Conservatives in chaos over food bank stance

Tags

benefit, benefits, Channel 4 News, charity, Chris Mould, Conservative, David Cameron, David Gauke, debt, Department, DWP, food, food bank, government, Health Service, hunger, Mike Sivier, mikesivier, NHS, package, packet, parcel, Pensions, people, police, politics, poverty, public sector, referral, signpost, social security, Social Services, starvation, supplies, supply, The Observer, Tories, Tory, Trussell Trust, voucher, Vox Political, welfare, work

Credit where it’s due: The vast majority of reasons for people being referred to food banks are attributable to the Department for Work and Pensions. Could that be why the DWP is so desperate to silence the food bank charities?

Tories – what are they like?

The answer is, of course, even they don’t know – as evidenced by their current confusion over food banks.

David Cameron has enthusiastically backed their work at a Christian faith group’s Easter reception (and so he should, having sent so much of it their way), and Treasury minister David Gauke also praised them in an interview on Channel 4 News last week.

But the DWP says leading food bank provider the Trussell Trust is guilty of “misleading and emotionally manipulative publicity seeking”, with the rise in food bank use being the result of the charity’s leaders “aggressively marketing their services” and “effectively running a business”.

At least one commenter on this blog has been completely taken in by the DWP’s prattling, claiming that demand for food banks has not risen at all since Cameron came to office. No, it’s clear to this demented individual that opening a food bank anywhere is like opening a supermarket – if there isn’t one nearby already, people will flock through your doors.

This, of course, completely misconstrues the way food banks are used and assumes that anyone can walk through their doors, claim food poverty and take away a packet of supplies whenever they want. It doesn’t work like that.

Food banks operate on a referral system. As Trussell Trust chairman Chris Mould put it in an Observer report: “You can’t get free food from the Trussell Trust by walking through the door and asking for it; you must have a voucher. More than 24,000 professionals – half of whom work in the public sector and health service, the police, and in social services – ask us to give this food to clients of theirs because they’ve made the decision that this individual or family is in dire straits and needs help. We’re not drumming up demand.”

This is absolutely correct and no amount of negative campaigning by the DWP can change it. In fact, Mr Gauke spent some time crowing about the fact the DWP rules have been altered to allow “signposting” to food banks by Job Centre advisors, in his Channel 4 News interview (although claiming credit for government employees sending people to someone else, rather than providing help themselves, is in itself a mean-spirited shot in the foot).

Once again, the Conservatives are getting stuck in the mire while trying to claim the moral high ground.

Not only have they created a poverty-driven starvation threat that organisations like the Trussell Trust have been forced to step in and fight, but the Tories have also tried to vilify those good people for laying the blame where it belongs.

It is a situation so twisted, there can be no wonder the Tories are tying themselves in knots.

Follow me on Twitter: @MidWalesMike

Join the Vox Political Facebook page.

Vox Political needs your help!
This independent blog’s only funding comes from readers’ contributions.
Without YOUR help, we cannot keep going.
You can make a one-off donation here:

Alternatively, you can buy the first Vox Political book,
Strong Words and Hard Times
in either print or eBook format here:

How much of the national debt has been faked by tax dodgers?

Tags

accountancy, accountant, annual leave, avoid, bail out, benefit, benefits, Big 4, Channel 4, Coalition, company, Conservative, corporate, corporation, debt, Democrat, Department for Work and Pensions, Dispatches, dodge, DWP, economy, fake, financial crisis, firm, flexible, government, Interest, Labour, Lib Dem, Liberal, loophole, market, Mike Sivier, mikesivier, minimum wage, national, national insurance, offshore, overtime, packet, part-time, pay, pension, people, politics, public service, Richard Brooks, self-employed, social security, tax, tax haven, temporary, The Great Tax Robbery, Tories, Tory, Treasury, Vox Political, welfare, work

Diddled into debt: A corporate tax avoidance scam is conning workers out of decent pay and the government out of tax and NI money, after causing the financial crisis.

“A bank in the UK could lend, say, $1bn to a US bank… generating tax-free income in the UK but a tax deduction in the US – and then simply borrow it back. For the second leg a different instrument could be used that generated tax-free income in the US and a tax deduction in the UK. The banks had simply swapped $1bn, to no economic effect beyond two tax breaks, while quite possibly keeping any mention of the debts off either’s balance sheet. Such tricks – the creation of debt more for tax advantages than any real business need – undoubtedly contributed to huge levels of inter-bank indebtedness that triggered the financial crisis.” – Richard Brooks, The Great Tax Robbery, p86.

If you are not deeply disturbed by the implications of the above quotation, read it again until you are. Richard Brooks is saying that the major banks of the UK, the USA, and who knows how many other countries colluded to hide massive amounts of money from the tax man by claiming – falsely – that it was debt.

The financial crisis happened because the banks could not service the debt they had created – they could not even pay back the interest on it, let alone the debt itself – and so the government was forced to step in and bail them out. So now the government had not only lost the tax it was due from the bank profits that had been hidden by the dodge Mr Brooks mentions, but it had now taken on the fake debt that had been created. The taxpayer was doubly the loser.

Who pays back the debt? Not the banks. Not the large corporations that are also avoiding tax. Not the rich businessmen and women who dreamed up the tax dodges. Thanks to changes in the law and already-existing legal loopholes that have not been closed by the Coalition government, they have been able to park their ill-gotten gains in offshore tax havens, depriving the nation of the wherewithal it needs to fix the problem they created.

Now it seems the government is also being deprived of badly-needed tax money because of the way large firms are structuring their pay packets – to the disadvantage of low-paid workers. The details were in Channel 4’s Dispatches documentary, Secrets of Your Pay Packet, broadcast on October 21.

With more people in work than ever before, the UK should be getting massive amounts more in tax and National Insurance, allowing it to provide the services we expect and pay down the national deficit. But the deficit hasn’t budged. Why?

Because the new jobs are part-time, self-employed or temporary.

Self-employed contracting means you can end up working for less than the minimum wage (you’re paid a fixed daily rate for the job, not the hours it takes to do it, so if it takes a long time to get it done, your pay-per-hour diminishes proportionately – and, as you are self-employed, you’re not entitled to the minimum wage).

Conversely, if you are employed part-time, you can end up working too few hours to qualify for tax or National Insurance (so you don’t get enough credits to pay for your pension later in life and the Treasury doesn’t get the tax money it needs to pay for services and clear debts) and on a personal level you don’t work enough hours to qualify for decent holidays. The company doesn’t pay for employees going on annual leave, potentially saving tens of millions of pounds.

If you work overtime, this doesn’t count towards annual leave, of course. So you can be employed on a part-time contract for, say, three days a week, be asked to work two more days overtime (a full five-day week) and lose out on all the benefits a full-time worker would expect.

The threshold is 20 hours per week. If you work less than that, employers do not have to pay NI contributions which would cost them nearly 14 per cent of pay. So people may work all their lives but never qualify for the state pension.

This is why more people are now in work than before the recession – it’s a cheat by bosses. They’re the ones who pay your tax and NI contributions. If you’re on pay that’s below the new tax threshold, you don’t pay tax. We have the Liberal Democrats to thank for that. It seems like a good deal but in fact it isn’t.

Meanwhile the companies say that cutting down working hours has saved jobs in a hard business environment, while the number of full-time jobs is down and wages have now fallen by 12 per cent in real terms (up from nine per cent, only a few months ago).

It is cheaper for companies to employ more people on shorter hours because they pay less to the government in tax and NI. And they say the “flexible” labour market has been a boost for the country, that having a job is better than having no job, and that it will help people progress.

That is not what we see.

We see a workforce ground down by the pressure of making ends meet on part-time or zero-hours jobs, making no NI contributions, getting very few holidays, and afraid to challenge the situation because their employers can simply let them go and hire someone else from the huge 2.5-million-strong pool of the unemployed (who are desperate for jobs because the DWP fills their entire lives will bullying and threats about losing their benefits).

We see the government completely unable to cover its costs because its own tax system – written by the ‘Big 4’ accountancy firms that have been responsible for more tax avoidance schemes than any other organisations in the country – actively promotes corporate tax avoidance; and Conservative ministers are totally indifferent to the huge losses they are piling up, because it means they can cut public services, or sell them off to (again) big corporations who will then avoid paying tax on them.

And we see the rich corporates laughing all the way to the (offshore) bank yet again.

The Coalition government has tried to tell us that it must squeeze benefits for the extremely poor, and low-paid working people must work much harder, in order to pay off the debt that – no matter what ministers tell us – neither they, nor the last Labour government, created.

In fact, this has been a story of tax avoidance by the very rich. A huge scam, running for decades, and hidden from the British people.

Are you angry yet?