It’s about time the spotlight swung round to illuminate the plight of unpaid family carers.
I’m one, and I can confirm that life for carers like me is a never-ending, thankless struggle to make ends meet, combat government attempts to terminate my partner’s sickness and disability benefits (and my own Carer’s Allowance), cope with my partner’s mood swings that can make me feel entirely unappreciated, and avoid knock-on effects on my physical and mental health as well.
I am fortunate enough to be able to earn a little extra cash by writing This Site (although it has attracted enmity from certain vested interests who are determined to deprive me of this valuable income stream by disparaging my articles and my character – click on the link to my JustGiving site for further information on that).
Others have to rely on government funding that is dwindling in value every year.
It is an agonising struggle to avoid being crushed between the rock of my partner’s needs and the hard place of increasing financial pressures.
The report mentioned below makes recommendations – but these relate only to carers who are also employees.
Much more help is required.
Nearly eight million family carers in the UK are “propping up the care system” by providing unpaid care for relatives and other loved-ones, whilst also paying a significant personal and financial price for the care they provide, according to a new report from the Social Market Foundation (SMF) think tank.
Research has calculated that around 7.6 million adults are giving up their time to provide unpaid care for relatives, up 1 million since 2005 and equal to almost 15% of adults living in the UK.
In [a] report published on Monday, the SMF says the proportion of family carers providing 20 or more hours of unpaid care each week has increased from 24% in 2005 to reach 28% in 2015, with family carers providing an average 19.5 hours of unpaid care each week.
In total, family carers are sacrificing 149 million hours to care for loved-ones every week, equal to 4 million paid care-givers working full-time hours.
However, this level of unselfishness can have a devastating impact on the carers’ health and work prospects, with family carers less likely to be in employment than non-carers and more likely to earn far less.
At the moment, real earnings stand 9.5 per cent lower than they were in February 2008. Here’s a graph showing how they have fallen:
Considering his plans could involve cutting tax credits and housing benefit – both of which would have a direct effect on household incomes, it seems the important question regarding the Autumn Statement on Wednesday is this:
Public spending on benefits has fallen by just £2.5 billion, despite cuts aimed at saving nearly eight times as much (£19bn) – because the silly unqualified Conservative career politicians who dreamed them up had no idea of the knock-on effects of their plans.
The miscalculations have not affected any Tory donors or rich people likely to vote Conservative, so it seems unlikely the government will care.
The BBC reported that the Institute for Fiscal Studies (IFS) has said the reasons for the increased spending included a rise in the cost of pensioner benefits (yet another BBC inaccuracy – the rise was in the cost of state pension payments) and an increase in housing benefit spending.
Let’s look at that.
The IFS said the £5 billion increase in state pensions was due to the “more generous” entitlements of a new generation of pensioners who had recently retired. This is entirely predictable and should have been included in the Conservative Party’s calculations before the Tories ever got anywhere near the Department for Work and Pensions. It is an avoidable mistake that they didn’t avoid. And they’re financially reliable?
Switching from measuring inflation using RPI – which shows a higher rate – to CPI (in order to pretend that the cost of living isn’t rising quite as fast as it really is) hasn’t saved the £4 billion the government expected. This relates more to pensions than any other benefits, as these are linked to inflation. The government was hoping to save billions because CPI inflation rises more slowly than RPI – but it hasn’t happened, for reasons stated in the paragraph immediately above. The Tories should have known this; they didn’t. Stupid Tories.
The BBC reported: “There had been an ‘unanticipated’ rise in housing benefit spending of £1bn, despite cuts of £2bn, which was down to the growth of the private rental sector, rising rents and slow earnings growth.
Are the Conservatives seriously trying to tell us that they didn’t realise the Bedroom Tax would lead to an increase in Housing Benefit claims on privately-rented properties? What did they think was going to happen? Oh no, wait… That was the plan! Tip people out of social housing on the pretext that they are under-occupying, and send them off to rent from private landlords. But private landlords always – always – charge more and the Conservative Party, many of whose members happen to be private landlords, would know that. So we have an increase in the amount of public money being spent on rents that are charged by Conservative-voting landlords. What a handy way of getting money into the pockets of your rich voting base! Let’s conclude that this particular bit of extra spending was in the plan from the start.
Rising rents are a logical consequence of an influx into the private rented sector from social housing. Suddenly there’s a squeeze on space and private landlords are able to hike rents. Again, Tory-voting landlords get a boost from the government.
Slow earnings growth was also planned by the Conservative Party, and is connected to spending on unemployment benefits. The benefits uprating cap of one per cent per year means an increase in social insecurity, intended to force people to seek work of any kind, no matter how low-paid. It’s not so much about making work pay as it is about making it the better of two bad options. The knock-on effect is that there is no job security any more. Anyone agitating for higher wages can be told there are hundreds of people willing to work for less. That will shut them up. The Tories planned this. It seems bizarre that they did not realise people would have to claim in-work benefits in order to make ends meet. That’s why spending on tax credits has fallen by less than expected. So – again – this should have been included in Tory calculations before they got into the DWP. It is another nail in the coffin of their financial reliability.
Here’s a personal favourite: “‘Significant delays’ in the replacement of Disability Living Allowance with the ‘less generous’ Personal Independence Payment had led to a £1.6 billion increase in spending, rather than a £1.2 billion cut.” It seems the Conservatives did not reckon on the people they’re trying to rob doing all they can to stop their money being taken away.
More seriously, this means that all the cuts to the social security budget should never have happened – nor should the thousands of deaths due to the increased pressure placed on claimants by the DWP on the order of its ignorant secretary of state, Iain Duncan Returned-To-Unit Smith.
If there is a drawback to Second Reading (the House of Commons Library blog), it’s that the library’s stern practice of impartiality means that it can end up producing figures on a phenomenon without being able to explain why that phenomenon came about.
First we get a graph showing that the number of people aged over 65 who are still in work has more than doubled, from 4.9 per cent in 1994 to 10.1 per cent (of 11 million people, making 1.1 million) in 2014.
Before anybody leaps in to say they’re taking jobs away from younger people, it is worth reading on to discover that they are far more likely to be self-employed or working part-time (79 per cent of the total, with 39 per cent self-employed – 438,000 people).
Chris Giles wrote a piece in the FT this week arguing that most of the increase [in self-employment] is due not to lots more people becoming self-employed but to lots more people not leaving self-employment who would otherwise have done so.
If that’s the case, you can’t even blame the catastrophic collapse in self-employed earnings after 2008 on there being lots of new people who didn’t know what they were doing. If Chris is right, this is old-timers seeing their business shrink, rather than newbies trying to find their feet, under-charging and messing things up [all boldings mine].
The same goes for the increase in the number of self-employed tax credit claimants and the steady rise in non-employing and non-VAT paying businesses. If there has been no surge in new entrants, then either a lot of low profit and low turnover businesses are hanging on in there, or a lot more of them have become low-profit and low turnover businesses since 2008.
Chris says we should stop complaining because self-employment boosts tax revenues. It hasn’t done much boosting in recent years though. Despite the increase in numbers of people, the declared income of the self-employed was down by £8bn between 2008 and 2012.
What we’re seeing, then, is a huge rise in the number of people who find themselves unable to retire because they won’t have enough income to support themselves.
It has been said that Conservatives try to look after the elderly, because they are the only population group that is sure to vote in elections.
It seems the Tories have forgotten around 1.1 million of them.
Damning: The graph by the House of Commons Library, showing how earnings have plummeted since Cameron’s Coa-lamity government came into office.
David Cameron must be so proud. He wanted a return to the Victorian era and that is exactly what he has achieved.
Wages have nosedived, meaning the gap between the richest and poorest is larger than it has ever been; we already know that diseases once thought long-gone are stalking our streets once again while the National Health Service has been bled to the point of death; and the welfare state is in critical condition, with people who have paid into the system all their lives bullied out of claiming benefits when they are needed and sent back to die in their homes.
This is David Cameron’s brave new Britain.
The figures on wages are the latest blow against the public-relations Prime Minister’s credibility – they come from the respected House of Commons Library.
The graph (above) uses figures from the Office for National Statistics, the Bank of England and forecasts from Coalition poodles the Office for Budget Responsibility.
It shows that real earnings are expected to have fallen by 2.3 per cent between 2010 and 2015 – the first fall since 1922-3 when wages fell by 1.8 per cent – and the largest since 1874-80, under Conservative Prime Minister Benjamin Disraeli, when they fell by 2.6 per cent.
Firm figures for 2010-13, from the ONS, paint an even worse picture – they show a 4.6 per cent drop during the three-year period.
So, Dear Reader, if you have been doubting Labour’s claim that wages have dropped by £1,600 per year, in real terms, since the Tories and the Liberal Democrats sidled into office, doubt no more!
This factual evidence has thrown into chaos Conservative claims that the UK has returned to prosperity because our Gross Domestic Product has finally exceeded its pre-financial-crisis peak.
Vox Political was right to say GDP might be up 3.1 per cent on last year but it has nothing to do with most of the population.
What is our part-time Chancellor going to do about it? He’s done quite a lot of nose-diving himself and, considering what he has managed from his office…
Let’s hope the song isn’t ‘Gold’, because the irony would be too much to bear.
George Osborne might as well go back to prancing around a prostitute’s boudoir to a soundtrack by Spandau Ballet.
Columnist Jill Filipovic hit the nail on the head when she wrote: “I can already hear your objections: ‘But the area under my boobs doesn’t stink!’ or ‘What kind of marketing genius not only came up with the term “swoob,” but actually thought half the world’s population might be dumb enough to buy into it?’ or simply, ‘This is a dumb product aimed at inventing an insecurity and then claiming to cure it.’
“You would be correct on all three points.
“In fact, inventing problems with women’s bodies and then offering a cure – if you pay up – is the primary purpose of the multi-billion dollar beauty industry.”
The simple fact is that you don’t really need to worry about smells down there – a good old soapy flannel will cure any such problems.
That’s not the point, though. The aim is to get you thinking about it and devoting your energy to it, rather than to other matters.
Now let’s translate that to politics.
We already know that all the scaremongering about Romanian and Bulgarian immigrants storming the country from January 1 was a crock. That bastion of good statistics, The Now Show, told us last week that the total number of Bulgarian immigrants in the last couple of weeks was “around two dozen so far”, according to their ambassador. In the first three months after our borders were opened to Croatians, 174 turned up.
Yet the government wanted you to believe they would flood our immigration service in their millions, “taking benefits and yet simultaneously also taking all the jobs”.
My use of language such as “storming” and “flood” is not accidental. By far the more serious threat to the UK in the early days of 2014 was the weather – and, guess what, not only was the government unprepared for the ferocity of the storms that swept our islands, the Coalition was in fact in the process of cutting funding for flood defence.
This would have gone unnoticed if the weather had behaved itself, because we would all have been distracted by the single Romanian immigrant who was ensnared by Keith Vaz in a ring of TV cameras at Heathrow Airport.
Now the Tories are telling us that our take-home pay is finally on the rise for all but the top 10 per cent of earners, with the rest of us seeing our wages rise by at least 2.5 per cent.
The government made its claims (up) by taking into account only cuts to income tax and national insurance, using data leading up to April last year, according to the BBC News website.
“The data used … takes no account of the large benefit cuts introduced by the coalition, such as the real-terms cut in child benefit, the uprating of benefits in line with CPI inflation rather than RPI, and the cuts to tax credits,” writes the Statesman‘s George Eaton.”
He also pointed out that other major cuts such as the bedroom tax, the benefit cap, and the 10 per cent cut in council tax support were introduced after April 2013 and were not included in the Coalition figures.
Once all tax and benefit changes are taken into account, the Institute for Fiscal Studies has shown that almost all families are worse off – and the Coalition also appears to have forgotten the five million low-paid workers who don’t earn enough to benefit from the increase in the personal allowance.
Skills and enterprise minister Matthew Hancock compounded the mistake in an exchange on Twitter with Jonathan Portes, director of the National Institute of Economic and Social Research (NIESR). Asked why his analysis “ignores more than four million people in work (the self-employed)”, Mr Hancock tweeted: “Analysis based on ONS ASHE survey of household earnings data”.
Wrong – as Mr Portes was quick to show: “Don’t you know the difference between household and individual earnings?”
Apparently not. ASHE (Annual Survey of Hours and Earnings) is a survey of employed individuals using their National Insurance numbers – not of households or the self-employed.
So the Coalition – and particularly the Tories – were trying to make us all feel good about the amount we earn.
That’s the distraction. What are we supposed to be ignoring?
Or is it the growing threat of a rise in interest rates, which may be triggered when official unemployment figures – which have been fiddled by increased sanctions on jobseekers, rigged reassessments of benefit claimants, a new scheme to increase the number of people and time spent on Workfare, and the fake economic upturn created by George Osborne’s housing bubble – drop to seven per cent?
It seems possible that the government – especially the Tory part of it – would want to keep people from considering the implications of an interest rate rise that is based on false figures.
As Vox Political commenter Jonathan Wilson wrote yesterday: “If the BOE bases its decisions on incorrect manipulated data that presents a false ‘good news’ analysis then potentially it could do something based on it that would have catastrophic consequences.
“For example if its unemployment rate test is reached, and wages were going up by X per cent against a Y per cent inflation rate which predicted that an interest rate rise of Z per cent would have no general effect and not impact on house prices nor significantly increase repossessions (when X per cent is over-inflated by the top 1 per cent of earners, Y per cent is unrealistically low due to, say, the 50 quid green reduction and/or shops massively discounting to inflate purchases/turnover and not profit) and when it does, instead of tapping on the breaks lightly it slams the gears into reverse while still traveling forward… repossessions go up hugely, house prices suffer a major downward re-evaluation (due to tens of thousands of repossessions hitting the auction rooms) debt rates hit the roof, people stop buying white goods and make do with last year’s iPad/phone/tv/sofa, major retail goes tits up, Amazon goes to the wall, the delivery market and post collapses… etc etc.
“And all because the government fiddled the figures.”
Perhaps Mr Cameron doesn’t want us thinking about that when we could be deodorising our breasts instead.
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Someone’s raiding the pensions piggy-bank: Government changes mean the rich will be subsidised by the poor. [Picture: The Guardian]
We all know that pensioners have a charmed life under the current government – right? Pensions take up around half the £160 billion social security budget and there are other perks like the cold weather payment during the winter months, free bus passes and free TV licences – right?
They get a triple-lock inflation guarantee, under which the state pension rises according to the highest of CPI inflation, the rise in earnings or 2.5 per cent. They get Pension Credit (otherwise known as the Minimum Income Guarantee) to ensure they receive a weekly minimum of more than £140.
So no matter what happens to the rest of us, they’re in clover – right?
Just taking those examples, Tory Liam Fox wants to cut the cold weather payment down to nothing, and the Liberal Democrat Vince Cable wants to means-test or tax pensions. The free TV licence will disappear if the rising clamour to privatise the BBC receives government blessing.
Then there’s the fact that the age at which we can start drawing our pensions is rising – from 65 (for men) and 60 (for women) in 2010 to 68 (for both) by 2046, which may seem a long way into the future but in fact affects people from 2016 onwards.
The government is bringing this in because people are living longer, and this may seem like a reasonable idea – until one takes into account the fact that life expectancy is hugely dependant not only on where you live but on your social class as well.
For example, in Kensington and Chelsea, average male life expectancy in 2010 was 85.1 years, and average female life expectancy was 89.8 years. In Glasgow at the same time, average male life expectancy was 71.6 years – 13.5 less than men in Kensington and Chelsea – and average female life expectancy was 78 years – 11.8 years lower than in Kensington and Chelsea.
Between 2004 and 2010 the gap in life expectancy between the two places increased by one year and 1.7 years for men and women respectively, indicating that health inequalities across the UK are increasing.
Social class also has a huge effect on life expectancy, with people in higher managerial and professional occupations likely to live 3.5 years longer than those in routine occupations.
But they all pay National Insurance contributions for the same period of time – 30 years – in order to qualify for the state pension. This means working class people living in social housing are likely to be paying towards the pensions of upper-middle class professionals in penthouses, as well as their own.
Now the government is introducing the flat-rate pension for people reaching the state pension age who have made 35 years’ National Insurance contributions. The payment will be £144 per week at today’s prices.
People who have built up large savings for their retirement will be considerably better-off because pensions will no longer be means-tested (Pension Credit will be phased out).
Existing pensioners will remain in the old system and are likely to be worse-off than those who qualify for the new pension.
People aged in their 20s at the moment may also be worse-off than under the current system (so, even with pensions, the Coalition government has found a way to attack the young).
And people who have not paid National Insurance for at least seven years in total will not qualify for the new single-tier state pension at all.
Workers who belong to contracted-out final salary schemes pay lower NI contributions at present, but these will rise after 2016. Public sector workers in such schemes will have to pay more.
The couple’s pension rate, which is lower than the individual rate, is being phased out. This means around 30,000 women due to retire in and around 2016 are expected to lose out, as they were relying on their husband’s NI record for a state pension income and will no longer be entitled to it.
We already knew all of that.
Now, the National Federation of Occupational Pensioners says the government is proposing changes to workplace pension schemes that will undermine benefits, increase pension poverty and widen the gap between the private sector and public sector schemes, according to Mature Times.
The proposed changes mean companies will be allowed to change their scheme rules to remove the inflation link for pensions, increase their pension age and get rid of other benefits such as pensions for spouses. This significant downgrade of pension provision means scheme members could reach retirement and then realise that the expected return from their pensions has been severely reduced.
Put it all together and the less wealthy are being subjected to another rip-off – this one delayed until retirement. Who knows how much energy bills will cost by then? How many of us will have rent to pay, or mortgage payments to complete? How much will the weekly groceries cost? Will the equivalent of £144 per week be enough, by then?
And – in the current cutthroat times – how many of us will survive to find out?
At risk of seeming to be ‘Disgusted of Tunbridge Wells’: Why, oh why, oh why is everybody making such a big fuss about the fact that the economy bounced back a little bit over the summer?
Did nobody think that, perhaps, the fact that it was more sunny than in recent years meant our tourism industry might get a much-needed shot in the arm – not least from run-down British people, desperate for relief from the constant, grinding monotony of the Conservative/Lib Dem Coa-lamity government’s austerity agenda?
Did they not recall that the holiday season is a traditional ‘lull’ period and that, therefore – unless unusual situations apply (as they have in previous years) – government spending should be less? What’s the relief to the public purse from not having any Olympic Games to stage this year? What’s the benefit of having no riots?
And, finally, for the vast majority of the British people, these figures are no reason to celebrate because they make no difference. The cost of living is going up while average real-terms earnings have plummetted. If we are seeing a recovery, it is a recovery for the rich alone.
As was always intended.
For the record, public sector borrowing for August was £13.2 billion – £1.2 billion lower than the amount recorded in August 2012. This puts the UK’s net national debt at £1.19 trillion – 74.6 per cent of Gross Domestic Product.
GDP itself grew by 0.7 per cent in the second quarter of 2013 (April-June), and tax revenues have been 2.8 per cent higher than in the same period of 2012. Total government spending has fallen by 2.2 per cent, led by a sharp drop in spending by individual departments.
You can read all this on the BBC News website and might find it pleasant enough, but then David Kern, chief economist at the British Chambers of Commerce had to ruin it by saying “Our ability to generate tax revenues will struggle to return to pre-recession levels, even when the pace of growth picks up. As a result, the government must continue to make cuts in current spending in order to reduce the deficit further.”
So he wants the madness to continue. I wonder… If his business was in trouble, would he cut investment in – say – advertising and then expect profits to improve? That would be madness. Every pound cut from public investment by the government results in a loss to the economy of £1.70-£2.20. It is the government’s own demand for austerity that is slowing the recovery!
And what does this mean for ordinary people?
It means that, after adjusting for inflation, average earnings are £1,350 per year lower than they were at the time of the 2010 General Election. The UK has suffered the biggest fall in income and living standards of any country in the G7. You are worse-off under the Conservatives and the Liberal Democrats!
By 2015, average wages are forecast to be £1,520 lower than in 2010 (based on figures from the House of Commons Library). This means working people will have lost an average of £6,660 in real terms while David Cameron has been Prime Minister – enough to support the average family’s weekly shop for one and a half years, at 2012 prices!
Inflation has been higher than in other G7 countries throughout David Cameron’s period in office, meaning that George Osborne’s claim that “rising global prices” have forced the cost-of-living increase is nonsense.
Claims like that of then-Treasury Minister Chloe Smith at the start of 2012 that lower inflation meant “the cost of living is coming down a little for families” were also rubbish – it was still increasing; just not quite as fast.
In fact, price rises have outstripped wage growth in every single month of the Coalition government – except April this year, when David Cameron cut taxes for millionaires and bank bonuses skyrocketed. Who benefited? The rich. Who lost out? The middle classes, workers, and the poor.
A YouGov survey of ordinary people has shown that 70 per cent do not believe the much-touted recent improvements in the economy have helped middle- and lower-income families. Only 10 per cent thought they had.
And 81 per cent had seen prices grow faster than household incomes, with just three per cent (and only one per cent of women) seeing income grow faster than prices.
It doesn’t matter what they say the economy is doing. You will continue to lose money as long as you have a government of millionaires, ruling in their own interests rather than the interests of the country.
When Mr Cameron’s housing benefits cap takes effect, along with the increased council tax bill for those on benefits, how long will it be before working-class Tories find their representatives have forced them out of their homes?
It’s the kind of ignorance that could kill off the Working-Class Tory.
We all knew David Cameron had his head in the clouds (or where the sun doesn’t shine) when he asked what hard-working people were meant to think when they see individual families getting up to £60,000 of housing benefit. I believe the Conservative Party has yet to provide proof of the claim.
The fact is that a huge amount of new housing benefit claimants are in work themselves – so Mr Cameron’s argument was utterly defeated before he had even uttered a word of it.
Today (Monday) the National Housing Federation has stated that a failure to build new houses has led to an 86 per cent rise in working people claiming housing benefit between May 2009-2012, as rents and mortgages have soared.
An extra 10,000 new claims are being made each month.
The solution is simple; I’ve pointed it out in this very blog, many times – cap rents.
Instead, Mr Cameron said he was capping housing benefit, meaning hard-working families will have to tighten their belts and cut back even further on their other outgoings, just to keep a roof over their heads. They might not be able to afford to heat their home as well as last year (I doubt a working family qualifies for the Winter fuel allowance). They might not be able to eat as well as they did last year, as food prices are rocketing. But don’t worry – their landlords will carry on doing just fine, thank you very much!
(Until the family’s earnings can’t be stretched any further and they are forced out and – because the rent is too high for anyone else, the property becomes vacant and derelict. Landlords: Isn’t it wiser to make rents affordable and at least have some regular income from your property?)
In his speech to the Conservative Party conference, Mr Cameron said: “Because of our welfare cap, no family will be getting more in benefits than the average family earns.”
But it seems the average family doesn’t earn enough to stay off benefits! So what, exactly, was Mr Cameron saying, there? That he’s putting the average British family into an ever-decreasing recursive benefit loop?
The worst nonsense was the choice he said we give our young people today: “Choice one: Work hard. Go to college. Get a job. Live at home. Save up for a flat […] Or: Don’t get a job. Sign on. Don’t even need to produce a CV when you do sign on. Get housing benefit. Get a flat. And then don’t ever get a job or you’ll lose a load of housing benefit.”
Wrong, wrong, wrong. Since people with jobs are on housing benefit, we already know this was a pile of hooey, but we also know that he’s capping that benefit, so people with jobs are going to lose a load of housing benefit as well!
“And we’re going to look at ending automatic access to housing benefit for people under 25 too.” So, if you’re aged under 25, Mr Cameron is pulling the ground out from beneath your feet, before you’ve even got on your feet!
And let’s not forget the threat of the Localism Act, which will add to the council tax bill payable on your home. If you are in a working family that receives housing benefit, you will most likely be in receipt of council tax benefit as well, and this means even more money will have to come from your tight budget, as of next April.
So here’s my question, for anyone who still thinks they’re a working-class Tory: When all these cuts and new taxes have done their worst to you, and you’ve moved back to live with mum and dad (or gran and grandad) simply to have a (rather overcrowded) roof over your head, and the next election rolls around, are you really going to tell me that you think David Cameron’s Conservative Party is your best choice?
Shall we play a game? This one’s called join-the-dots. I didn’t really like it when I was younger and I doubt that you will, after you see the picture we’ll be creating.
We’ll start here: The government wants to cut another £10 billion from the welfare budget – that’s the bit of public spending that keeps millions of people off the streets, if only on the breadline. The government could, alternatively, try stimulating the economy to make that money in taxes, but policy seems to be pushing hard the other way, as we’ll see shortly.
So: cuts are coming. How to perform them? Draw a line to where the government announces it wants to break the link between benefits and inflation, and link them to average earnings instead.
George Osborne thinks this is a good idea because inflation hit 5.2 per cent last September, much higher than rises in earnings – remember, the man who won’t do what his initials demand (GO) has kept public sector wages frozen for the last few years and private sector wages are also stagnant. As a result, Gideon has been paying out more than he thinks he should to people who, honestly, deserve a break from his miserly administration.
Now draw a line to the results of the NatCen survey that came out earlier this week, stating that people do not want to see more money being spent on welfare than is being spent already. This is the excuse that Mr Osborne wants to use – he can say there is polling evidence that puts significant numbers in support of an end to so-called benefits uprating. Never mind that only 3,000 people were asked or that none of the main parties ever intended to increase the proportion of government spending that goes on welfare; this is his justification and he’s sticking to it.
I wonder what will happen if wages start to rise faster than inflation? Will the Nasty Party write a new clause into the contract, that benefits should rise along with inflation or wages, depending on which is lower? Officials have already stated that they do not want a huge increase in benefits if wages start to climb sharply, so they are already working on ways to ‘fix’ the linking mechanism. Evil, isn’t it?
Never mind; the current plan uses wages, so now draw a line to this: The government still wants to introduce regional pay settlements for the public sector. The Tories – sorry, the Coalition – believe that national pay settlements inflate public sector wages in certain parts of the country far beyond what their private sector counterparts can manage. They also believe that forcing regional settlements on us will save them a fortune in salaries.
Think what this will achieve: The ghettoisation of much of the UK. With regional pay deals, people will have less money available for things other than necessities, meaning fewer trips to the shops (which have already suffered thanks to the idiotic VAT increase to 20 per cent, which cut a large chunk of growth out of the economy). What happens then? The shops shut and their suppliers go out of business too. More people end up on benefits and looking for work.
You see, this right-wing government does not accept the simple fact that welfare benefits help keep the economy stable. Yes, government spending increases as payments are made, but businesses keep their customers, the economy stays afloat and the country as a whole avoids a terminal spiral of decline.
Cutting welfare, thereby reducing the incomes of society’s poorest, creates fiscal hindrance. As billions of pounds (£10 billion in this case) are taken from the active economy, businesses lose customers and lay off staff.
In a recession, increased welfare spending benefits national income so that each pound is worth £1.60 when it has worked its way through shop tills and paycheques. When welfare is cut, this works in reverse, so cutting £10 billion from benefits will increase the UK’s recession by more than one per cent.
This means a longer recession, a larger deficit and more debt. (The above information courtesy of the False Economy website, which has produced a handy factsheet for you to download, keep, and show to anyone spouting Tory propoganda)
Now draw a line to: The government wants to cut more money from the welfare budget.
Look at what you’ve drawn. A big, fat zero.
This is what the government’s plan will achieve for the people, and economy, of Britain.
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