This comes hot on the heels of trust fund millionaire George Osborne (personal fortune of £4m according to wikipedia) saying he's giving up his child benefit, and Ken Clarke (personal wealth over £1m) has been on the record using the two things as interchangeable terms.
I earn just shy of enough to be affected by the changes in child benefit but through the tax and national insurance system, I contribute well over £16,000 a year to the Treasury (and my employer contributes almost £7,000 in employers national insurance as a result of employing me), so I don't think the government does badly out of me, especially when you factor in the fuel duty and VAT on filling the car up and the VAT on almost everything nowadays (including ebooks irritatingly).
I certainly don't feel affluent in the way that these millionaires presumably do. We have to watch what we spend each month carefully, we discuss any spending over £50 between ourselves, don't go on foreign holidays as they're too expensive, and so on.
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No, what this is really about is a shift of focus. It's about engaging the middle class guilt complex and trying to get us all to think that "we're not doing our bit for the country" in this time of cuts. This time of cuts also happens to be the time when the Government is spending £643m on a feasibility study into replacing Trident. That's not money spent replacing Trident, that's money spent in seeing whether we should replace Trident. I have no problem with paying my dues but I'd rather not pay them to see stuff flushed down the toilet before I've even started.
Bizarrely when the original scheme to stop child benefit completely from families with one higher rate tax payer was announced, the savings were expected to be £1bn a year. Now that the watered down system is in place, with a higher threshold and sliding scale, the Government thinks the savings will be over £2bn a year. Obviously they're far too caught up in their own spin and PR on the matter to see their own figures massively contradict each other but hey, this is only the economy right?
Preying on middle class guilt is a much better approach than dealing with illegal tax evasion which costs the government tens of billions a year isn't it?
Of course society as a whole is under attack because the Government is so fundamentally intertwined with big business, it wont (or can't) seek to make savings by doing something as fundamentally basic as enforcing the law when it comes to corporate tax evasion (and it's not impossible, the US government has recently effectively put a Swiss bank out of business for harbouring offshore money from it's taxation system) It's apparently much easier to systematically disassemble the welfare state which the party are ideologically opposed to anyway.
You know I disagree with you, I don't think it's about kicking in a guilt reflex, it's about accepting that in owning your own home and earning £50k you are comfortably off.
ReplyDeleteMy parents are social workers and I was raised with a good insight into what happens when people fall through the cracks in society - I've known so many people with mental illness and learning disabilities who live in terrible poverty, some not even able to hold on to a flat of their own.
With that knowledge, it's hard for me to look at anyone earning £50k and NOT think they're well off.
Of course we wish the government would put as much effort into addressing tax avoidance among large corporations as it seems to do into challenging benefits claims from vulnerable individuals, but arguing that it's wrong to cut benefits to the middle classes because someone else isn't being targeted equally doesn't make sense to me.
It's all relative and if I tried, I could find lots of people worse off than us(ironically though, when we bought our first house, the only privately owned one in a row of councils houses, we were definitely the worst off there). In fact the finding someone worse off than you could continue down the chain until you reach the illiterate crack addicts on the streets.
DeleteSt Albans is (infamously) an affluent area but it hasn't stopped a lot of us sharing around 2nd/3rd/4th hand baby clothes between us all- some of the stuff Danger is wearing, I've seen on 3 other kids as they've grown up.
Cuts full stop do not need to be made. Cutting anything is ideologically based and certainly not the way out of a recession as many studies have shown. Collecting taxes due would not only remove the need for cuts, it would wipe the deficit out in under 3 years.
I have lived in areas of deprivation in my time,not least the poorest ward in Hertfordshire and the back end of nowhere in Morecambe during a recession but it still doesn't make flagellating the squeezed middle any more right, especially when calls for a Mansion Tax are vetoed by a cabinet with 23 millionaires in it.
I have friends that moved into social work, charity aid work, overseas missionary work and are exposed to all sorts of poverty on a daily basis. It still doesn't make what the government are doing right though- either in actual procedure or insinuation.
But I suppose we'll have to disagree on this one :)
Thanks for raising this point - I am in a similar position to you financially but what really annoys us is that while I earn a good salary my wife is a teaching assistant and therefore does not! This means that when I next get a pay rise we will start to lose child benefit - even though my wife will still be on minimum wages.
ReplyDeleteIt seems very unfair that you can have a couple with 1 person earning 50k and they lose some of their child benefit and yet you can have a couple where both partners earn 49k and yet they keep every penny of the benefit.
It is a massive disincentive on people to ask for wage rises etc.
Grrrr.
Really interesting points, Alex. As we're still awaiting the heir to the Stork fortune (ha!), the child benefit cuts don't affect us directly, but I'm staggered at how unjust the new rulings are. The disparity between a family with a single earner earning over the threshold at 50k and a double income family each on £49k makes me incredulous.
ReplyDeletePerhaps I should just spend all of my money on gin. The world might seem a brighter place.