Benefits Cheats are actually Companies - Apparently.

[Twiggy]

http://www.theguardian.com/money/blog/2015/jul/04/firms-paying-poor-wages-benefit-cheats-tax-credits

 

Just wanted some unbiased opinions on this, unbiased in the fact that I actually work for Next and are treated like **** every day for little pay.

[Hamilton Saint]

Can you re-write that sentence so that it makes sense?

 

[Mr Biscuits]

Twiggy, you do have a choice - nobody is forcing you to stay at that job

[whelk]

Twiggy, you do have a choice - nobody is forcing you to stay at that job

 

Lack of alternate options maybe? Sh 1t employers tend not to survive like that for long but just telling those who work for such companies to leave isn't overly helpful.

[badgerx16]

Lack of alternate options maybe? Sh 1t employers tend not to survive like that for long but just telling those who work for such companies to leave isn't overly helpful.

When there are sometimes over 100 applicants per job advertised, simple economics will keep such companies running. When they are run by Tory peers and their profits are effectively boosted by benefits, it just grates more. It will be interesting / worrying to see the consequences of any cuts to the Tax Credit and Housing Benefits systems in Georgie Porgy's budget.

[CHAPEL END CHARLIE]

When there are sometimes over 100 applicants per job advertised, simple economics will keep such companies running. When they are run by Tory peers and their profits are effectively boosted by benefits, it just grates more. It will be interesting / worrying to see the consequences of any cuts to the Tax Credit and Housing Benefits systems in Georgie Porgy's budget.

 

Well we will soon know for sure what the Chancellor plans to do, but by all accounts it is our poorer working families who will bare the brunt of the coming 'austerity' measures while those with £1m houses are expected to benefit from cuts to Inheritance Tax. So much for all that ''one nation'' cobblers the PM spouted in the aftermath of his election victory.

 

I do believe that austerity measures are both necessary and unavoidable given the (appalling) state of our public finances. However, surely it is not beyond the wit of man to devise policies that result in that 'pain' being shared more widely throughout society rather than hitting the poorest the hardest.

 

To mix my metaphors, the right royal 'kicking' the British people administered to the Liberal Democrat Party at the last election is coming home to roost ...

[Nolan]

The Guardian writer is an idiot.

 

It's difficult enough for high street shops to make money as it is.

[Whitey Grandad]

Well we will soon know for sure what the Chancellor plans to do, but by all accounts it is our poorer working families who will bare the brunt of the coming 'austerity' measures while those with £1m houses are expected to benefit from cuts to Inheritance Tax. So much for all that ''one nation'' cobblers the PM spouted in the aftermath of his election victory.

 

I do believe that austerity measures are both necessary and unavoidable given the (appalling) state of our public finances. However, surely it is not beyond the wit of man to devise policies that result in that 'pain' being shared more widely throughout society rather than hitting the poorest the hardest.

 

To mix my metaphors, the right royal 'kicking' the British people administered to the Liberal Democrat Party at the last election is coming home to roost ...

 

How can you benefit if you're dead?

[SuperMikey]

The Guardian writer is an idiot.

 

It's difficult enough for high street shops to make money as it is.

 

Oh, poor them. Only £695m in profits last year - boo hoo!

 

You really are a f*cktard of enormous magnitude.

[Nolan]

Oh, poor them. Only £695m in profits last year - boo hoo!

 

You really are a f*cktard of enormous magnitude.

 

you do realize there are other uses for profits other than wages, right?

 

The profit is probably needed to counter the reduction in value of the company due to losses in share value.

[CB Fry]

you do realize there are other uses for profits other than wages, right?

 

The profit is probably needed to counter the reduction in value of the company due to losses in share value.

Okay then.

[Whitey Grandad]

Oh, poor them. Only £695m in profits last year - boo hoo!

 

You really are a f*cktard of enormous magnitude.

 

No profits = no company = no jobs

[CB Fry]

No profits = no company = no jobs

Better paid workers = more disposable income = more profits = more jobs

 

Easy this, ain't it?

[Ex Lion Tamer]

No profits = no company = no jobs

I think they're talking about profit after salary costs. If a company is making millions in profit on top of that, they can afford to pay staff a living wage rather than spunking it all to shareholders

[Nolan]

Better paid workers = more disposable income = more profits = more jobs

 

Easy this, ain't it?

No profits, no reserves for bad years, no company left, no money for pension or taxes.

[CB Fry]

No profits, no reserves for bad years, no company left, no money for pension or taxes.

Okay then.

[Whitey Grandad]

Better paid workers = more disposable income = more profits = more jobs

 

Easy this, ain't it?

 

Er, no. Higher wage bill => less profits => fewer jobs

 

Unless all the extra disposable income is spent at that same employer, which isn't going to happen.

Edited 5 July, 2015 by Whitey Grandad

[bridge too far]

Er, no. Higher wage bill => less profits => fewer jobs

 

Doesn't alter the fact that the British taxpayer is subsidising the wage bill of these big, wealthy companies. How is that right?

 

People can't moan about 'subsidising' people in receipt of in-work benefits but ignore the fact that they're actually lining the pockets of company bosses and shareholders.

 

 

The Square Mile = Benefits Street

[Nolan]

Doesn't alter the fact that the British taxpayer is subsidising the wage bill of these big, wealthy companies. How is that right?

 

People can't moan about 'subsidising' people in receipt of in-work benefits but ignore the fact that they're actually lining the pockets of company bosses and shareholders.

 

 

The Square Mile = Benefits Street

Because subsidizing some of a wage is better than paying full unemployment benefit.

[Whitey Grandad]

Doesn't alter the fact that the British taxpayer is subsidising the wage bill of these big, wealthy companies. How is that right?

 

People can't moan about 'subsidising' people in receipt of in-work benefits but ignore the fact that they're actually lining the pockets of company bosses and shareholders.

 

 

The Square Mile = Benefits Street

 

Then stop the subsidy, remove the benefits. The state is not giving money direct to the companies.

[buctootim]

No profits = no company = no jobs

 

No company = some other company selling clothes and employing staff - unless your argument is that if the minimum wage goes up to a reasonable level we will all be naked?

[buctootim]

 

The profit is probably needed to counter the reduction in value of the company due to losses in share value.

 

https://uk.finance.yahoo.com/echarts?s=NXT.L#symbol=NXT.L;range=5y

 

 

Share price more than tripled in past 5 years. Guess they can afford to pay a living wage after all.

Edited 5 July, 2015 by buctootim

[SuperMikey]

Then stop the subsidy, remove the benefits. The state is not giving money direct to the companies.

 

You're missing the point entirely. The point is that Next made nearly £700m in profit last year but they pay some of their employees so poorly that the state has to subsidise their wages when the company can quite easily correct that themselves by paying them properly. It's completely unethical.

[bridge too far]

Mikey - large companies such as these don't understand 'ethics'.

[SuperMikey]

Unfortunately that's the problem. There are exceptions to the rule - some companies like John Lewis and B&Q look after their employees very well and are still very profitable. It's still BAU to put profit over people though, and this government definitely aren't the ones to step in over that kind of behaviour and try to influence it.

[SOTONS EAST SIDE]

Er, no. Higher wage bill => less profits => fewer jobs

 

Unless all the extra disposable income is spent at that same employer, which isn't going to happen.

AaaH but they might well spend it in another chain store. Who's profit rises, leading to an employee wage rise. Who then can spend it in Next, who's profit rises. And so on, and so on!!

[Dig Dig]

Er, no. Higher wage bill => less profits => fewer jobs

 

Unless all the extra disposable income is spent at that same employer, which isn't going to happen.

 

Are you sure Einstein is the right avatar for you?

[CB Fry]

Er, no. Higher wage bill => less profits => fewer jobs

 

Unless all the extra disposable income is spent at that same employer, which isn't going to happen.

Wow. That's some pretty impressive economic analysis you've got going on there. Well done.

[Lord Duckhunter]

Unfortunately that's the problem. There are exceptions to the rule - some companies like John Lewis and B&Q look after their employees very well and are still very profitable. It's still BAU to put profit over people though, and this government definitely aren't the ones to step in over that kind of behaviour and try to influence it.

 

B&Q pay just above minimum wage for most of their staff and therefore the state spends a lot of money subsidising them.

 

Too much supply & subsidies will always produce low wages. The unskilled working man has one tool to bargain with, the withdrawal of that labour. If nobody will stack the shelves the retailer will have to increase wages to attract people. Whilst there's a ready supply of workers and whilst the government increases pay on behalf of the employer, why on earth would they? They are only interested in their shareholders and profits .

 

The government also subsidies landlords as rents are kept artificial high and not subjected to the market. If there was more social housing and no housing benefit , private landlords would have to either bring rents down or have empty properties .

[Whitey Grandad]

Are you sure Einstein is the right avatar for you?

 

You see Einstein, I see a white-haired grandfather.

 

For the record, I don't agree with all these messy tax credits, just set the tax rates at the right levels and the economy will sort itself out.

[Whitey Grandad]

AaaH but they might well spend it in another chain store. Who's profit rises, leading to an employee wage rise. Who then can spend it in Next, who's profit rises. And so on, and so on!!

 

Unfortunately the money can only go round so far before it's reduced to bugger all.

[CB Fry]

Unfortunately the money can only go round so far before it's reduced to bugger all.

I'm guessing you read economic theory at Harvard, right? Apologies if I'm slightly out but there's a real sense of Ivy League thinking in your analysis.

[buctootim]

I don't agree with all these messy tax credits, just set the minimum wage at the right level and the economy will sort itself out.

 

I agree

[badgerx16]

The government also subsidies landlords as rents are kept artificially high and not subjected to the market.

If you're referring to Housing Benefits, that's just more self-serving by those with their snouts in the gravy trough, if there is any truth behind this story :

http://www.mirror.co.uk/news/ampp3d/tory-mps-donors-taking-millions-5614468.

 

( I beleive that some Labour & LD MPs are doing the same ).

[Manuel]

I agree that most employers could easily afford a much higher minimum wage, perhaps even £10 per hour, which on the face of it sounds good, and I think on the whole it would be. Some employers might not be able to afford that though, so would probably lead to more swallowing up of of smaller companies by big multinationals who can afford it.

 

Also if our minimum wage was significantly higher than elsewhere, it's bound to lead to higher economic immigration, which would have to be considered/managed.

[buctootim]

would probably lead to more swallowing up of of smaller companies by big multinationals who can afford it.

 

I think the reverse would apply. Almost by definition most small business owners pay themselves a decent wage, otherwise they wouldnt bother with the hassle. Currently they are undercut by the minimum wage behemoths. A higher minimum wage could actually make startups more viable.

[Lord Duckhunter]

I agree that most employers could easily afford a much higher minimum wage, perhaps even £10 per hour, which on the face of it sounds good, and I think on the whole it would be. Some employers might not be able to afford that though, so would probably lead to more swallowing up of of smaller companies by big multinationals who can afford it.

 

Also if our minimum wage was significantly higher than elsewhere, it's bound to lead to higher economic immigration, which would have to be considered/managed.

 

If companies can't afford to pay people a living wage , then they're not financially viable . The modern Tory party only seems to believe in the free market when it helps companies . To work there needs to be a free market in wages and labour . If I need £10 an hour to be better off than on the dole , I don't really care if Tesco pay £7 of it and the taxpayer £3. If the taxpayer removed his portion then tesco could either give me a £3 rise or find someone else, if enough people felt the same their shelves go unstacked and their tills unmanned until they pay an attractive wage . That's a free market working for the working man .Of course as you seem to acknowledge an influx of foreign workers will distort the market .somebody somewhere will work for £7 an hour because they'll only get £2.50 in their home country .

[Hockey_saint]

B&Q pay just above minimum wage for most of their staff and therefore the state spends a lot of money subsidising them.

 

Too much supply & subsidies will always produce low wages. The unskilled working man has one tool to bargain with, the withdrawal of that labour. If nobody will stack the shelves the retailer will have to increase wages to attract people. Whilst there's a ready supply of workers and whilst the government increases pay on behalf of the employer, why on earth would they? They are only interested in their shareholders and profits .

 

The government also subsidies landlords as rents are kept artificial high and not subjected to the market. If there was more social housing and no housing benefit , private landlords would have to either bring rents down or have empty properties .

 

I worked at John Lewis for a number of years on just above minimum wage. You are aware of Spedan Lewis's marvelous anti-communistic wheeze right? essentially they get a bit of a bonus (which in no way makes up for their retail wages being just above minimum wage) whilst nepotism in the Lewis family happened until about 20 years ago when the chairman wasn't a family member and of course, John Lewis grows large on inflated prices because, frankly, it knows it's middle-class-tory-voting customers will lap up their "traditionalist" values.

 

I digress, but simply put, people that use the partnership as a great example of fairness to workers know bugger all about how the partnership works (I did my bachelor's thesis on this).

[Torres]

No company = some other company selling clothes and employing staff - unless your argument is that if the minimum wage goes up to a reasonable level we will all be naked?

 

It's been a while since I did this but:

 

No company + unless your argument is that if the minimum wage goes up to a reasonable level we will all be naked = some other company selling clothes and employing staff

 

Right?

[buctootim]

It's been a while since I did this but:

 

No company + unless your argument is that if the minimum wage goes up to a reasonable level we will all be naked = some other company selling clothes and employing staff

 

Right?

 

I can see why its been a while since you did that.

[Torres]

Would it help if I showed my workings?

[moonraker]

No profits, no reserves for bad years, no company left, no money for pension or taxes.

I doubt they have much in terms of reserves most companies do not operate in the black, especially with the current low interest rates. They will be reliant on loans to operate the business, so the shareholders and executive management make good from low wages and credit while the government subsidise the low wages. Paying a living (not minimum) wage should be the goal, this would remove the need for tax credits.

[buctootim]

Would it help if I showed my workings?

 

I dunno, I doubt it. My maths teacher insisted X + Y = Z was just like apples + oranges = pears. I said it equalled fruit salad and got a detention.

[Torres]

I dunno, I doubt it. My maths teacher insisted X + Y = Z was just like apples + oranges = pears. I said it equalled fruit salad and got a detention.

 

http://www.bbc.co.uk/news/education-29342539

 

It's your classmates who failed their exams because of you and are now unemployed, fat and depressed that I feel sorry for.

[Sour Mash]

What would happen if in-work benefits and tax credits were removed?

[View From The Top]

What would happen if in-work benefits and tax credits were removed?

 

Good chance we will be finding out very shortly.

[st alex]

No profits = no company = no jobs

 

The first thing that comes up when you type profit into Google:

"'Profit' A financial benefit that is realized when the amount of revenue gained from a business activity exceeds the expenses, costs and taxes needed to sustain the activity."

 

It's perfectly possible to run a company and break even. Profits are what's left for the owners of the company after all expenses, (i.e. wages & pensions). I'd imagine they typically get spent on luxuries for the tiny minority at the top of the pyramid, speed boats, houses abroad, that type of thing.

 

In the olden days there was also a thing called philanthropy where occasionally wealthy individuals would use their profits for good causes and charitable endeavours. I think Bill Gates is one of the few remaining philanthropists although his company, microsoft, is based in the USA.

[hutch]

What would happen if in-work benefits and tax credits were removed?

Queues of people trying to break into the back of trucks at Dover

[Batman]

What would happen if in-work benefits and tax credits were removed?

 

it will be tough but no where near as bad as what will be predicted

[Lord Duckhunter]

What would happen if in-work benefits and tax credits were removed?

 

Depends on which other measures were taken at the same time. If the minimum wage was increased to a living wage & immigration was controlled , there would be job loses short term but in the longer run we would have higher wages for unskilled labour.

 

Its not really something you can do in the present climate , the time for this is during the boom years , unfortunately Gordon Brown did the exact opposite during his years of growth .