To get an idea of just how fair the changes to the tax and welfare system are, Left Foot Forward have compiled a quick overview of some the changes and given them each a fairness score out of 10.
To get an idea of just how fair the changes to the tax and welfare system are, Left Foot Forward have compiled a succinct list of some the changes and given them each a fairness score out of 10.
Benefits cap – fairness rating: 3/10
The benefits cap means that no family will be able to receive more than £26,000 in benefits a year. The change will be trialled from April 15 in Bromley, Creydon, Enfield and Haringey and then introduced nationwide from September.
According to the official definitions used in the UK and across the OECD nations, households are defined as being in income poverty if they earn less than 60 per cent of the UK’s median income. This could mean that any family on benefits with four or more children would move below the poverty line.
Bedroom Tax – fairness rating: 1/10
The Bedroom Tax, which came in yesterday (1 April 2013) as part of the 2012 Welfare Reform Act, will charge people in social housing based on how many spare rooms they have, and will hit tenants aged 16 to 65.
households that will be affected by the Bedroom Tax have disabled people in them. Down-sizing is often unfeasible for wheelchair users due to the shortage of wheelchair accessible properties. In effect, the Bedroom Tax risks penalising disabled people for being disabled – those who cannot move to a smaller property will be forced to pay more for their housing needs.
Income tax changes – fairness rating: 1/10
From April 6 the top rate of income tax will be reduced from 50 per cent to 45 per cent, giving an average tax break of £100,000 to 13,000 people earning over £1 million.
Despite being portrayed as fair, the greatest percentage change in net income from the rise in the amount of personal tax free allowance to £9,440.
Benefits rise below inflation – fairness rating: 3/10
From April 8 most work-related benefits and tax credits will increase by just 1 per cent – below the rate of inflation which currently stands at 2.8 per cent.
The thinking behind the move seems to be that because living standards have stagnated for working families due to a flatlining economy, it’s only fair that those on benefits should suffer too. This type of measure is “fair” only in the sense that any measure which makes everyone poorer is fair.
Council tax subsidies cut – fairness rating: 5/10
Yesterday (April 1) the budget for council tax subsidies was cut by 10 per cent, but with control over the system devolved to local authorities.
In practice this means that most claimants will lose around £137 a year.
Disability Living Allowance scrapped – fairness rating:
From April 8 disability living allowance will be replaced by the personal independence payment, a benefit ostensibly “not based on your condition but on how your condition affects you”.
Around 500,000 disabled people are expected to lose out when the Disability Living Allowance (DLA) is scrapped, according to a report by The Hardest Hit, a coalition of 90 disabled people’s organisations and charities.
The government claims it will claw back about £2.2 billion from the reform.
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