egafd.com

"Fundamentally, he wants to cut spending and through this he will have something to point to as a means to show "we're all in this together" etc."

Agreed. And announcing this almost in isolation at the conference instead of on October 20th. emphasises the message he is trying to get across - the lie that we are all in this together. I suspect Lord Ashcroft isn't "in it".

"Re universal benefits: it's hard to set anything other than a somewhat arbitrary level re where to draw the line (in the same way as, say, how/where the higher rate tax threshold is set). And as with all rules and regs there will be winners and losers."

This seems to me to be an important point. The way the Tory plan on child benefits works is extraordinarily cack-handed in penalising a family with one earner on ?44K to the tune of ?30K if they have two kids and not penalising at all another family with two earners with a joint income of ?80K. If that is fair, I'm the Queen of Sheba. This illustrates two points. First it is very difficult to implement the dismantling of universal benefits in a "fair", to use the buzz word of the year, way. Secondly, this government looks as if they will make a right mess of it anyway based on this example.

"However, if you need benefits to live to a minimum/reasonable standard, by all means you should be able to claim them."

There lies the problem, I suspect. For me, the dismantling of universal benefits is an enormous step. It is a beguiling argument to say why should the single bloke, no kids on a small wage fund the child benefit for the rich etc etc.

However you can extend this argument across to pretty much all benefits. Why should a rich person get winter fuel allowance. Why should a person who has inherited a large house in London get a state pension etc etc. Once you move away from universal benefits you start going down the means testing route and as the Citizens Advice Bureau have illustrated the amount of unclaimed benefits far exceeds the amount of fraudulent claiming that goes on.

I notice Cameron introduced the concept of "deserving" in his speech i.e. the unemployed who refuse work, do not "deserve" the help of the state. We appear to be moving from universal benefits back to the Victorian concepts of "deserving" and "undeserving" poor. As an aside this never seems to get used as in the "undeserving" rich.

" If we as a society agree a level (?15k, ?20k, ?25k, ?100k, whatever) over which you should not be able to receive benefits such as winter fuel payments and free bus passes then so be it, you shouldn't get them."

This is a bit, sitting on the fence, if you don't mind me saying. Personally I believe universal benefits should stay and if need be, there should be an increase in income tax, a progressive tax if ever there was one - the more you earn, the more you pay, to help fund the maintenance of universal benefits such as bus passes and winter fuel allowance for the elderly as well as providing cash towards cutting the deficit. This would also have the advantage of cutting out the huge bureaucratic costs of means tested benefits where the weak tend to fall by the roadside because of the complexity of the form filling etc.

Cheers
D

Points noted.

I don't think I'm sitting on the fence towards the end of my previous post. I've stated my position; the principle that I don't believe certain benefits should be provided to all as a default. Please refer to my previous post re the arbitrary nature of any "cut off" level. (If I specified a figure in my previous post, that would be open to critique - eg too high/low etc).

Sure, means testing has its flaws and has overhead costs (as does administering and paying out universal benefit systems). And if we can land on the moon we can devise forms that are easier to fill in. I just don't accept that a very comfortable pensioner should automatically get free public transport, but a 16 year old apprentice tradesman has to pay what can be a substantial part of his/her wages each day for that same journey to get to work.

alicia_fan_uk

David,
Thank you for the info. on the Child Benefit.
I forgot to look on Wikipedia myself.

I must say that I have to mainly agree with you on a increase in income tax providing that the start levels for taxation are regulated for both standard and the higher levels. The Lib Dems did quote working up to a starting level of ?10.000 in the election.

I know a number of readers will not agree with this but the admministration costs of means testing everyone appear to be uneconomical

It will be interesting to read what other ideas readers would come up with to make the savings the country requires.

On the Today programme this morning they were saying that it will work out more cost effective to build our two new aircraft carriers than to scarp one of them due to cancellation costs.

As far as bus passes and fuel allowance are concerned, why do they start at 60 and not the retirement age of 65(for men)
Also why is the fuel allowance paid to everyone over 60 and not one payment per household?.

Back to the bus passes maybe a small yearly charge could be made for one, as is done for a over 60's train pass

David Johnson wrote:

> "David, child trust funds are being withdrawn - or at least the
> last government announced that they were being abolished."
>
> Wrong, I suspect.
>
> On 24 May 2010 the Government announced that it intended to
> reduce and then stop Government payments to Child Trust Fund
> accounts. Parliament has now passed the Regulations necessary
> to introduce the first stage of these changes with effect from
> August 2010.
>
So they are being abolished... how is what I said wrong?

> "There used to be a stigma in this country about being on the
> dole - going to see Father Feed Em All was supposed to be a
> last resort not a lifestyle choice. Too many people these days
> have never worked nor have their parents and that can never be
> a good thing either for society as a whole or those people
> themselves. Work is more than just a paypacket at the end of
> the week/month - it is psychologically beneficial or so we are
> told."
>
> This has nothing at all to do with the subject being discussed
> i.e. the state involvement or otherwise in supporting those in
> need, hence no comment.
>
Yes it does because it is part of a malaise affecting society that some people believe that they have an entitlement to benefits rather than working. It can never be right that some people can get more money from the state including child benefits than they would do if they worked.

> "Your last sentence was, I guess, supposed to make us all
> recoil in horror but yes if you have children, you SHOULD pay
> for them."
>
> I disagree and am no more convinced by your use of CAPS.
>
> Nothing more to discuss.

I only used caps because as far as I am aware you can't use italics or bold on here and it seemed as a good a way as an to emphasise my point.

No one will starve if child benefits are abolished...

"David, child trust funds are being withdrawn - or at least the
> last government announced that they were being abolished."
>
So they are being abolished... how is what I said wrong?"

It wasn't the last government that announced that they were being abolished. That is what is wrong. The above implies that it was a Labour government decision.

Cheers
D

"Please refer to my previous post re the arbitrary nature of any "cut off" level."

I have read your post. Honest!

Would you be quite so sanguine about these tax "anomalies" if you were the sole earner on ?44K with three kids and end up losing out on ?45K over the childrens' upbringing whilst your next door neighbours in exactly the same scenario except they have joint earnings of ?80K lost nothing?
I guess not somehow.

"And if we can land on the moon we can devise forms that are easier to fill in."

Yes, you really would have thought so, wouldn't you?

However, the range of wealth generating activities: rent, shares, gifts, bank accounts, houses etc etc that have to be taken into account in order to work out one's wealth as part of means testing is complex in itself. I once helped my mother to fill in a form for income support and I recall it was over 50 pages long. She would have had zero chance of filling it in without my help.

"I just don't accept that a very comfortable pensioner should automatically get free public transport, but a 16 year old apprentice tradesman has to pay what can be a substantial part of his/her wages each day for that same journey to get to work."

I notice you have bought into the transferability of Osborne's argument. The problem with this argument is that when you dispense with universal benefits you open a Pandora's box of self interest. I could equally say, why should a very healthy apprentice tradesman pay taxes towards the NHS so that a very comfortable pensioner gets free treatment in that same NHS. Alternatively, I could argue why should a retired millionaire who has paid loads of income tax and NI over his lifetime not get a free bus pass? Or why should that same millionaire carry on paying taxes in retirement to support the unemployed workshy etc etc etc etc?

For me, universal benefits are a contract between individuals and the State where in return for your making a contribution, certain benefits will come your way, irrespective of your wealth now, ten, tweny, thirty years down the line. Obviously, a separate issue is how do you deal with the people who do their best to spend a lifetime avoiding making a contribution. But for the State to break that contract, opens up a whole new ball game where all benefits potentially are up for grabs.

Cheers
D

David,

- I'm not so sanguine; you have just inferred that.

- See previous post where I acknowledge the existence of cons of both means testing and universal benefits, particularly cost/administration.

- I'm not sure exactly what you mean by the "transferability of Osborne's argument", so can't comment fully/further.

- I'm all for certain universal benefits - NHS open to all etc - but you need to draw the line somewhere. Otherwise you get universal universal benefits which apply, er, universally. And we call that communism. Where to draw the line isn't something that is going to get resolved in this post.

alicia_fan_uk

"I'm not so sanguine; you have just inferred that."

Quite! Judging from the response to this measure from many of the people affected by it, there will be something of an upper middle class revolt if this measure stays the same in 2013 when it is due to be implemented.

"I'm not sure exactly what you mean by the "transferability of Osborne's argument", so can't comment fully/further"

See previous post where I state
However you can extend (transfer) this argument (Osborne's )across to pretty much all benefits. Why should a rich person get winter fuel allowance. Why should a person who has inherited a large house in London get a state pension etc etc.

"I'm all for certain universal benefits"
Quite. If the Sun poll of 83% in favour of Osborne's child benefit cuts is to be believed, people (not necessarily, you. I wouldn't want to over-infer!) are in favour of those universal benefits that they see themselves using, remaining, but not necessarily in favour of those universal benefits which apply to other families e.g. higher tax rate payers in this case.

"but you need to draw the line somewhere"

Quite. Universal benefits should be universal. Non-universal benefits should not be universal. Break the virtual contract between state and individual over universal benefits and naked self-interest kicks in which is amply illustrated by the dismantling of universal benefits which occured this week and the reaction to that decision.

"Where to draw the line isn't something that is going to get resolved in this post."

Agreed.

Cheers
D