| Non-motoring > Routes out of Low Wages | Miscellaneous |
| Thread Author: Bromptonaut | Replies: 41 |
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New Sat 22 Sep 18 10:51
Routes out of Low Wages - Bromptonaut
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The previous volume of the Brexit thread had a tangential sub thread on low wages and ways out of poverty. There was a 'hanging' post there that I feel deserves a reply and rather than cover it in Brexit I've posted as a new discussion. rtj70 said: Because around here they certainly do get more than that. And my cousin in south Wales gets more than £10/hour cleaning houses. The gardeners typically charges £20/hour. But they have to provide tools, don't get paid moving from job to job, etc. I still think a lot of people 'in poverty' could make a difference for themselves. Or are you saying we should give them more benefits? It's certainly true that domestic cleaners get more than min wage. I'd expect to pay more than £10 here if I engaged somebody directly or through their one man business. More if I used a brand/franchise like Molly Maid. Like the gardeners though they don't get paid to move from job to job and some will provide their own equipment. Agree that some people on low wages can make a difference for themselves. There is though, even in area like Northampton with full employment, a finite supply of better paying jobs. The result is that while some get a permanent move to being better off there's a snakes & ladders style churn with a lot others going back to the bottom. There's ample evidence of this and the numbers in published research from Joseph Rowntree Foundation, Parliamentary Committees and charities in the advice sector. On benefits I suggest a qualified yes to your question. Not more benefits but changes in the way they work so as to remove traps that lessen the incentive to improve earnings. Universal Credit was meant to do that. The original objective was that work or extra work would always make the claimant better off. Claimant agreements would include objectives to move people on from part time to full time. The keys to being better off are (a) work allowances - the amount of pay claimant can have before benefit goes down and (b) the taper rate - the amount by which benefit is reduced for every extra pound earned. The former have been drastically curtailed from what was foreseen in Iain Duncan-Smith's original concept following changes after the 2015 budget when Osborne still thought kicking claimants was good political theatre. That was probably the last but one straw for IDS's back. The taper rate has recently been reduced from 65p to 63 - every extra pound earned leaves the claimant 37p better off. What sort of an incentive is that particularly where there are costs of taking extra work such as transport or child care? If a tax rate of 55p on top slice of income is a disincentive to entrepreneurs what does an effective tax of 63p do for somebody on £250 a week? |
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New Sat 22 Sep 18 11:50
Routes out of Low Wages - Manatee
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>> The keys to being better off are (a) work allowances - the amount of pay >> claimant can have before benefit goes down and (b) the taper rate - the amount >> by which benefit is reduced for every extra pound earned. And in-work benefits as part of that equation. Unfortunately one effect of this and lower taper rates is that employers can recruit people for less than what would otherwise be the market or even subsistence rate of pay. This problem dates back to the Speenhamland system of around 1800 and has still not been solved. >> If a tax rate of 55p on top slice of income is a disincentive to >> entrepreneurs what does an effective tax of 63p do for somebody on £250 a week? Exactly. And it's very common to hear "marginal rates of over 50% are too unfair" from higher earners. The last time I got into a discussion about this with one of the "anybody can be rich, it's their own fault" brigade I was asked "do you like paying tax?". To which my answer is yes - I want healthcare, roads fit to drive on, libraries, decent social housing, affordable childcare, et cetera. But everybody should pay a share according to their means. The current system seems increasingly to allow wealth to pass from capital to labour via loans, both public and private, rather than taxes. It morally unacceptable, unfair, unsustainable and will eventually lead to civil unrest if not dealt with. Of course too many are like lambs to the slaughter and willingly take the next PCP "deal". Brexit is neither here nor there compared with this issue. |
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New Sat 22 Sep 18 12:16
Routes out of Low Wages - Bromptonaut
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>> This problem dates back to the Speenhamland >> system of around 1800 and has still not been solved. Blimey I've not heard of Speenhamland since I did O Level History from 1974-6. I'm sure Mr Dunsmore had a fact sheet on it... en.wikipedia.org/wiki/Speenhamland_system And Malthus gets a mention as well. There was a fact sheet on him too.. Agree with most of substance of your post. Boosting the Living Wage is probably as good as anything. Government is quick to 'big up' role tax cuts, conveniently forgetting the Tories were dragged by the LD's kicking and screaming into big uprates to the personal allowance. Trouble with that though is it applies to everybody and gives me tax cut while a low earner doing 25hrs a week gets nothing. Not sure about private lending. Big change this year in welfare was to move support for unemployed, sick and pensioners with mortgages from benefit to loans. Give it between five and ten years when people find that debt eating substantially into their inheritance and it'll be all over the press. It's also a disincentive to downsizing because it eats into equity and has, surprise surprise, been poorly publicised and implemented. Last edited by: Bromptonaut on Sat 22 Sep 18 at 12:16
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New Sat 22 Sep 18 14:23
Routes out of Low Wages - Duncan
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>> Blimey I've not heard of Speenhamland since I did O Level History from 1974-6. I'm >> sure Mr Dunsmore had a fact sheet on it... >> >> en.wikipedia.org/wiki/Speenhamland_system >> >> And Malthus gets a mention as well. There was a fact sheet on him too.. What was I doing the other day when Malthus came up? Crumbs! This memory. en.wikipedia.org/wiki/Malthusianism |
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New Sat 22 Sep 18 15:01
Routes out of Low Wages - Bromptonaut
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>> en.wikipedia.org/wiki/Malthusianism Malthusianism still very much with us hence the two child rule for tax credits: www.litrg.org.uk/tax-guides/tax-credits-and-benefits/tax-credits/what-child-tax-credit/2-child-limit-policy |
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New Sat 22 Sep 18 15:55
Routes out of Low Wages - Cliff Pope
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>> >> >> The keys to being better off are (a) work allowances - the amount of pay >> claimant can have before benefit goes down and (b) the taper rate - >> >> If a tax rate of 55p on top slice of income is a disincentive to >> entrepreneurs what does an effective tax of 63p do for somebody on £250 a week? >> I agree. With marginal rates like that it's a wonder anyone on benefits ever makes any effort to get a job. It works higher up the scale too. I had staff enquiring about moving deliberately to part-time because they'd gain in tax credits, housing benefit and council tax benefit what they'd lose in pay. It's tempting to think that one solution to (b) might be a combination of a very generous retention rate for earnings before benefits were reduced, with limiting the period during which it applied. What about allowing a total retention of benefits regardless of earnings for say one year only? If someone is really going to make the step into proper waged income that ought to be long enough perhaps? |
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New Sat 22 Sep 18 16:50
Routes out of Low Wages - Falkirk Bairn
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My Indie also runs a small fleet of minibuses - drivers are often required & the hours do not suit everyone. The latest attempts to find drivers ended with nobody taken on - just more overtime for the existing staff. Only 2 were deemed as suitable for a job offer - BOTH turned down the offer. Both wanted to work around 20-25 hours only - working more than that would result in benefits being withdrawn. The 2, sent by the Job Centre, might have difficulty as I am sure the JC will contact the business owner. |
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New Sat 22 Sep 18 17:02
Routes out of Low Wages - Bromptonaut
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>> My Indie also runs a small fleet of minibuses - drivers are often required & >> the hours do not suit everyone. The latest attempts to find drivers ended with nobody >> taken on - just more overtime for the existing staff. What was the wage being offered and whereabouts in UK. We've advertised for a full timer (40hrs Mo-Fr) in same role as me at £10.10/hr. Didn't even get applications, or at least not any worth pursuing. They've redeployed somebody from an admin role instead. They were displaced by another person moved from a project to which she'd been seconded and that lost its funding. Redundancy was a possibility. The redeployee is a youngster, female, twentyish, but bright and bubbly and who's already learned to be very good with clients on the phone. We'll all support her and I think she'll succeed. |
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New Sat 22 Sep 18 22:25
Routes out of Low Wages - Duncan
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>> My Indie also runs a small fleet of minibuses - drivers are often required & >> the hours do not suit everyone. The latest attempts to find drivers ended with nobody >> taken on - just more overtime for the existing staff. >> >> Only 2 were deemed as suitable for a job offer - BOTH turned down the >> offer. Both wanted to work around 20-25 hours only - working more than that would >> result in benefits being withdrawn. >> The 2, sent by the Job Centre, might have difficulty as I am sure the >> JC will contact the business owner. Applicants who didn't want the job used to tell me to put 'unsuitable' on the form from the JC. |
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New Sat 22 Sep 18 16:52
Routes out of Low Wages - Bromptonaut
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>> I agree. With marginal rates like that it's a wonder anyone on benefits ever makes >> any effort to get a job. >> It works higher up the scale too. I had staff enquiring about moving deliberately to >> part-time because they'd gain in tax credits, housing benefit and council tax benefit what they'd >> lose in pay. Even if they're if they're a bit worse off in straight cash (and they should expect to be) they'll probably level peg after travel, childcare etc and have a better work/life balance. The back breaker is usually private sector renting. There's an upper limit for Housing Benefit in private sector rentals known as the Local Housing Allowance. LHA is deliberately set low, the 30th percentile of market rates in the relevant area. It's been frozen for the last three years. Needless to say landlord's haven't shown corresponding restraint. The 3 bed rate in Northampton is £605.97/month. There's nothing in this village on rightmove at less than £700 and some of those are two bed. I'd expect there to be a rural premium for here but rates in town don't look much less. If you can walk to the station in ten minutes then London is under an hour away. The desperate need is affordable social housing. But if it existed in sufficient numbers it'd knock the bottom out of the private market leaving people in negative equity; politically untenable. |
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New Sat 22 Sep 18 17:01
Routes out of Low Wages - CGNorwich
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> It works higher up the scale too. I had staff enquiring about moving deliberately to >> part-time because they'd gain in tax credits, housing benefit and council tax benefit what they'd llose in pay. A fairly conclusive argument that the benefit system acts as a disincentive to work as a way out of poverty. |
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New Sat 22 Sep 18 19:44
Routes out of Low Wages - Cliff Pope
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>> >> >> A fairly conclusive argument that the benefit system acts as a disincentive to work as >> a way out of poverty. >> Not quite. That's the point being made - that the rate at which benefits (and fringe benefits as Bromptonaut points out) are withdrawn ensures that work/benefits remain roughly comparable. So who wouldn't chose fewer hours for the same net money? It's the very steep marginal rate that causes this - one might almost be cynical and say it is designed deliberately to bribe the lowest rung of workers off the job market and keep them confined to a kind of sump ghetto existence with no escape. |
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New Sat 22 Sep 18 17:28
Routes out of Low Wages - CGNorwich
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“If a tax rate of 55p on top slice of income is a disincentive to entrepreneurs what does an effective tax of 63p do for somebody on £250 a week?†What completely spurious comparison . Tax is money taken by the state from an individuals earnings. Taper relief is simply the State saying we will give you less of the taxpayers money now you are in a position to earn more for yourself. |
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New Sat 22 Sep 18 17:56
Routes out of Low Wages - Bromptonaut
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>> What completely spurious comparison . Tax is money taken by the state from an individuals >> earnings. Taper relief is simply the State saying we will give you less of the >> taxpayers money now you are in a position to earn more for yourself. Make that judgement if you like but the effect on an individual is exactly the same. |
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New Sat 22 Sep 18 18:20
Routes out of Low Wages - CGNorwich
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| It's hardly a judgement, it's a fact. One individual is paying the state money. The other is receiving money from the state i.e. the taxpayer. Conflating the two is, as I said, a spurious argument. |
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New Sat 22 Sep 18 19:25
Routes out of Low Wages - Lygonos
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>> Conflating the two is, as I said, a spurious argument Perhaps comparing rather than conflating. I'll be reducing from 4 to 3 days/week in the next couple of months ans at least part of that decision is based on diminishing returns on earning/working more. I could quite imagine the situation where someone was put off working more as a result of negligible increases to income. Of course living on the margin of benefits has no prospect of leading to a better income so it's not quite the same thing. |
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New Sat 22 Sep 18 19:49
Routes out of Low Wages - Cliff Pope
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>> One individual is paying the state money. The >> other is receiving money from the state i.e. the taxpayer. One individual is disincentivised from extra work so deprives the state of additional tax revenue. The other is disincentivised from work by taking state money instead. A pretty good comparison it seems to me. |
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New Sat 22 Sep 18 21:49
Routes out of Low Wages - Falkirk Bairn
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Reduction of tax rates often leads to more tax being collected. PAYE rates are Higher in Scotland than the rest of the UK if you earn more than roughly £27K. The 40% rate comes in at a lower level & is 41%. Friends of my son run small, but very profitable companies, have reduced their salaries by about 80% to come under the £27K limit - they then pay themselves dividends every 3 months - this is taxed at the UK rate rather than Scot Govt Rate & no National Insurance on the dividends. SG gets much less & the NI payments are much less - SG gets tax on £25K instead of 6 figures, UK gets more tax & a lot less NI - business owner keeps more of his company earnings. The best route out of poverty is Education & acquiring a skill that is in demand. I have had 2 mini floods within 10 days of each other - tradesmen traipsing in/out of the last 3 weeks - none of them are in danger of starving! Plumbers x 2, electrician, tiler, plasterer - booking them meant waiting 2-3 weeks in advance - on the last lap now hopefully! |
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New Sat 22 Sep 18 20:59
Routes out of Low Wages - Bromptonaut
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>> It's hardly a judgement, it's a fact. One individual is paying the state money. The >> other is receiving money from the state i.e. the taxpayer. Conflating the two is, as >> I said, a spurious argument. You earn a pound but, because of the law, keep less than half of it. That's either sufficient incentive for the effort or it's not. It makes no practical difference whether the state is paying the money or taking it. |
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New Sun 23 Sep 18 07:22
Routes out of Low Wages - CGNorwich
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It is a question of honesty and dare I say it morality. If you not in a position to work or can only find work that does not provide enough in wages to support you and you family the state will help you. If you are in a position to find better paid work then you should. If your net income is the same then at least you have the pride and self esteem that you are paying your way in life. If there were no state benefits and your friend supported you when your earnings were low presumably you would think it right to stop taking his money as soon as you could get a better paid job. You wouldn’t, I assume, keep taking his money and not take the job on the basis that you wouldn’t be better off by doing so. Or perhaps you would? |
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New Sun 23 Sep 18 09:13
Routes out of Low Wages - sooty123
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I don't think it's so much a question of morality more one of practicality question. If you're doing a lot more hours for a not a great deal extra at all, any positive answer from questions of morality regarding an individual and their relationship with the state doesn't sort out child care, travelling costs, commuting etc. I'm not saying a sense of civic pride and morality regarding your way in life are for the comfortably off, but they don't put food on the table or pay for extra child care. |
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New Sun 23 Sep 18 07:28
Routes out of Low Wages - CGNorwich
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>> It makes no practical difference whether the state is paying the money or taking it. >> It makes all the difference in the world to the people who are paying for others benefits from their taxes. |
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New Sun 23 Sep 18 09:29
Routes out of Low Wages - Lygonos
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>> It makes all the difference in the world to the people who are paying for others benefits from their taxes. It's not a them and us equation. Everyone pays taxes, including those on benefits (VAT, duties, council tax, and so forth). The beneficiaries of the system include the wealthy receiving expensive NHS care (I have patients getting cancer treatments costing a few grand every month), the relatively well off with multiple children at state school (5 grand per child per year) as well as the poor having their income topped up. |
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New Sun 23 Sep 18 10:33
Routes out of Low Wages - Fullchat
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And of course those equally well heeled who insist on their free prescription medication including cheap 'over the counter' medications such as Paracetemol because they are entitled to them.
Last edited by: Fullchat on Sun 23 Sep 18 at 10:34
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New Sun 23 Sep 18 11:37
Routes out of Low Wages - sooty123
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>> And of course those equally well heeled who insist on their free prescription medication including >> cheap 'over the counter' medications such as Paracetemol because they are entitled to them. Do drs still prescribe paracetamol etc? I know the last time I had day surgery, even though I get free prescriptions, they said just take paracetamol with no prescription, which didn't bother me at all. I thought they were looking at clamping down on prescribing paracetamol etc due to relatively high costs? |
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New Sun 23 Sep 18 16:16
Routes out of Low Wages - Bromptonaut
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>> Do drs still prescribe paracetamol etc? IME only if it's combined with codeine at beyond the limited dose that's permissible in over the counter 'co-codamol'. I've had 30/500 Co-Codamol offered but preferred straight codeine to mix/match with Ibuprofen or Paracetamol. I wasn't offered a 'scrip for either of latter. On another occasion though I was prescribed the anti-fungal miconazole. The pharmacist would have happily sold it to me at around half the 'scrip charge had I not had a pre-paid 'season ticket'. Last edited by: Bromptonaut on Sun 23 Sep 18 at 16:16
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New Sun 23 Sep 18 17:24
Routes out of Low Wages - Rudedog
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>> Do drs still prescribe paracetamol etc? Yes they do where I am after surgery... we've tried to get them to stop as part of a department cost saving but they still do it (and for ibuprofen). Thing is the standard paracetamol pack is pretty cheap but we have to make them TTA packs which just means adding a sticky label to them so the patient's details can be added, this ramps up the total cost 10 fold, we ask if patients have any at home but as it's essentially 'free' many still ask for it. Saying that, about two years ago our trust got to within a millimetre of implementing that post-op patients had to pay for their TTA drugs if they weren't exempt, can be 100% why it was dropped but I guess all of the admin (collecting cash and form filling) would have fallen on us. |
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New Sun 23 Sep 18 17:45
Routes out of Low Wages - sooty123
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Saying that, about two years ago our trust got to within a millimetre of implementing >> that post-op patients had to pay for their TTA drugs if they weren't exempt, can >> be 100% why it was dropped but I guess all of the admin (collecting cash >> and form filling) would have fallen on us. Sorry not quite sure I follow that, I can only go on my experience. The Dr just said take xyz at home. Why would there be loads of collecting cash and form filing? |
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New Sun 23 Sep 18 17:52
Routes out of Low Wages - rtj70
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>> Why would there be loads of collecting cash and form filing? I think Rudedog works in a hospital. His post above about post-op patients confirms it I think. So pain relief prescribed by hospital doctors seems to be given for free. If they had to pay then there would be admin. I suppose you could write a prescription for the hospital pharmacy but someone being discharged after an op might not be able to make it to the pharmacy on the site and the prescription couldn't be used at a non-hospital pharmacy. |
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New Sun 23 Sep 18 17:54
Routes out of Low Wages - Bromptonaut
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>> Why would there be loads of collecting cash and form filing? TTA appears to be acronym for To Take Home; stuff prescribed by hospital for discharge. Thinking more I might have got paracetamol as well as codeine and anti-coagulant jabs after hip surgery 6 years ago. Rules there may be different from when a GP prescribes. |
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New Sun 23 Sep 18 18:02
Routes out of Low Wages - rtj70
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>> TTA To Take Away. |
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New Sun 23 Sep 18 18:04
Routes out of Low Wages - sooty123
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Sorry I don't think I've made myself clear, why prescribe paracetamol, ibuprofen, asprin etc to anyone? As Rudedog said it appears to add x10 to the price. |
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New Sun 23 Sep 18 18:37
Routes out of Low Wages - rtj70
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Because it's medicine they want you to have when leaving the hospital. What if they don't have the right pain meds at home. Most of us know you can buy a pack of 16 tablets/capsules of paracetamol, aspirin and iburprofen it a supermarket for next to nothing (30p?). I would imagine there is a need to have the frequency and dosage on the packaging otherwise someone might go home and not realise if you took too many paracetamol then they'll then need a liver transplant. There is a duty of care. Last edited by: rtj70 on Sun 23 Sep 18 at 18:39
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New Sun 23 Sep 18 21:30
Routes out of Low Wages - Rudedog
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Sorry yes my post relates to drugs given to you to take home after you've had surgery. At one point post-op patients were going to be treated in the same way as a regular prescription written by your GP, it was one of the cost saving ideas thought up, it was felt that if you paid for them at the GP's then why shouldn't you also pay for them when in hospital. Obviously if your trust had a high patient population that were prescription exempt then there was no real benefit and the admin costs would actually cost more than we were getting back. Just to be clear, the paracetamol we buy in is the same cost as you can get in the supermarkets but because we have to put one of those white stickers on it to add the patient details it pushes the cost up x 10. Although fighting over the cost of paracetamol and ibuprofen is small fry in the grand scheme of things when you look at the ultra high cost of agency staff and faceless external productivity consultants (don't go there!) |
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New Sun 23 Sep 18 21:43
Routes out of Low Wages - Duncan
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>> TTA appears to be acronym for To Take Home Pedant Corner. TTA is an abbreviation, not an acronym. i.e. it is a set of letters, not a word. www.dictionary.com/e/acronym-or-abbreviation/ HTH. |
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New Sat 22 Sep 18 17:49
Routes out of Low Wages - Stuu
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When my wife was given a choice of redundancy or relocate to another site 30 miles away she had to take the relocation, not because she wanted to travel but because there were no full time positions available anywhere local, despite a low headline unemployment rate and an extensive search through available positions within her skill set ( and taking into account she is pregnant ). Most offer no more than 16 hours a week, likely to match the thresholds for tax credits, many were offering multiple positions but with limited hours too. It made her 30 hour a week contract she is currently on look worth holding on to, even if it only pays just over 8 quid an hour. |
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New Sun 23 Sep 18 10:47
Routes out of Low Wages - Bromptonaut
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>> Most offer no more than 16 hours a week, likely to match the thresholds for >> tax credits, many were offering multiple positions but with limited hours too. Sixteen hours a week is the tax credit threshold for people with caring responsibility (and a few other groups too). I think though there might be advantages to the employer in terms of Employer NICs and/or auto enrolment for pensions. Cheaper to employ 3 people on 16hrs than one on 48. |
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New Sun 23 Sep 18 11:07
Routes out of Low Wages - sooty123
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| I think auto enrolment on pensions is wages above £10k a year? |
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New Sun 23 Sep 18 11:24
Routes out of Low Wages - Bromptonaut
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>> I think auto enrolment on pensions is wages above £10k a year? That looks right: www.thepensionsregulator.gov.uk/automatic-enrolment-earnings-threshold.aspx I normally work 16hrs, pay no NIC and am not auto-enrolled for pension. Been doing an extra day since June so as to help out on struggling projects and that's taken me over monthly threshold. Paid pension conts in last two months and will again in September. Also paid NICs as has employer. Employer YTD figure for NICs shows they were not paying either based on 16hrs. |
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New Sun 23 Sep 18 13:51
Routes out of Low Wages - Stuu
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>>Cheaper to employ 3 people on 16hrs than one on 48. << From what we saw, those 16 hours are not on a fixed rota either so you couldn't line up another 16 hour gig to make it up to full time. I think the lack of full time opportunities on minimum wage is a problem that has yet to be widely recognised, perhaps because you don't notice until you have to look for a job. |
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New Sun 23 Sep 18 14:25
Routes out of Low Wages - zippy
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This is complex. If the cost of living were lower then low wages would not be such a problem. The biggest contributor to the cost of living is the high housing costs in the UK. Also, it seems that the Govt is indirectly subsidising companies who offer low wages because many of their staff will be claiming tax credits and allowances. Supermarkets and I am sure other companies benefit: www.dailymail.co.uk/news/article-3036200/Supermarkets-fire-11bn-benefits-subsidise-low-wages-Critics-say-figures-companies-rely-taxpayers-ensure-staff-food-table.html Though these benefits target families. I have friends who are in their 60's working who earn minimum wage and get no extra help! Some supermarkets say share bonuses and staff discounts help employees towards a living wage. I thought "how Victorian" - weren't laws introduced years ago to prevent employers forcing staff to shop at the employers' stores? |
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New Sun 23 Sep 18 14:26
Routes out of Low Wages - Bromptonaut
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>> I think the lack of full time opportunities on minimum wage is a problem that >> has yet to be widely recognised, perhaps because you don't notice until you have to >> look for a job. I think that's right. The advice sector would recognise it as would those engaged in social policy research but I don't think those in comfortable tenured employment or retirement would be so aware. We may have little unemployment but we have very significant under employment. |
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