Universal credit

[chem1st]

http://www.telegraph.co.uk/news/newstopics/politics/8114110/Iain-Duncan-Smith-2.5m-better-off-under-our-welfare-reforms.html

 

The reforms are described as the most far-reaching since the welfare state was established more than 60 years ago.

A "universal credit" is planned to reverse years of welfare dependency and return the work ethic to homes where it has been lost for generations.

 

Iain Duncan Smith, the Work and Pensions Secretary, will detail a much simplified system for offering, claiming and paying out benefits. The Coalition expects no one to lose out and more than 2.5 million ultimately to be better off.

But those who "don't play ball" will have to "face the consequences," Mr Duncan Smith said in an interview with The Daily Telegraph.

 

The proposals will be announced this week.

 

I assume there will be a flat rate of benefit withdrawal equivalent to 55p in the £1. For each £1 earned (after tax) that is.

 

What does everyone else think of universal credit?

 

Could the Tories actually make the poor better off than what they were under Labour!

[discodown]

If they do and it really will simplify things and make things better then they should be applauded. I agree there should be fairly harsh penalties for not playing ball

[INTERVIEWER]

This 'universal credit' will be linked to making the long term unemployed (those who have been without work for 12 months or more, through no fault of their own) work 30 hours per week in a manual job, for no wages.

 

These manual jobs will have recently been done by laid-off public sector workers, such as litter cleaning and gardening. The ConDem coalition wants the unemployed to take over responsibility for most public sector manual jobs, but without the security of decent pay and conditions.

[INTERVIEWER]

What does everyone else think of universal credit?

 

I think that the 'universal credit' is just another way for the multi-millionaires in the Conservative/Liberal Democrat parties to scapegoat the unemployed, during a time of recession, as 'lazy'. Instead of creating jobs, the 'universal credit' will lead to terrible mass unemployment and the poor working for free - in jobs recently vacated by public sector workers made redundant by those same multi-millionaire Tories/Libs Dems.

 

Could the Tories actually make the poor better off than what they were under Labour!

 

Not a chance. But this is not the intention behind the 'universal credit'. It is about Dave Cameron's 'Big Society' - which is nothing more than getting people to work for no wages.

[bubblybubble]

has everybody noticed that every time there is a change of government then they allways have a benefit bashing time

its always the old the disabled and the unemployed that gets it in the neck

everyboby under pension age should work we know that but if the jobs arnt there then what can they do

its come to something when there are more money being owed to the tax man by the rich and everybody knows that they get more Tax breaks for having second homes more cars the rich ought to have 1 car each and if they have more then no tax allowances on any subsequent cars and so on then ther would be more tax paid

[chem1st]

The benefit withdrawal rate will be 65% of NET income.

But it will rise to 69.2% and 76.2% as people hit the NI and tax bands.

 

Essentially, you get to keep 35p in each £1 earned up to £97 (£33.95) [16.35 hours @NMW]

 

Then for the next £28 you get to keep 30.8p in the £1, (£8.624) [4.72 hours @NMW]

 

Then after that you get to keep 23.8p in the £1 until you are no longer claiming benefit.

 

At which point you are paying 32% tax. Keeping 68p in the £1.

 

 

There is room for improvement, there is still an overlap between the benefit and taxation.

 

Marginal Deduction Rates per pound earned in said band are;

65% on the first £97pw

69.2% on the next £28pw

76.2% thereafter until benefits withdrawn

 

32% tax & NI up to £288pw (at which point people with student loans pay an extra 9% until they clear the debt)

32% & 41% up to £720pw

52% & 61% up to £844pw

41% and 50% up to £2885pw

 

and then 52% and 61% thereafter for £2885pw

 

 

It's not perfect, but it is better than it was before.

 

You'd think there would be a fixed MDR until the benefits are withdrawn. People on benefits will still be paying tax and NI. And some people will be paying tax & NI & entitled to benefits without knowing. Which are essentially the problems the current system has.

[Anna B]

Now Universal Credit is being rolled out across the country I thought people might be interested in how it's really affecting people.

 

A man of i know, 35 years old with Severe disabilities, (he has Huntingdons Chorea, a life limiting illness and about the cruellist illness it's possible to get,) has found out his much needed benefits will drop by £40 a month under the new system and have serious repercussions for him.

 

If it will do that to someone with such real and obvious needs, then God help everyone else.

 

Universal credit = Benefit cuts by another name.

[geared]

I heard the Rollout was going so slowly it'll take a lifetime to get it fully implemented???

[Mister M]

has everybody noticed that every time there is a change of government then they allways have a benefit bashing time

its always the old the disabled and the unemployed that gets it in the neck

everyboby under pension age should work we know that but if the jobs arnt there then what can they do

its come to something when there are more money being owed to the tax man by the rich and everybody knows that they get more Tax breaks for having second homes more cars the rich ought to have 1 car each and if they have more then no tax allowances on any subsequent cars and so on then ther would be more tax paid

 

And when there is a general election as well. Some politicians know full well that kicking the poor & disabled goes down well with some voters, and if some people commit suicide or suffer extreme hardship, well that's just tough titty.

But yes there does appear to be lots of money owed to the taxman from the likes of HSBC and their clients. It does appear that they won't be in for the same treatment, from politicians, as those at the bottom of the pile.

I wonder why?

[chem1st]

The headline MDR of 65% has now become a bit of a joke.

 

Council tax benefit changes to CTR mean people now have to pay a proportion of their council tax when on low/no income and CTR will not be included in UC. - Thus the MDR will be higher than the 65%

 

By not allowing people to claim for the first 7days, there is now a job penalty for the unemployed which increases the effective MDR for short term employment.

 

A day's work will now be even more financially irrational than it was before!

 

UC is a disaster.

 

We treat criminals better than the unemployed. But unemployment isn't a crime. For some it would seem that in order to live, they would be better of engaging with public services by committing a murder than by trying to find paid work.