Bill Carmichael: Coalition benefit reforms are working

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Across the country, letters have been dropping on millions of doormats that has caused much weeping and gnashing of teeth among the political Left.

Over the next few days about 24 million people will receive for the first time an annual tax summary that shows not just how much tax you have paid, but also where it has been spent.

Apparently (I’ve not received mine yet so I am going on Press reports) it includes a handy little pie chart that shows in hard, cold facts that the largest recipients of your taxes are not schools and hospitals, nor defence, police or transport – but those on welfare.

Fully 23 per cent of your taxes is spent on welfare. Even people struggling by on £23,000 a year are paying more than £1,000 of their taxes to support their neighbours who prefer not to work.

Someone on £30,000 a year – hardly a comfortable salary for someone supporting a family – is paying £1,663 on welfare, dwarfing the amounts spent on health (£1,280), education (£892), the state pension (£822) and paying the interest on the national debt (£475).

This factual information has caused paroxysms of rage among the posh socialists who see their role in life as generously spending other people’s money.

How dare the plebeian wage slaves demand to know where their money is being spent? What damnable cheek!

The genius of this simple move by the Treasury is that it brings national scale spending down to the easily understandable level of the family budget.

Tell someone that the UK spends an astonishing £160bn a year on welfare and their eyes glaze over. The figure is simply so big, so beyond our everyday experience, as to be meaningless to most people.

But tell them they are spending £1,600 a year so the lard bucket across the street can sit on his backside all day drinking beer and watching daytime television, and it hits home in a big way.

Most taxpayers will start totting up what they could do with that money – a fantastic holiday with the kids, a new car, or redecorate the entire house. Instead, it is drained away on the feckless and workshy.

That’s why the Left hates the whole idea. Some have suggested that it will pave the way for further reforms in benefits.

Well, let’s hope so because reform of the benefits system is one of the current government’s biggest success stories.

You might recall when the benefit reforms were first introduced there were dire warnings that entire cities would be ‘socially cleansed’ of poor people, thousands would be made homeless, people would be starving in the gutters and chopping up their grannies for firewood.

None of this happened, of course. Street begging, for example, seems no worse now than it was four years ago and many of those demanding your loose change are lifetime professional beggars imported from Eastern Europe.

So where have all these benefit claimants gone? The answer is straightforward – many of them have got jobs.

Since 2010 the private sector has created around two million jobs and many of these have been taken up by people previously on benefits.

Figures released by the Office of National Statistics last week showed that the number of children living in workless families has fallen to its lowest level for 18 years.

A total of 1.5 million children now live in families where nobody works compared to 2.3 million in 1996.

This is not only good news for the public finances and the workers who have to pay for the benefits bill, but also for the unemployed individuals themselves and their families.

The only route out of poverty is through work, not languishing on benefits for generations.

And perhaps those who have recently found jobs will discover the joy and pride of paying your way and supporting your family and will go on to instil the virtues of self-reliance and hard work in their own children.

The lesson is simple; if you make benefits more attractive than work, people will sign up for benefits; if on the other hand you make work more attractive than benefits, then people will work.

The benefit reforms are working, and if tax transparency helps to drive further changes then that is all to the good.

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