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    Really Interesting Finance News
    Monday, 07 November 2016 22:52

    Scrooge and the tory Christmas present of poverty and homelessness

    If life wasn’t already struggle enough, with just 48 more sleeps until Santa arrives it seems the Government’s merriment is to put struggling UK households into further poverty and homelessness. Kick someone when they’re down why don’t you; not content with lower wage growth, higher inflation and the 'eye-watering' fact childcare in the UK is the most expensive in the world with an average yearly spend of £11,300.

    A tough new benefit cap that kicked in today, could lead some families to lose more than £100 a week with the benefits cap being cut from £26,000 – previously in line with the national average salary - to £20,000. The streets really aren’t paved with gold and estimates of the people who will suffer range from between 88,000 to 116,000, who will find life several degrees colder from today as a result of Tory “chilling callousness”.

    The cap has been described by the GMB union as “a monstrous assault on struggling families that will shatter the life chances of the poorest children”.  Low and behold, our old ‘friend’ is yet again to blame in the form of George Osborne, who spearheaded the scrooge move last year.  

    Funnily enough, the numbers don’t add up. Maybe that’s because Mr Osborne did the maths!! Professors of Maths we are not, but surely it doesn’t take a genius to work out that there are glaringly obvious flaws in not only the numbers, but the rationale.

    Let’s start with the claim on which the policy rests - that “no out-of-work family should receive more in benefits than the average family receives from going out to work”. A fabricated myth to hoodwink the public, since it takes no account of the benefits that an in-work family can claim to increase their income, thereby in real terms, earning much much more than those on benefits!

    Then there’s the Department for Work and Pensions, who say “only 88,000 families will be affected” by the cap – as if that’s not enough – so why does the data from the Chartered Institute of Housing estimate a staggering 116,000 families nationwide are set to be affected, which includes 300,000 children.

    Which leads us on to the fact the Government has chosen to ignore it will likely cost more than it saves! The cap is expected to save just £110 million a year, but it’s estimated that these savings could be wiped out due to the cost to local authorities of homelessness and housing families in temporary accommodation. A well thought out plan then; we think not!

    So much for Prime Minister Theresa May’s vow in her Conservative conference speech last month to “make society fairer for families”. Injustice in the form of robbing hypocrites springs to mind as more promises go broken and the Tories yet again abandon their paltry pledges to help struggling households!

    Apparently, the new cap will encourage people to find work, with the current Work and Pensions Secretary, Damian Green saying; “What we are doing for everyone is make it easier for them to get into work”. In yet another useless piece of patronising advice from our would-be leaders; “If they want to avoid the benefit cap they only have to be working 16 hours a week.”

    Maybe the silver-spooned, Oxford-educated, ex- BBC and The Times journalist has missed the point or cannot read! The Institute for Fiscal Studies, estimates that only 5 per cent of households hit by the first cap in 2013 moved into employment as a result and a study published in the summer by Oxford city council in partnership, ironically, with the DWP, found that cutting people’s benefits reduced their chances of moving into work, because dealing with the additional pressures of poverty eroded their capacity for job seeking. 

    So what is the result? Low and behold, debt, ill health and homelessness! If the benefit cap was introduced by the coalition government as a device to supposedly “restore fairness”, then we wholeheartedly agree with Liberal Democrat leader Tim Farron’s comments that “Attempts by the Conservatives to somehow re-brand themselves as the workers' party are now looking absurd. This is disgraceful.”

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