Universal Credit - Screwing as many people as possible

Well it had to happen. It seems that after a nice and doubtless expensive review, MPs have finally realised something that the average unemployed person could have told them for no more than the price of a cup of coffee in Starbucks; that the unemployment and benefits system is set up to screw people who have the initiative to look for self-employed work.

Seriously, on the basis of things MPs say and announce, unemployed people should be forced to serve as MPs and thus reduce government costs and reduce stupidity levels.

The crisis-hit benefits system of Universal Credit treats the self-employed unfairly and endangers budding businesses, MPs have warned.

A new report from the Commons Work and Pensions Committee has found found that the flagship benefit reform is designed with little regard for the reality of self-employed work, such as window-cleaning and hairdressing. According to the report and despite the UK having around 5 million individuals in self-employment, the self-employed could miss out on support worth as much as £2,500 a year when compared to an employed person with similar income.

The Universal Credit system will be used to administer in-work benefits to millions, but rules affecting claimants who are self-employed are being described as “inherently unfair”.

One rule, called the minimum income floor (MIF), requires the self-employed to prove they earn at least the national minimum wage for 35 hours consistently each month to receive top-ups such as tax credits. If they earn less than that, they get no benefits. So the people who most need income support are deliberatly excluded from it. That can only make sense to a civil servant or MP.

Critics have said the MIF does not reflect the reality of running a seasonal business.

For example, many businesses, even shops, have seasonal peaks and troughs, when income can go from good to invisible. If you run a toy shop, for example, the bulk of your annual profits will arrive around the christmas period, if Amazon doesn’t swallow them all up. However, in order to claim universal benefit you will need to show that you earn above the MIF throughout the year, meaning its requirements will be impossible to meet, especially during quieter months.

Despite the fact that businesses are most likely to fail in their first 3 years and the fact that many start-ups need at least 12 months to become profitable, the MIF is applied to all self-employed people who have been active for more than 12 months.

The national chair of the Federation of Small Businesses, Mike Cherry, said: “The Minimum Income Floor is bad for entrepreneurialism, pure and simple. We know that it generally takes two to three years to get a viable firm off the ground.”

MPs are now calling for the one-year start-up period, in which a self-employed claimant receives support regardless of their earnings, to be extended to three years. They also suggest extending reporting periods from one month to a year for those who rely on seasonal trade. 

It’s not right to use the story to bash one political party; they’re all the same in the sense that they all have an obligation to reduce costs and come up with half-baked ways of doing it. Incompetence and unfairness are inevitable when the vast majority of MPs have never had a proper job, and many only come face to face with the real world when doorstepping around election time. How can you have any idea what life as an unhapplily unemployed person islike unless you’ve been here, lived the life and haven’t been able to eat the pie because you couldn’t afrord to buy it?

Seriously, instead of talking among themselves and specialy selected ‘spokespeople’, wouldn’t it make a change if MPs stepped out of their world and spoke to people who inhabit this one?

Old Spice - aka Brian

Brian - Co-Editor

No, I don't use Old Spice and was given the nickname because I'm the oldest person working on Goodish Times. I was told it was either going to be 'old spice' or 'grumpy git'.

I'm a 'normal' person. Mr Average in most respects, working but not earning enough to buy an Aston Martin yet, or ever. After running a couple of businesses in the UK, I moved to Italy, where I became a language teacher and met 3 of the people now involved with GoodishTimes. After a decade teaching, I returned to the UK.

I write because I enjoy it and I like the opportunity to bite back against the flood of propaganda and hysteria that passes for news in the UK media. I don't care if you agree with what I say, only that it's interesting enough to read.