Tuesday 2 December 2008

"Claimants should be work ready'"

Just quite how stupid are they?

FFS, people respond to incentives!

Faced with a relatively cushy life on the dole and total withdrawal rates of approx. 80% of wages (i.e. you lose 31% of your wages in income tax/National Insurance, plus you lose JSA, Housing Benefit and Council Tax benefit worth around a third of an average salary, plus you lose another 39p in Working Tax Credits for every £1 you earn), there is little financial motivation to take up whatever limited employment opportunities present themselces.

If you really want people to get off welfare (rather than just having an excuse for more layers of bureaucracy), all you need to do is to reduce basic welfare levels a bit and scrap means testing completely*. Even an anonymous ranter's comment on an earlier post (which I deleted) managed to nail this:

if [we] gave everyone dole, then they could work and earn more than the dole without being dole scum, here is £60 now go earn some more, simple, if you earned too much you could have it taxed back, it would end dole culture, you get it anyway, why sit on your bum, you get more for getting up and doing something.

Which is pretty much what the experts say. If we are to have a welfare system at all**, this is the only rational way of doing it.

Of course, willingness-to-work is only half the equation. Equally important is reducing super-taxes on employment (Employer's NIC and VAT), scrapping the National Minimum Wage and getting rid of the regulatory burden on employers (except basic health and safety matters).

* To keep the costs down, people would have a choice between a) claiming welfare or b) a much higher tax-free personal allowance.

** I accept that there is an argument to say there should be no taxpayer-funded welfare at all, that's a different topic.

1 comments:

Obnoxio The Clown said...

Just quite how stupid are they?

Infinitely so.