From the BBC:
The government is considering ending the automatic annual increase in benefits in line with inflation, sources have told BBC Newsnight. If implemented, the move would see many benefits frozen for two years, then rising only in line with average pay...
Ah... why's that then?
In recent years inflation has risen at a far higher rate than average earnings - Whitehall officials say a switch since 2008/9 would have saved £14bn.
If and when the depression is ever over and the normal pattern re-established, i.e. wage increases are higher then inflation, the Tories (and probably Labour) will change tack and say that benefits should be increased with inflation again, so there's no logic to this other than choosing whichever figure is lower.
What about pensions then?
One benefit that will not be affected is the state pension. Pensions are now protected by a "triple lock" which means they will go up annually by either inflation, earnings, or 2.5%, whichever is higher. Having introduced this measure, the coalition will not touch it. But all other benefits are not protected in this way.
Which illustrates my general point: you can have anything you want, provided enough of you are prepared to go out and vote for it.
Tuesday, 18 September 2012
Fun With Numbers
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8 comments:
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Which illustrates my general point: you can have anything you want, provided enough of you are prepared to go out and vote for it.
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And in this case get somebody else to pay for it.
Sh: "And in this case get somebody else to pay for it."
That's what politics is about - it's a good tax if somebody else pays it and a good benefit if you receive it.
Pensioners tend to go out and vote - all parties know it.
Quite right, you get the government you elect, and you get them good and hard!
http://www.forbes.com/sites/timworstall/2012/09/18/where-laura-tyson-goes-wrong-on-tax/?utm_source=twitterfeed&utm_medium=facebook
AKH, RS, yes. Hence YPP.
SB, well TW is correct on LVT but quite wrong in his pantheon of bad taxes - VAT or Sales Tax is, as a matter of fact the worst of all taxes by any stretch, destroys the most businesses, acts as the biggest barrier to entry, introduces the most distortions, is quite tricky to administer, has the highest incidence of fraud and error etc.
I just thought you'd be interested as we seem to have corrected him about LVT.
SB, being fair, TW has always claimed to be in favour of LVT. But only if it is introduced absolutely perfectly on Day One and all other taxes replaced immediately, and if any negative effects on land owners are somehow avoided or mitigated.
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