Bolitics The New Condem Government

[peterms]

 

people are taking jobs with no pension provision

 

There won't be any jobs with no pension provision in the next couple of years. Not sure which government, (this one, the last one or the European one) brought that in, but it's here.

 

Up to about 4m people, in fact, according to the TUC.  That's quite a lot.

 

Even those above the auto-enrolment threshold may end up with very little.  Leaving aside the very lowest paid, a quarter of those earning over £500 a week have a combined contribution rate of less than 8%.  If you take someone on an income of £12,000 and a combined contribution rate of 8%, after 30 years they will have a pension pot of less than £30,000, giving an annual income of £2,000.   That's far from an extreme example.

 

Auto enrolment is a step in the right direction, but there's still a very big problem out there.

[tonyh29]

...... and no doubt the argument will be trotted out that other parties have done similar but that counts for nothing

 the good old " Ahhhhh anyone but labour " line    

[markavfc40]

There are plenty of things that will ensure that the Tories have no chance of winning the next election but the attacks on the most vulnerable in society will comfortably prove to be their biggest downfall. You may get away with convincing some people that those on benefits are lazy scroungers but these attacks on benefits to disabled people are disgusting and I am sure we can all agree on that.

Those most vulnerable and in need in society should be the last people you look to make cuts to. With this Government it has been the first. It is not just cuts in benefits it is cuts to public services that the poorest in society are most reliant on. The most deprived areas of local Government have seen cuts of 30% whilst more affluent areas, Tory heartlands, have in many cases not seen anything like the same level.

I don't know how anyone no matter which way you swing politically can be comfortable with what is happening at present. It is simply just wrong and shouldn't sit right with anyone. I have said before I am relatively comfortably off, have been fortunate never to have had to claim a benefit in my life, and could in all honesty easily turn a blind eye to all this and think well I am alright Jack. We can't though can we. Surely we all have a responsibility to ensure those less fortunate, those most in need, those most vulnerable are protected.

It is 20 years since the Tories last won an election and given their actions over the last 2 years and 9 months it will be at least another 20 before they win another one. My feelings towards that party have now gone past disgust.

Edited February 26, 2013 by markavfc40

[snowychap]

As I said previously, I've not missed or failed to understand anything I just didn't agree with your original post in terms of your opinion as I'm entitled to do and some of it I considered factually incorrect. If I incorrectly paraphrased your point perhaps that is because of the way you made it.

Yes you have failed to understand what I was saying though that may well be down to how I made my point initially.

I have since hopefully clarified what I meant (by saying above the reforms are being 'continued further' (suggesting an increase in the 'reform(s)') under Freud after his conversion to the Tories)) so I'm not sure why you continue down the path where you disagreed with me suggesting 'the government is simply carrying on Blair/New Labour's work' (which wasn't the case).

Edit: Peter put it best, I think, with 'But in terms of the attacks on benefits, including disabled claimants, yes, the Blairites started down a road which the current government is continuing, ramped up to a more brutal level'.

I think this from Feb 2008 was the original article quoted on VT that began the first discussions on the welfare reforms subject:

David Freud's family background may have been a useful preparation for politics - his great-grandfather, Sigmund, would have had a field day with the "psychological flaws" and competing egos of the Labour Government.

But it was his experience in the City that persuaded Tony Blair to hire him to review the welfare system two years ago.

There can be few things more horrid than the welfare system. "It's a mess nobody understands or can manage," he says. He took three weeks to research and write the first draft of his report.

"I didn't know anything about welfare at all when I started, but that may have been an advantage. I was genuinely shocked that the analysis was such a blob, nobody had come up with anything clear. In a funny way the solution was obvious."

In the dying days of the last regime, the Freud Report - which called for large sections of the welfare state to be privatised - became a political football between Tony Blair and Gordon Brown. The then prime minister wanted it as his legacy, the then chancellor did not want it as an inheritance and did all he could to emasculate its proposals.

On one occasion it is said that Mr Freud had to sit through a 45-minute shouting match with Mr Brown, before being aggressively cross-examined by a room full of Treasury advisers.

"It was a robust process," the banker admits. "There was a negotiation. Normally the negotiation takes place over two years; they had a week and a fairly obdurate writer who's used to being beaten to a pulp in the City. It was like a deal and I thought I've got to get through this as unscathed as possible."

This week, however, Mr Freud was hired by James Purnell, the new Work and Pensions Secretary, as an adviser and asked to help implement nothing less than a revolution in the welfare state.

There has, he believes, been a sea change in Labour's thinking about the benefits system. "Gordon Brown has now said they're going to do it," he says. "Peter Hain [the previous work and pensions secretary] was worried about the Left. Purnell is showing astonishing energy, there is going to be a much more single-minded ferocity."

Mr Freud's big idea is that the private sector be put in charge of the long-term unemployed. Companies taking part would receive a huge fee for getting somebody to stay in a job for more than three years but nothing if they fail.

There will be bonuses for hard cases, and no special treatment of disabled people or lone parents with children at school. "There are about 3.1 million people not working, I think we can get about 1.4 million back to work," Mr Freud says.

Labour MPs and activists will hate the idea of "privatising" the Welfare State but the adviser says: "The system we have at the moment sends 2.64 million people into a form of economic house arrest and encourages them to stay at home and watch daytime TV. We're doing nothing for these people."

There is in his view "one simple reason why it's got to be the private sector. You cannot incentivise someone on payment-by-results if the person who is paying is the Chancellor of the Exchequer. There has to be some risk."

For the companies that do well, the rewards could be huge. "We can pay masses - I worked out that it is economically rational to spend up to £62,000 on getting the average person on Incapacity Benefit into work."

Specialists will spring up - he gives the example of Bangladeshi women, who are the lowest participants in the work force - "somebody will see a gap in the market and make their fortune."

He wants a combination of carrots and sticks to persuade people to take jobs. "You have to slice the benefits [if people won't work] but if you're not spending the money to provide the services, the stick is just a vengeful and useless way of beating people."

He doesn't think people on the dole are lazy. "There's good, evil, laziness and hard work in everyone, it's a question of motivation. I do not accept the rhetoric about lazy scroungers. Even if they're a Jack the Lad or a Jill the Lass, there's usually something else as well - they're illiterate or they've got no social skills."

But in his view, fewer than a third of those on incapacity benefit are really too ill to get a job. "When the whole rot started in the 1980s we had 700,000. I suspect that's much closer to the real figure than the one we've got now.

If you want a recipe for getting people on to IB, we've got it: you get more money and you don't get hassled. You can sit there for the rest of your life. And it's ludicrous that the disability tests are done by people's own GPs - they've got a classic conflict of interest and they're frightened of legal action."

Under his system, the market will decide who should receive benefit and who should go out to work. "The private sector will have to start making assessments about who they can get back into work at what cost.

If somebody is really clinically depressed, for example, [the company] might say, 'I'm not going to get this guy to hold down a job for three years because he's not up to it so I'm not going to expend my efforts on him at the moment'?."

In Mr Freud's view, the real losers will be those working on the black market. "There are probably five to seven per cent of the people on IB today who are on the black economy. They're doing jobs and claiming too but they won't have a free lunch any more."

Lone parents should also, he believes, have to work when their children reach the age of five. "The point about my approach is you don't need to make a huge fuss about categorising people - everyone should be able to work."

Mr Freud started his own working life as a journalist on the Financial Times, then made a fortune working on some of the biggest and most controversial deals in the City in the 1980s and 1990s.

Banking at that time, he once said, was a "pioneering piratical industry where we made up the rules". The City is still "morally ambiguous because it's so competitive".

He was shocked by how long it took to sort out the Northern Rock crisis. "I expected it to be sorted out in a weekend. If you're trying to do a deal against the backdrop of a gossip-fuelled market you don't have time."

It is, he says "always sensible to work on the assumption that banks are mad, they behave like lemmings, there is always something they all go and do that then explodes".

So does he think there will be a recession? "Yes, because we should have recessions every five or six years and we are due one. What would be very skilful would be to have a mild, short one."

And this is a post I made in 2008 referring to an article in The Times (so now behind a paywall):

teenage single mums contributerd nothing to the reasons behind our current problems no matter how the hate papers wish to portray it as facts that they do.

It is the government's welfare reform which is targetting (not wholly but certainly specifically) lone parents with young children (from the age of one upwards).

Here are some of the words of Mr Freud (the multi-millionaire merchant banker)in today's Times:

>It is reasonably straightforward to spring the trap in the welfare system and today's White Paper does just that. It proposes to move everyone - existing claimants joining new ones - from incapacity benefit on to the new employment and support allowance. The bulk will be categorised in the former category “employment” and will therefore be able to start the journey into the world of work without jeopardising their benefit status.

.....

It is one thing to streamline the system. It is quite another to provide the much-enhanced level of support - the motivation and new skills - that will be needed by many to succeed in the workplace.

No mention of any medical support (especially for the huge numbers of people claiming job seeker's allowance or incapacity benefit who suffer from mental health problems).

Some of our greatest national heroes suffered from disabilities; from Nelson with his lost eye and arm, to Churchill with his “Black Dog” depression, to the physicist Stephen Hawking, bestselling author regardless of immobilisation.

I don't think that anyone would deny that these were remarkable people. I think it is a fair old leap to demand that everyone display that same level of remarkableness.

May as well chuck in Bader and tell everyone with artifical legs that they ought to be out flying 'planes otherwise they're letting the country down.

Indeed, until the past few months, the roughly 900,000 of standard unemployment claimants on jobseeker's allowance were little more than the frictional number necessary for the economy to function.

Have I read that wrong or is that an acceptance that there is a requirement for a certain level of unemployment?

In which case, is it slightly perverse to devise a system that effectively penalises the most those people who by being out of work facilitate the better functioning of the economy?

 

Edited February 26, 2013 by snowychap

[snowychap]

...and/or added correct information in terms of the correct timescales of things...

Though your correction also said:

He then worked as an advisor to Hutton not Blair between 2008 and 2009 which is a fair while after Blair left power.

As per the article above, that wouldn't appear to be the case as Purnell was at the DWP from early 2008 onwards.

Hutton was at Business and then Defence in 2008/9

[mockingbird_franklin]

people are taking jobs with no pension provision

 

There won't be any jobs with no pension provision in the next couple of years. Not sure which government, (this one, the last one or the European one) brought that in, but it's here.

I may be wrong as my understanding of the new compulsory pensions scheme is a little thin, but Isn't there an "opt out' option on the employees part and as the employers part of the compulsory pension is reliant on employee contribution it makes the everyone will get a pension argument a little creaky,

 

It reasonable to argue opt out may very well be commonplace amongst those purported to be helped by this provision, seeing as many people currently struggle to just live from day to day,It's also a this a situation that is bound to increase with inflation currently outstripping wages,(maybe except for the very wealthy). So from this reasoning The people most likely not to have pension provision are most likely to remain so under the new set up.

 

The only way this could have been improved was to make the employer contribution compulsory and not dependent the Employee also making contribution i.e. 'remaining opted in'. Now if they had introduced something along those lines then you would be closer to the Australian system of 9% compulsory contribution by the employer on top of salary. Then maybe the lack of pension situation in old age could really have been combated. The situation seems more a case as always that governments want you to seen to be tackling a problem while doing nothing worthwhile or constructive about it they also seem more intent people have enough pension provision to be unable to qualify for any state help, often leaving a situation where they may actually be worse off, rather than have enough pension contribution be be financially secure in old age.

 

Of course I may have misunderstood the whole compulsory pension scheme and hence talking utter bollocks

Edited February 26, 2013 by mockingbird_franklin

[mockingbird_franklin]

Forgive my potential ignorance on this particular subject because disability benefit isn't something I know much about and I didn't see the program so I stand to be corrected, however here goes...

 

There is an Atos office on the same street as one of our offices, each week disabled people are protesting outside the building but this has only happened under the current government it didn't happen during Labours time.

 

Now as I understand it Freud produced an 'independent' report in 2007 which was commissioned by John Hutton rather than Blair directly, although I've no idea what if any, Blair's direction was in this. He then worked as an advisor to Hutton not Blair between 2008 and 2009 which is a fair while after Blair left power.

 

Now granted to you did say "I think" in reference to Blair but I think that part of what you posted is incorrect, I also don't agree that the stance of New Labour under Blair or for that matter Brown were the same as Cameron's Tory party on the subject of disability benefits, I don't even think they are remotely close.

 

As I say there weren't protests outside Atos under the last government yet I believe Labour had began to shift in terms of their view on disability benefits and to make changes.

 

But I think Labour's change of stance and the action they took was to stop abuse of the system and to stop payments to those not truly worthy of them, on the face of it that granted is what the current government are doing but the reality is it would seem very very different. The Tories aren't looking to stop a few obese people claiming they are systematically trying to stop or significantly reduce benefit payments via a 3rd party, who are earning a fortune in the process, to some of societies most needy people.

 

Personally I find that repulsive, cold and reprehensible especially considering their lack of action in certain other areas concerning their more wealthy backers such as non dom tax exiles and the bankers.

 

As I said, I'm no expert on this topic but based on what I do know I think your suggestion, to paraphrase, that the government is simply carrying on Blair/New Labour's work to be without foundation and well just wrong.

 

It is akin to saying that the current government have simply continued where the last left off in terms of academies in the education sector which is again incorrect. They might share common themes or origins but the practical application, aims and ambitions are in my view almost entirely different.

Just think yourself lucky you haven't any experience of the corrupt new system and hope you never have to. I shan't go into too much detail, but having experienced the system through helping someone else claim, someone genuinely disabled from birth, If I hadn't seen it I would never believe such a system would exist in a country claiming to be fair and civilized, Having seen the medical report by Atos of a medical interview I sat in on I would say it could be considered almost criminal in what is happening.

 

A couple of examples are as such and by no means would these be the only ones

 

1. doctor asks if the claimant had any problem traveling to the medical

The answer given was: No, not really, but only because My friend (me) bought me here, I could not have found my way here on my own, I really struggle to understand maps and directions, I need people to make sure I get on the right bus and I could not have managed to get here on my own

 

Doctor then asked, could you find your way here again

Answer, NO I couldn't, probably would get very lost

 

The report said, patient had no problem traveling to the medical or getting about in general.

 

2. Doctor asks, Can you learn simple tasks like setting an alarm clock

 

answer, No, I've never been able to do that, even though I try, somethings I just can't seem to learn no matter how hard I try, I have to get other people to do things like that for me

 

report says, No difficulty in learning new tasks.

 

Medical supporting evidence was taken along, it wasn't even looked at, the claimant was having a hard time understanding and answering some questions so looked to me to help explain, and help them give answer, I was told I couldn't help them, I had to sit there quietly.

 

Utter surprise when the decision to place in work group and that they should be perfectly fit to enter employment within 12 months, that was until we got the report, which at first was questioned as it appeared to be about someone completely different, this was questioned as assurances that it was indeed the correct report where given, I read the report after sitting in on the medical I would not believe it was other than the name to not in any form representative of the medical or the person assessed.

 

Now you can find reports of experiences similar to this all over the place

 

i suppose the question is why are companies like Atos following such dodgy practices and seemingly biased against the claimant agendas. is such an attitude reliant on the award of contract. Oh yea, before anyone asks about why interviews arn't recorded, at the time Atos had banned to recording of medicals, They have since relaxed this view, provided before you leave the medical you can provide 2 copies of your recording on CD.

[tonyh29]

 

people are taking jobs with no pension provision

 

There won't be any jobs with no pension provision in the next couple of years. Not sure which government, (this one, the last one or the European one) brought that in, but it's here.

I may be wrong as my understanding of the new compulsory pensions scheme is a little thin, but Isn't there an "opt out' option on the employees part and as the employers part of the compulsory pension is reliant on employee contribution it makes the everyone will get a pension argument a little creaky,

 

It reasonable to argue opt out may very well be commonplace amongst those purported to be helped by this provision, seeing as many people currently struggle to just live from day to day,It's also a this a situation that is bound to increase with inflation currently outstripping wages,(maybe except for the very wealthy). So from this reasoning The people most likely not to have pension provision are most likely to remain so under the new set up.

 

The only way this could have been improved was to make the employer contribution compulsory and not dependent the Employee also making contribution i.e. 'remaining opted in'. Now if they had introduced something along those lines then you would be closer to the Australian system of 9% compulsory contribution by the employer on top of salary. Then maybe the lack of pension situation in old age could really have been combated. The situation seems more a case as always that governments want you to seen to be tackling a problem while doing nothing worthwhile or constructive about it they also seem more intent people have enough pension provision to be unable to qualify for any state help, often leaving a situation where they may actually be worse off, rather than have enough pension contribution be be financially secure in old age.

 

Of course I may have misunderstood the whole compulsory pension scheme and hence talking utter bollocks

there is an opt out for employees as you say

 

it also doesn't kick in until around the £8k mark so if you have part time workers they may not even qualify for it

[drat01]

Tony those are the part time workers that this Gvmt are making the big song and dance about in reducing the jobless figures. Reality is that FT workers are down in number

[tonyh29]

Tony those are the part time workers that this Gvmt are making the big song and dance about in reducing the jobless figures. Reality is that FT workers are down in number

 

 

According to the interweb

 

 

 

The ONS figures show that 200,000 more people were in full-time employment by the end of last year and that the number of part-time workers had fallen by 43,000.

 

 

and yet according to the very same interweb

 

The ONS said that between October to December 2012, full-time employment was 378,000 lower than in the April-to-June quarter in 2008, the first

quarter of the recession. But part-time employment was 572,000 highercompared with the same period.

 

 

same source ONS and yet different outcomes  ??

Edited February 26, 2013 by tonyh29

[peterms]

How David Cameron has simplified and streamlined the inefficient NHS bureaucracy:

 

 

[TrentVilla]

The pension legislation is interesting, it stipulate employers must have a contribution pension scheme so as a headline that appears a significant change.

 

However the reality is that the scheme is far from being what it first appears, for a start there is a drawn out period of staging dates based upon numbers of employees that has now started but will take a few years before it covers all employers.

 

Then as I think Tony mentioned not all works will be automatically enrolled due to their level of earnings although they can opt into the scheme. Those automatically enrolled have the option to opt out and given that so many people in this country opt not to have a private pension it has to be expected that many people, especially those on wages just above the automated threshold or those in temporary work will opt out.

 

Then you have to consider the rate tiny percentages involved, 2% initially from the worker and 1% from the employer in year 1. This then rises over 3 years to if I recall correctly 3% by the 3rd year from the employer and I think the same from the employee.

 

I suspect that this has been done in order to encourage workers not to opt out but the reality is that the employer contribution is so low to start with many, especially those in temporary work will probably not bother.

 

In fact research my firm have done with temporary workers indicate that as many as 42% of our temporary workers would opt out. In the US similar legislation has seen take up stall at 50% (I'm unsure if they have an opt in or opt out system)

 

The other thing worthy mentioning in relation to this legislation though is that similar was introduced in Australia, around 20 years ago and the percentage of contributions have risen to a far higher level there.

 

I won't bang on too much on this, I could bore you all on it for quite some time as there is a lot more to this than I've detailed here and a lot more differences between the UK version of this than the Australian or US versions.

 

One thing I will though point out is that regardless of the intentions or expectations of this legislation, which personally I think is both well intentioned and needed, the reality of its implementation like the AWD and the implementation of AWR last year will be very different.

 

The employers of temporary workers will struggle to pass this cost on to the end hirers and won't be eager to foot the cost of it themselves so just as they've done with AWR they will seek ways to legitimately mitigate the impact which will I'm afraid mean that for temporary workers especially little will really change.

[villaajax]

[CarewsEyebrowDesigner]

Could a 3-year-old anti-establishment party win a quarter of the vote in the UK?

[bickster]

Could a 3-year-old anti-establishment party win a quarter of the vote in the UK?

Now? no. In 2 elections time? quite possibly as all three parties will be seen by most by then for what they are. Libs, already found out. Tories - its coming soon. Labour at next election will win and be found out then

[snowychap]

Son of Poll Tax (or Council Tax Support) ought to be that, really.

The Bastard son of Poll tax :-)

Up to 84% on low incomes will not pay council tax, local authorities believe

Local authorities have conceded that up to 84% people on low incomes will refuse to pay council tax after being caught in the net by benefit changes this April, and admit there is little they can do about it.

Ministers have cut the support for means-tested council tax benefit by £500m, and told local authorities to decide where the axe should fall. The result is that 326 town halls in England have put forward "local" council tax schemes – with residents in neighbouring regions facing wildly different penalties.

Nationally the council tax benefit cuts will mean the poor face an average bill of £247 a year from April – a charge from which they are currently exempt. But the sums are so small – on average less than £5 a week – that councils are warning it "would in many cases be uneconomic to recover, with the costs of collection, including legal recovery costs, being higher than the bill".

The result is that councils are budgeting for large losses and potentially widespread non-payment. A series of freedom of information requests by False Economy, a campaigning group part-funded by trade unions, found more than 70 councils were resigned to seeing swaths of residents refusing to pay the tax.

In Harlow the local authority expects to collect the new council tax from just 800 of the 5,000 poor households supposed to be paying it for the first time this year. The shortfall will mean a £1.14m black hole in the council finances.

In the Kent borough of Gravesham the council estimates 70% of the proposed tax will not be paid. Some local authorities will take unprecedented measures against the poor who won't pay. In North Tyneside the council says that the low level of charge to the poor – amounting to £50 a year – means that it is justified in collecting unpaid council tax from "ongoing benefits".

False Economy figures show on average councils are budgeting for a third of residents not paying the new charge. A spokesman said: "While these forecasts are cautious estimates, it is clear that council tax benefit cuts will cause chaos not just for families and households, but for councils themselves. Some councils look set to pursue people with no money through the courts, reviving memories of the poll tax."

Other experts have pointed out that the patchwork of new charges is particularly onerous for the jobless. The New Policy Institute, which examined all 326 schemes, pointed out that in Sutton the only residents paying a new charge would be the unemployed, who face a flat minimum payment of £3.55 per week. Nationally the highest minimum payment will be in North Hertfordshire, where poor residents will pay on average a third of the council tax faced by wealthier citizens – a new annual charge of £322.40.

Peter Kenway of the institute warned that the "postcode lottery is very complex and will reduce the transparency of the council tax system. It also has serious implications for fairness as low-income households with similar needs face big variations in the amount of council tax they will have to pay."

Labour said: "David Cameron's poll tax mark II has been a disaster from inception through to implementation." Hilary Benn, the shadow local government secretary, said: "Very soon hefty bills will be dropping on the doorsteps of those on the lowest incomes. Making very poor people pay bills they simply can't afford simply doesn't make sense, especially when at the same time the government is giving a tax cut to top earners."

The government said council tax benefit spending had doubled between 1997 and 2010. The local government minister Brandon Lewis said: "The localisation of council tax benefit will give councils stronger incentives to cut fraud, promote local enterprise and get people back into work. Whereas council tax doubled under the last administration, we have taken action to freeze council tax bills for three years, to help hard-working families and pensioners."

What will the knock on effects be?

I think that, on top of the other changes that have/are taking place, there will be too much for a lot of people to cope with. Whether that just means some real hardships for (large numbers of) individual cases or some kind of widespread response, I suppose we'll just have to wait and see.

Then when Universal Credit comes in, a new set of problems (with regard to marginal deduction rates) are likely to surface.

Edited February 27, 2013 by snowychap

[peterms]

It really is the Poll Tax all over again.  They just don't learn.

 

And they're starting to fight like rats in a sack about more spending cuts, approving cuts in the abstract but having more difficulty when they personally have to front them up.

 

What a mess.  They will be hounded out of office, bleating about how people didn't understand the problems they faced, and repeating the daily lies about cutting the deficit and 1m new private sector jobs.

[TrentVilla]

Talking of lies, Nick Clegg you are starting to look like a compulsive liar.

[Jon]

Talking of lies, Nick Clegg you are starting to look like a compulsive liar.

starting?

[CarewsEyebrowDesigner]

Could a 3-year-old anti-establishment party win a quarter of the vote in the UK?

Now? no. In 2 elections time? quite possibly as all three parties will be seen by most by then for what they are. Libs, already found out. Tories - its coming soon. Labour at next election will win and be found out then

 

Well then, what is the VT cabinet waiting for?