The reality of the Coalition’s crackdown on tax credits

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agencies, agency, austerity, collection, debt, disability, disabled, earn, employer, hospital transport, low, minimum wage, national, NHS, pay, pension, poor, sick, tax credits, Tony Blair, working, zero hours

Nothing more to say: This Tax Credits advert was intended to warn people to keep up-to-date with information they send HMRC about their claim; now it seems the message is much simpler – they want to stop paying you anyway.

A guest blog by ‘Mimismum’.

What follows was posted to Vox Political as a response to Tax Credits and Debt Collection Agencies: Peachy’s Comment. It details the facts of the situation for just one struggling family and as such was worth a larger audience than it would have received as a comment on another article.

This government scares the s**t out me. I don’t know how much more stress I can take now. It has gone beyond anything like “austerity” or “in it together” rhetoric and is now a witch hunt against the poor or low earners, sick and disabled – even going as far as blaming us for our own predicament.

We have seen our family income go from £800 from my other half’s wage back in 2009 to just under £350 now, due to successive redundacies. He works and has never had any unemployment in the past 12 years, and yet each time he calls tax credits to say there is a change in our income they lower the award (ha! thats a rich term for it now, its garbage to call it an award) based on his predicted income, even though its gone down and down.

Last year he worked overtime for two weeks, got paid an extra £20 in the month and they hammered us by cutting his Working Tax Credits by £30 a week for the entire year! He recently got made redundant again and is now working two temp jobs (one of which is zero hours) and he has got hours bouncing around all over the joint. Family life has been shot to s**t, and when he rang Tax Credits to tell them they just said, “Oh well, as long as it’s over the 24 a week you are okay.”

Today they shoved some money in the bank. He rang to ask what the hell it was for; they can’t tell him because “We haven’t had the renewal paperwork in.” For goodness’ sake, we just wanted to know what this extra money is, it’s not rocket science! The guy refused to tell us!

My other half had to use it to pay bills because his wages were short due to the zero hour contract job changing how they pay wages now – because of that stupid pension scheme c**p the government forced on everyone. Even though he already has one from his previous job, this company took money for their pension and said they wouldnt pay into his! Oh, and because his old employer forgot to send his P45, he had to pay emergency tax as well!

We can’t do this any more. The stress of him working two jobs, my disability, and having children is driving a wedge between us. One of our children has autism, and I am struggling to maintain a routine that they desperately need – and I can’t. The other half is now on National Minimum Wage for both crappy jobs; both want exclusivity out of him and now keep rostering him on during the other job’s time. Both knew he had a second job when they took him on, and now we find out that tax credits can send debt collectors and bailiffs around for money they say anyone owes, just like that.

I wish to god Tony Blair had not invented tax credits, because it gives employers a get-out clause for paying decent wages. I can’t get hospital transport fees out of the NHS for trips I have had to make and even though they were claimed within the time allowed – no payment has been forthcoming because “it’s too late now” for them to pay out. I have another appointment in two weeks’ time which I have to cancel as I cant get there, because my other half can’t take time off work from either job – and my physio is about to strike me off for the same reason.

I am sick of this mess; we dont deserve this, and if we find out Tax Credits have overpaid us as well I don’t know what we would do. We have an income of less than average and we pay our own rent; we don’t claim Housing Benefit because the council stuffs it up and we get into arrears so we manage on our own.

We claim less of what we are entitled to because I am scared they will want it back, and now they are playing this game with tax credits.

I don’t want to be punished any more for being disabled, a parent or married. I have had enough of being poor and scared. All I want is for my other half to have a decent job with a decent wage, and there is nothing out there now.

No jobs, nothing, and it’s getting worse.

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How do we wrestle fairness from a rigged economic system?

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abroad, benefit, board, boss, business, capitalism, capitalist, company, condition, corporate, corporation, debt, Department for Work and Pensions, DWP, economic, economy, employer, fatcat, firm, in-work, inflation, Investment Partnership, make-work, Mandatory Work Activity, Margaret Thatcher, Mike Sivier, mikesivier, Milton Friedman, misery, multinational, national, offshore, pay, politics, profit, protection racket, relocate, sanction, servitude, shareholder, social security, subsidise, tax haven, taxpayer, TPP, Trans-Pacific Partnership, Transatlantic Trade, TTIP, unemployment, Vox Political, welfare, work, Work Programme, Workfare

The problem in a nutshell – and this cartoon was drawn in 1972! [Image: Alan Hardman]

It’s terrific when an article makes you think.

Why Capitalism needs unemployment, by Cheltenham & Gloucester Against Cuts, tells us that unemployment is used as a weapon against the workers – with the threat of it used to force pay cuts on employees, while we are told to fear inflation if unemployment falls.

So fatcat company bosses win either way, it seems.

The article commented on Margaret Thatcher’s ideological mentor, Milton Friedman, who “understood that low levels of unemployment give confidence to workers, who can fight for better pay and conditions. When they’re successful, the profit margins of capitalists are reduced, causing them to put their prices up in response“.

We know this happens; we have seen it many times. Some may argue that it is different from cases in which shortages of particular commodities push up their prices and the prices of products that are made from them – but, with fuel prices as the only notable exception, have you ever seen prices drop after these shortages end?

The system is rigged to ensure that working people stay poor, either through pay cuts during high unemployment or inflation in low unemployment; meanwhile the employers and shareholders ensure that they stay rich, by sharing out extra profits gained by keeping pay low or by putting up prices.

What do they do with this money?

The answer, it seems, is nothing. They bank it in offshore tax havens and leave it there. This is why, we are told, Britain’s richest citizens have more than £20 trillion banked offshore at the moment.

That’s more than £20,000,000,000,000! Enough to pay off this country’s national debt 18,000 times over and still have plenty to spare. Enough to solve the problems of the world, forever. It is, in fact, more money than we can comfortably imagine.

It is doing nothing.

Faced with this knowledge, there can only be one logical question: Why?

Why rig the system so that ever-larger sums of money pour into these offshore accounts, if nothing is to be done with it? Where is the sense in that?

The only logical answer appears to relate to its effect on workers: Keeping the profits of their work away from the workforce means they are kept in misery and servitude to the ruling classes – the parasitical board members and shareholders.

There are knock-on effects. Taxpayers are hit twice – not only are they forced to grapple with ever-more-hostile pay offers, but their taxes pay for in-work benefits that subsidise corporate-imposed pay levels; they support people who have been forced into unemployment unnecessarily and the silly make-work schemes that are forced on those people by the Department for Work and Pensions, under threat of sanction.

It’s a protection racket. There should be a law against it. And this begs the next question: Why isn’t there a law against it? How can this corrupt system be dismantled and what should replace it?

That’s a very good question, because the other cosh being held over our collective heads is the possibility that firms will move abroad if new laws in this country threaten their massive profits. This is where an international agreement between nations or groups of nations would be very useful, if it was carried out in the right way – a Transatlantic, or Trans-pacific, Trade and Investment Partnership, perhaps.

And what do we see? Plans for such agreements have been put together and they do the exact opposite of what they should – tying the workers into ever-worsening conditions. This is why the TTIP, currently being pushed on the European Union, must be rejected – and why bosses will do anything to ensure it succeeds.

This is the situation. It seems clear that nothing will change it for the better until somebody has the courage to stand up to these manipulators (who were probably schoolyard bullies back in the day) and say enough is enough; change is coming – do what you will.

Tax evasion and avoidance is already a huge issue here in the UK; perhaps we need to make a criminal offence of manipulating the economy – with prison sentences for bosses who put their prices up purely to retain high profit margins when their salaries are already dozens of times higher than those of their workers.

But what else is needed? How can such a mechanism be brought in without scaring off business? Or should we let them go, and put something fairer in their place? Ban them from trading in the UK unless they conform to the new model?

These are ideas that need exploration – by many people, not just a few.

What do you think should happen?

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Tory policy on ‘zero hours’: Beggars can’t be choosers

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beggar, benefit, choice, choose, chooser, coach, Conservative, Ed Miliband, employer, esther mcvey, exploit, force, holiday, Job Centre, Jobseeker's Allowance, JSA, Labour, mandate, Mandatory Work Activity, Mike Sivier, mikesivier, national insurance, NI, pay, pension, people, politics, Sheila Gilmore, sick, social security, subsidise, taxpayer, Tories, Tory, UC, Universal Credit, Vox Political, welfare, Work Programme, Workfare, zero hour contract

Isn’t it nice to see some clear blue water emerge between the main political parties on an important issue?

Less than two weeks after Ed Miliband announced that he would tackle the “epidemic” of zero-hours contracts if Labour wins the next general election, the Conservatives have confirmed that Universal Credit – if they can ever get it working – will force jobseekers into those very contracts.

Labour said workers on zero-hours contracts should not be obliged to be available outside contracted hours; be free to work for other employers; have a right to compensation if shifts are cancelled at short notice; have ‘clarity’ from their employer about their employment status, terms and conditions; have the right to request a contract with a ‘minimum amount of work’ after six months, that could only be refused if employers could prove their business could not operate any other way; and have an automatic right to a fixed-hours contract after 12 months with the same employer.

At the time, the Tories said the number of zero-hours contracts had increased under the last Labour government, which had done nothing about it.

This tired excuse has been trotted out far too many times to be taken seriously any more, but it may have led some members of the public to believe that the Tories were distancing themselves from zero-hours contracts as well. They are, after all, supposed to be The Party of More Choice. Perhaps they are, themselves, less than keen on this kind of exploitation.

Not a bit of it!

The Guardian revealed yesterday that conditions will be imposed on the receipt of Universal Credit, meaning that – for the first time ever – jobseekers could lose their benefits if they refuse to take zero-hour jobs – for three months or longer.

Currently, people on Jobseekers’ Allowance are able to refuse such jobs without facing penalties.

The policy change was revealed in a letter from employment minister Esther McVey to Labour MP Sheila Gilmore. She said Job Centre “coaches” would be able to “mandate to zero-hours contracts” – basically forcing them to accept this kind of exploitation by employers.

The DWP has also stated: “We expect claimants to do all they reasonably can to look for and move into paid work. If a claimant turns down a particular vacancy (including zero-hours contract jobs) a sanction may be applied.”

The message from the Conservatives – the Party of More Choice – is clear: Beggars can’t be choosers.

Their chums on the boards of big businesses want more profits, and know the way to get it – employ people on low pay and with no employee benefits. Zero-hours contracts mean you can be made to work fewer hours than you need in order for employers to have to pay National Insurance credits for you. You don’t get sick pay; holiday pay; or a pension. And you’ll probably still be on benefits, meaning the work that you do is subsidised by other hardworking taxpayers, most of whom earn only a little more than you do.

It’s a racket – as bad as workfare/mandatory work activity/the work programme/whatever-they’re-calling-it-today, in which taxpayers subsidise work carried out by jobseekers for participating employers, hugely boosting those firms’ profits while ensuring that the number of people without proper, paid jobs remains high.

Their attitude is that, if you don’t have a job, you are a beggar.

Beggars can’t be choosers.

So they’ll choose what you do, and they – or their boardroom chums – will benefit from it.

If you are a working taxpayer, think about this before casting your vote later this month – and especially before you do so in May 2015: A vote for the Conservative Party means more of your fellow citizens will be prevented from getting proper jobs and becoming contributing members of society by the greedy – and idle – rich.

A vote for the Conservative Party means more of your tax money going to subsidise fat business board members who already have more money than they can ever use.

A vote for the Conservative Party means a better life for them and their friends – and a poorer life for you.

You’d have to be mad to choose that.

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Marcus Brigstocke v the Government – has he been reading Vox Political?

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absentee, bank, benefit, bonus, company, cost of living, cynic, demoralise, economic, Economic and Social Research, economy, employee, employer, exploit, financial crisis, financial sector, George Osborne, government, growth, illness, in-work, living, Marcus Brigstocke, Mike Sivier, mikesivier, minimum, morale, National Institute, NIESR, politics, productivity, ruthless, sabot, sabotage, social security, staff, stress, The Now Show, turnover, Vox Political, wage, wages, welfare, work, zero hours contract

This is the first pic I could find of Marcus Brigstocke, as he might have looked while delivering the piece quoted below. He’s a known beardie so he probably had face-fuzz as well.

What a rare and pleasant thing we’ve enjoyed for the last few days – a Bank Holiday weekend with good weather! And isn’t it a shame that this means most of you will have been out, and therefore missed Marcus Brigstocke’s turn on The Now Show.

Here’s a guy who knows how to take the government apart; it seemed as though he’d been reading Vox Political for the last few months because he touched on some of our favourite subjects:

1. The economy

He led with the 0.8 per cent increase in economic growth, mocking the government’s celebratory tone with impressions of how ordinary people took the news, up and down the country (some of the accents were beyond belief).

“Well done, George Osborne,” said Marcus, his voice dripping with sarcasm. “You have proved your theory right, using the Grand Theft Auto model. You have successfully shown that the poor really are like video game prostitutes – if you kick them hard enough, eventually money will come flying out of them.”

Doesn’t this fit nicely with what this blog has been saying about the economy being dependent entirely on the movement of poor people’s money? Those with less spend all – or almost all – of their income and it is this money, being pushed around the system, that boosts profits and keeps Britain going.

He continued: “I know that the state of the economy matters but for the vast majority of people it is as mysterious and cryptic as the shipping forecast… What makes a difference to people is not zero-point-eight-per-cent growth; it’s actual wages and the cost of living.

“The National Institute of Economic and Social Research (NIESR) showed this week that the average worker is £2,000 worse-off since the financial crisis hit,” another common theme here on VP, except in fact it’s £2K per year worse-off. Let’s do a quick shout-out to Jonathan Portes, NIESR’s director, whose Tweets are well worth a read: @jdportes

“I say, ‘hit’. That makes it sound like the crisis swerved towards us. The reality is, the average worker is £2,000 worse-off since the financial sector arrogantly, and with galactic, hubristic stupidity, drove the economy off a cliff, yelling, ‘Does this mean I still get my bonus?’ Of course you’ll still get your bonus. Otherwise you’d leave the country and [chuckling] nobody wants that.” [Laughter from the audience – we’re all in on that joke.]

2. Employment

“More people are in work now; good. But why do employers talk like they deserve a sainthood when they have people working for them? Your company does a thing; you need workers to facilitate the doing of that thing. The workers work, and the thing is done – am I missing something here? Do you feel you need a medal?”

2a. Zero-hours contracts

“One-point-four million British workers are having to scrape a living together from cynical, ruthless, exploitative employers using zero-hours contracts. Value your employees – they are not battery workers; they are people… One in five UK workers earns less than the Living Wage.”

At this point the narrative switches to a spoof advert: “At GreatBigFacelessBastardCorp we care so little about what we do, we pay our workers the minimum wage allowed under the law! That way we can pass on their listlessness and overwhelming sense of defeated apathy to you, the customer! GreatBigFacelessBastardCorp – crushing dreams so you don’t have to!”

This relates to an argument that Vox Political has been having with Tory-supporting businesspeople for years, going back to the earliest days of the blog. Back in January 2012, I wrote False economies that leave the business books unbalanced in which I stated:

It seems to me that many employees are finding life extremely difficult now, because the amount they are paid does not cover all their outgoings and they are having to work out what they can do without. The cost of living has risen more sharply than their pay, so they are out of pocket.

This creates stress, which can create illness, which could take them out of work and turn them into a liability to the economy – as they would then be claiming benefits.

That’s bad – not only for the country but also for their company, because demoralised employees produce poor work and the company’s turnover will decrease; having to bring in and train up new workers to replace those who are leaving through ill health is time-consuming and unproductive.

Therefore, in taking the money for themselves, rather than sharing it with employees, bosses are clearly harming their own companies and the economy.

In fact, it seems to me that this is a microcosm of the larger, national economy. In order to keep more money, bosses (and the government) pay less (in the government’s case, to pay off the national deficit). This means less work gets done, and is of poorer quality (in both cases). So orders fall off and firms have to make more cutbacks (or, revenue decreases so the government makes more cutbacks in order to keep up its debt payments).

[This seems to have been borne out by subsequent events. More people are employed than ever before, according to the government, yet GDP has improved by only a fraction of one per cent in the last quarter. By rights, it should be about 20 percentage points higher than the pre-crisis peak by now, according to some analysts.]

The message to bosses – and the government – is clear: Cutting back investment in people to keep money for yourselves will cripple your earning ability. Cutting even more to make up for what you lose will put you into a death spiral. You are trying to dig your way out of your own graves.

But there is an alternative.

A reasonable pay increase to employees would ensure they can pay their bills, and would also keep them happy.

Happy workers produce better results.

Better results keep businesses afloat and earn extra work for them.

That in turn creates more revenue, making it possible for bosses not only to increase their own pay but employ more people as well.

Wouldn’t that be better for everybody?

Well, wouldn’t it?

3. Welfare lies

“Young workers are amongst the hardest-hit by the downturn, with pay falling by 14 per cent between 2008 and 2013. Well done, everybody! We pay far more from the welfare budget supporting incomes for people in work than we do for those out of a job.

“The government keep on crowing about the number of people they have in work … most of them are not so much in work as near some work, if only they were allowed to do any.

“If you’re on the minimum wage, kept on a zero-hours contract between 7am and 7pm so you can’t work for anyone else but rack up a grand total of – ooh! – just enough hours so your employer doesn’t have to pay your National Insurance [another VP theme], you get no training, no employee benefits, no hope of any promotion and you hear ‘IDS’ banging on about how he’s ‘the saviour of benefits street’, well, if you can still afford a shoe then please throw it at the radio or through the telly or at his actual face.” This is a reference to sabotage, in which workers threw their crude shoes – or ‘sabots’ into machinery to stop it working, in protest against their working conditions and developments that were endangering their jobs.

“Low pay means higher staff turnover, high absenteeism, poor morale and lower productivity.” That’s exactly as I stated in the VP article from 2012.

4. In conclusion

“I don’t know when money started making money faster than people but… It’s not helping,” said Marcus, truthfully. “So instead of running about with your shirt over your head doing ‘airplane arms’, shouting ‘Nought-point-eight-per-cent’… do something to get the people who actually work to be rewarded, recognised and remunerated for what they do.

“It’s not rocket science and, frankly, if it is, I sincerely hope they’re not on minimum wage.”

When I heard that piece, I very nearly stood up to applaud. If you want to hear it yourself (and I’ve left out enough of it to make it worthwhile, I promise you), it’s available for download here, and starts around eight and a half minutes in.

Actually, it would be better if Marcus hasn’t been reading this blog, because then he would have drawn the same conclusions, from the same evidence, thereby reinforcing my own reasoning.

Now, let’s have your opinions, please. I’ll be very interested to hear from supporters of the current “pay-’em-the-bare-minimum” policy as they almost invariably say things like “We can’t pay them any more” – it’s never “They have good reasons that mean they can’t pay us more”.

Interesting, that.

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‘Scrap maternity pay’ – how Tories see the future of ‘welfare’ reform

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appeal, benefit, benefits, bureaucracy, Charlie Elphicke, Coalition, collection, Conservative, cut, debate, Democrat, Department for Work and Pensions, DWP, employer, employment, government, in-work, infrastructure, insurance, levy, Lib Dem, Liberal, living wage, maternity, Mike Sivier, mikesivier, minimum wage, national insurance, people, politics, Reform, rules, self-employed, social security, tax, tax base, taxpayer, Tories, Tory, Vox Political, welfare, Westminster Hall, work

[Image: The Guardian]

Yesterday (February 11) we had a chance to see what the Tories – or at least some of them – want to do to state benefits.

Charlie Elphicke, Tory MP for Dover, launched a debate in the Westminster Hall in which he called for the axing of maternity pay – and other in-work benefits – to make way for a new insurance system into which employers and the self-employed would pay, and from which the costs of maternity leave and other benefits would be met. He suggested that participating employers would see a corresponding cut in their National Insurance contributions.

He said he wanted this system to pay out at minimum wage levels, rather than at the current £137 per week maternity rate. The state would back the scheme, but it would be entirely funded by businesses.

The taxpayer would not fund any of this scheme – at least, not the way the visionary Charlie put it during the debate. It would be “paid for by the workplaces of the nation”.

This is how (some) Tories want the system to be: Insurance schemes-a-go-go, with people and businesses standing or falling on their ability to meet the requirements of the system.

Obviously he has not considered the drawbacks of such a scheme. One is very simple: If employers are paying everything towards in-work benefits, why not simply pay the Living Wage, whether a person is working, on maternity, or whatever? The cost would be the same or lower – because there would be no government administrative burden.

Liberal Democrat Work and Pensions minister Steve Webb put some more of them into words.

“As the system currently works… 93 per cent of the cost of statutory maternity pay is refunded to employers. In fact, more than 100 per cent is refunded to small firms,” he said.

“If an employer is reluctant to take on a woman who might have a child, therefore, the pure finances should not make a huge difference.

“I am not therefore sure that having a collectivised… system of insurance is any different substantively for the employer. Either way, employers are getting reimbursed — the costs are being met and are not in essence falling on the employer.”

In other words, there would be no benefit to employers.

He continued: “Whenever we set up a new scheme, we have new infrastructure, bureaucracy and sets of rules. If we had the levy—the at-work scheme that he described — we would have to define the new tax base, have a new levy collection mechanism, work out who was in and who was out, have appeals and all that kind of stuff. There is always a dead weight to such things. Simply setting up new infrastructure costs money. I would have to be convinced that we were getting something back for it.”

In other words, the scheme proposed by the intellectual Mr Elphicke would be more expensive than the current system.

“He then says that he wants the rate not to be some £130 a week, but to be £200 and something a week,” said Mr Webb.

“I was not clear where that extra money would come from. If we pay women on maternity leave double, someone must pay for it. If he does not want that to be an extra burden on firms, paying for it will simply be a tax increase.”

In other words, the scheme might be doubly more expensive.

In addition, he said the proposal created issues around whether it distorted the choice between becoming an employed earner or a self-employed person.

And he pointed out that Mr Elphicke’s proposal was based on a belief that women taking maternity leave would not return to their previous employment – but this is no longer true. Mr Elphicke’s proposal is based on an outdated understanding of the market.

Mr Webb said: “The norm now for an employer who takes on a woman who goes on maternity leave is that — four times out of five — he will come back to the job for which she was trained, in which she is experienced and to which she can contribute.

“We now find that three quarters of women return to work within 12 to 18 months of having their baby… We need to educate employers about the fact that, if they do not employ women of childbearing age, they are depriving themselves of talented people who contribute to the work force. Not employing such women is clearly a bad thing, not only from a social point of view, but from an economic point of view.”

There you have it. Mr Elphicke’s proposal was defeated by a member of his own Coalition government; it was archaic, it was expensive, and it offered no profit for the people who were to pay for it.

That won’t stop him pushing plans like this. You will have noticed that a keystone of his scheme was that businesses would pay for in-work benefits – not the state. Charlie Elphicke is a Tory, and Tories cut taxes for very rich people like themselves. He’ll go on pushing for it in one form or another, for as long as he remains an MP.

Even if it is expensive, harmful nonsense.

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The fakery and failure behind the DWP’s new ‘health’ scheme

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absence, Adolf Hitler, appeal, BBC, benefit, benefits, big lie, biopsychosocial, Chronic Fatigue Syndrome, Chronic Pain, cumulative, Department, DWP, economic plan, employee, employer, employment, Employment and Support Allowance, ESA, fail, fake, fibromyalgia, fit for work, health, Health and Work Service, Iain Duncan Smith, ill, Incapacity Benefit, job, Labour Force Survey, leave, long term, Media, Mike Sivier, mikesivier, nudge, occupational health, Pensions, people, politics, public relations, sick, social security, subjective, Telegraph & Argus, unit, Vox Political, welfare, work, work capability assessment

It seems that the Department for Work and Pensions is sticking to the ‘Adolf Hitler’ model of public relations: If you tell a big lie and repeat it often enough, people will believe it. The press release announcing the new ‘Health and Work Service’ is riddled with long-debunked old lies – and one new statement that deserves our scrutiny.

This is the press release used by the BBC in its article on Saturday, telling us that the new, privately-run service is needed to combat the high cost of long-term absence from work.

It seems to be the DWP’s new practice to pass announcements to – let’s call them “trusted” – media outlets before putting them up on the government’s own press website, as a kind of test-run, allowing any credibility problems to be fixed before the government commits itself in an official way.

That’s why the announcement appeared on the government website yesterday (Monday) – two days after the BBC broke the story. Now – in just half the time it took to appear – let’s look at why it’s a load of rubbish.

“As many as 960,000 employees were on sick leave for a month or more each year on average between October 2010 and September 2013, the government has revealed,” the document begins.

Oh really? The DWP reached this figure by applying the findings of a survey, showing the ratio of long-term absences to total days of sickness absence, to findings by the Labour Force Survey showing the total number of days of sickness absence in the UK. That’s 9,000 sick days and 70 absences, applied to an average of 120 million sick days per year. This is based on 2,019 interviews with employees. There’s just one problem.

At the time covered by these surveys, there were around 4.9 million private sector employers.

Considering the huge size difference between the sample surveyed and the body it represents, it seems unlikely in the extreme that the figure is accurate. If it is right, it would be by luck; it’s probably wrong. The figure might as well have been made up – and you should treat it as though it was.

“The government has already taken big steps in getting people on long-term sick benefits back into work as part of the government’s long-term economic plan, with almost a quarter of a million coming off incapacity benefits since 2010-” Let’s stop there and examine the information content of this sentence so far.

The “government’s long-term economic plan” is a phrase that is being shoe-horned into every press release possible and means nothing. There never was a “long-term economic plan”, and there isn’t one now. Have you seen it? Of course not – it doesn’t exist. This is just a comforting nonsense inserted to lull people into false security that somebody knows what they are doing; I suspect the newly-privatised “nudge” unit may have had something to do with this.

As for “almost a quarter of a million coming off incapacity benefits since 2010”, check out this interview with Iain Duncan Smith, published in the Telegraph & Argus in 2010. He said: “I intend to move 1.5 million off incapacity benefit by 2014.”

It’s now 2014. We don’t have up-to-the-minute figures but on November 13 last year, the DWP press office helpfully tweeted us its then-current figure for people moving off incapacity benefits in a handy chart: 156,000.

That is a long way from a quarter of a million, and only around one-tenth of the Secretary-in-a-State’s 2010 target.

“- and almost a million who put in a claim actually have been found fit for work.” This is a bare-faced lie. It relates to a statement that 980,400 people were judged capable of work between 2008 and March 2013, but there are two problems with this. Firstly, it does not take into account the number of successful appeals against the ‘fit for work’ judgement (125,700); when adjusted to account for these, the total drops to 854,700. Secondly, this refers to the cumulative number of ‘fit for work’ outcomes of initial functional assessments since October 2008, and it seems likely that many people will have made repeat claims after being knocked off-benefit by an adverse decision. We do not know how many people have done this. Therefore the figure is meaningless.

So far, the DWP has told us that working people get sick (no surprises there), that it has failed to reach its target for clearing people off incapacity benefit and that its work capability assessment system is failing to push as many off-benefit as it should, because it is riddled with errors.

How does this connect with the creation of a new ‘Health and Work Service’, dedicated to ensuring that people who spend more than four weeks at a time off work with an illness get back into their job with a minimum of difficulty?

It’s obvious, isn’t it?

This is a scheme to ensure that people are discouraged from claiming incapacity benefits; the idea is that a drop in new claims, coupled with the number of uncontested ‘fit for work’ decisions, might lead to a larger drop in the number of active claims – which means the amount of money being paid out in benefits would also drop.

Inclusion of the word ‘health’ in the title of the new service is misleading, as it seems unlikely that consideration of an employee’s physical condition will have anything to do with the aim of the exercise.

Look at what the release has to say: “The Health and Work Service will offer a work-focused occupational health assessment and case management to employees in the early stages of sickness absence.”

It continues: “The work-focused occupational health assessment will identify the issues preventing an employee from returning to work and draw up a plan for them, their employer and GP, recommending how the employee can be helped back to work more quickly.”

Health doesn’t get a look-in.

No, what we’re most probably seeing is an expansion of the “biopsychosocial” method employed in work capability assessments, in an attempt to convince sick people that their illnesses are all in their minds. Don’t expect this approach to be used for people with broken limbs or easily-medicated diseases; this is for the new kinds of ‘subjective illness’, for which medical science has not been prepared – ‘chronic pain’, ‘chronic fatigue syndrome’, fibromyalgia and the like.

People with these conditions will probably be sent back to work – with speed. Their conditions may worsen, their lives may become an unending hell of pain and threats – I write from experience, as Mrs Mike spent around two years trying to soldier on in her job before finally giving up and claiming her own incapacity benefits – but that won’t matter to the DWP as long as they’re not claiming benefits.

That is what we can all expect from the new ‘service’.

It will be a fake, necessitated by failure.

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Private company given contract to harass the long-term sick

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A4E, advice, allowance, assessment, BBC, bullied, bully, Coalition, Conservative, costs, Democrat, Department, DWP, economic, economy, employer, employment, England, ESA, GP, harass, health, illness, Lib Dem, Liberal, long term, loss, Mike Sivier, mikesivier, money, non compulsory, output, Pensions, people, plan, politics, profit, Scotland, service, sick, support, Tories, Tory, Trades Union Congress, treatment, TUC, Universal Jobmatch, Vox Political, Wales, WCA, welfare to work, work, work capability assessment

The pretext: These are the figures showing the estimated amount of long-term illness in the UK per year. Remember that these figures have halved in the last decade.

The Department for Work and Pensions is setting up a new “service” offering “advice” to people who are off work with an illness for more than four weeks.

No reference is made to improving people’s health.

It should also be noted that sickness absence in the UK is among the lowest in Europe, and has halved over the past decade.

The announcement was made on the BBC News website shortly after midnight. Nothing has appeared on the Government’s own website so it seems the Corporation has gone back to being Westminster’s poodle again – breaking news for the government in order to give spin doctors time to assess the reaction and then write a press release that is more acceptable to the public.

The Health and Work Service will be a privately-run operation covering England, Wales and Scotland, offering “non-compulsory” medical assessments and “treatment plans”. This is reminiscent of the way Universal Jobmatch was introduced to jobseekers as a “non-compulsory” service – which many thousands of people have been bullied and harassed into joining.

The scheme will allow employers or GPs to refer employees for a “work-focused occupational health assessment”, according to the BBC report. So this means the employee has no say in whether to go on the scheme – it is down to bosses and doctors. You are invited to consider whether this represents another great step forward in the Conservative Party’s claims to be crusading for patient choice.

The story says workers will be allowed to refuse assessment or to follow any course of action that is recommended but, again, we have the example of Universal Jobmatch.

The “assessment” is meant to identify the issues preventing an employee from returning to work and draw up a plan for them, their GP and their employer, showing how that person can be “helped” back more quickly.

One is forced to question the efficacy of such a system, if faced with illnesses or diseases that must receive medical treatment.

You don’t talk someone better – the huge number of people who have died while going through the DWP’s Employment and Support Allowance sickness denial machine has proved that.

The government has made its aim in setting up the new scheme perfectly clear, saying employers will “save money” by having fewer staff off sick – possibly saving companies up to £70 million a year in reduced sickness pay and related costs.

The DWP says people will return to work earlier. This seems like a pie-in-the-sky aspiration, as illness does not go away in accordance with a timetable. This means the Department’s other claims – that there will be a reduction in lost working days and increased economic output – are also pipe dreams.

It is far more likely that sick people will be forced back to work before they are better – leading to an increased chance that illnesses will spread among workforces, there will be more lost working days and lowered economic output.

The Trades Union Congress, while supporting schemes that could help people back into work, agreed (with me) that this one creates a danger that people will be forced back to work before they are well.

Finally, any company involved in the scheme should be aware that it is unlikely to make a profit from it. Look at the effect on other firms of involvement with DWP schemes: Welfare-to-work provider A4e has reported a pre-tax loss of £11.5 million in the year to March 31, 2013 – up from a £2.1 million loss the year before. Turnover dropped from £194 million to £167 million.

So now we can say very clearly to all private companies:

Working for the Coalition government doesn’t pay.

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More mistakes in the script? Correcting Cameron’s New Year speech

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David Cameron’s New Year message – what a disgrace!

Standing uncomfortably in an empty factory (one presumes the workers were all on part-time contracts to save bosses money in holiday pay and national insurance), the comedy Prime Minister looked nervous as he reeled off a list of statements the Conservative Party wants the proles to believe, going into 2014.

What a shame his words were so easy to debunk.

If you can bear to hear it, play the video (above). I did, and wrote the following response in real time – as his speech was taking place. Then I sent it to his Facebook page. Here are my words:

“Mr Cameron,

“When you weren’t elected into office, the economy was on the up – and your policies killed it stone dead for three years. You haven’t cut the deficit significantly for years (it’s been stuck at £120 billion or thereabouts). You have cut income tax for the super-rich; raising the tax allowance for the poor (which you claim is a cut) means they don’t pay National Insurance (if anybody hadn’t noticed) and it will take them longer to qualify for retirement pension.

“You only decided to cut fuel duty because Labour came out with a better policy – and nobody was fooled by your choice.

“The jobs created under your government are part-time, zero-hours, or fake ‘self-employed’ in which the worker is contracted to larger companies and receives lower-than-minimum-wages for the amount of time spent. Stop talking nonsense about ‘jobs taxes’ – all this does is show that you do not understand the principles behind National Insurance.

“How many people did your ‘welfare’ work kill last year? We don’t know because your Department for Work and Pensions is terrified that releasing the figures will cause a national scandal.

“As for your immigration policy – apart from the tangential tightening of monitoring around the minimum wage, all your new measures are already enshrined in law; you have created phantom solutions to a phantom problem.

“Building an economy for people who work hard and “play by the rules”, is it? There’s a new condition in there, and people should be warned that your rules are not intended to benefit hard-working people but to free their employers from any responsibility towards those who generate their bloated salaries for them.

“I’m surprised you didn’t choke on your comments about education, after the fiasco that has led to the closure of one free school and special measures for several others.

“As far as the Scottish referendum is concerned, if any government, through its policies, could do more to push an entire country out of the United Kingdom, I don’t see how.

“I look forward to your response on the welfare deaths. In 2011 they stood at 73 per week, which was a scandal at the time. New figures will show whether you have been merely misguided or intentionally genocidal.

“Happy New Year? It will be a lot happier if you and your entire Parliamentary party resigned. How many of them know anything about struggling to make ends meet, in debt and in a place where there are no jobs to be had?

“You know nothing about hard work.”

Did anyone else notice he said nothing about the National Health Service, that his government has brought down from its most popular and efficient moment ever – slandering it and legislating to ensure private profit-driven firms could get into it, turning it away from healthcare and into money generation?

If ever there was a time to fight back for our cherished publicly-funded institutions, it is now.

That is the real message we should take from this soulless mouthpiece and his empty words.

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The State of Osborne: a visitor’s guide

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A moment of crisis for David Cameron as he realises it is unlikely that George Osborne has the faintest idea what the Autumn Statement means.

If anybody else had prattled on for 50 minutes while hardly uttering a single sensible word, they would have been consigned to a mental hospital forthwith.

But this is Coalition Britain, and the speaker was George Osborne, the man who likes to tell us all that he is in charge of the nation’s finances. Thanks to his government’s Department for Work and Pensions, nobody is allowed to have mental illnesses anymore; after this speech, it seems likely we all have an idea about the reason for that.

A 50-minute speech is a lot of verbiage, and it is certain that worthier journalists across Britain – if not the world – have already analysed it to exhaustion. Allow me to let you into a secret:

They’re probably trying too hard.

Most of the speech was about putting Labour down. The Opposition has made all the headway over the past few weeks, and we all knew Osborne was under orders to change the mood music of the nation in time for Christmas.

Did he manage it? Not really. His speeches always come across as strained events, where he’s making an effort to be clever without ever achieving it. As a result, the message gets lost. We can therefore discount the Labour-bashing.

That leaves us with what he actually said. Even here, his meaning was at times opaque. What follows is an attempt to provide a handy guide to George-speak, for anyone unfortunate enough to have heard him yesterday.

Osborne: “We have held our nerve while those who predicted there would be no growth until we turned the spending taps back on have been proved comprehensively wrong.”/Meaning: “I am lying. Austerity failed miserably and the economy flatlined. A few months ago I realised that we would have nothing to show at election time so I turned the spending taps back on, with Help To Buy and Funding For Lending. I know that these are exactly the sort of Keynesian economic levers that I preached against for three years but I’m hoping that nobody noticed.”

The hard work of the British people is paying off, and we will not squander their efforts./Osborne appears to be celebrating his three years of stagnation. He inherited growth and decided to trash it. (MagsNews on Twitter)

There was no double-dip recession./“Phew! Lucky escape there!”

At the time of the Budget in March, the Office of Budget Responsibility forecast that growth this year would be 0.6 per cent. Today, it more than doubles that forecast and the estimate for growth will be 1.4 per cent./“Please God don’t let anybody remember that three years ago, the forecast for this year was 2.9 per cent.”

Today in Britain, employment is at an all-time high… We have the lowest proportion of workless households for 17 years./These jobs have increased the numbers of the working poor. Too few are full-time; too many are part-time, zero-hours or self-employed, serving up no National Insurance contributions from employers, no holiday or sick pay, or making contractors work long hours for less than the minimum wage.

The number of people claiming unemployment benefit has fallen by more than 200,000 in the past six months—the largest such fall for 16 years./“And we have imposed sanctions on more people on Jobseekers’ Allowance than ever before, in order to produce that figure.”

By 2018-19, on this measure, the OBR does not expect a deficit at all. Instead, it expects Britain to run a small surplus. These numbers mean that the Government will meet their fiscal mandate to bring the structural current budget into balance and meet it one year early./Although of course the books were initially supposed to be balanced by 2015. (Huffington Post live blog)

This year, we will borrow £111 billion, which is £9 billion less than was feared in March./…and £41 billion more than forecast in 2010.

We will cap overall welfare spending./But this will not include the state pension (half the social security budget) or the most cyclical jobseeker benefits./”A living wage would mean less dosh on in-work benefits; letting councils build would mean less subsidies for private landlords.” (Owen Jones on Twitter)

Pensioners will be more than £800 better off every year./But as usual he’s ignoring the VAT elephant in the room. (Mark Ferguson on Twitter)

We think that a fair principle is that, as now, people should expect to spend up to a third of their adult lives in retirement. Based on the latest life expectancy figures, applying that principle would mean an increase in the state pension age to 68 in the mid-2030s and to 69 in the late 2040s./But life expectancy depends on where you live and how much money you have, meaning the poor continue to pay more towards the pensions of the rich./”Current pensioners better off – future pensioners paying for it. What was that about “making our kids pay for current spending” George?” (Mark Ferguson of LabourList on Twitter)

Most wealthy people pay their taxes and make a huge contribution to funding our public services; the latest figures show that 30 per cent of all income tax is paid by just one per cent of taxpayers./Estimates of the amount of tax that is not collected range between £25-£120 billion per year and it is not the poor who aren’t paying up.

This year the rich pay a greater share of the nation’s income taxes than was the case in any year under the last Labour Government./Because they now have more income. Simple really. (Tom Clark of The Guardian, on Twitter)

Today we set out in detail the largest package of measures to tackle tax avoidance, tax evasion, fraud and error so far this Parliament. Together it will raise over £9 billion over the next five years./Including capital gains tax for foreign investors on sales of UK property, which has nothing to do with tax avoidance/evasion, fraud or error.

We must confront this simple truth: if we want more people to own a home, we have to build more homes… The latest survey data showed residential construction growing at its fastest rate for a decade./The rate of house building is at its lowest peacetime level since the 1920s

This autumn statement has found the financial resources to fund the expansion of free school meals to all school children in reception, year 1 and year 2, announced by the Deputy Prime Minister and supported by me./On Wednesday, the Lib Dems and Michael Gove’s education department argued over who had to pay for it.

Extra funding will be provided to science, technology, and engineering courses [in universities]. The new loans will be financed by selling the old student loan book, allowing thousands more to achieve their potential./And pushing thousands into the hands of debt collectors.

The best way to help business is by lowering the burden of tax. KPMG’s report last week confirmed for the second year running that Britain has the most competitive business tax system in the world./KPMG would know – it writes the tax system and also runs some of the larger tax avoidance schemes.

From April 2015 we will introduce a new transferable tax allowance for married couples… Four million families will benefit, many of them among the poorest working families in our country./Osborne says the Tories are backing British Families – but only ones who are married it seems. (Mark Ferguson on Twitter)/While the new tax arrangements bribe families to marry, the benefit cap will bribe big families to split up. (Tom Clark on Twitter)

We are all in this together./The biggest lie of this Parliament.

We are also helping families with their energy bills./Commence the cutting of the “green crap”. This from the “Greenest government ever”. (Mark Ferguson on Twitter)

Next year’s fuel duty rise will be cancelled./This is a cut in a tax that was never imposed in the first place.

We are going to abolish the jobs tax on young people under the age of 21. Employer national insurance contributions will be removed altogether on a million and a half jobs for young people./Young people will therefore have less chance to get contribution-based benefit. National Insurance assures people their pension contributions – except when it isn’t paid. So they will have no contributions to show for any years they worked before 21 and will have to work until their late 60s.

The cost for a business of employing a young person on a salary of £12,000 will fall by over £500./This is a bonus for businesses, not employees.

“Jobs tax” – it’s ludicrous, isn’t it? National Insurance has been a respected part of British life for more than 100 years but Osborne, living as he does in a mythical Victorian-era golden age that never actually existed, thinks it is a “jobs tax”. Either that or he’s still bruised by the fact that Labour’s labelling of the under-occupation charge as a Bedroom Tax caught on with the public.

Shadow Chancellor Ed Balls got on his feet and immediately attacked Osborne’s “breathtaking complacency” for denying the drop in living standards faced by everyone in the country, with families already £1,600 per year worse off. Osborne laughed. He thought that was funny.

The Shadow Chancellor pointed out that we are enduring the slowest recovery in a century, and that average real wages will have dropped by 5.8 per cent by the end of the Parliament (except for fatcat business bosses).

He was having a hard time getting his points across, however, because Tory MPs were heckling him very loudly. Owen Jones tweeted, appositely, “Do the Tories think that a bunch of braying MPs dripping with privilege, while ordinary people’s living standards crash, is good TV?”

Maybe they did. Maybe they thought they had the public on their side.

Let’s have a look at a few comments from the public – courtesy of the Huffington Post:

“Planning to kill more people, George?” (Robin Stacey)

“Spend more you wet lipped monkey.” (Will Moriarty)

“No one has an ounce of faith in anything you say, you parasitic pool of curdled warthog’s puke.” (Anthony Nicholas)

And finally: “Hope you end the speech with your resignation x” (Joanne Wood – and yes, she did mean to end with a kiss).

What a shame Osborne did not follow her advice.

 

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Windbag Cameron is afraid to give us the facts

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administration, administrator, B&Q, Bank of England, BBC, borrow, capita, capital spend, Chancellor, Coalition, Conservative, crash, David Cameron, debt, deficit, Deloitte, economy, employer, employment, financial crisis, full-time, George, George Osborne, Gideon, government, guarantee, help to buy, Hibu, holiday pay, house, housing, jobs, Kingfisher, Michael Meacher, Mike Sivier, mikesivier, mortgage, national insurance, npower, Osborne, Parliament, part-time, people, politics, price bubble, Prime Minister's Questions, productivity, Screwfix, self-employed, sick pay, Tata, Tories, Tory, unemployment, unsupported, VAT, Vox Political, wage, work, Yellow Pages, zero hours

Leading us down the garden path: Cameron wants us to believe the economy is growing but, like a bad gardener, he hasn’t fertilised it, and has allowed it to be overrun with weeds. [Image: Andy Davey http://www.andydavey.com]

“The week before the autumn statement, and the right honourable gentleman [Ed Miliband] cannot ask about the economy because it is growing. He cannot ask about the deficit because it is falling. He cannot ask about the numbers in work because they are rising. People can see that we have a long-term plan to turn our country around.”

Strong words – uttered by David Cameron during Prime Minister’s Questions yesterday (November 27).

What a shame he chose to give Parliament bluster instead of facts.

Does he think that the economy is growing because of the housing price bubble engineered by his deranged Chancellor via his ‘Help to Buy’ scheme? It is massively increasing the cost of housing in London but will inevitably lead to a crash and the loss of serious amounts of money for both buyers and the government (as mortgage underwriter). The Bank of England has revealed that it has no power of veto and can only advise on whether the scheme should continue – it is for the Conservative-led government to decide how long it will last.

Gideon’s ‘Help to Buy’ offers unsupported mortgage guarantees to buyers and lenders. He has not said where he will find the money for it. Critics have warned that this is simply creating another housing-fuelled debt bubble that will burst in a couple of years’ time, leaving even more people in debt than after the financial crisis hit us all.

Michael Meacher has read the £130 billion scheme right – as we can see from his blog: “Where does that sort of money come from when the public accounts are under extreme pressure to make enormous cuts? State-subsidised mortgages for the well-off (houses valued at up to £600,000) seems, even for Osborne, a strange decision when some of the poorest tenants in the country are at the same time being expelled from their homes by the bedroom tax.

“It can only be explained by Osborne panicking at the time of the March budget this year that the economy showed no sign of recovery in time for the 2015 election, made worse by his mistaken increase in VAT and big cuts in capital spending. He chose a big artificial stimulus of the mortgage market to kick-start the moribund economy, repeating the mistake of every previous boom triggered by consumer borrowing and a pumped-up housing market, an inevitable forerunner eventually of yet another round of boom and bust.”

Does Cameron really think the deficit is falling fast enough to revitalise the nation’s economy? In October, borrowing (excluding the cost of interventions like bank bailouts, so we’re already in the realm of made-up figures) fell by two one-hundred-and-thirds, from £8.24 billion in the same month last year to £8.08 billion.

We are told the aim is to keep borrowing for 2013-14 at £120 billion or below. In his ‘Emergency Budget’ of 2010, Osborne predicted that borrowing this year would be down to half that – at £60 billion, and estimates have been rising ever since.

The 2011 budget had the 2013-14 deficit at £70 billion; in 2012 it was expected to be £98 billion; and now £120 billion – double Osborne’s prediction when he became Chancellor.

As for the numbers of people in work, let’s ask Cameron: If more people are working, why has productivity fallen back to the level it reached in 2005? Is it because employers are taking on workers in part-time, zero-hours or self-employed contracts, rather than full-time, in order to take advantage of the opportunity to get out of their holiday pay, sick pay and National Insurance obligations? This seems most likely.

Average wages have been cut by nine per cent since 2010, in real terms, and are still falling. Should Cameron really be boasting about this?

Now German-owned energy firm Npower is cutting 1,460 British jobs. It seems customer service and back-office functions will be outsourced to those well-known friends of the UK government, Capita and Tata.

Kingfisher, the owner of DIY chains B&Q and Screwfix, has suffered a five per cent drop in share values after profits dipped.

And Hibu, the company that owns Yellow Pages, has gone into administration with £2.3 billion of debts. Another old friend of the UK government – Deloitte – will profit from this as administrator – but who knows what will happen to Hibu’s 12,000 employees?

These are just today’s business headlines on the BBC News website – the day after Cameron boasted that the economy was on the rise, the deficit dropping and employment was soaring.

What we’re seeing is not a Prime Minister and Chancellor leading the country back to prosperity.

It’s time we realised that these two chancers have been leading us down the garden path.