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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Britain’s starvation crisis won’t bother our new millionaires at all

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bedroom tax, benefit, cost of living, cut, David Cameron, David Gauke, delay, disease, economy, Eddie Izzard, election, employment, exploit, food bank, industry, life expectancy, malnourishment, Mike Sivier, mikesivier, millionaire, National Health Service, neoliberal, NHS, pay, pay freeze, pension, people, politics, poverty, privatisation, privatise, recovery, rickets, salary, sanction, Scarlet Fever, social security, starvation, starve, sweetheart deal, tax, third world, Trussell Trust, tuberculosis, vote, Vox Political, wage, welfare, zero hours

Britain’s shame: The front page of yesterday’s Daily Mirror.

So the United Kingdom now houses more millionaires than ever before – but at the huge cost of forcing hundreds of thousands of people to seek help from food banks or starve.

This is David Cameron’s gamble: That enough people will profit from the misery of the huge underclass he has created to vote him back into office in 2015, to continue his attack on anybody who takes home less than £100,000 pay per year.

Are you really that selfish?

Do you think this is any way for a civilised, First-World society to order itself?

No – it’s more like the description of the Third World that became prevalent towards the end of the 1960s: A country with low economic development, low life expectancy, high rates of poverty, and rampant disease. They are also countries where a wealthy ruling class is free to exploit the population at large who, without money or force of arms, are powerless to stop them.

Let’s see now… The UK definitely has low economic development. Neoliberal governments since 1979 have decimated our industrial base and the so-called recovery we are currently enjoying has yet to show any worthwhile results, despite the dubious rises in employment and wages that are making headlines this week.

Low life expectancy? Yes, we have that. People in lower-class residential areas are expected to live only a few years into their retirement, if they make it that far, while those in rich areas may continue into their late eighties. Sharp readers will recognise that, although we all pay the same amount into the state pension, the rich get more from it as they live long enough to receive larger amounts.

High rates of poverty? According to the Trussell Trust, the number of food parcels it handed out per year tripled from 346,992 in 2012 to 913,138 last year, with 330,205 going to children. Another 182,000 were provided by 45 independent food banks. The government says poverty is falling but bases its figures on a proportion of the median wage, which has been dropping for the last six years. This means government claims that worker wages are rising must also be lies.

Rampant disease? Perhaps we should not go as far as to suggest this is happening – but the British Isles have witnessed the return of diseases long-thought banished from these shores, like Rickets and Scarlet Fever, along with an increase in Tuberculosis. These are all poverty-related, as they are caused by malnourishment. You can thank your Tory government for forcing so many people out of work and diverting so much NHS funding into privatisation.

As for a wealthy working class exploiting the population – the evidence is all around us.

Look at the reasons people are being driven to food banks, according to the Daily Mirror article from which I quoted the food bank figures: “Benefits cuts and delays, the rising cost of living and pay freezes are forcing more and more people into food banks, experts have long warned.” All of these are the result of Tory government policy.

The government is, of course, unrepentant. I had the misfortune to see Treasury minister David Gauke – who found infamy when he signed off on huge “sweetheart deals” letting multinational firms off paying billions of pounds of income tax they owed us – saying he was not ashamed of the huge food bank uptake. He said they were doing a valuable job and he was glad that the government was signposting people to them. Nobody seemed to want to ask him: In the country with the world’s sixth-largest economy, why are food banks needed at all?

Of course, I’m not likely to persuade anyone to change their political allegiance over this. You all know where I stand and, besides, this blog is simply not big enough to make a difference.

So I’ll leave you with the words of someone who is far more popular: Eddie Izzard, writing in (again) the Mirror:

“A million food parcels. How did our Britain get to be so hungry? Our country, where even after the Second World War, we still had the ambition to feed our poorest people and build a better country.

“This government said it wanted to reform the British welfare system. Instead, it has broken it. The proof is here in the desperate families who have had to turn to their GP, not for medicine, but for vouchers to be able to eat.

“Instead of supporting the most vulnerable people in Britain during the recession this government has hit them with a wave of cruel cuts and punishments – sanctions, Bedroom Tax, welfare cuts.

“The zero hours economy it champions is not enough to put food on tables. It’s done nothing to tackle food and fuel costs.

“No wonder that today, 600 faith leaders, dozens of charities and 40 bishops are telling David Cameron he is failing the country’s poorest people.”

Perhaps you are not affected, like all those new millionaires on whom the Tories are relying. Do you think that makes it all right for this to be happening here?

You can use your vote to share your opinion.

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Workers blamed for sinking wages by Tory-controlled BBC

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BBC, blame, Coalition, Conservative, cost of living, David Cameron, Democrat, drop, earning, economy, employment, fall, fiscal, government, House of Commons Library, IFS, inflation, Institute, Jonty Bloom, Lib Dem, Liberal, manufacturing, Mike Sivier, mikesivier, national, office, ONS, part-time, people, plausible deniability, politics, real, self-employed, service, statistics, Studies, Tories, Tory, Vox Political, wage, work, worker, zero hours

Congratulations are due to BBC business body Jonty Bloom, who should get an award for the bilge he blathered to justify the fact that the Conservatives and Liberal Democrats have engineered the longest drop in wages for 50 years.

He blamed employees, saying that they weren’t productive enough.

The Office for National Statistics had reported that real wages have fallen by 2.2 per cent every year since David Cameron took over as Prime Minister in 2010 and, as the Tory’s mass-media mouthpiece, the BBC seem to have tasked Mr Bloom with finding plausible deniability for the Coalition, so that ministers won’t have to take responsibility.

Real wages are worked out by taking the rising cost of living into account while calculating the value of earnings.

The ONS report followed one from the Institute for Fiscal Studies on Thursday, suggesting that a mid-range household’s income between 2013-14 was six per cent below its pre-crisis peak.

Both of these reports were latecomers to this particular party, though. A Labour Party report from August 2013 stated that prices had risen faster than wages in all but one month of Cameron’s premiership – April 2013, when he cut taxes for millionaires and bank bonuses soared. The overall fall in annual real wages was £1,350 at the time that report was written.

The Labour report went on to say that figures from the House of Commons Library forecast that, after inflation, wages will be £1,520 lower in 2015 than in 2010, meaning working people, on average, will have lost £6,660 in real terms during the Coalition Parliament.

You’ll notice the BBC report only provides percentages. Interesting, that.

Over at the BBC, Mr Bloom tried to convince us that “workers have, on average, been working fewer hours during the downturn and that in turn has meant that they are earning less.

“The wage an employer pays… will be based on the productivity of the employee. So if a firm’s output falls, it will respond by reducing either the level of wages or the number of people employed in order to maintain its viability… Many firms seem to have held on to staff but output per hour worked fell, putting downward pressure on wages.”

He also suggested that a shift from higher-paid manufacturing jobs to lower-paid service jobs had contributed.

Sadly for Mr Bloom, we can punch holes through all of his arguments. Firstly, this is the government that insisted private sector jobs growth would outweigh the loss of public sector jobs it was going to inflict on the country. That claim alone suggests that ministers may have pressurised firms to keep employees in-post.

But the downturn meant there was less demand for firms’ products. How could they remain viable? Answer: Cut the hours worked by employees. Could this be the reason part-time and zero-hours contracts have exploded during the course of this Parliament? Part-time workers have fewer holiday entitlements and do not cost employers as much in National Insurance. Zero-hours workers are only called when they are needed and therefore the firm’s overheads are hugely reduced. Bosses benefit while workers go without.

Could this also be why firms have hired outside contractors on a self-employed basis, paying them a set amount per job, no matter how long it takes, in order to bypass the minimum wage law? Contractors earn less than the minimum wage but work far longer hours (without upsetting Mr Bloom’s average).

The productivity of a worker depends on how long they are working; part-time or zero-hours employees work for less time and therefore their productivity cannot be anything but lower than a full-time worker. Self-employed contractors’ pay is fixed in companies’ favour from the start. Mr Bloom’s argument is based on a wages fiddle.

Oh, and that shift from manufacturing to the service industries? Isn’t that something the Conservative-led Coalition has vowed vehemently to reverse, while doing spectacularly little about it? I think it is.

One personal note: My own experience as an employee suggests that firms’ financial woes have far more to do with the idiotic decisions made by executives than with the output of employees. Changes in the market do not lead to inventive and innovative responses; instead, the workers are penalised with lower wages or unemployment. This puts firms in a slow death spiral as continual erosion of the workforce makes managers increasingly less able to cope with the challenges that, unaddressed, rack up against them.

So congratulations, Jonty. You carry on blaming the workers if you want. It won’t make a scrap of difference because the real problems lie with the decisions made by company execs, responding to stupid Tory policies.

What a shame you can’t say anything about that because your employers are so utterly under the Tory thumb.

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Abuse of sanctions causes huge drop in unemployment claims

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abuse, benefit, benefits, claim, Coalition, Conservative, Democrat, Department for Work and Pensions, discourage, DWP, esther mcvey, government, Lib Dem, Liberal, Mike Sivier, mikesivier, part-time, people, politics, sanction, social security, Tories, Tory, unemployment, Vox Political, welfare, work, zero hours

Esther McVey must be so proud. She has managed to make the unemployment benefit system do the exact opposite of its original purpose.

Today, the Coalition announced that in the last three months the UK has enjoyed “the largest quarterly rise in employment since records began”, with 30.15 million people in work.

This might be a good thing, depending on whether those jobs are well-enough paid to keep their holders from having to claim in-work benefits. The number of hours worked has also increased, but this may be due to the increase in employment itself, rather than an indication of fewer zero-hours or part-time jobs, which help employers more than workers.

The real cause for concern is the huge leap in the number of unemployed people who are not claiming Jobseeker’s Allowance, to 1,015,000. That’s a massive 43.7 per cent of the total workless population.

Ms McVey was probably whooping with joy when she heard that her government’s policies have discouraged so many people from claiming. It means the government isn’t paying them any money in benefits – exactly as intended.

The figures speak for themselves. The new sanctions regime started in October 2012, when the percentage of people who weren’t claiming JSA stood at just 37 per cent (around 936,100 – there were 2.53 million unemployed at the time). In the 15 months since, a further 78,900 have been discouraged from claiming by the new system, according to the Centre for Economic and Social Inclusion (CESI).

They haven’t got jobs.

In fact, they don’t have any visible means of support.

Why aren’t they claiming?

“You apply for three jobs one week and three jobs the following Sunday and Monday. Because the job centre week starts on a Tuesday it treats this as applying for six jobs in one week and none the following week. You are sanctioned for 13 weeks for failing to apply for three jobs each week.”

“You have a job interview which overruns so you arrive at your job centre appointment nine minutes late. You get sanctioned for a month.”

“Your job centre advisor suggests a job. When you go online to apply it says the job has “expired” so you don’t apply. You are sanctioned for 13 weeks.”

“You are on a workfare placement and your job centre appointment comes round. The job centre tells you to sign on then go to your placement – which you do. The placement reports you for being late and you get sanctioned for 3 months.”

These are all real experiences of real jobseekers – not scroungers, skivers or layabouts, as reported in a Vox Political article last month.

And they’re still going on. Benefit Tales published this account, from Facebook page The People vs the Government, DWP and Atos, today: “My lad been sanctioned yet again by job centre this time for not applying for enough jobs. He has applied for all those he can physically get to, we live in a rural area and buses are very limited. Yet they said he should have applied for the ones that are impossible for him to get to and from.”

So let’s all remember, next time we hear the government spouting “good news” about employment figures… It isn’t good news for everyone.

The benefit system has been perverted. It should be providing a safety net to keep people out of poverty while they find a new job.

Instead, the Coalition is bullying people into destitution and asking us to celebrate.

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The lies that smashed the unions and destroyed our coal industry

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So now we know that Margaret Thatcher lied about the scale of her attack on the British mining industry.

She told the country that only 20 pits were to be closed, when in secret she and National Coal Board chief Ian Macgregor had planned to close no less than 75.

The revelation vindicates then-National Union of Mineworkers’ leader Arthur Scargill, who claimed at the time that there was a “secret hit-list” of more than 70 pits marked for closure.

Documents released under what used to be called the Thirty Year Rule show that under the plan, two-thirds of Welsh miners would become redundant, a third of those in Scotland, almost half of those in north east England, half in South Yorkshire and almost half in the South Midlands. The entire Kent coalfield would close.

The workforce was to be cut by about a third, from 202,000 to 138,000.

Thatcher went on to use the lie as an excuse to break the power of the trade unions, setting the scene for the long decline in employees’ rights that has brought us to the current sorry situation in which part-time work, zero-hours contracts and fake ‘self-employed’ status are robbing us of what few entitlements we have left.

She used the police as a political weapon to attack picket lines, sowing seeds of distrust that persist to this day. How many people who saw the scenes of carnage during the miners’ strike can honestly say they trust the police to uphold the law without fear or favour? Is it not more accurate to say they fear the police as agents of a ruling elite?

She destroyed Britain’s ability to provide fuel for our own power stations, leading us into dependence on foreign powers for our energy needs. It is this helplessness – caused by the policies of that Conservative Prime Minister – that has put so many British families into fuel poverty under the current Conservative Prime Minister, forcing them to choose between heating and eating.

In short, Margaret Thatcher owes compensation to a huge number of British people.

Some might consider it a lucky escape for her that she died last year and will avoid our wrath, but then again, considering her state of mind at the end it is unlikely that she would have recognised what it was.

Perhaps it will be possible for some of her victims to claim compensation from her estate; that will be a matter for them.

But other leading Conservatives and civil servants were in on the plot – and they should not be allowed to walk away unpunished. These include:

• Nigel Lawson (Chancellor of the Exchequer at the time).
• Norman Tebbit (Employment Secretary).
• Sir Robert Armstrong (now Baron Armstrong of Ilminster, Secretary of the Cabinet in 1983). Armstrong has denied that there was a cover-up – an astonishing claim when documentation shows there was an agreement not to keep records of the secret meetings in which the plans were hatched and developed.
• Peter Gregson (although he may also be dead; attempts to determine his status have turned up nothing).
• Michael Scholar.

These are just the names on the document market ‘Secret’ meeting at No 10 on the BBC News report of the revelation.

They all knew about the lie and could all have told the truth but they did not.

They betrayed Britain.

Will they escape justice?

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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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allowance, Anthony Nicholas, austerity, autumn statement, avoid, bedroom tax, benefit cap, book, breathtaking complacency, budget, building, cap, Coalition, Conservative, debt, deficit, Democrat, Department, double-dip, DWP, economy, education, election, employer, employment, error, evade, evasion, fraud, Free, fuel duty, full-time, Funding For Lending, George Osborne, Gideon, help to buy, holiday, house, Huffington Post, ill, Joanne Wood, jobs tax, Jobseeker's Allowance, JSA, keynes, KPMG, Labour, Lib Dem, Liberal, living standards, loan, Mark Ferguson, married, marry, mental, Michael Gove, Mike Sivier, mikesivier, national insurance, OBR, office, Owen Jones, part-time, pay, pensioner, Pensions, recession, responsibility, Robin Stacey, sanction, school meal, self-employed, sell, sick, spending, stagnate, stagnation, student, surplus, tax, The Guardian, Tom Clark, Tories, Tory, Twitter, under occupation charge, VAT, Vox Political, wage, welfare, Will Moriarty, work, zero hours

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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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.

The great wage con is keeping you poor

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Any Answers, BBC, benefit, benefits, Channel 4, Child Benefit, civil unrest, Coalition, con, Conservative, contract, contractor, corporation, debt, Deloitte, disease, Dispatches, economy, employ, employment, Ernst & Young, EU, european union, firm, flat rate, food, government, health, heat, holiday, housing benefit, ill, immigrant, income, KPMG, Landlord Subsidy, living wage, low income, malnourishment, mental, Mike Sivier, mikesivier, minimum wage, national insurance, parasite, part-time, pay, people, physical, politics, PricewaterhouseCoopers, private, production, rent, self-employed, sick, social security, stress, tax, tax avoidance, tax credit, Tories, Tory, trap, unemployment, Universal Credit, Vox Political, welfare, work, zero hours

Is anyone else sick of employers bleating that the minimum wage is hindering their business?

They must think we’re all stupid.

A few of them were on the BBC’s Any Answers on Saturday, saying the minimum wage keeps pay down, and that people can’t afford to go to work – especially if they live in London – because their housing costs are paid by benefits. This is nonsense.

The minimum wage is exactly what it claims to be – a minimum. And if people aren’t getting up to work for it because benefits give them more, we can see that it is not enough.

But let’s take this further: We all know that Landlord Subsidy is being restricted – especially in London, where landlords charge more than in the rest of the country. This means that people on low incomes in rented homes will be unable to pay the bills and will be forced to move somewhere cheaper (if they can find it), as intended by our extreme right-wing government.

Where are all these minimum-wage employers going to find their minimum-wage workers then?

Even that isn’t the limit of it, though. We know from such sources as the summer’s excellent Dispatches documentary on Channel 4 that employers have found ways around the minimum wage.

• They have taken people on as self-employed contractors who are paid a flat rate for a day’s work – no matter how long that work takes – and being self-employed, these people pay their own taxes and National Insurance, and get no time off for holidays or if they are ill.
• They have taken on workers on part-time contracts, meaning reduced or non-existent holiday and sick pay entitlements – and then boosted up their hours to full-time levels with fake ‘overtime’ offers.
• They have employed workers on zero-hours contracts, meaning they can demand an employee’s presence at any time and make them work for as long – or short – a period as required. Again, there are no tax administration obligations, NI, sickness or holiday benefits.

The result is very nice for a government of liars such as the current Westminster administration, because it seems they have managed to increase employment (in fact the last figures showed unemployment is greater than at the end of the Labour administration in 2010, but by such a small amount that it’s not worth mentioning).

Production, on the other hand, has remained flat. If more people are in work, it should have increased.

That is how we know we are looking at a con.

If more people are in work but production hasn’t gone up, we must question the incentive for this increased employment. It has already been mentioned: The lack of holiday and sick pay entitlement, National Insurance and tax admin obligations. The larger the employer, the larger the saving – but this doesn’t mean small firms aren’t feeling the benefit.

The minimum wage worker’s income is topped up by benefits – but the government is cutting these back. Landlord Subsidy in London won’t be enough for people on the kind of contracts described here to stay in their homes, and this means a consequent job loss if they have to move out of the area.

Tax credits are being removed; child benefit restricted. Universal Credit (if it ever works) will operate in real-time, adjusting benefits to ensure that low-paid workers remain in an income trap for as long as their wages remain below a certain level.

Employers reap the benefits. But even they are being conned, because this can’t last forever.

Imagine a Britain without in-work benefits but where the living wage has not been introduced nationwide (this will be a reality in a few years, under a Coalition or Conservative government). Workers on the self-employed, part-time or zero-hours contracts described here will not earn enough to survive.

Private debt will increase exponentially, leading to increased mental illness as the stress of trying to cope takes its toll on the workforce. Physical illness will increase as people cut back on heating in their homes and food in their fridges and larders. Result: malnourishment and disease.

What happens then? It’s hard to say. It may be that employers will take on increasing numbers of cheap foreign workers – but there is already resentment at the influx of immigrants from the European Union and this could lead to civil unrest.

It seems likely that the largest firms will leave these shores. If we compare them to huge parasites – and we can – then the host will have been drained almost dry and it will be time to move on and find another to treat the same way. These are the companies who have reaped huge rewards from tax avoidance, aided by the ‘Big Four’ accountancy firms – KPMG, Deloitte, PricewaterhouseCoopers and Ernst & Young – who have been writing – into British law – ways for them to get out of paying their share.

The smaller employers might keep going for a while or collapse; it depends how much their bosses save up for the inevitable crash. Deficit financing of their business will support them for a while but, if they don’t have any ideas, they’ll go under.

All because a few very greedy people just won’t pay a reasonable amount for a hard day’s work.

They get on the media, telling us they can’t afford higher wages. In that case, why are they even in business? If they need a workforce of a certain size, but cannot pay a living wage, then they simply should not bother. All they are doing, in the long run, is contributing to a monumental confidence trick that will cause immense harm to the economy and the nation’s health.

Of course, the UK did not always have in-work benefits. People used to be paid enough to make ends meet. We should be asking why that changed and who benefits. A return to that situation would benefit the country enormously – but it isn’t going to happen on the minimum wage, and it isn’t going to happen on zero-hours contracts.

It’s time to name these firms and ask bosses who employ on these terms why those contracts are necessary and why they feel justified in the damage they are causing.

And while we’re at it, it’s time to ask our MPs why they tolerate it, too.

Iain Duncan Smith owes us all an apology – but do we owe one to Rachel Reeves?

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Iain Duncan Smith: He opens his mouth – and the world screams. [Image: Steve Bell]

It seems redundant to start an article by saying Iain Duncan Smith is a filthy liar, because it is a fact that we all know too well already.

The latest offence – and the word is used very deliberately – took place during Work and Pensions Questions in Parliament yesterday (October 14) and means that he has lied to Parliament – not for the first time, either!

It is interesting that he phrased his words in a particular way. Responding to Andy Sawford’s call for clarity on whether, under the new claimant commitment, benefits officers will sanction jobseekers for refusing zero-hours work, he said this referred to “people’s obligations under the existing terms… Once they are offered a job they must take it… Right now, zero-hours contracts are legal.”

You will note, Dear Reader, that he did not simply say, “Under the claimant commitment, they must take zero-hours work or be sanctioned,” even though that is clearly the meaning of his words. It seems likely he was looking for leeway if questioned about it afterwards.

Well, he shouldn’t get any. A reasonable person, looking at the statement, will draw the obvious – intended – conclusion.

It is a conclusion – and a statement – that runs against current DWP policy.

The DWP responded to a Freedom of Information request in July this year, which also called for clarity on zero-hours contracts. The response contains the very clear statement: “Jobseeker’s Allowance claimants are not required to apply for zero hours contract vacancies and they will not face sanctions for turning down the offer of a zero hours contract.”

So Iain Duncan Smith was lying to Parliament yesterday – a very grave offence for a Secretary of State to commit.

Smith said, responding to Mr Sawford: “People will lose benefits for three months for a first offence, six months for a second offence and three years for a third offence.” When it comes to Parliamentary lies, he has committed multiple offences, and yet he gets away with it every time.

Why?

Another person who seems to have had trouble saying what they mean is Rachel Reeves. This blog – and many other people – took her to task last weekend, after The Observer published an interview in which she reportedly made many ill-advised comments, giving the impression that Labour policy on social security was lurching to the right yet again.

Yesterday a statement appeared on the Labour Party website in which the new Shadow Work and Pensions Secretary put forward a much more reasonable plan for social security reform under a Labour government. Particularly attractive are the parts where she says Labour will work with the disabled to design services and benefits that will help them play their part, and where she promises to repeal the Bedroom Tax, which has penalised vulnerable people, many of them disabled.

It is a much better statement of intent and indicates that Ms Reeves has been from one end to the other of a very steep learning curve with extreme rapidity.

Does it mean she was misquoted in the Observer article, and should she receive an apology from those of us who leapt down her throat? No.

There has been no suggestion that the article was inaccurate or unfair. The logical conclusion is that she said those words, and it is also logical to deduce that, had we not reacted so strongly, she might not have released the new statement.

It is unfortunate that, for many, the damage has been done. The Observer article was the first chance we had to see what the new Shadow Work and Pensions Secretary was thinking – and first impressions last. Her new statement seems like to go largely unreported. It should be noted that Tristram Hunt also made a fool of himself by supporting Michael Gove’s wasteful and elitist ‘Free Schools’ scheme. Hopefully Ed Miliband has accepted the need to make sure all of his Shadow Cabinet stay on-message from now until the next election. Reeves and Hunt should count themselves lucky to still have their new jobs.

But let’s not dwell on that. The new statement by Rachel Reeves has much to commend it, and is reproduced in full below. Your responses are invited.

Leading the debate on employment, poverty and social security.

Families facing a cost of living crisis want to know we have a social security system that is fair and sustainable, with costs kept under control but there for them when they need it.

The Tories seek to use every opportunity to divide this country and set one group of people against another. But their approach is failing – with the result that people are left out of work for year after year and costs to the country continue to rise. The Work Programme isn’t working, the roll-out of Universal Credit is in disarray, the Youth Contract has been a flop and there is mounting anger at the degrading and disgraceful treatment of disabled people by ATOS.

The complacent Tories are congratulating themselves about a long-delayed recovery. But almost a million young people are out of work. For those in work, increasing numbers of them aren’t being paid a living wage, are stuck on zero hours contracts or working part time when they want to work full time, and are being hit by soaring rents because levels of house building are so low – all of which drive up the benefits bill.

Labour will control the costs of social security by getting more people into work, rewarding work and tackling low pay, investing in the future, and recognising contribution. We’ll strive to make the right to work a reality for people with disabilities, working with them to design services and benefits that enable them to play their part.

A One Nation social security system will be one with responsibility at its heart – people receiving benefits who can work have a responsibility to look for work, prepare for work and take jobs that are available to them, but government has a responsibility to treat benefit recipients fairly and decently, help and support them and work with employers to ensure there are real job opportunities available.

Our compulsory jobs guarantees for young people and the long term unemployed, funded by repeating the tax on bank bonuses and limiting pensions tax relief for those on more than £150,000, would ensure there is work for under 25s out of work for more than a year and adults out of work for more than two years. These would be proper paid jobs – and people would be expected to take them or face losing benefits.

And unlike the Tories, we’ll put an effective cap on structural social security spending by getting tough on the causes of unemployment and rising benefit bills: low pay, lack of economic opportunity, shortage of affordable housing.

We would repeal cruel and counterproductive measures like David Cameron’s Bedroom Tax. I see constituents week in and week out with heart-breaking stories about how this policy is hitting them and their families. Around the country hundreds of thousands of vulnerable people, many of them disabled, are being penalised by this perverse policy which could end up costing more than it saves because of the distress and disruption it’s causing.

And we’ll keep up the campaign for the living wage, and for the economic reforms we need to ensure that prosperity is fairly shared and welfare is not a substitute for good employment and decent jobs.