Universal Benefits Are An Even Bigger Universal Cost

People are puzzling over the following conundrum – It is proposed that Child benefit for individuals or married couples on GBP 44,000 a year is to be removed, but unmarried couples with a child, earning GBP 43,000 a year each, giving a household income of GBP 86,000 would be allowed to keep it.

The administrative details of removing universal benefits is nightmarish.  Whichever solution is picked, the result is unfairness and illogicality.

Yet the public seems to be highly in favour of removing universal benefits.  Free TV Licences, winter fuel allowance, free bus passes for over 60s are all disliked.  The details will have to be worked out somehow, but where do you draw the line?  The wisdom of Solomon will be required.

In essence, people understand that cuts will have to come, and that their universal benefit being sacrificed will be matched by everyone else losing their universal benefits.  That’s fairness of a sort.  The problem will be though how to decide who would still receive the benefits without setting up costly bureaucracy to decide who qualifies.

The biggest divide between the haves and the have-nots is not anything to do with benefits, but in the ability to find work and achieve independence from the state.  Britain has a national minimum wage which applies from the quietest bleakest rural locations right to the centre of London.  That cannot make sense.  This is not a universal benefit at all.  To some it provides a temporary advantage.  To others it ensures they will never find a job.  Yet unlike universal benefits, the public have not yet realised that the minimum wage, applied in a recession, damages their own interests, and is a universal cost to the economy.  It merely drives jobs out faster.  With six million sitting idle at home, it would seem just as sensible to lower the national minimum wage, and allow regional variations, as it is to get rid of universal child benefits.  If not more so.

How long will it take before this issue makes it onto the political agenda?

The Tap Blog is a collective of like-minded researchers and writers who’ve joined forces to distribute information and voice opinions avoided by the world’s media.

2 Responses to “Universal Benefits Are An Even Bigger Universal Cost”

  1. Twig says:

    From Apr 6th 2011
    – No more child benefit for anything over 6 kids (not applied to existing qualifying children).
    This mumber reduces by one each year until it reaches two.
    – The rate of benefit should be frozen indefinitely.
    – The cut off age should reduce by one year, every two years.

    This should allow the people raising their children on the taxpayer time to get used to the idea that it cannot continue.

    Another idea, allow married couples to opt for joint taxation, thereby utilizing the personal allowance of the “home maker”.

    Reduce all taxes to the basic rate so there’s no need for armies of tax inspectors and tax advisors. The large numbers of people thereby released from the pointless task of arguing about how much tax is due could then find productive employment and everyone would be happier and more prosperous.

    There! wasn’t so difficult was it? and I just made it up myself without any special advisors.

  2. Twig says:

    …and as for free TV licences – abolish the licence fee – job done!

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