6 April 2012

…and others and elsewhere

The other day I wrote about the slow erosion of the minimum wage which for a dozen years has helped those at the bottom of the pay pile. The wage has been “the slow-foot hope of the poor”. As the budget provisions come into force there is more bad news for the vulnerable here.

Yes, any budget is complex with winners and losers and contending interpretations. In the 2012 budget there are very small tax reductions for a lot of taxpayers, but I think these are outmatched by significant losses for some poor, low-paid, and very modestly paid groups. For example, today the Tory Libdem government’s destructive change to working tax credits comes into force. A couple with children on less than about £17 000 a year at present can get the credit as a top up to their wages for working at least 16 hours a week. From today those qualifying hours are raised to 24: between them they must work 24 with one working at least 16 or one must work 24. There is a recession, jobs are hard to find, the opportunities for increasing hours extremely limited. If they fail the new hours test, the family will lose all the working tax credit, up to £74 a week. There are estimated to be around
200 000 couples affected by this change nationally and pro-rata that is nearly two thousand in Cornwall. These are working people and their families; they should be encouraged not find their lives made more difficult by deliberate government decision.

At the same time research by the Institute for Fiscal Studies (IFS) for the Labour party shows that a typical family will lose £511 a year due to 2012 Tory Libdem budget changes in taxes and benefits: this takes into account the vaunted increase in the income tax threshold. In April 2014 pensioners will be £315 a year worse off as the granny tax bites.

Here then are the fruits of Tories and Libdems working together to take from the poor and low paid. Cue overpaid politicians earnestly telling us how it pains them to have to take hard decisions to reduce lesser paid people’s income.

Do not expect the Conservatives or Libdems to mention these cuts.


Read here why the government’s tax threshold change amounts to only 81p a week after accounting for the default inflation rise. (7 April 2012)

A survey by the Guardian shows that many jobs are not giving enough hours for people to meet the new qualifying hours rule for working tax benefits. This new rule is either serious incompetence by the Tory Libdem government or a callous policy change; it should be righted. (8 April 2012)

“the slow-foot hope of the poor”: Robert TRESSELL Ragged trousered philanthropists chapter 45