On the benefit cap
I take no pleasure in the need to cut benefits in real terms, which is what capping the increase in many state benefits below the rate of inflation effectively does.
Capping people's income is not something which should be an end in itself or any grounds for celebration.
The problem is that while the economy is taking a long time to recover from recession, the incomes of all too many of the people in work who actually pay the taxes which fund those benefits is also flat. Millions of low paid workers who are paying tax to support the welfare state have also had pay rises below the rate of inflation.
It would neither be fair and right, nor in the long-term interests of any group in British society (including those who happen to be on benefit at the moment) if the real value of benefits were protected while the living standards of low paid workers who pay taxes to fund those benefits were not protected.
This would be unsustainable for two reasons - firstly it sends out entirely the wrong signals about the need for people to find work. And secondly, with government spending still far higher, even after the cuts made to date, than is sustainable, Britain simply cannot afford such a policy
These caps might not have been necessary, or at least would not have had to be so tough, had the previous government not left behind a situation where they were spending four pounds for every three raised in tax. And where in consequence the national debt had doubled to 1.2 trillion pounds, and Britain was spending more in interest payments to service that debt than on schools. There are no good options to deal with the sort of mess those never-to-be-sufficiently-damned fools Gordon Brown and Ed Balls left behind - there are only bad options and worse ones.
The coalition has reduced the deficit by a quarter, but it is still unsustainably large and must be brought down further if we are not to leave our children an intolerable burden of debt. Those who argue that we can afford to keep spending risk putting Britain into the same sort of mess that Greece is in now.
Capping people's income is not something which should be an end in itself or any grounds for celebration.
The problem is that while the economy is taking a long time to recover from recession, the incomes of all too many of the people in work who actually pay the taxes which fund those benefits is also flat. Millions of low paid workers who are paying tax to support the welfare state have also had pay rises below the rate of inflation.
It would neither be fair and right, nor in the long-term interests of any group in British society (including those who happen to be on benefit at the moment) if the real value of benefits were protected while the living standards of low paid workers who pay taxes to fund those benefits were not protected.
This would be unsustainable for two reasons - firstly it sends out entirely the wrong signals about the need for people to find work. And secondly, with government spending still far higher, even after the cuts made to date, than is sustainable, Britain simply cannot afford such a policy
These caps might not have been necessary, or at least would not have had to be so tough, had the previous government not left behind a situation where they were spending four pounds for every three raised in tax. And where in consequence the national debt had doubled to 1.2 trillion pounds, and Britain was spending more in interest payments to service that debt than on schools. There are no good options to deal with the sort of mess those never-to-be-sufficiently-damned fools Gordon Brown and Ed Balls left behind - there are only bad options and worse ones.
The coalition has reduced the deficit by a quarter, but it is still unsustainably large and must be brought down further if we are not to leave our children an intolerable burden of debt. Those who argue that we can afford to keep spending risk putting Britain into the same sort of mess that Greece is in now.
Comments
One must always start from the simple fact "the government has no money of its own". There is only really one way it can raise money, and that is by taxing people who earn money. Some would say "they can borrow" but in effect that is only taxing people who have not yet been born.
It then is just simple logic to see that benefits can not be sustained above the income of governments.
It really is as simple as why i can not earn £300 per week and spend £400 each week. I can for a while, but before long i would start to get rather nasty letters from Visa, then a knock at the door........
Governments have a little more wriggle room than you or I, but it's not infinite.
Had Gordon Brown and Ed Balls spent their own household finances the way they treated those of the country, they would have had exactly the sort of nasty letter and knocks on the door that you are talking about.
The original idea was to make sure that the financial needs of families with children were protected so that the children would not go without clothes or food.
But we certainly ought to be able to find ways to protect children without the administrative cost of taking tax money from millions of families and then handing it back again in benefits.
For example the benefit could be given to eligible taxpayers in the form of a tax credit.
Part of the trouble is that sorting out a system always produces winners and losers, and the losers usually shout louder than the winners.