Tag Archives: inflation

Universal Credit rise will STILL leave families with less than half what they would have had without the benefit freeze

Therese Coffey: She knows the rise in Universal Credit doesn’t even cover the price increases claimants face. And she couldn’t care less. So much for her duty of care.

Typical Tories – they cut your income by more than half and then expect you to be grateful.

They are ending a benefit freeze that has lasted many years, to give Universal Credit claimants on £500 a month a rise of £8.50 next April.

That will leave claimants only £580 out-of-pocket, in comparison to what they would have received, had people like Boris Johnson, Therese Coffey, Michael Gove, Priti Patel and Dominic Raab not decided to freeze benefits for the poor and give huge tax cuts to rich people like themselves instead.

Oh, and if you’ve heard that the rise is intended to cover inflation, I have bad news for you – it won’t.

Inflation is measured on the basis of a basket of goods representing “typical” spending – but people on benefits don’t make such “typical” purchases.

Utility and council tax bills have risen by more than the average, while the cost of “discretionary” items like clothing and shoes have risen by less.

So even less of UC claimants’ money will actually be available for necessities like food and, with winter coming up again, heat.

Mr Johnson knows this – as does his Work and Pensions secretary, Therese Coffey. They just don’t care.

Source: Poorest Universal Credit families £580 worse off – despite first rise in 5 years – Mirror Online

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Corruption scandal makes it easy to believe Johnson has sold us all out over Brexit

Boris Johnson and Jennifer Arcuri: If an inappropriate relationship with her is proved, should claims of another inappropriate relationship – with hedge fund-owning backers who have bet on the disastrous effect of a “no deal” Brexit – also be investigated?

What is Boris Johnson’s Brexit really about?

It has been alleged that he is in cahoots with a number of ‘City’ financiers who backed his campaign to become Tory leader – and prime minister – on condition that he push the UK through a “no deal” Brexit that would enrich them (and, by connection, him).

The claim is that these hedge fund bosses have bet heavily on what’s known as “shorting” – and stand to make £8.3 billion if the pound plummets and inflation skyrockets after the UK crashes out of the EU without a withdrawal agreement.

It’s what Mr Johnson’s own sister has been saying – and also former Chancellor Philip Hammond.

Such a claim is extremely damaging to BoJob’s reputation as it implies that he is working, not as a servant of the public, which is the reason he draws a publicly-financed salary, of course – but in the interests of a shadowy group of self-motivated mobsters who are quite happy to endanger the entire UK economy for their own gain.

And, of course, to satisfy his own personal greed when they pay him off for his services.

Is there any evidence to support the claims? I don’t know. Mr Hammond and Ms Johnson must have reasons for saying what they have, otherwise they have put themselves in a very actionable position.

But what makes them believable to the public is the fact that Mr Johnson has been referred to the Independent Office for Police Conduct (IOPC) over allegations that he overruled his own officials to give favourable treatment – thousands of pounds in sponsorship grants and places on trade missions – to his friend Jennifer Arcuri when he was Mayor of London.

It is potentially a criminal offence – made worse by the fact that, as London Mayor, Mr Johnson would also have been Metropolitan Police and Crime Commissioner.

Of course, if the IOPC decides Mr Johnson’s behaviour towards Ms Arcuri was inappropriate, it makes it easy to believe that he is in collusion with these hedge fund bosses to rig Brexit – against the best interests of the UK as a whole.

The BBC – in its apparent role as propaganda arm of the Conservative Party – has run a story in which Downing Street has claimed the Arcuri allegations are politically-motivated, as it was timed to happen days before the start of the Conservative conference.

If that were true, why were the allegations published in the overtly pro-Tory Sunday Times, rather than by a news organisation that opposes Mr Johnson’s party, like The Guardian or The Mirror?

It seems clear that Boris Johnson will have to work very hard if he wants to make sure this mud won’t stick to him.

And what if the claims are true, but he fails to deliver the “no deal” Brexit these hedge fund bosses want?

Will they not be annoyed? And won’t they want some kind of compensation?

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You are paying more for less: UK inflation has risen to 2.1 per cent

No doubt certain people will be concocting stories about this later so here it is for our information:

Inflation in Britain accelerated to 2.1 per cent in July, confounding forecasts for a slowdown.

Economists had expected annual inflation to drop to 1.9 per cent from 2 per cent in June. However, official data revealed an increase in consumer price inflation, driven by rises in the prices of computer games, toys, hotel rooms, clothing and shoes.

Analysts said inflation is likely to be supported in the coming months by the recent decline in the pound, sparked by fears of a no-deal Brexit, as well as strong pay growth. Wages rose at the fastest pace in 11 years between April and June compared with a year earlier, according to figures from the Office for National Statistics (ONS) released on Tuesday.

Source: UK inflation leaps to 2.1 per cent in shock rise | The Independent

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Nice – an ‘above inflation’ pay rise for public sector workers. But is it enough?

Forgive me if I’m underwhelmed by the pay rise that has been announced for people in the public sector.

Their pay was frozen for two years in 2010, and capped at a one per cent increase every year since. That’s well below inflation.

How much would this rise need to have been, to make up all the increases these people have lost, just to be paid in line with inflation?

It seems to me that the Tories are trying to look generous in giving this increase now.

In fact, it should highlight their cruelty.

In the nine years since they imposed their ridiculous austerity, shrinking the state by starving it of cash, while giving huge tax cuts to the very rich, the 100 richest people in the UK have become £55 billion richer, we’re told.

And what has happened to MPs’ pay in the same period?

The rest of us have suffered – and will continue to do so. Remember that.

Hundreds of thousands of public sector workers are reportedly set to get a pay rise.

The Treasury will unveil the biggest public sector pay rise in six years as one of Theresa May’s final acts as prime minister, The Times reported.

Soldiers are set to get a 2.9% rise, teachers and school staff 2.75%, police officers, dentists and consultants 2.5% and senior civil servants 2%.

It is thought the money will come from existing budgets.

Incidentally, this is a pay rise for police and soldiers, among others.

Considering current developments over Brexit, are the Tories planning to face widespread public unrest – possibly even violence?

Source: Public sector workers ‘to get above-inflation pay rise’ – BBC News

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All Tory talk about pay rises is useless as inflation hits five-year high

The UK’s Tory government really takes your breath away – no sooner do they start talking about relaxing restrictions on pay rises than inflation shoots up to its highest level in years, rendering all their offers academic.

No matter what they promise, you will still be left with less cash in your pocket.

(Notice that they’re not getting any poorer, though!)

Here’s The Independent to explain:

Inflation rose to a five-year high of 3 per cent in September, far outstripping wage increases, the latest official figures show.

The Consumer Price Index (CPI) rose 0.1 per cent from August to September to their highest since April 2012, increasing the likelihood that the Bank of England will raise its benchmark interest rate from 0.25 per cent next month.

Consumers face rising costs for essentials, with food and transport prices driving rising inflation, the Office for National Statistics said on Tuesday.

Wages rose at an annual rate of 2.1 per cent in the three months to July, meaning workers are seeing the value of their pay packets decrease in real terms.

Businesses are also facing a squeeze as Retail Price Index inflation, which will be used to set business rates next year, was 3.9 per cent in September.

Inflation has risen sharply since the Brexit vote in June last year as the value of the pound has fallen against other major currencies, causing the prices of imports to rise.

Labour‘s comment is actually quite restrained:

Peter Dowd MP, Labour’s Chief Secretary to the Treasury, responding to today’s inflation figures by the ONS, said:

“Inflation has reached its highest level in five years, while real earnings are still lower than in 2010, following seven years of Tory economic failure.

“Only Labour will deliver a £10 per hour Real Living Wage, investment in infrastructure, and an effective industrial strategy to raise living standards and build an economy for the many, not the few.”

Still, you can rely on Twitter to produce some juice:

https://twitter.com/mcnally_bucky/status/920335387075203079

Yes, inflation is up, debt is up, growth is down, and living standards are down. You can tell we’ve had a Conservative government for the last few years.


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Most people want the public sector pay cap lifted. Shame the government will cheat on it

62 per cent said now is the ‘right time’ to lift the restraints on workers’ pay [Image: Getty].

How pleasant to see that the majority of people in the UK believe the public sector pay cap has been unjust and should be lifted!

And how unpleasant to see that the minority Conservative government’s reaction is to pretend to be helping, while in fact doing nothing of the kind.

Two years of pay freezes followed by four years with pay rises capped at one per cent mean, for example, that teachers’ unions have been able to claim that average pay has fallen by 15 per cent behind inflation since 2010.

With inflation now standing at 2.9 per cent, the rises announced for prison officers (1.7 per cent) and for police (2 per cent) are in fact still pay cuts as they do not cover the increase in the cost of living.

Add to that the fact that the Tories have said the pay rises must be funded from existing budgets and we can see that the Tories have piled insult upon injury.

Already police forces across the country have said the only way to achieve these increases is to cut the number of police officers – leading to increased strain on the remaining officers and reducing the UK’s ability to detect – for example – terrorist bomb plots.

The only thing the Tories will be able to achieve with this insult is the further collapse of the services involved and an increase in the nation’s vulnerability.

Isn’t it time somebody asked them why they think that is desirable?

A majority of the public believe the public sector pay cap has been unjustified and agree now is the time to remove restraints on workers’ wages, according to new polling for The Independent.

It comes as Downing Street said earlier this week that the seven-year public sector pay cap is to be scrapped, unveiling a 1.7 per cent hike for prison officers and improvements totalling 2 per cent in [police] pay for 2017-18.

It is expected that ministers will announce further rises for other workers in the public sector at the Chancellor’s Budget in November.

Read more: Majority believe public sector pay cap has been unjustifiable and now is the time to end it, new poll says


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Osborne’s last budget says more in its omissions than in its announcements

150319budget8

Did we just have the worst-ever Budget from Britain’s weakest-ever Chancellor? All the indications suggest it.

George Osborne stole his best ideas from the Labour Party and claimed he was trimming his planned austerity back – raising mockery from those who said he was running like a rabbit from Labour’s “back to the 1930s” attack.

“George Osborne blinked,” said Paul Mason on Channel 4 News. “He looked at the scale of austerity he promised in December and realised it wasn’t going to be that popular.”

Did he, though? An alternative view might be that he has been trying to trick us – setting out a plan that suggests a horrific level of cuts at first, then claiming to relent and suggesting that he will inflict less damage and spend lots at the very end of the next Parliament.

So his promise is hideous suffering for four more years, with the vague possibility of greater spending at the end of it – if all has gone well.

Based on his current record, that’s a promise George Osborne can’t keep. Did he balance the books in this Parliament? No. Did he cut the deficit without cutting frontline services? No. Did he balance austerity fairly between the poor and the rich? No – the poor have taken a hugely disproportionate amount of the pain while the richest in the UK are now twice as rich as they were in 2009; for them, we have been in an economic boom.

What a shame those "naughty Trotskyites" (thank you, Mike Collins) at the Torygraph had to burst Osborne's balloon by pointing out the huge growth of the national debt on his watch.

What a shame those “naughty Trotskyites” (thank you, Mike Collins) at the Torygraph had to burst Osborne’s balloon by pointing out the huge growth of the national debt on his watch – more than £517 billion so far, which is more than every Labour government in history.

Labour’s bank levy and the changes to pensions that would have funded Labour’s tuition fees cut were stolen by Osborne. This is why Labour has been keeping future policies quiet – to prevent such things from happening. In making these moves, Osborne has helped Labour because critics of Labour’s failure to announce policies in advance will now have to shut up.

He said living standards would be back where they were in 2010 by the end of the current financial year – but using a scale (Real Household Disposable Incomes) that is disputed, and in any case is only a projection. According to the Mean Income scale, we’re nowhere near.

And Osborne’s claim assumes that household incomes will rise by no less than 3.1 per cent this year. Unlikely!

And remember – as Mr Mason put it: “Prices are falling because of oil prices and potential deflation; it’s not because a load of bricklayers and plumbers and taxi drivers are putting down their prices – and wages up.”

He repeated the claim that he has halved the deficit – but this is as a proportion of GDP. What if we have another economic shock (as seems likely) and GDP drops? Suddenly that figure won’t look as good. In money terms, the deficit has come down by around one-third to something like £90 billion a year. This means Osborne hasn’t even achieved what the previous Labour chancellor, Alistair Darling, said was possible in 2010 – and Labour would not have caused anything like the misery George Osborne’s party and the Liberal Democrats created for people on housing benefit, the sick, the disabled, and low-paid workers.

He didn’t mention the huge budget cuts to come over the next five years (if we get lumbered with more Tory rule) – worse than “anything over the past five years”

150319budget7

As the BBC’s Robert Peston tweeted: “If Tories win, OBR says ‘sharp acceleration’ in pace of cuts to day-to-day spending on public services & admin 2016-17 & 2017-18.” In those two years – under Tory rule – we would get double the amount of austerity cuts that we’ve had at any point in the last four. We don’t even know where those cuts will happen.

150319budget4

It is important to note that we won’t get cuts on anything like this scale under a Labour government, according to shadow chancellor Ed Balls.

In the meantime, Osborne has managed to pull a few rabbits out of his hat:

  • The tax allowance has been raised again, lifting more low-earners out of paying Income Tax. But those working part-time on low wages, including most apprentices and people who are self-employed, are already unlikely to pay income tax and will miss out entirely on the benefits of this tax change.
  • Meanwhile the threshold at which people will pay tax at the ‘high’ 40 per cent rate will also rise, meaning people earning up to £42,384 will get a massive tax break.
  • Beer duty is being cut again.
  • There will be a new savings tax break, meaning more than 90 per cent of savers won’t pay tax on this money.
  • And Osborne is launching a new ‘help to buy’ ISA for people trying to get on the property ladder.

All of these remove income from the Treasury, meaning the austerity measures Osborne plans to introduce will be more severe than you may be expecting. Note that the high-earners benefiting from the rise in the tax threshold will profit again – they can’t be hurt by cuts to benefits they don’t receive.

And what about tax dodging? Osborne omitted his failure to tackle this issue from his Budget speech. Perhaps this is because the wounds inflicted by the HSBC scandal are still too raw; perhaps it is because everybody knows Osborne and the Coalition have re-written tax law to make avoidance much easier for the filthy rich and the corporates. 38 Degrees caught the mood in a nutshell:

150319budget5

Regarding the ‘help to buy’ ISA, it’s notable that Osborne didn’t mention the lack of new homes built since 2010.

150319budget2Osborne did not mention the Coalition government’s disgraceful treatment of the National Health Service at all. There will be no new money for the service. His omission prompted the following – scathing – response:

150319budget1

However, as Mark Ferguson of LabourList pointed out on Twitter: “Cameron again takes credit for more doctors. Now it takes seven years to train a doctor. So those are Labour’s doctors.”

Oh, and there was a sideswipe at the SNP. North Sea oil revenues have taken a vertiginous tumble as a result of the cut in oil prices, meaning investment has also declined markedly. Osborne has cut the supplementary charge and introduced investment incentives to prop up this income stream, in a move that Tom Bradby describes as “trying to shoot SNP foxes”.

On employment, Osborne quoted his claim that there are 1.9 million new jobs and the jobless rate is at 5.3 per cent. He omitted the figures on how many are zero-hours (1.8 million in a snapshot taken last August) or off the dole due to sanctions. The number of people unemployed and not claiming JSA is at its highest level ever, as this graph shows:

[Thanks to Bernadette Meaden for this information.]

[Thanks to @InclusionCESI for this information.]

So, as one commentator put it, the Tories go into the 2015 general election with debt, in-work poverty and net migration higher – and the NHS in crisis compared to 2010.

Labour’s Michael Dugher followed up on this with: “Are the Tories really going to run on ‘You’ve never had it so good’?”

He has offered a few small freebies in a lame bid to influence the vote, hoping all the while that you won’t ask questions about the important economic issues he hasn’t bothered to mention.

Not only are we at the end of a zombie Parliament, but its own chancellor has crippled it in its final lurch to the election.

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Unemployment figures are a sanction-based stitch-up, research shows

Iain Duncan Smith: He's proud of the sanctions regime he introduced, in which Job Centre staff are expected to use possibly-fraudulent means to push people off benefits - and he doesn't care how many people they harm.

Iain Duncan Smith: He’s proud of the sanctions regime he introduced, in which Job Centre staff are expected to use possibly-fraudulent means to push people off benefits – and he doesn’t care how many people they harm.

The Coalition government will be crowing about the latest drop in unemployment today – according to official statistics. What a shame it’s all a load of bunk.

New research by Oxford University and the London School of Hygiene & Tropical Medicine has shown that only around one-fifth (20 per cent) of people who have been sanctioned off of Jobseekers’ Allowance have actually found work, leaving 1.6 million in limbo; they’re off the benefits system but researchers can only surmise that they are relying on food banks.

(Isn’t the Coalition government desperate to discredit food banks? Are ministers determined to drive the out-of-work population to starvation?)

This suggests that official Office for National Statistics figures are inaccurate. The latest batch – out today (January 21, 2015) – claim that unemployment dropped by 58,000 in the three months to November last year, when it totalled 1.91 million.

How can we trust these figures when it has been claimed there’s a sanction-based stitch-up going on?

The new figures are from the same ONS that is claiming wages are rising above inflation. Oh really? The figures show average earnings (excluding bonuses) rose by 1.8 per cent, which is more than the CPI rate of inflation – but not more than RPI, which is a more accurate measure of the costs affecting households.

What happens to those figures when executive pay is taken out of them? What’s the average for employees?

The revelation that sanctions have created a huge underclass of people – who have been refused benefits by Iain Duncan Smith’s homicidal system – casts all the ONS statistics into doubt.

If 1.6 million people are being denied benefits, that doesn’t stop them being unemployed.

Therefore the true unemployment figure should be almost twice as high as stated, at a massive 3.51 million.

That’s before other elements, such as the Work Programme, have been taken into account!

And what about the hidden cost of sanctions – to other taxpayer-funded services?

Professor David Stuckler of Oxford University explained this to The Guardian: “If, as we’re finding, people are out of work but without support – disappeared from view – there’s a real danger that other services will absorb the costs, like the NHS, possibly jails and food support systems, to name a few. Sanctions could be costing taxpayers more.”

Debbie Abrahams is a member of the House of Commons Work and Pensions committee, which was due to take evidence on benefit sanctions today. She told the paper: “This government has developed a culture in which Jobcentre Plus advisers are expected to sanction claimants using unjust, and potentially fraudulent, reasons in order get people ‘off-flow’. This creates the illusion the government is bringing down unemployment.”

[Image: The Void.]

[Image: The Void.]

Finally, there is the revelation that “physical punishment is now built into the benefit system, with sanctions both known and intended to cause a deterioration in health, says the DWP rule book”. Visit the Void blog for further details.

The evidence is stacking up, and shows that the Coalition government has falsified the figures to a shocking extent.

Any new government entering office after the general election will face an uphill struggle simply to uncover the depth of the depravity currently taking place.

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Economy slowing as growth is revised down: So what?

141223economic-growth-uk-ons-quarter1

The BBC is reporting that the UK economy has grown by 2.6 per cent in the last year – less than the 3 per cent originally thought. In the third quarter of 2014 the increase was 0.6 per cent.

“So what?” you’re probably asking. “Isn’t 2.6 per cent enough?” Well, it’s certainly much better than the limbo days of 2011-13 when the economy was in and out of the red and Ed Balls’ claim that it had “flatlined” was literally true.

The lower growth has been attributed to smaller government and business investment than had previously been expected, and higher imports.

There’s nothing to be done about the increase in the balance of payments deficit (that’s the difference between import costs and export takings) to 27 billion – especially if both government and business investment is down; it seems that Britain simply has nothing to sell.

So much for the “nation of shopkeepers” as Napoleon Bonaparte (among others) famously described us!

Perhaps George Osborne has restricted government investment in order to meet his (revised-revised – and probably revised again) deficit reduction target for 2014-15. If so, he’s even more of a short-sighted fool than we all thought because this will cause greater harm in the long run.

And there’s also the impending crash when the property bubble created by Osborne’s artificially-engineered housing boom pops. Help to Buy and Funding for Lending stimulated the economy when the private sector ignored Gideon’s call for help, but won’t go on forever.

But what does all this mean for the average person on the street?

Not much, it turns out.

All this talk of economic improvement may sound good – indeed, it is intended to do so. But it hasn’t translated into any improvement in living standards. They’ve been plummeting ever since the Conservative-led Coalition government took office.

Tories are bad for the nation’s living standards. So are Liberal Democrats.

Household incomes have dropped by a massive £1,600 every year – a huge amount for the poorest to bear and a considerable inconvenience for those of middle incomes as well.

Pay rises have been non-existent or below the level, even of CPI inflation – which doesn’t take into account all the costs that households must bear. That’s why the Tories and Liberal Democrats switched to using it as their main indicator back in 2010.

Where are all the new full-time jobs?

The only people to benefit from any economic upturn have been the corporate bosses and the Conservative Party (thanks to donations from the corporate bosses).

This means that, instead of asking, “So what? Isn’t 2.6 per cent enough?” you would be better-advised to ask:

“So what? When do I get my share?”

The answer is: “Under the Conservatives and Liberal Democrats?

“Never.”

Follow me on Twitter: @MidWalesMike

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Tories miscalculate welfare savings. No rich people affected

[Image: Institute for Fiscal Studies.]

[Image: Institute for Fiscal Studies.]

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.

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