Robbing Peter to pay Peter

It is about time that taking money from Peter then giving it back to him stops

Should London's lowest earners be grateful for LLW?
Simon Miller
On 18 January 2013 15:43

Those poor things, politicians. So poor, so worried about job security that the majority of them want a pay-rise.

Unfortunately for them, I doubt the British public see it that way. For them, job security and the cost of living is a real, serious matter. For the majority, being in the same job by the Summer is by no means guaranteed and as the snow falls, a chill is being felt in households around the UK. Money matters continue to bite.

But bless these people with their expense accounts and a guaranteed job for five years - hell, for some it’s a life-time guarantee if you happen to live in a constituency where a donkey would vote on a certain colour of rosette.

You have to wonder how connected these people in Westminster are to the real world. Sure, they pay lip service to the real world but how many are actually aware of how little money goes nowadays?

Bread has gone up by 50 percent, other basic food stuffs have gone up too, and thanks to a poor world harvest this year they will continue to rise and that is before you add in fuel and energy costs.

For many people these small costs rise incrementally, reducing the amount of money that they have in their pockets. What £20 could get you a year ago is significantly reduced - but politicians only see the headline rate of inflation, not the inflation on the high street.

For the politician, carbon taxes, VAT rises, beer and cigarette taxes, and petrol taxes are just part of the grand scheme - the actions that prove that they are right-on; that they're doing something honourable - rather than what they actually do, which is punish the taxpayer.

The resultant actions of these feckless SW2 residents continues to pile pressures on the national account.

This week saw a report out that claimed 36.6 percent of households would be unable to meet unexpected but necessary financial expenses, up from 26.6 percent in 2007 when the downturn began. In addition, over a fifth of the UK population were considered to be at risk of poverty or social exclusion.

Now, even with sociologically wooly terms such as exclusion, these figures should be a worry to politicians, The more people are poor, the more likely the risk of social disruption and more pressures on the national budgets.

The fastest growth area in social spending is on work benefits - those top-ups given to the low-waged. But it is an area that politicians are reluctant to look at. Instead of questioning the role of the state and the waged, politicians are happy to pay out money to taxpayers to top up incomes.

Take Boris Johnson. This week he launched a new London Living Wage (LLW) of £8.55 an hour. But those who earn the LLW will only take home £13,869.34 a year from a gross pay of £16,672.50. Why? Why should someone on that wage lose nearly £3,000 to the government?

Despite Boris’ worthy intentions, he is answering the wrong question. The question of wages should be left to the company and the individual but because of government policy, that person on the LLW will still be having to claim benefits.

The answer is the wrong one. The question that needs to be answered should be why someone on wages below £20,000 be taxed either that much, or even at all? It is a crazy system that basically has the State enforcing lower employment and continued benefits expenditure.

The simple matter is that HM Treasury is taking tax from those that can least afford it and then, in its benevolence, giving a bit of their own money back. This system requires a vast bureaucracy created to suit themselves rather than treat the problem.

Yes, there is a problem with wage deflation - especially in the manual worker sector where undercutting is becoming an ever-growing problem  - but for any government to endorse itself taking money from those that least afford it is a joke.

This is the fundamental issue that has blighted the State over the past twenty years. It just cannot bring itself to allow the people to have their own money. It needs that control; it needs its own vast workforce to be justified.

It is not only the case in this country that Peter is robbed to pay Paul; it is the case that Peter is also robbed to pay Peter.

Yes, there are those that see living on the State as a career choice but for those on low wages, surely giving them back their money is a far more sensible policy, isn’t it?

Simon Miller is a Contributing Editor to The Commentator

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