Anyone else think this is all a big ploy to enable the chattering classes to vent their spleen on a tax change that will affect few who can easily cope with it? Why announce it ahead of the big spending review? And surely he should have foreseen the anomaly of two-income households benefitting. If not, then he really is a moron... ah, yes, that explains all.
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In message , Tiddy Ogg writes
I'd say an inexperienced amateur, in a guvmint which is making policy decisions "on the hoof".
It's certainly got the BBC HYS nutters foaming in the mouth with delight - so it must be a bad idea.
There's not just the obvious flaw of the single/two income issue but the fact, if you are close to the limit, a small pay rise could see you much worse off. If they are going to do this thing then they should:
- Raise the income threshold.
- Use the whole family income.
- Have a graduated reduction in benefit.
A lot of people argue that it would be too expensive to administer this way but whole family income is already assessed for child tax credits so the system's already there. (Higher earners are already due to lose their tax credits so there's a double whammy there.)
I wouldn't mind betting that the scheme won't actually save any money owing to the extra admin either way.
But it's all alright since rich pensioners will still get their fuel allowance and vote tory.
And nothing about the years credited to the state pension for non working mothers getting child benefit, which could be lost with the benefit. Who knows.
The ghost of GB and the law of unintended consequences which he invoked endlessly is wadering round Downing Street.
Should they be denied their state retirement pension too on that basis?
You see, the way I see it, the winter fuel allowance is really only part of the state pension, being paid on an age-related basis that is very similar. If it was just regarded as part of the state pension, and not called something different, there wouldn't be any fuss about it at all.
Does it really cost a couple of thousand pounds a year to work out if a household should be getting a couple of thousand pounds a year benefit?
Perhaps they should be concentrating on efficiency in the admin system instead, if it takes hundreds of man-hours to work this out per family...
What? I see your totally failed to spot the irony there.
The winter fuel allowance is nothing to do with the pension. It is a recent innovation and not funded by NI unlike the state pension.
Let me throw it back at you. Do you think that a rich pensioner who spends the winter abroad on holiday should receive the winter fuel allowance when a poorer family with young children do not get any help?
It's also a further attack on families where one parent wants to actually look after their own children. Families like already have to suffer one personal tax allowance that they can't use, lack of tax credits available to working parents, and now a possible loss of their child benefit.
State pension is not funded by NI. It's funded from the Big Pot. NI also feeds into the Big Pot, but I don't think it can feed in enough, especially given all the other things people seem to think NI is meant to fund, like unemployment benefits and the NHS.
I think so. Your comparison is a bit muddy because it co-mingles the comparison of rich and poor with that of pensioners and young families. It makes more sense to keep those comparisons separate. You do have a point with rich vs poor, but that boils down to whether the cost of administering means testing adds too much to the cost of the whole scheme. The comparison between pensioners and young families does, I think, justify favouring the pensioners, and this is because to them the cold is more than a mere discomfort, it is life threatening. Not a lot of yougsters die at home of hypothermia, but pensioners do. Pensioners' homes need to be warmer than homes of "normal" people.
If a pensioner chooses to keep warm in the winter by spending it in a warmer climate, that may well be quite cost efficient, given that he can then reduce the heating of his UK house to a minimum. He may not even need to be particularly rich to afford that holiday, given that it will be part-funded from savings in heating costs. You wouldn't deny pensioners an annual holiday, would you? It makes sense to take it in the winter than in the summer. If the WFA is supposed to help pensioners keep warm in winter, there's no reason to deny them it if they choose to keep warm in an unorthodox way.
Some will cope with it easily. Others won't. Eg a family with 4 kids where one parent earns 45k, it'll be about a 10% net income cut on an income which is now only about 6k per person (net).
Political. It is very popular - this plus the benefits cap both have over 80% support in a YouGov poll. The general public are the morons...
Yup. The Tories wanted to introduce transferrable allowaces for married couples but the LibDems weren't keen - wonder if they'll use this to try to persuade them it's a good idea?
HYS?
I thought they were going to withdraw it via the tax system, so presumably there'll be some taper there. And unless they put something specific in place, an easy way round it for people on the borderline will be use to pension contributions to lower the income they're assessed on. This works with tax credits now.
They won't touch pensioner benefits because pensioners are good voters. Labour did their best to bribe them with increased fuel allowances, pension credit, bus passes and applicable amounts double what younger people get...
No, because if you take 2500 away from someone who earns 45K you have taken away a significant part of their after tax income. It's easy to say that people on 100K wont miss it but the 45K people will
tim
The problem is that you will have to assess 100% of the claimants to find the 5% that are affected by the rule. This is why it costs so much.
Whilst the above is probably an overestimate of the actual cost, it is certainly more costly than moving the claim threshold up to say 60K.
Having said that, even the simple solution is going to be costly. How do you decide if someone is going to be a HR tax payer for the current year? Do you assess on previous year's earnings, wait until the year end and then claim back the over-paid CB or work it out weekly(!)?
And if the first, what happens if someone's income is substantially changed during the year (say they lose this job in Month 1?). Are they going to be stuck with no CB for the whole year? Is that fair!
Personally, I think it's an ill thought out mess. As a person disinterested in the actual change, it has left me with a very poor opinion of the Tory's ability to "do the right thing".
(and for those who shout "what would do instead then":
1) remove CB from over 16's. 2) tax it (in the hands of a "nominated" partner). 3) both of the above.seems fair, under the current circumstances, simple and workable to me)
tim
I would be in favour of increasing the basic pension and forget the headline perqs, even though I would pay slightly more tax on it, because it would benefit those totally dependent on the S.P. If only the increments hadn't been switched from average earnings to cost of living by Thatcher...
In message , Andy Pandy writes
I didn't vote for Labour because of the "bribes",and in any case I don't get any means tested benefits such as pension credit.
I voted *against* Cameron because he is so far from reality that he regards high rate taxpayers as "Middle England", and lies that "We are all in this together". All the current Cabinet are well safe from any hardship which will result from the cuts.
I know that, but it would be much simpler, and far less divisive, if it were. Few would object to an extra £250 being added to the State Retirement Pension in lieu of the winter fuel allowance, and few would demand that it be paid only to the deserving poor. The truth of the matter is, because it's an age-related benefit and is payable to the same sector of society, adding it to the pension instead of paying it separately would hardly affect anyone significantly, would be much easier to administer, and we wouldn't be having this argument.
There is only any such objection because of what it's called and how it's paid. If it was incorporated into the pension, no-one would object, just as they don't object to the rest of the pension even if the pensioner spends the winter abroad.
Then we've been lied to. One of the justifications for the current NI swindle is that it pays for state pensions.
I thought it was a good comparison ;-)
But if they are weathly enough then they can afford to pay their heating bills themselves.
When my youngest son was a small baby he was quite ill for a long time, the entire winter. I would hate to think what might have happened if we could not heat our house.
Yet many pensioners choose not to use their heating, despite being able to afford it.
I very much doubt that the cost savings would pay for a holiday!
If I can't afford a holiday I don't have one. I can't see why this should be different for anyone else.
I don't see why the taxpayer should subsidise anyone's holiday.
So are most people I would have thought.
If I understand this change correctly, you're only affected if you're earning £900 a week or more -- 3 years from now (when the tax burden could be different anyway).
Also, doesn't Cameron himself currently qualify for child benefit, which would no longer be the case under the new rules?
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