Vote for me and I’ll give you free cash!
The Working Family Tax Credit is quite simply an electoral bribe to subsidize the national minimum wage, both employees and employers dependant on Labor staying in power to keep this obvious perk. It’s clever because, like most New Labor apparent giveaways, you have to apply for it with complex government forms (only deciphered by fraudsters and polish builders in Gdansk according to the Mail on Sunday) and so not enough people who really need it get the benefit are on it. They use a similar ploy with state pensions, proud and infirm old folks who thought a war, unable to gather enough energy or damaged pride to get to the benefit office to claim extra money’ what is already rightfully theirs.
If the government really wanted to empower poor people to get off benefits and into work through subsidy they would have dropped income tax rates, giving people enough money to pay their utility bills and rent, some two thirds of most low income peoples wages now. It would have been a much simpler and a hell of a lot cheaper to administer. The principal reason peole don’t come off benefits and into work, via tax breaks like this, is because they are too proud to apply and take the money and too scared if they have to pay it all back on the threat of bailiffs when it goes tits up. I think unemployment rates are pretty constant and there just as many people out of work now as Thatcher’s day, the unemployment figures disguised by various incapacity and disabled benefits hiding the bulk of the jobless, and schemes like this just encourage fraud, waste and people who will vote Labor..
Nine out of 10 families with children in the UK are eligible for tax credit payments. Some single people are but it’s miniscule. The point of it is to try and encourage people off benefits, effectively subsiding and allowing employers to pay lower wages and for employees to not sign on, taking marginally less money from the tax pot. To actually claim the tax benefit of up to 5,500 a year you must be a parent and be in work. Claimants must predict their income on the basis of last years wages, payments clawed back if they earn more.
The system was bizarrely uploaded to the internet, meaning organized gangs could easily make multiple claims, the job centre head office themselves being embroiled in the misappropriation with thousands of false claims emanating from there. Treasury officials closed the website in 2005 as it sank in fraud.
It’s noticeable that New Labor let people get away with over claiming the tax credit just before the general election and then publicly clamped down on the obvious fraud and misappropriation after the election, looking tough on crime and so appealing to the Middle classes again, yet insuring the vote of the poorer people who got all this free money. It was clear that our poorest working citizens were hardly likely to ring up the tax office and tell them you are over paying me by 60 quid a week as those utility bills and petrol tabs rocketed. The government knew this system would be expensive to run and riddled with fraud, yet they went ahead with it anyway, upgrading the 1998 hybrid to the current system.
The problems begins when people wages go up, therefore the subsidy should do the opposite ,but few people able to figure out what to do next, such is the complexity-like any tax form-of the adjustment. Of the 5, 6 BILLION LOST and unaccounted for so far from this giveaway most of that is money owned through overpayment, apparently costing more money to retrieve it than is owed. Some 14 million ended up in Eastern Europe! When you are confronted with a demand for two or three grand that you weren’t supposed to get and you’re already flat broke then how can you pay it back?
Some people, I’m sure,’ forget’ to tell the tax office their wages had gone up and expected the government to guess, so cutting their subsidy. The temptation is huge; again, those gas and leccy’ bills have to be paid. It now costs 69 to fill your petrol tank every week because of the Iraq war.
Another reason I don’t agree with the Working Tax Credit is because there was always going to those high levels of fraud and miss-payment. I would have been so much cheaper to just keep the income tax levels really low for poorly paid workers than introducing this bureaucracy that’s rife for fraud and fiddle. The only way to get people out of poverty is not to try and undermine the minimum wage with mass immigration and subsidies housing costs but to hold onto to good jobs, using that subsidy to stop out sourcing. Who exactly can afford to buy a house these days? With a minimum 15 grand deposit required and most people that can afford housing still paying off their student debt the money blown on the WFTC could have been used far more prudently, Mr. browns favorite word.
Fraud before the election
Summary: Election bribe..