Ipswich Unemployed Action.

Campaigning for Unemployed Rights.

Posts Tagged ‘Budget

A Budget for the Top 10% Wealthy, as 3/4 of Welfare Cuts Remain.

with 57 comments

Image result for arthur daley

One Man’s Advice has been Heeded.

Tory Budgets are odd things.

There’s a standard pattern

A Chancellor of the Exchequer stands up and grins like a Cheshire cat, meaning that you can be sure that only fellow tubby cats are going to be happy with the announcements.

In this case the likes of Sir Philip Green(CBI  and British Chamber of Commerce) and the Sir Arthur Daley (President, Federation of Small Businesses) are lapping it up.

Phil Fleming, spokesperson for the Federation of Small Businesses, described it as “a brilliant Budget”.

He said: “It was the most enjoyable Budget speech I have ever listened to in my life.

“He shut up the Opposition, considering what he had to juggle with. It is a brilliant Budget.”

Schools, we are told, are going to get cash for ‘little extras’.

Much needed it is said, for the post-Brexit teaching programme on the reintroduction of farthings, groats, and measurements such as Els, Furlongs, and terms for the reform of local government, Wapentakes and Hides.

Meanwhile…..

On Universal Credit in  the ‘I’ reporter Serina Sandhu reports,

The rollout of Universal Credit is being delayed once more, with a new target date of December 2023 for all claimants to be transferred to the Government’s flagship new benefit. The announcement came as Chancellor Philip Hammond provided an additional £6.6 billion over the next six years to smooth the introduction of UC, which replaces a range of welfare payments. Mr Hammond revealed the Treasury would be giving £1bn over five years to the Department for Work and Pensions to help ease the transition to the controversial benefits system. He also said he was increasing the work allowance – the amount claimants can earn before Universal Credit begins to be withdrawn – by £1,000 a year, at a cost of £1.7bn annually.

Mr Hammond defended the much-blighted system, which has led to some claimants being hundreds of pounds a month worse off than on legacy benefits. Others have fallen into rent arrears caused by delays to their first payment. “The switch to Universal Credit is a long overdue and necessary reform,” he said. “It replaces the broken system left by the last Labour government, a system… that trapped millions on out of work benefits. Universal Credit is here to stay.” Welfare damage Green Party MP Caroline Lucas said: “The announcement doesn’t begin to repair damage caused by yearly welfare payment freezes, welfare reform act [and] austerity. This is no budget for strivers, grafters [and] carers.” Labour said: “[It] is inadequate. The document confirms that the work allowance change only reverses around half of the previous Tory cuts from 2015.”

The Resolution Foundation says,

Squeeze continues for low and middle income families despite Chancellor’s £55bn giveaway Budget

Almost half of Budget 2018 income tax cuts are set to go to the top ten per cent of households

The Chancellor set out a significant easing of austerity in a £55bn giveaway Budget yesterday that set out major increases in public service spending, tax cuts and a reversal of cuts to the generosity of Universal Credit. But the squeeze is set to continue for low and middle income families, the Resolution Foundation said today (Tuesday) in its overnight analysis of the Budget, How To Spend It.

Faced with a total fiscal windfall of £73.8bn from the Office for Budget Responsibility over the forecast period, the Chancellor chose to use 75 per cent of it in a £55bn giveaway Budget. But while yesterday’s Budget represents a significant shift in overall direction of public spending, it does not spell the end of the squeeze – either for unprotected public services, or over ten million working age families in receipt of benefits.

Key findings from How To Spend It include:

The squeeze continues for low and middle income families

  • The analysis shows that over three quarters of the £12bn of welfare cuts announced after the 2015 election remain government policy, despite the welcome £1.7bn boost to Work Allowances in Universal Credit.
  • Half of the welfare cuts that hit family budgets are yet to be rolled out – including a £1.5bn benefit freeze next April that will see a couple with children in the bottom half of the income distribution losing £200.

Better news for the ‘more than just managing’

  • 84 per cent of the income tax cuts announced yesterday will go to the top half of the income distribution next year, rising to 89 per cent by the end of the parliament (2022-23) when almost half (45 per cent) will go to the top ten per cent of households alone.
  • The richest tenth of households are set to gain 14 times as much in cash terms next year from the income tax and benefits giveaways in the Budget as the poorest tenth of households (£410 vs £30).
  • The overall package of tax and benefit changes announced since 2015 will deliver an average gain of £390 for the richest fifth of households in 2023-24, compared to an average loss of £400 for the poorest fifth of households.

Cuts to public services are eased, but not ended

  • Overall day-to-day departmental spending per capita is now set to rise by 4 per cent between this year and 2022-23, rather than fall by 4 per cent as previously planned.
  • However, the promises of extra spending on the NHS, defence and international aid mean that unprotected departments will continue to see cuts in every year from 2020-21. Their per capita real-terms budgets are set to be 3 per cent lower in 2023-24 than 2019-20.
  • If allocated equally this would mean day-to-day spending cuts of 48, 52 and 77 per cent between 2009-10 and 2023-24 for the departments of Justice, Business and Transport respectively.

The economic backdrop to Budget 2018

  • Despite the slight upgrade in the OBR growth forecasts, GDP per capita is set to grow by 4.9 per cent between 2018 and 2023, compared with an IMF forecast of 5.5 per cent across the rest of the G7.
  • Real average earnings are not set to return to their pre-crisis peak until the end of 2024 – representing an unprecedented 17-year pay downturn.

Torsten Bell, Director of the Resolution Foundation, said:

“The Chancellor was able to navigate the near impossible task in his Budget of easing austerity, seeing debt fall and avoiding big tax rises, thanks to a £74bn fiscal windfall. He chose to spend the vast majority of this on the NHS, income tax cuts and a welcome boost to Universal Credit.

“But while yesterday’s Budget represented a seismic shift in the government’s approach to the public finances, it spelt an easing rather than an end to austerity – particularly for low and middle income families.

The Chancellor made a very welcome £1.7bn commitment to Universal Credit, but has left intact three quarters of the benefit cuts announced following the 2015 general election. Meanwhile income tax cuts announced yesterday will overwhelmingly benefit richer households, with almost half of the long term gains going to the top ten per cent of households. On public services the NHS saw a big spending boost ­– but unprotected departments still have further cuts penciled in.

“This Budget was much easier for Philip Hammond than many expected. But there will be tougher choices for Chancellors in the years ahead. Brexit must be delivered smoothly, public spending will remain tight, and forecasts may not always be so rosy.

“Looking further ahead, living standards growth is set to be sluggish and the tax rises to meet pressures in the 2020s from our ageing society will still be needed – as and when there’s a government with the majority to deliver them. Austerity has been eased, but there are still tough times ahead.”

The Mirror gives Labour’s response:

John McDonnell: Philip Hammond gave a broken promise budget, failing to end austerity

By choosing to cut rather than invest, Tories have failed to fix the weaknesses of the economy, says the Shadow Chancellor

Advertisements

Budget: Universal Credit Sticking Plaster Announced.

with 102 comments

Image result for universal credit unite community

 

As Ace Reporter, Breaking News, informs us, with the rest of our tip top team of Contributors, there are some changes to Universal Credit in the Budget.

I was initially confused with all this talk of 1,5 Billion, which it turns out, is not the Queen’s Billion,  a million million (i.e. 1,000,000,000,000),  but a miserable US thousand million (i.e. 1,000,000,000).

But here it is,

The Mirror, which is pretty good on these things, reports,

Chancellor Philip Hammond has bowed to pressure over Universal Credit with a £1.5 billion package to cut the waiting period for payments- by a week.

He has also removed the seven-day waiting period so entitlement starts on the day of the claim.

Changes announced today will also mean any household needing an advance can access a full month’s payment within five days of applying instead of half a month’s worth.

While the repayment period for advances will increase from six to 12 months.

He said that any new Universal Credit claimant in receipt of housing benefit will continue to receive that benefit for a further 2 weeks.

But Jeremy Corbyn slammed the U-turn as simply not good enough.

He told the House of Commons: “Wouldn’t it have been better to pause the whole thing and look at the problems it has caused?”

In response to Mr Hammond, Mr Corbyn said: “The Chancellor’s solution to a failing system causing more debt is to offer a loan,” referring to increased ‘advances’ for people in need.

It’s pretty clear what us lot think, but it’s good to hear somebody say it in a national paper,

The reaction from the Child Poverty Action Group, who have campaigned passionately for changes to Universal Credit, was mixed.

The charity’s Chief Executive Alison Garnham welcomed changes to the waiting days but said the chancellor had missed an opportunity to completely overhaul the flawed system.

She said: “We were the first to sound the alarm over the waiting days for universal credit, so we’re pleased the Chancellor has acted to remove them and put in place new arrangements for receiving advances as part of an emergency rescue package, but this should have been the budget that ushered in much needed structural reform of Universal Credit to revive the central promise to strengthen the rewards from work and that didn’t happen.”

The trusty lot at the Mirror put all this into place,

Hammond’s Budget is no game changer and tinkering with Universal Credit is a con when deep, painful welfare cuts for families in and out of work will plunge more kids into grinding poverty.

Branding a £7.83 an hour minimum wage a “living wage” adds insult to injury when independent experts calculate the real rate would need to be £8.75 – or in expensive London, £10.20.

Sunny BBC reporters summarise this dream-package for those who wish to go a but further:

“For the average person claiming the benefit, they’ll have £73 extra in their pockets plus housing costs and any other elements they qualify for – like childcare support.”

More details:

People claiming universal credit will now wait, to be precise, 35 days rather than 42 before they get their first payment.

It’s helpful to think of the current waiting period before people can receive their first universal credit in three chunks:

  • Four weeks to assess how much someone has earned in the last month
  • An administrative week set aside to process the payment
  • A further seven “waiting days” during which claimants are not eligible for any benefit – this is what the chancellor is scrapping

The four weeks is more or less baked into the design of the system. Universal credit was designed to be paid in arrears once a person’s monthly income has been assessed. Changing this feature would have required a fairly significant change to the whole structure of the benefit.

So it was in the other 14 days that the government had some leeway.

The reduction in the waiting period announced in the Budget strips away seven of those extra days, leaving a full week to process the payment. Arguably, the chancellor could have shortened the payment processing time too.

It was the seven additional “waiting days” many took issue with, since it’s difficult to see what purpose those days served other than to save money.

David Finch, a senior policy analyst at think tank the Resolution Foundation, described them as a “completely unnecessary saving” which had a disproportionate negative impact on claimants.

And a report on the six week waiting period by a cross-party group of MPs, chaired by Labour MP Frank Field, described the motivation of those extra days as “primarily fiscal”.

But the motivation behind universal credit was not a cost-saving one – it was supposed to be all about getting more people into work.

The report’s authors added that they had been told by a wide range of charities, councils and housing associations that the seven waiting days did “nothing to further the stated objectives of Universal Credit but contribute to claimant hardship.”

Who will benefit?

Just over a third of people eligible for universal credit have always been exempt from having to go for seven “waiting days” with no benefits.

This group includes people who are moving on to universal credit from a relevant existing benefit, those who have claimed Jobseeker’s Allowance or Employment Support Allowance in the past three months, young people under the age of 22 leaving local authority care and victims of domestic abuse.

The other 64% of new claimants will benefit from this change.

The actual number of people will vary – there were 47,000 new people starting to receive universal credit in the most recent month we have data for (13 September to 12 October).

Still, while we pause,  this is a good larf..

But…..(leaving aside the rest of the unfit for purpose system stays in place),

Benefits are still frozen.

Food prices, to begin with, are rocketing.

Butter has gone up by 40%’: readers on rising UK food prices.

As inflation sticks at a five-year high of 3%, readers share their experiences of how they are coping with the squeeze.

It’s very generous of the Chancellor to extend rail cards for young people, to those who are under 30.

“Discount railcard extended for people aged up to 30”.

I shall bear that in mind the next time I am under 30.

But duty on high-strength “white ciders” to be increased in 2019 via new legislation.

Like the kind of po-faced Scottish nationalists who do not want the poor to drink the devil’s buttermilk, and who have introduced ‘Minimum Pricing’ for alcohol, you can see here an attempt to stop the really hard up getting pissed up on the cheap with White Lightening.

One to watch out for, as there are  temperance lobbyist in other parties in the UK who’d  like to do the same here.

 

 

Written by Andrew Coates

November 22, 2017 at 3:48 pm

Budget’s Expected Impact on Welfare.

with 67 comments

Image result for budget box

 

Budget 2017 for benefits: what welfare changes is Philip Hammond planning? Everything we know so far about the Chancellor’s plans for the benefits system. ANOOSH CHAKELIAN New Statesman.

This timely article outline some very bad news:

The Chancellor Philip Hammond will announce changes to welfare when he delivers his Budget. What do we know?

How has Theresa May’s government approached welfare so far?

Outside No 10 on 13 July 2016, Theresa May put equality at the heart of her first statement as Prime Minister. She claimed that she would put herself, “squarely at the service of ordinary working-class people”. She dedicated her speech to those who, “can just about manage but you worry about the cost of living and getting your kids into a good school”, telling the nation: “If you’re just managing, I want to address you directly.”

This meant that progressives looked to the first Autumn Statement from her Chancellor Philip Hammond last year to see if she would turn her rhetoric into action.

There wasn’t much, however, for the “just about managing” (nicknamed “Jams”) when the new government announced its first plan for Britain’s finances. The Chancellor eased the planned cuts to Universal Credit slightly, by slowing the pace at which your benefits are reduced the higher above the allowance you earn. He said the welfare cap would remain, but promised there would be no more welfare cuts this parliament.

A four-year freeze on tax credits and benefits such as Jobseeker’s Allowance and income support has been in place since April 2016 last year, and £12bn worth of cuts to the welfare budget were planned for this parliament in the 2015 Tory manifesto pledge. The government wants to stick to making these savings. A £3bn-a-year reduction in the work allowance – the amount benefit claimants can earn before their benefits start being withdrawn – has only really been reduced by about £700m by Hammond.

Hammond inherited harsh welfare policies from George Osborne’s regime, whose austerity programme hit low-income households the hardest – cutting working-age benefits to add to the burden of wage stagnation and rising living costs. He’s not done much so far to ease this pain.

So what are they planning for the Budget?

We can’t expect a huge amount of easing up on benefit freezes in the coming Budget. Here’s what we’re likely to see:

Jobseeker’s Allowance freeze

This is an Osborne legacy, but the unemployment benefit will continue to be frozen at £57.90 a week for under-25s, and £73.10 for those who are 25 and older. Since April 2013, this went up 1 per cent a year. The freeze was announced in the 2015 budget, and came into force last year. Remember, the rate of inflation is increasing, so this could be a big squeeze in the next year.

(Note: This is beginning to really bite.)

No automatic entitlement to housing benefit

The government recently announced its plan to remove the entitlement to housing benefit for some 18-21 year olds. Centrepoint warns that this could lead to 9,000 young people being unable to access accommodation and at risk of homelessness. The Guardian suggests Hammond might u-turn on this.

(Note: Mean-spirited is the least of it. Expect more rough sleepers everywhere)

Child benefit freeze

Another continued freeze, at the existing rate of £20.70 a week for the first child and £13.70 for ensuing children. Again, inflation going up means this will feel increasingly tighter. Another part of the Osborne plan.

(Note: the plan to hit ordinary people.)

Child tax credit limited to two children

If you want to claim child tax credits for children born on or after 6 April 2017, you can only do so for two children. If you already claim them, your claims won’t be affected. You also won’t receive what’s known as the “family element” (around £40.40 a month) if your children are born after that date. This is another Osborne policy, announced in 2015 to start this year.

Universal Credit freeze

Universal Credit rates will be frozen for 2017-18. The Osborne plan was the cut the work allowance by £3bn each year – a plan Hammond slightly softened by reducing the taper rate in the Autumn Statement.

(Note: another kick in the face for the less well off, in work.)

So that’s a huge squeeze on living standards for May’s beloved “ordinary, working-class people” then?

As we already notice in our bills and shopping, this will hit us hard.

Hard up working families face a “double whammy” of benefits freezes and rising inflation to the tune of billions of pounds, a new study has warned. 

Analysis from thinktank the Resolution Foundation found that a total of £3.6bn will be taken from the worst off households by 2020 thanks to the freeze in tax credit and working age benefits.

Their calculations suggest a single earner family with two children could lose £680 a year once inflation is factored in.

The Foundation’s director, Torsten Bell, warned the Office for Budget Responsibility could revise up its inflation forecast to 2.6% for both this year and 2018.

That would see real pay falling by the end of this year as prices start to outstrip only modest wage growth.

“The effect of a renewed pay squeeze would be broadly felt across the population,” Mr Bell told the Guardian.

“But in many ways the worst affected group might be those ‘ordinary working families’ on lower incomes who will face a double whammy of lower pay growth and benefit cuts.”

 

Written by Andrew Coates

March 7, 2017 at 11:11 am

How the Budget will affect the Unemployed.

with 32 comments

Osborne Celebrates at Pushing People into Deeper Poverty.

 

Effects of the Budget on the out-of-work.

SINGLE

Single, no children. Unemployed

2015-16 He receives jobseeker’s allowance of £73.10 a week (£57.90 if aged 16-24). Housing benefit eligibility will depend on his property size and, if he rents, where he lives.

2016-17 Jobseeker’s allowance is frozen for the next four years, so remains at £3,801 a year. Any housing benefit he may receive is also frozen for that period.

Single, one child. Unemployed

2015­-16 Income support is £73.10 a week, child tax credit is £63.98, and child benefit is £20.70. This gives an annual household income of £8,205 disregarding any housing benefit.

2016-­17 Last summer the chancellor announced he was freezing all three of her benefits for the next four years. It leaves her income unchanged, disregarding housing benefit.

Guardian.

Put simply as the cost of living rises – note that this particularly affects rent – the amount of JSA and Income support will not go up.

This will mean that people already in poverty will be pushed further down.

Disabled:

Around 640,000 claimants could lose out as a result of changes to the assessment criteria for PIP, which is designed to help people with extra costs associated with disabilities and long-term illnesses.

Disabled people will be badly affected with an expected 200,000 individuals set to lose almost £3,000 a year according to Labour Party analysis.

Metro.

Summary of 2016 Benefit changes:

The following benefit changes are set to take place in 2016, some may be subject to change or approval.

Benefit and Tax Credit rates frozen

The main rates of working age benefits and tax credits will be frozen in cash terms for 4 years from April 2016. Pensioner benefits are excluded from the benefit freeze and will be protected by the ‘triple lock’.

Disability benefits, the disability-related elements of tax credits and statutory payments including Personal Independence Payment, Attendance Allowance, Disability Living Allowance, Employment and Support Allowance (Support Group only), Maternity Allowance, Statutory Maternity/Paternity Pay and Statutory Sick Pay, will be uprated in line with the Consumer Prices Index (CPI). The CPI was announced to have fallen in the year to September 2015 so this means that the benefits mentioned above will not be increased from April 2016.

Benefit cap reduced

There is currently a benefit cap in place in England, Scotland and Wales restricting the amount in certain benefits that a working age household can receive. Any household receiving more than the cap has their Housing Benefit reduced to bring them back within the limit. The benefit cap is to be introduced in Northern Ireland from 31 May.

The cap which is currently £26,000 per year is to be reduced to £23,000 for households living in London and to £20,000 for those outside London from Autumn 2016, when exactly you will be affected will depend on where you live. For further details see our Benefit cap reduction Autumn 2016 help page.

Housing Benefit changes

Unlike other reforms the Chancellor announced directly affecting child related payments, withdrawal of the family premium in Housing Benefit (£17.45 when a claimant has one or more dependant children) will take effect from 1 May 2016, a year earlier than the reductions for children within Child Tax Credit. Removal of the family premium will affect both new claims and new births from 1 May 2016. For further details see our Family premium abolished May 2016 help page.

Housing Benefit backdating will be reduced so that new claims from working age claimants will be backdated for a maximum of one month. Currently, if you are working age, your Housing Benefit claim can be backdated for up to six months if you can show good cause for making a late claim and you would have qualified for the benefit sooner.

Tax credit allowance and taper cut

On 25th November 2015 during the Chancellor’s combined Autumn Statement and Spending Review, he announced that the widely unpopular planned tax credit changes (reduced income threshold and increased taper rate), which would have meant that any working household receiving tax credits with an annual income of more than £3,850 a year would be worse off, would in fact not be going ahead.

Tax credit income disregard cut

At the moment, if your household income increases by up to £5,000 during the tax year this increase is ignored when calculating your entitlement for that year. From April 2016 this will be reduced so that any increase in income of more than £2,500 will be taken into account. According to the Treasury, it is estimated that 800,000 people will see their entitlement to tax credits reduced by an average of £200-£300 per year due to this cut which brings the ‘income rise disregard’ back to the same level it was when tax credits were first introduced.

New State Pension

For those reaching pension age from 6 April 2016 a new State Pension is being introduced to replace the basic State Pension and State Second Pension. This affects all women born on or after 6 April 1953 and all men born on or after 6 April 1951. The new pension is designed to be much simpler than the current system and will consist of a single amount to be awarded in full if you have 35 qualifying years of National Insurance contributions. If you don’t have the contributions required for the full pension, as long as you have a minimum number of qualifying years (between 7 and 10) you will receive a pro rata amount. If you don’t have the minimum number of qualifying years you will not qualify for the single tier pension. Any contributions made under the current pension system can be used toward the new State Pension.

If you qualify for the full amount you will receive £155.65 a week. For those who do gain in state pension income, for some this will be offset by reductions in means-tested benefit entitlements and if you fall under the new single tier pension system you will not be able to claim the Pension Credit savings credit. To find out more see Age UK’s ‘what the new pension reforms mean for you’

Universal Credit changes

The work allowance in Universal Credit, the amount you can earn without your benefit being affected, will be reduced from April 2016. For disabled people and people with children it will be reduced to £192 per month if you have housing costs and £397 per month if you don’t have housing costs. The work allowance will be abolished altogether from April 2016 for non-disabled, childless claimants meaning your benefit is reduced as soon as you start earning.

The Childcare Costs element of Universal Credit currently pays for 70% of your registered childcare costs up to a monthly limit of £532 for one child or £912 for two or more children. From 11 April 2016, this will increase so that you will be able to claim back up to 85% of your paid out childcare costs up to a monthly limit of £646 for one child or £1108 for two or more children.

Other changes

National Minimum Wage increased

The National Minimum Wage will be ‘rebranded’ as the National Living Wage and will be increased to £7.20 per hour for those 25 or over from April 2016. It will reach £9.00 per hour by 2020.

Personal tax allowance increased

The Personal Tax Allowance, the amount you can earn before paying income tax, will be increased from £10,600 to £11,000 from April 2016. It will be further increased to £12,500 by 2020 and thereafter it will automatically be set at the same level as 30 times the National Living Wage (National Minimum Wage).

Rent changes for social tenants

From April 2016 social housing rents will be reduced by 1%, or in some exceptions frozen, for four years.

The Void also asks:Does The End of Social Security Lie Behind Osborne’s Savings Hand Out?

The use of personal savings accounts as a replacement fot the social security system has long been an ambition of free-market extremists desperate to eradicate any form of social spending.  As the Think Tank Review website reminded us last year, the Adam Smith Institute proposed Fortune Accounts way back in 1995.  The suggestion was that individuals should pay into a pot of money to fund any future periods of sickness or unemployment.  More recently the right-wing Policy Exhange called for the establishment of MyFund accounts in an astonishing report that did not just call for these savings pots to replace unemployment benefits but also suggested that the money could pay for “access to private sector employment support services”.  They want us to pay for our own workfare.

Government ministers are already thinking along the lines of some sort of savings or insurance based social security system.  A public sector consultant recently blogged about a meeting – sponsored by health insurers BUPA just by the way – with comedy toff Lord Fraud held at the Reform think tank.   According to the report the Minister for Welfare Reform raised the question of “why do employers insure against sickness absence and why don’t individuals?” .

More on the Void.

Written by Andrew Coates

March 17, 2016 at 3:59 pm

Impact of Benefit Cuts Leaves Mothers £13bn worse off.

with 56 comments

Osborne Smirks at Thought of more Welfare Cuts. 

As the Budget on the 16th of March gets nearer here are some things to think about.

In February we saw this:

Government freeze on tax credits and jobseekers’ allowance could cost families 12% of their benefits, says report.

A report by the Children’s Society, published on Tuesday, says families could lose up to 12% from the real value of their benefits over the next four years as a result of government plans to freeze child tax credits, working tax credits and jobseekers’ allowance from April.

Guardian. 23rd of February.

Note: this was introduced last year:

A freeze in working age benefits for four years (including tax credits and Local Housing Allowance, and excluding maternity pay and disability benefits – PIP, DLA and ESA Support Group).

These are some of the changes that will hit people here from April 2016 (more details here).

  • The level of earnings at which a household’s Universal Credit award starts to be withdrawn for every extra pound earned (Income threshold reduction) will be reduced from £6,420 to £3,850. SeeSummer Budget 2015 page
  • Universal Credit work allowances will be reduced to £4,764 for those without housing costs, £2,304 for those with housing costs, and removed altogether for non-disabled claimants without children. See SI 2015/1649 and Summer Budget 2015 page.
  • The amount by which a tax credit claimant’s income can increase in-year compared to their previous year’s income before their award is adjusted (the income rise disregard) will be reduced to £2,500. See Spending Review 2015 page

From April 2017.

  • New ESA claimants who are placed in the Work-Related Activity Group will receive the same rate of benefit as those claiming Jobseeker’s Allowance, alongside additional support to help them take steps back to work. See Summer Budget 2015 page
  • Those aged 18 to 21 who are on Universal Credit (UC) will have to apply for an apprenticeship or traineeship, gain work-based skills, or go on a work placement 6 months after the start of their claim. Apart from certain exceptions (those considered vulnerable) they will not be allowed to claim Housing Benefit/UC housing costs element. See Summer Budget 2015 page

Now the results are being analysed:

Benefit cuts ‘will leave mothers £13bn worse off over course of current Parliament’. Independent March the 6th 2016.

Mothers will be £13bn worse off under the current Government as a result of policies announced over the past year, according to a new analysis.

Labour described the figures – produced by the House of Commons Library – as a “disgrace”, saying mothers played a key role in society but had been hit with a “stonking great bill”.

The research looked at the effects on women with dependent children of a number of changes announced by Chancellor George Osborne, since last year’s general election.

It found that cuts to universal credit, the four-year freeze on child benefit and other welfare payments, reductions in housing benefit and other policies outweighed increases to the personal income tax allowance and extra money for childcare.

The overall impact meant mothers will be £13bn worse off over the course of the current parliament, from last year until 2020. The Labour MP Yvette Cooper, who commissioned the research, said: “These figures are a disgrace. On Mother’s Day, the whole country celebrates just how much mums do to hold families together, communities together and even hold our economy together too.

“Yet what thanks do mums get from George Osborne and David Cameron? Only a stonking great £13bn bill.”

Last month the Children’s Society urged the Government to reconsider the benefits freeze if ministers were “genuinely concerned about child poverty”.

The charity calculated that a 23-year-old single mother, who works as a primary school teacher and rents her home, would be more than £2,800 a year worse off as a result of the changes. And a nurse and her partner, living in a rented house in London with three children, would be £5,100 a year worse off.

In a report, the society found that seven million children in low-income families would be affected by the four-year benefits freeze, while others would be pushed into poverty as a result.

A spokeswoman for the Treasury did not respond to a request for comment.

Responding to the Children’s Society report last month, the Department for Work and Pensions said: “We are bringing welfare spending under control, while – crucially – helping people into work, and through universal credit helping them to earn more.”

Still it’s not all bad news: Pensions: George Osborne drops plans to cut tax relief

And the big winners of this non-announcement will be wealthy people. At the moment not only do they earn more, they also get a proportionately bigger tax top-up from the government when they save for their retirement.

If the chancellor had scrapped the tax relief entirely on pensions savings and created instead a new pensions Isa, that would have cost the better off (40p and 45p taxpayers) billions of pounds collectively.

Written by Andrew Coates

March 6, 2016 at 11:30 am

What the Budget Means for the Unemployed.

with 52 comments

Osborne: I don’t Care, My Family’s Doing Quite Nicely Thank You.

Some effects of the Budget on the out of work. (Guardian)

Single, no children. Unemployed

Base income: £3,801 2015-16 Jobseeker’s allowance rose to £73.10 (£57.90 if aged 16-24) in April, an increase of 70p a week or £36.40 a year compared with 2014-15. Housing benefit eligibility will depend on his property size and, if he rents, where he lives.

2016-17 His benefits are frozen, meaning his overall income neither increases nor decreases.

Except that with the price of basics unlikely to stay still until 2017 this means a cut in benefits.

A single person aged 24 with no children. He previously worked but is now receiving sickness benefits. He rents a housing association flat in Manchester for £70 per week

Base income: £8,952 2015-16 He receives £5,312 in employment and support allowance and housing benefit of £3,640. This gives a total income of £8,952.

2016-17 The 1% reduction in social housing rents means he now has to pay rent of £69.30. Housing benefit reduces to cover this amount. Other benefits are frozen meaning that he is no better or worse off.

Couple, both unemployed, three children, renting in Bristol £800pcm

Base income: £26,000 2015-16 They get combined total benefits of £26,000 – made up of jobseeker’s allowance, child tax credit, housing and child benefit. They would get £26,502 but this is over the maximum benefit cap of £26,000. In the case that one child is disabled, they get £32,507 and are unaffected by the cap.

2016-17 Lowering the maximum benefit cap means their benefits are limited to £20,000. Overall they will be £6,000 worse off. Where one of the children is disabled they are neither better or worse off due to the freeze in benefit rates.

18-21-year-olds to lose jobless benefits under ‘earn or learn’ scheme.

This is a real blow to the young unemployed: either do workfare or “learn” .

This does not mean going to college, unless you take out a loan:

University maintenance grants for lower income students in England and Wales are to be scrapped from September 2016, Chancellor George Osborne has said.

In his budget, Mr Osborne said the grants had become “unaffordable”. Mr Osborne also said tuition fees could rise with inflation, above £9,000, for those institutions which offer high-quality teaching from 2017-18. BBC.

As the Guardian says,

The tone of the chancellor’s strict carrot-and-stick approach was established by his planned “youth obligation” for 18 to 21-year-olds on universal credit, which he said would provide them with “an intensive regime of support from day one of their benefit claim”, from April 2017. At the same time, Osborne said housing benefit would no longer be automatically available for 18 to 21-year-olds.

There is also this:

The upmarket wallpaper firm Osborne & Little is claimed to have linked up with a corporation in the British Virgin Islands to turn its former headquarters in an expensive south London district into flats and houses. Once they had received planning permission for the site, Osborne & Little sold the site to its foreigner partner for £6,088,000. The deal was signed by Sir Peter Osborne, the Chancellor’s father. Details of the agreement, which emerged on the eve of the Budget, were disclosed in documents obtained by Channel 4 News. There is no suggestion that the Chancellor, or the family firm, avoided tax as a result of the deal. Independent. 

Welfare Analysis of the Budget.

with 22 comments

This is a cross-post from Harpy (here). Louise is employed full-time in the area of welfare rights. She is one of the few people who have been campaigning against Welfare Reform for the last few years. Ipswich Unemployed Action works with her. As someone based in the East End of London she knows some of the hardest edges of the system.

Louise’s Blog also has  her own, really ace,  digital photos on it.  

I note, in passing, that our old friend David Freud was on Newsnight yesterday. Interviewed by a  very anti-the-unemployed Jeremy Paxman.

 The incredibly wealthy Paxman came out with some Daily Express type tales about people living the life of Riley on the Dole.  Normally he does not bully the weak, but you could see on the programme how nasty he can turn. For some details on the kind of lies that are being peddled see this – here.

The real human cost of this miserable & draconian Budget

22 06 2010

This emergency Budget is totally draconian and utterly austere. To think otherwise (only if you are wealthy) is a fool’s paradise. Richard Murphy highlighted:

Benefits will be cut by about 10%. Departmental spending, except in health and overseas development will be cut by 25%. At least 750,000 state sector jobs will go on that basis, in my estimation. I think 750,000 more from the private sector could join them on the unemployment register. And this budget, which according to George Osborne promised growth, did no such thing.

Sunny Hundal points to this YouGov poll where 49% of the respondents believe that the cuts are a good idea (the vox pop on tonight’s C4 News concluded that it wasn’t too bad and many expected to ‘pay’ for the crisis)… . Firstly, regarding this YouGov poll, who was precisely polled and secondly, it’s the calm before the storm…and the impact has not sunk in as yet. People will pay, and pay dearly they will. But the reality is that people will suffer, a massive 25% will be slashed from public departments. Public sector pay will be frozen for two years (translated…. a pay cut). Therefore massive unemployment, poorer population and the likelihood of a double-dip recession. To put it bluntly, we are fucked….

Another area that has been plundered is welfare, Con/Dems attack the poorest and the most powerless with their raid on the coffers of welfare.

Uprating

  • the government will adopt the Consumer Price Index (CPI) for the uprating of benefits and tax credits from April 2011

DLA

  • the government will introduce the use of ‘objective medical assessments’ for all DLA claimants from 2013/2014

Translated this means bullying people into the job market based on supposedly “objective medical assessment” when really it is based on ideology.

Benefits and children

  • from October 2011, lone parents whose youngest child is aged 5 or above will be eligible for jobseeker’s allowance rather than income support, and existing claimants will be transferred from income support to jobseeker’s allowance from April 2012;
  • from April 2011 the government will restrict eligibility to the sure start maternity grant for the first child (or children where the first is a multiple birth);
  • the health in pregnancy grant will be abolished from January 2011; and
  • child benefit will be frozen for three years from April 2011

Tax credits

  • from April 2011, the second income threshold for the family element of child tax credit will reduce from £50,000 to £40,000 and, from April 2012, the family element of child tax credit will be withdrawn immediately after the child element;

Benefits and children

  • from October 2011, lone parents whose youngest child is aged 5 or above will be eligible for jobseeker’s allowance rather than income support, and existing claimants will be transferred from income support to jobseeker’s allowance from April 2012;
  • from April 2011 the government will restrict eligibility to the sure start maternity grant for the first child (or children where the first is a multiple birth) ;
  • the health in pregnancy grant will be abolished from January 2011; and
  • child benefit will be frozen for three years from April 2011.

Housing costs and housing benefit

I know there are other measures regarding Housing benefit but this below is very worrying as it will cause untold misery;

  • from April 2013, housing benefit awards will be reduced to 90 per cent of the initial award after 12 months for claimants receiving jobseeker’s allowance;

This means not just that people will be finding things a bit tough but that they will not be able to pay the rent. They will be made homeless. George is putting beggars back on the street in the same way that his hero, Thatcher, did.

Unemployed people will be used to put downward pressure on wages. This the role of the employment advisers involved in the “New Deal”. The result is that the rich and their big corporations will benefit hugely at ordinary peoples’ expense. Expect more bullying in the workplace and in the Jobcentre.

We are going to be living in a very nasty and destructive society (and the CBI btw want to restrict strike action). The message people should take is organise and resist or be destroyed.

As Mark Serwotka (PCS general secretary) argues, This is one of the most regressive budgets we have seen for many years, with attacks on the low-paid, the unemployed, pensioners, the welfare state and the public sector as a whole. This is not a progressive budget to help the country recover from the worst economic crisis in living memory, it is a programme of despair for millions of people who did not cause the recession and should not be made to pay for it. We do not believe that these cuts are necessary, we do not accept the flawed analysis on which they are based, and we are committed to helping to organise joint union action and campaigning in communities to resist them.

Written by Andrew Coates

June 24, 2010 at 8:58 am