Savings and Investments thread

Rob7Lee said:

I'm ok with removing the 2 child cap, however it should have been done in conjunction with a complete review of benefits/welfare as a whole. We cannot continue on a path where we use 1/4 or if you include State pension 1/3rd of all income tax and National Insurance collected on welfare/state pension, it's simply not sustainable.

Dont disagree there needs to be a review but I do once again want to challenge the way you have presented these numbers. When you just look at working aged and childrens social security - which is what we are talking about here it makes up 10.2% of all government spending. not a quarter. 

Figure 3 here: https://ifs.org.uk/taxlab/taxlab-key-questions/what-does-government-spend-money

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

I saw it on Twitter and immediately called bull, I then put the info myself into a benefit checker (entitled.co.uk if anyone wants to have a go and depress themselves!)

Clearly someone had worked out what the absolute maximum you could get based on circumstance.

£4,287 in benefits (made up of UC and Child allowance and council tax help). £11k a year on minimum wage/16 hours each gives you £6,120 a month.

Someone also made the point that if you also suffer with 'anxiety' (probably from having 5 kids and so much money) you can also get a brand new car on Mobility although I'm not convinced it's that simple!!

I'll get my coat......... someone turn the lights out on the way out

What housing costs assumption did you use in this example? was it a single parent family or 2 parent, what ages are the children? I think some pretty unrealistic and extreme assumptions will have been needed to get these figures. E.g. I think all 5 of the kids will need to be below school age and housing costs would need to be extreme. 

Not saying its impossible but its gonna be extremely unlikely to get numbers like this. 

And it was discussed on the general things that annoy you thread a couple of weeks ago but anxiety alone is not enough for motability. It Needs a few other conditions/criteria to be met alongside that to become eligible.

£1100 rent
Dual parent (hence two x minimum wage salaries x 16 hours each per week)
All school age (5-15).

I don't know the full calculation and exactly what it is made up from as it's an online calculator as linked to above.

As I say, I'm sure this is based on an extreme, but even still there should be no circumstances really where a couple with 5 children are working 16 hours a week each on minimum wage and are getting the equivalent of north of a £100k salary.

!00% agree. The benefits system is/was designed as a safety net - and those in genuine need should be supported. What it should never be is an alternative lifestyle choice, which it is for some. That's the fault of the system, not the individuals.

Carter said:

Diebythesword said:

Children are dossers? Personally I’m happy something that’s proven to drive children into poverty has been removed. 

Hang on, I'm pretty sure I didn’t say that children were dossers 

I know who is, and this budget does more for helping them and taking more from pretty much everyone else 

Carter said:

bobmunro said:

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

I saw it on Twitter and immediately called bull, I then put the info myself into a benefit checker (entitled.co.uk if anyone wants to have a go and depress themselves!)

Clearly someone had worked out what the absolute maximum you could get based on circumstance.

£4,287 in benefits (made up of UC and Child allowance and council tax help). £11k a year on minimum wage/16 hours each gives you £6,120 a month.

Someone also made the point that if you also suffer with 'anxiety' (probably from having 5 kids and so much money) you can also get a brand new car on Mobility although I'm not convinced it's that simple!!

I'll get my coat......... someone turn the lights out on the way out

What housing costs assumption did you use in this example? was it a single parent family or 2 parent, what ages are the children? I think some pretty unrealistic and extreme assumptions will have been needed to get these figures. E.g. I think all 5 of the kids will need to be below school age and housing costs would need to be extreme. 

Not saying its impossible but its gonna be extremely unlikely to get numbers like this. 

And it was discussed on the general things that annoy you thread a couple of weeks ago but anxiety alone is not enough for motability. It Needs a few other conditions/criteria to be met alongside that to become eligible.

£1100 rent
Dual parent (hence two x minimum wage salaries x 16 hours each per week)
All school age (5-15).

I don't know the full calculation and exactly what it is made up from as it's an online calculator as linked to above.

As I say, I'm sure this is based on an extreme, but even still there should be no circumstances really where a couple with 5 children are working 16 hours a week each on minimum wage and are getting the equivalent of north of a £100k salary.

!00% agree. The benefits system is/was designed as a safety net - and those in genuine need should be supported. What it should never be is an alternative lifestyle choice, which it is for some. That's the fault of the system, not the individuals.

Its a fair chunk of both in my eyes 

Just because you can do something definitely doesn't always mean you should 

Being out of work is more about lack of purpose, structure and drive. I'm not talking about high performers or over achievers. Not doing that will absolutely wallop your mental health 

For my part, its the societal contract, I don't mind paying tax what I can't abide is how that money is wasted and given to people who have chosen not to take part in their end of the societal contract
 

I completely agree that the social contract has broken down. The other side to that social contract is low pay. the minimum wage was effectively brought in as part of that social contract to say that if you worked 40 hours a week you would be able to provide for yourself and your family and not be in poverty. Unfortunately that side of the social contract has also broken down. We now have massive and growing in work poverty. Thats a real issue and for me is the main factor in why welfare has exploded. Its not that the safety net is too high its that we have had a whole generation of wage suppression which means those in work also need the safety net. Yes there will be a minority who choose not to work but thats not because the safety net is too high but because the pay is too low (otherwise they wouldn't be in poverty).  


https://www.health.org.uk/evidence-hub/money-and-resources/poverty/in-work-poverty-trends

• 65% of children and working-age adults in poverty in 2023/24 lived in families where at least one adult was working part-time or more, up from 56% in 2012/13 and 44% in 1996/97.
• 18% of children and working-age adults in poverty in 2023/24 lived in families where all adults were working and at least one adult was working full-time (referred to here as high work intensity families), which is up from 13% in 2012/13 and 9% in 1996/97.

Carter said:

Have to agree to disagree then 

I can promise you, give most the households who are having kids they can't afford 10k and it would not improve anything for the children involved. Incentivising going to work might help but the government seem intent on making that as unappealing to both employers and employees as they can 

This whole lone about lifting kids out of poverty is absolute bollocks. Poverty is not erased by the sums of money they are using. 

To answer your question. The dossers are anyone who can go to work choosing not to, anyone who is living beyond their means and being babied by the state in this case people having children they cannot afford to raise.

That could be not feeding their kids because they see that as something the state should do, not reading to or educating their children at home, not setting an example to their children. 

Sudden changes of situation, ill health are what a welfare state is there for, the numbers show and the information behind the data is a lot of people are choosing to be looked after, like infants as opposed to being accountable. 

You can promise me and the numbers show - but where are these numbers? Because the DWP data direct from the system and the health foundation data show that the majority of these people are in work.

So the amounts of money are simultaneously far too high but also not enough to lift children out of poverty? Can't be both can it?

Where is your evidence that people are choosing to have kids they cant afford definitely not experiencing a change in circumstances? That's a perception but I really don't think it holds up to any scrutiny. There will always be some but to present it as the majority is ridiculous.

carly burn said:

Giveth with one hand. Taketh with the other.

So salary sacrafice pots in a lot of cases will be used to help pay for future care, which is expensive.
If people start to greatly reduce the amount they are putting into pensions it will be left for the state to increase the elderly adult care tab.

Budget 2040 is going to be an absolute corker!

Yeah short termism in government is a massive problem and its built into the self imposed fiscal rules which are by design very short term. Social care is a massive ticking time bomb which has been shoved down the road by governments for 15 years. For the current over 60's cohort who will be using these services in the next 30 years and who hold a lot of wealth - It will be a massive transfer of wealth from these people to the private equity firms who own most of elderly care in the UK, who offshore their profits, pay minimal tax and outsource large proportions of what should be care in their responsibility to the NHS. Needs addressing ASAP.

I dont see any solution to short termism without changing the fiscal rules and our electoral system. 

Rob7Lee said:

cantersaddick said:

Carter said:

bobmunro said:

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

I saw it on Twitter and immediately called bull, I then put the info myself into a benefit checker (entitled.co.uk if anyone wants to have a go and depress themselves!)

Clearly someone had worked out what the absolute maximum you could get based on circumstance.

£4,287 in benefits (made up of UC and Child allowance and council tax help). £11k a year on minimum wage/16 hours each gives you £6,120 a month.

Someone also made the point that if you also suffer with 'anxiety' (probably from having 5 kids and so much money) you can also get a brand new car on Mobility although I'm not convinced it's that simple!!

I'll get my coat......... someone turn the lights out on the way out

What housing costs assumption did you use in this example? was it a single parent family or 2 parent, what ages are the children? I think some pretty unrealistic and extreme assumptions will have been needed to get these figures. E.g. I think all 5 of the kids will need to be below school age and housing costs would need to be extreme. 

Not saying its impossible but its gonna be extremely unlikely to get numbers like this. 

And it was discussed on the general things that annoy you thread a couple of weeks ago but anxiety alone is not enough for motability. It Needs a few other conditions/criteria to be met alongside that to become eligible.

£1100 rent
Dual parent (hence two x minimum wage salaries x 16 hours each per week)
All school age (5-15).

I don't know the full calculation and exactly what it is made up from as it's an online calculator as linked to above.

As I say, I'm sure this is based on an extreme, but even still there should be no circumstances really where a couple with 5 children are working 16 hours a week each on minimum wage and are getting the equivalent of north of a £100k salary.

!00% agree. The benefits system is/was designed as a safety net - and those in genuine need should be supported. What it should never be is an alternative lifestyle choice, which it is for some. That's the fault of the system, not the individuals.

Its a fair chunk of both in my eyes 

Just because you can do something definitely doesn't always mean you should 

Being out of work is more about lack of purpose, structure and drive. I'm not talking about high performers or over achievers. Not doing that will absolutely wallop your mental health 

For my part, its the societal contract, I don't mind paying tax what I can't abide is how that money is wasted and given to people who have chosen not to take part in their end of the societal contract
 

I completely agree that the social contract has broken down. The other side to that social contract is low pay. the minimum wage was effectively brought in as part of that social contract to say that if you worked 40 hours a week you would be able to provide for yourself and your family and not be in poverty. Unfortunately that side of the social contract has also broken down. We now have massive and growing in work poverty. Thats a real issue and for me is the main factor in why welfare has exploded. Its not that the safety net is too high its that we have had a whole generation of wage suppression which means those in work also need the safety net. Yes there will be a minority who choose not to work but thats not because the safety net is too high but because the pay is too low (otherwise they wouldn't be in poverty).  


https://www.health.org.uk/evidence-hub/money-and-resources/poverty/in-work-poverty-trends

• 65% of children and working-age adults in poverty in 2023/24 lived in families where at least one adult was working part-time or more, up from 56% in 2012/13 and 44% in 1996/97.
• 18% of children and working-age adults in poverty in 2023/24 lived in families where all adults were working and at least one adult was working full-time (referred to here as high work intensity families), which is up from 13% in 2012/13 and 9% in 1996/97.

I don't actually think Minimum wage is the real issue. We are taxing ourselves as a country to the bottom.

Go back a few pages where a lifer talked about closing their business. Now I don't know the ins and outs of that business or the numbers involved, but a clear indication was given that the increased staff costs was a real issue (the increased Min Wage, increased NI levels, no doubt things like compulsory pension contributions also).

In my view the long and short is government expenditure is simply too high. The country cannot continue to spend what it does, it needs to spend considerably less as a %. Of course there are 101 ways that can happen and of course we need to protect the most needy/vulnerable. But unless we have a grown up conversation about that, we are on a race to the very bottom.

Taking your point on minimum wage, on a 40 hour week that will be £26,500 roughly come April. Your saying that isn't enough to live on and remain outside 'poverty' - well from that amount the government are taking £4k in tax and national insurance. Why are we taxing these people who earn the absolute bare minimum? And as we know with the freeze on tax bands and the tax free amount for about another 6 years, that will only get worse assuming minimum wage continues to increase by at least inflation. By the time we get to 2031 the bands won't have really changed for 12 years, is it any wonder the lower paid (in particular but by no means exclusively) are worse off? The tax free allowance was £11k in 2016, it's now 12,570. By simple inflation that should be £15,300 and on an increase of 3.5% per annum that should be £19,000 by 2031.

We can either make some tough decisions, or we can continue the race to the bottom, which compounds year after year. I fear if we continue as is for another few years we will be past the point of it being possible to resolve, if we aren't already there.

I've all but given up that Great Britain will resolve any of these issues in my lifetime, which is why as every day passes it's becoming more and more likely I'll retire early and leave the country and my advice to my two daughters is to do the same.

I completely agree on the bit in bold. Where I disagree is that its expenditure thats the problem. I think what we need to do is redress the balance of where tax comes from.

My brother in law is a small business owner, he has a bespoke house building and barn conversion company. He has for years said similar things to what you're saying here and also things like the minimum wage is too high. I persuaded him to spend some time sat with the public accounts of the national large house builders (with multinational ownership structures and parent companies) in the UK and look at their tax. He realised that he was paying as a proportion of both revenue and profit roughly double the rate of tax they are. How is that small business supposed to compete. My family come from farming - a number of them campaign and leaflet for reform. I got one of them to sit down with the published supermarket accounts and they found a similar story. How are farms meant to survive when 98% of the profit on food goes to large supermarkets with multinational ownership structures with massive oligopoly power and only 2% left for farmers, processors and distributors. 

This is why we need to move the tax burden both from lower-middle earners and small businesses to large corporations and multi nationals and a small number of very wealthy individuals. 

How? Well I've talked in the last few weeks about how I would do this. I have talked about the medicines pricing mechanism and applying that to other sectors like energy, I would also take the model of the digital services tax and go sector by sector and apply an operations tax in the same way on companies whose profits are based overseas. I'd return the bank levy to its post 2008 banking crisis level rather than the version we have now which is massively watered down. Remove the private equity tax relief. Other things like bringing back the investment income surcharge on high amounts, and I still believe in a wealth tax (but on much higher levels - progressive from 1% over £50/100m up to 3% over a billion) plus an exit tax. Possibly moving CGT rates slightly towards income tax rates (which would be coming down a little too). I've probably (definitely) missed a couple other things I've talked about recently.

If we did that we would be able to massively raise the thresholds of income tax and likely reduce the rates too, as well as reduce the burden on small businesses. More cash in peoples pockets means due to the Marginal Propensity to Consume that money is more likely to be spent rather than saved or moved abroad, the velocity of money is also higher at the lower end so you're more likely to get the multiplier effect and so this should boost growth.

I fundamentally believe it is possible to both reduce the tax burden on people earning under say 60K and small businesses as well as fund public services. 

It needs a government willing to take on the oligopoly power of big business. It wont be this one as they are 60% funded by those multinationals. The Tories and reform even more so. The only party not funded by them are the Greens.

Carter said:

cantersaddick said:

Carter said:

Have to agree to disagree then 

I can promise you, give most the households who are having kids they can't afford 10k and it would not improve anything for the children involved. Incentivising going to work might help but the government seem intent on making that as unappealing to both employers and employees as they can 

This whole lone about lifting kids out of poverty is absolute bollocks. Poverty is not erased by the sums of money they are using. 

To answer your question. The dossers are anyone who can go to work choosing not to, anyone who is living beyond their means and being babied by the state in this case people having children they cannot afford to raise.

That could be not feeding their kids because they see that as something the state should do, not reading to or educating their children at home, not setting an example to their children. 

Sudden changes of situation, ill health are what a welfare state is there for, the numbers show and the information behind the data is a lot of people are choosing to be looked after, like infants as opposed to being accountable. 

You can promise me and the numbers show - but where are these numbers? Because the DWP data direct from the system and the health foundation data show that the majority of these people are in work.

So the amounts of money are simultaneously far too high but also not enough to lift children out of poverty? Can't be both can it?

Where is your evidence that people are choosing to have kids they cant afford definitely not experiencing a change in circumstances? That's a perception but I really don't think it holds up to any scrutiny. There will always be some but to present it as the majority is ridiculous.

I think you are being contrary for the shits and giggles now and finding what you want to find 

The data is the numbers available on the HMRC site or anywhere else you pull them from. 

Whats your point? People should carry on having kids they have no intention paying for or taking responsibility for? But thats ok as its the system thats the fault as opposed to whoever is bringing lives into the world they can't look after

I don't know what you want me to say about evidence, I'll say what I see with my eyes is my evidence. 

I don't think that's fair. I literally posted official stats from DWP and a report from a research body showing the majority of the households affected are working households. You're telling me that's not true so I want to know what evidence you have for that? If its just your eyes then I'll believe the official stats.

My point is that peoples circumstances change. We shouldn't punish them or their children for that. Ensuring that child is properly clothed, housed and fed will have the biggest impact on their educational outcomes and future participation in the workforce and productivity. If we keep reinforcing the cycles of poverty then we will end up with the problem getting worse for every generation. We have to end those cycles.