Wanted:
    0
    Trophy Points:
    164
    Location:
    Brighton
    Ratings:
    +2,880
    Does anyone here seriously think Boz would be making statements like this if his time as Mayor wasn't due to run out soon? I don't recall the Tories saying anything about tax credits during their election campaign, do they actually have a policy on them?

    I suppose it is a fairly damning indictment of a laissez-faire attitude to workers' incomes that top up credits even exist at all. But being on a zero hours contract and all the insecurity and powerlessness that that entails is always better than being on benefits, apparently.

    So on the one hand you've got barely enough to live on but you're "striving", and on the other you've got barely enough to live on but you're "scrounging".

    Ideological? Nah. Clueless? Yep.
     
    • Like Like x 1
    • Funny Funny x 1
    • List
  11. la gran siete

    la gran siete
    Well-known Member

    Joined:
    Oct 5, 2003
    Messages:
    25,276
    Products Owned:
    0
    Products Wanted:
    0
    Trophy Points:
    136
    Location:
    West Sussex
    Ratings:
    +1,984
    increasing the minimum wage substantially would be a good place to start, although I would prefer a Basic income to be put in place then any other income an individual can get from a job would be an extra.
    No need to push anyone
     
  12. Enki

    Enki
    Banned

    Joined:
    Dec 3, 2014
    Messages:
    3,602
    Products Owned:
    2
    Products Wanted:
    0
    Trophy Points:
    136
    Location:
    IP address init.
    Ratings:
    +1,200
    I've been musing for some time how £12 billion will be saved, so it's going to be Tax credit and justified by redefining poverty in families, as electrifying as the midland line and being serious about northern power house, thingy. The narrative is set!
    Back to company's not paying appropriate wage, so Boris is on the money when it comes to Tax Credits, by asking hard working shareholders of mentioned companies to take less dividends, hopefully this is meaningful and not guff, government needs to intervene through further legislation forcing companies to pay, fair welfare free wages.:rotfl:
     
    Last edited: Jun 26, 2015
  13. Cliff

    Cliff
    Distinguished Member

    Joined:
    Mar 17, 2001
    Messages:
    6,856
    Products Owned:
    0
    Products Wanted:
    0
    Trophy Points:
    167
    Location:
    Kent Accra Rub Al Khali
    Ratings:
    +4,358
    Agreed , it should not be about pushing, should be like a carrot!

    If you work then the rewards should be significantly more than living on benefits.
    That is the encouragement to seek work and live a better and more comfortable life.
     
  14. domtheone

    domtheone
    Distinguished Member

    Joined:
    Nov 23, 2004
    Messages:
    16,206
    Products Owned:
    0
    Products Wanted:
    0
    Trophy Points:
    166
    Location:
    Nottingham
    Ratings:
    +5,045
    Which is clearly not that case at the moment.

    Tax credits should be abolished, in full.

    Over what period of time is the only argument.

    Granted, wages should rise to compensate but something needs to be done about the cost of living.

    Anyone see the report about how rents are higher in this country than practically anywhere else in Europe?

    If you're on a low/medium wage, once you've paid your high rent costs, outrageous council tax costs, food, gas, electric etc, there can't be anything left.
     
  15. Enki

    Enki
    Banned

    Joined:
    Dec 3, 2014
    Messages:
    3,602
    Products Owned:
    2
    Products Wanted:
    0
    Trophy Points:
    136
    Location:
    IP address init.
    Ratings:
    +1,200
    Work harder and train harder;).
     
  16. domtheone

    domtheone
    Distinguished Member

    Joined:
    Nov 23, 2004
    Messages:
    16,206
    Products Owned:
    0
    Products Wanted:
    0
    Trophy Points:
    166
    Location:
    Nottingham
    Ratings:
    +5,045
    That would be my answer to them. Glad you agree.:smashin:

    When all the tax credits have gone, and people are moaning that they can't get by, that'll be the answer.
     
  17. Enki

    Enki
    Banned

    Joined:
    Dec 3, 2014
    Messages:
    3,602
    Products Owned:
    2
    Products Wanted:
    0
    Trophy Points:
    136
    Location:
    IP address init.
    Ratings:
    +1,200
    I can absolutely guarantee, someone has spoken of their modest beginnings and how through just determination they have bettered themselves here in the UK, self satisfying of the grandiose kind and poppycock of Darwinism economics, is my answer:p.
     
  18. Squiffy

    Squiffy
    Distinguished Member

    Joined:
    May 23, 2002
    Messages:
    14,528
    Products Owned:
    1
    Products Wanted:
    0
    Trophy Points:
    166
    Location:
    Ashford, Kent
    Ratings:
    +7,531
    Well Enki, I would put myself in that category but no matter.

    My concern is that there is an underclass content to live on benefits.

    But I think that removing tax credits and increasing wages is the way to deal with this, rather than decreasing any other benefits. Out of work benefits should be a safety net only, and not enough for anyone to live comfortably.

    Alongside this I would like to see short term unemployment benefits INCREASED so those losing their job do not have a sudden shock while they have time to seek a new job.
     
    • Agree Agree x 4
    • Funny Funny x 1
    • List
  19. Enki

    Enki
    Banned

    Joined:
    Dec 3, 2014
    Messages:
    3,602
    Products Owned:
    2
    Products Wanted:
    0
    Trophy Points:
    136
    Location:
    IP address init.
    Ratings:
    +1,200
    Indeed, well Squiffy. We all have personal unique narratives to share.

    So, we have demonised the workshy in wide brush strokes, anybody supported in benefit. Now we set out to demonise hard working people with families who are the recipients of tax credits, whoever next, maybe the baby boomers once they become a burden on health and social care and have been asset stripped:(. Cameron sounds pretty unconvincing at the best of times; his Runcorn speech on tax credits was awful and unconvincing, even by his standards.

    “This is what I would call a merry-go-round, people working on the minimum wage having that money taxed by the government and then the government giving them the money back, and more”. Who does he think he is, caricature of Mr.Bumble.

    One nation pffft, no wonder they wheeled out the real Mr. Bumble, by its meaning. I wait with anticipation how this will be received by employees and employers ;).

    Glad my children have grown up, got have them young, but most frowned upon;).
     
    Last edited: Jun 26, 2015
  20. Sve

    Sve
    Banned

    Joined:
    Feb 2, 2014
    Messages:
    3,334
    Products Owned:
    0
    Products Wanted:
    0
    Trophy Points:
    136
    Ratings:
    +827
    This has got nothing to do with an underclass living on benefits.

    Are you prepared for the rise in the cost of food, clothes, fuel and everything else that will come with the increase in the wages. Also how are the shareholders going to react when the profits go down.

    Less tax for the taxman from company profits.
     
  21. tapzilla2k

    tapzilla2k
    Distinguished Member

    Joined:
    Dec 7, 2005
    Messages:
    7,631
    Products Owned:
    1
    Products Wanted:
    0
    Trophy Points:
    166
    Location:
    Oxford
    Ratings:
    +2,853
    There might be a minority content to live on benefits, but they are not enough to live on comfortably. I know full well I'd not have coped on my own, even in sheltered accommodation as the CMHT wanted to put me in. My concern is the measures taken by IDS will not address the core issues and failure of policy will be blamed on "scroungers".

    Easier said than done. What you are likely to see from the Tories is the removal of Working Tax Credits before wages have risen to compensate. Leading to a lot of angry people who are in work, but have had to rely on Working Tax Credits to stay afloat. Do not blame them for that, blame the Employers who've taken advantage of working tax credits as a means to keep wage bills low and thus profits up. Basically this policy is sounding as ill thought out as the poll tax, and could backfire entirely. The whole "Party for working people" spin will at the very least go up in flames.
    Or Dave will see the danger and do a U Turn.

    The other issue is what does the Government do to support those who seek to become self employed ? Removing working tax credits will have a direct impact on that. Which would be bad for the job figures.

    They have to be enough for people to live on, especially if they are in the grips of a serious mental illness or if they are severely disabled and need a great deal of support to be able to live independently (far better than cramming them into care homes, where they are open to abuse). IDS is still refusing to release DWP figures on deaths that can be attributed to people losing benefits. The real scandal is how the DWP has treated the sick, disabled and mentally ill, it shows that there is no safety net for those who need it most. You will probably disagree with that, but having been through the WCA and appeals process, I can tell you it was a waste of time and tax payers money. Medical evidence is ignored and the WCA is hopelessly useless for assessing mental health conditions. Mine especially as it's quite complex as explained to me by an expert in mood disorders from Oxford University. I'd rather the DWP listened to his opinion than an A&E nurse who only sees mentally ill people who are in crisis and end up in A&E due to the woeful state of NHS mental health services. She thought that because I was not threatening to kill myself and others, I was perfectly well and able to work. Seemed to think Social anxiety was not a problem either.

    For those that are not sick, disabled or mentally ill, then as I've said before you need to have systems in place that can help them overcome whatever issues prevent them from working. Labelling people scroungers and punishing them with punitive sanctions is not going to solve the problem. It might save money in the short term, but in the long term ? The gap between skills employers demand and the skill level of those who are able to work will increase. Our education system is failing too many children and that's one area which successive Governments have failed to address properly, other than political vanity projects or measures designed to give political parties a poll boost.

    That will not happen. It's a one size fits all payment, to keep the cost down. Unless of course you intend to shift money around in the Welfare budget from pension age benefits to working age benefits. That'll go down nicely with Tory voters of a certain age.
     
    • Like Like x 2
    • Thanks Thanks x 1
    • List
  22. Enki

    Enki
    Banned

    Joined:
    Dec 3, 2014
    Messages:
    3,602
    Products Owned:
    2
    Products Wanted:
    0
    Trophy Points:
    136
    Location:
    IP address init.
    Ratings:
    +1,200
    Spoilsport, I was enjoying the gobble call, to arms;).
     
    Last edited: Jun 26, 2015
  23. Cliff

    Cliff
    Distinguished Member

    Joined:
    Mar 17, 2001
    Messages:
    6,856
    Products Owned:
    0
    Products Wanted:
    0
    Trophy Points:
    167
    Location:
    Kent Accra Rub Al Khali
    Ratings:
    +4,358
    I think it is very important to separate out of work benefits and tax credits for people who capable of work and are healthy, from the type of benefit you are describing.
    No one here is arguing for those to be cut.
     
  24. Squiffy

    Squiffy
    Distinguished Member

    Joined:
    May 23, 2002
    Messages:
    14,528
    Products Owned:
    1
    Products Wanted:
    0
    Trophy Points:
    166
    Location:
    Ashford, Kent
    Ratings:
    +7,531
    Exactly. I was very clear to call them out of work benefits, to distinguish them from benefits for the disabled.

    As to the rest. Prices may rise, or they may not. This isn't the same as mandating a rise in the minimum wage with no other changes. Remember this is overall net-neutral to the economy. Tax credits do not magically appear out of thin air, they are paid for by the rest of us in tax.

    One further point. Enki seems to say I have demonised the workshy. GOOD! They should be shamed.

    For those in work... How is supporting tax credits falling, but wages going up demonising anyone?
     
  25. Sve

    Sve
    Banned

    Joined:
    Feb 2, 2014
    Messages:
    3,334
    Products Owned:
    0
    Products Wanted:
    0
    Trophy Points:
    136
    Ratings:
    +827
    You cannot have it both ways, either prices rise or profits fall. Why are goods esp food so cheap, because the majority of shop workers are on or just above minimum wage so depend on tax credits to be able to live. Make every employer pay a decent living wage and something has to give.
     
  26. Squiffy

    Squiffy
    Distinguished Member

    Joined:
    May 23, 2002
    Messages:
    14,528
    Products Owned:
    1
    Products Wanted:
    0
    Trophy Points:
    166
    Location:
    Ashford, Kent
    Ratings:
    +7,531
    I will repeat again. If tax credits fall bit wages rise, this is neutral to the worker.

    The employer may pay more, but elsewhere in the economy we are paying less tax to fund tax credits so the effect is net neutral to the economy overall.

    Of course this may mean prices rise in some areas, but currently we are indirectly subsidising those prices thru higher taxes. If I pay higher prices but pay less tax the impact is neutral to me.
     
  27. Sve

    Sve
    Banned

    Joined:
    Feb 2, 2014
    Messages:
    3,334
    Products Owned:
    0
    Products Wanted:
    0
    Trophy Points:
    136
    Ratings:
    +827
    It cannot be neutral at all. Employer pays worker more, either it comes out their profits or they raise prices. If they raise prices the workers could be better or worse off than before when they had tax credits.

    Higher wage bill, less profits = less tax for the taxman = less revenue for the chancellor to spend = tax rises.
     
  28. fluxo

    fluxo
    Distinguished Member

    Joined:
    Oct 30, 2011
    Messages:
    7,185
    Products Owned:
    0
    Products Wanted:
    0
    Trophy Points:
    163
    Ratings:
    +2,351
    I think underlying all this are issues that are not so much discussed. That is, issues to do with globalisation, automation, etc., that are very challenging not just for us in the UK but for countries across the west. If we had a fundamentally sound and thriving economy, we would not be having this discussion. Tax credits arise from an attempt to socially engineer full employment in the absence of that sort of economy.

    We can spend a lot of time discussion this or that tax or benefit etc., but none of that will help unless we tackle the harder issues, such as what to do if it automation means that less human work is needed. There aren't really any fully developed means of successfully dealing with a situation like that.
     
  29. Squiffy

    Squiffy
    Distinguished Member

    Joined:
    May 23, 2002
    Messages:
    14,528
    Products Owned:
    1
    Products Wanted:
    0
    Trophy Points:
    166
    Location:
    Ashford, Kent
    Ratings:
    +7,531
    You are ignoring that the taxpayer is not funding tax credits.
     
  30. Sve

    Sve
    Banned

    Joined:
    Feb 2, 2014
    Messages:
    3,334
    Products Owned:
    0
    Products Wanted:
    0
    Trophy Points:
    136
    Ratings:
    +827
    You what?
     

Share This Page

Loading...