The benefit cap: Popular, but ill-judged and supported by lies

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Mark Hoban has a history of lying to the people, as the above image shows. How can we believe what he’s trying to tell us about the benefit cap?

What a shame that so many Vox Political articles this week are on the same subject: Your Government Is Lying To You.

Today, the lies are clustered around the benefit cap, which has been launched this week – in only four London boroughs, rather than nationally.

Perhaps the Tory-led Coalition government already has an inkling that it got its sums wrong?

Nevertheless, David Cameron’s Twitter feed announced to the world that yesterday (April 15) was “A big day for welfare reform as we pilot a cap on benefits equal to the average wage. Amazingly Labour oppose it.”

Two sentences, two untruths.

Firstly, let’s look at the average amounts that families bring into their homes. While it may be true that the average family wage is £26,000 per year – equal to the £500 per week at which benefits will be capped – it is not true that this is the total amount of income such a working family may receive. A couple with four children earning that much after tax, with rent and council tax liabilities of £400 a week would get around £15,000 a year in housing benefit and council tax support, £3,146 in child benefit and more than £4,000 in tax credits: £48,146.

That’s not an average; just an example. The average income of a working family is, we are told, £31,500, or £605 per week, with a little change left over. So there is a huge difference between what Mr Cameron says the average working family takes home, and what the average working family in fact takes home.

If benefits were capped at this figure, though, most unemployed families would already be receiving less, so there is no saving to be made – and the whole point of this, from the Coalition’s point of view, is to cut the benefit bill. It isn’t about fairness at all.

The second lie is that Labour opposes it. In fact, the Labour Party agrees that there should be a limit on the amount of benefit working-age people may receive – for exactly the same reason the Coalition keeps using: Limiting benefits is an incentive to seek work.

Obviously, employment should pay more. If people have a particular way of life and they want it to continue, then they should earn it. There is cross-party support for that principle and, by stating otherwise, Mr Cameron is feeding falsehoods to the public, trying to create a false impression.

Is he doing this because this is his most popular policy (wrongly so, for reasons we’ll address shortly) and he doesn’t want to admit that Labour would have carried it through as well?

Of course, there would have been one difference: The Labour version would have been fair.

Note that the government is also lying about the benefits affected by the cap. It says Jobseekers’ Allowance, Income Support, Child and Housing Benefit all count towards it, but not disability benefits.

What is Employment and Support Allowance if it isn’t a disability benefit, then? ESA is also counted when calculating whether a claimant’s or family’s benefits should be capped. It is only provided to people with a long-term sickness or disability.

So: Labour supports the benefit cap and would probably have brought it in. But Labour would have installed the cap on a regional basis, taking account of variations in the cost of living across the country. Labour said this would help ensure that the policy works in practice.

As long ago as January last year, Labour was saying that the version of the policy that has now come into effect would backfire.

When rolled out nationally, it is expected to save £110 million per year from the £201 billion benefits bill. For the drop-in-the-ocean effect it will have, we can see that it is already disproportionately popular. But consider the knock-on effects and it becomes clear that the benefit cap may cost the taxpayer much more than leaving matters as they were!

How much will local authorities have to pay on homelessness and housing families in temporary accommodation? Most out-of-work families with four children, and all those with five or more, will be pushed into poverty – Department for Work and Pensions figures show that the poverty threshold for a non-working family with four children (two of whom are over 14) is £26,566 – £566 more than the cap.

“Serves them right for having so many children while on benefits,” you might say. What if they weren’t on benefits when they had the children? The UK has been plunged into a recession after a period of full employment (more or less) as defined back in the 1940s, when the original Welfare State was created. The number of families forced into unemployment has grown massively as a result of the credit crunch and banking crisis, and they have been kept there by the policies of the Coalition government, which continue to depress the economy and prevent growth. Anybody can fall on hard times unexpectedly and it is one of the principle injustices of the current government that a person can be labelled a “striver” one day, lose their job the next and instantly become a “skiver” in the opinion of, among others, Daily Mail readers.

Of course the DWP has not released any estimates of the increase in poverty – especially child poverty – but a leaked government analysis suggests around 100,000 children would be impoverished once the cap is introduced nationally.

The first benefit to be trimmed, if families’ or individuals’ current benefit exceeds the limit and is deemed to need capping, is Housing Benefit (or, let’s be accurate here, Landlord Subsidy). It is expected that 40,000 families will be unable to pay their rent and will become homeless. That’s a lot of work for local authorities, who will have to try to find reasonable accommodation for them while paying the (higher) cost of putting them up in bed-and-breakfasts.

Many families may break up in response to the pressures. Parents who live separately and divide the residency of their children between them will be able to claim up to £1,000 a week in benefits, while a couple living together will only be able to claim £500. Of course, this would completely wipe out any saving the government would have made on that family and in fact would cost £13,000 more every year, per family.

Finally, Mark Hoban was on Radio 4’s Today programme, telling the nation that the best way to avoid the benefit cap is “to move into work” – completely ignoring the fact that there is hardly any work available. When thousands of people apply for a single job in a coffee house, as happened within the last few weeks, you know the employment situation is dire. Perhaps the government is playing fast and loose with its increased employment figures as well?

So which do you believe – the comfortable lie that the benefit cap ensures people in work earn more than those on benefits (there was never any danger of the situation being otherwise), or the unpalatable truth that the government’s imbecilic handling of the situation will cost us all many millions more in damage control when it all goes wrong?

The future’s terrifying – if the future’s Tory

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What does the future have in store for the UK, if the Conservatives win the 2015 election?

It seems sensible to conclude my loose series on the current changes to social security benefits – see here, here, here, here and here – by taking a look at what we know they have planned, and what we can reasonably expect from them. Some of this comes from the document ‘2020 Vision’, which has been produced by a group of Conservative Parliamentarians; some is just pushing current activity to a logical conclusion.

It’s all horrifying. Let’s have a look:

1. Conservative ministers to be above the law. That’s right; they want their future governments to be answerable only to Parliament, not to judges. Apparently they think the possibility of judicial review when they make illegal decisions means that the system is too slow. Of course, being answerable to Parliament means being answerable to nobody because a Conservative majority means Parliament will rubber-stampe anything they do, no matter how hare-brained, harmful or tyrannical.

2. NHS to be fully privatised. Of course this is already well on its way now, with the collusion of the right-wing press in keeping some of the major changes quiet. Just take a look at some of the measures being brought in by Jeremy Hunt, right now, if you don’t believe me.

3. Benefits system to be privatised. There has been some discussion of this on the blog already. The idea is simply to switch the system from being nationwide and run by the state to a patchwork of private insurance, run by private companies, for profit. From what’s being said, the biggest player in this would be Unum, the disgraced American company which is already doing considerable damage in the Netherlands, from what one reader has been telling us.

4. Police to be privatised. This is being piloted in certain parts of the UK already. Of course, with private companies running a police service for profit, only the rich will be able to afford their services. In other words, its a wheeze to ensure the poor lose what little luxuries they currently have and are unable to turn to our law guardians for justice.

5. Regional pay for all employees. This is in order to accelerate the race to the bottom of the pay scale for the people who do the actual work. If pay for the same job varies between UK regions, then employers can happily turn to their workforce at any time and say, “They’re doing it for less over the border, so you can take less as well.” The government tried it with public sector pay but was told to think again. We know some of them want to do it with benefits. It’s only a matter of time before it happens.

6. UK to exit Europe. Not because the EU is anti-democratic, forcing unreasonable demands on the UK, but because its human rights laws are damned inconvenient for a political party that wants to crush anyone who isn’t in the top 10 per cent of earners (I may be exaggerating this; it could be that they’re only interested in the top one per cent).

7. Free movement to be discouraged. They already have plans for a two-tier road tax system.

8. Education to be fragmented so you only get the best if you pay for it. Obviously we’ve always had private education but the starvation of the state system to fund ‘free schools’ is softening the system up for worse to come. Can anyone say they honestly understand Michael Gove’s divisive and wasteful policies?

9. Flat-rate taxes. This is a Conservative dream, because flat-rate taxation – one percentage for everybody – provides an unfair advantage to those who have more money to start with. They recognise that there are people in the UK who understand how unfair it is, so they launch periodical campaigns to point us in the other direction. Hence the current push to get us to believe a 20 per cent rise in JSA, from £59.15 to £71 (a rise of just £11.85), is totally unfair when compared to a 12 per cent rise in average wages, from £420 to £468 (a rise of £48 – more than four times as much). How can it be unfair to keep the level of the former the same, as a proportion of the latter – especially when one considers the rocketing prices of groceries and utilities? Those of use who can remember the Community Charge should also remember that this was also a flat-rate tax. People took to the streets to put an end to it but clearly the Conservatives have not learned the lesson. ‘2020 Vision’ suggests that Income Tax could come down to 20 per cent for everybody. This means someone earning £25,000 a year would have £20,000 left after Income Tax. Someone paying themselves £1 million a year would have £800,000 left afterwards. And we wouldn’t have anything like the public sector services that we have, even today after nearly three years of Coalition rule – that level of taxation cannot sustain that level of spending.

10. Continuation of the high-level national deficit and debt. This is to justify the shrinking of the state. The changes that have been made so far, including those that are to come in this year, are not intended to boost the economy – quite the opposite. If this government wanted to boost the economy it would close tax loopholes (including those that have been created by the current Chancellor) that allow the richest in the UK to avoid paying more than £100 billion every year and ensure that any of them who wish to leave this country as a result pay their fair share before they leave. It would also borrow – yes, borrow; don’t you know that interest rates are fantastically low just now? – in order to invest in British jobs and industry, the new technologies that will power the world in the future. They’re not doing that, for specious reasons, and they know that the poorest in the UK will suffer as a result.

That’s what the UK will look like under a government of Tory tyrants.

No wonder so many Scots want to leave.

Iain Duncan Smith’s shirkers and scroungers: Soldiers, teachers and nurses

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David Cameron, pictured in the Telegraph article: “I want to go on,” he says, neglecting to add, “harming the honest, the hard-working, the strivers and the tryers of the UK. I want to go on rewarding the tax-dodgers, the bankers, the exploiters and Parliamentary scroungers. I want to go on deceiving the easily-led into believing that my way is the only way, and duping my Coalition partners into supporting my extreme right-wing policies until I can sling them into the gutter in 2015”. Does that seem about right to you?

Apparently ‘Compassionate Conservatism’ doesn’t extend to people in certain professions.

According to a new analysis by The Children’s Society published in The Observer, almost half a million soldiers, teachers and nurses will lose hundreds of pounds every year when the Coalition’s latest benefit cut comes into force.

The cap of one per cent on benefit and tax credits upratings over the next three years means up to 40,000 soldiers will be worse-off: A second lieutenant in the army with three children, earning £470 a week and whose wife does not work will lose £552 per year.

Around 150,000 primary and nursery school teachers will lose out: A couple with two children where the sole earner is a primary school teacher earning £600 per week will lose £424.

But the majority of losers in the professions will be nurses – 300,000 of them. A lone-parent nurse with two children, earning the profession’s average of £530 per week, will lose £424 per year.

For a government that likes to state “We love the NHS”, the Coalition seems to really enjoy attacking nurses and trying to cover it up. By December 13 last year, 7,134 nursing posts had been lost since the Coalition came into power, 943 in the previous month alone. But when the issue was raised in Parliamentary debate, Health Secretary and gynaecological slang-term Jeremy Hunt did his level best to avoid giving a straight response. “The nurse to bed ratio has gone up. The average bed is getting an extra two hours of nursing care, per week, than under Labour.” That didn’t tell us how many nurses had lost their jobs. So we got: “The number of clinical staff in the NHS has gone up and not down. I don’t want to micro-manage every hospital in the country and tell them how many doctors and how many nurses.”

Perhaps there’s some deep-seated childhood trauma affected all the members of the Coalition government, that makes them want to persecute nurses and then try to cover it up? Whatever the case, I’m sure the facts would form the skeleton of a terrific little crime thriller.

Don’t be fooled by the fact that the government will be debating an increase of one per cent in benefits this year. With inflation at 2.7 or 3.2 per cent, depending on which system you use, that’s a real-terms cut of two per cent every year for the next three years.

I’d like to draw your attention to the fact that these figures were compiled by The Children’s Society, meaning they relate only to working parents. The one per cent cap on benefit rises will hit single working people as well – we just don’t have the figures for them yet.

The figures make a nonsense of Iain Duncan Smith’s increasingly desperate claims that his policy of cuts and persecution to achieve lower take-up of welfare benefits is fair.

The Tories have now alienated working people and those on benefits. Who’s next, do you think? I reckon pensioners had better prepare for the worst!

Remember last week, when he trotted out a roll of fabricated figures to make it seem that the tax credit system had run out of control under Labour (tax credits are among the benefits to be capped at one per cent)? It turns out that all his figures were wrong, with his claims about fraud – which stands at less than one per cent of total claims – spectacularly inaccurate.

How about the very next day, when he was dribbling about the relative percentage rises in Jobseekers’ Allowance and private sector salaries, claiming that the unemployed were getting a far better deal than workers – only to be rebuffed when we all checked how much this was in real money, found out that workers were still making far more (although not enough – remember many employers pay so little that people working full-time still have to claim state benefits, so that’s a subsidy for private companies, being paid out of our taxes). The amount paid in benefits as a proportion of average wages has stayed the same, as it should. The Work and Pensions Secretary is hell-bent on breaking that link in order to inflict real harm on Britain’s poorest.

Does anybody remember the Tory slogan “Broken Britain”? What they didn’t tell us was that they were the ones who wanted to break us!

And now David Cameron has told the Telegraph he wants to be Prime Minister for another full term, from 2015 to 2020. If he manages that feat, he will no doubt face pressure from some of his own cabinet members to inflict further harm on those receiving benefits.

For example, a group of 70 Tory MPs including Michael Gove and David Willetts have published an agenda of policies that one minister has already – according to the Torygraph – described as a “blueprint” for the party’s next general election manifesto.

It includes plans to lengthen the school day “to help working parents” – how do you like that, all you teachers who are losing benefits this year? You can rest assured that your pay won’t increase to cover the extra hours!

And it calls for benefits to be cut for people who live in the North, and other parts of the country where the cost of living is lower. They love regional pay, don’t they? And they WILL drive it through, no matter how much of the population oppose it!

For a representative selection of citizens’ opinions about this, I suggest you visit the MSN news site’s version of this story where (when I looked last night) the Comment column was unanimously opposed to Cameron continuing. That’s something like 20-odd pages of people demanding that he be ousted at the first opportunity.

It did my heart good to see that.

The sad truth is that none of the above will change the result of the debate and vote on benefits uprating, due to take place in the House of Commons on Tuesday.

As long as the Tories have the support of Nick Clegg’s Liberal Democrats, they have a majority and can vote through any ludicrous and harmful policies they please.

The only thing I can suggest is that you all email your MPs in advance of the debate and put pressure on them to do the right thing – or account for their decision if they vote with the government – especially if you live in the North, or in rural areas!

As ever, you can find your MP’s contact details here: http://www.parliament.uk/get-involved/contact-your-mp/

Follow me on Twitter: @MidWalesMike

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