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The real cost of benefits in the UK

The real cost of benefits in the UK
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The benefits system in the UK has been under scrutiny for a long time, every government promises to make changes and every government fails to keep up with the high levels of demand. As a working parent it can be hard to find the right balance between work and child care can be a stressful set of decisions as working more hours can often mean less benefits and in the long term make you worse off financially.

The question we all need to know is, how much does the government spend on benefits in the UK, and is it evenly distributed?

The Department for Work and Pensions spent £166.98bn on benefits in the UK last year, while HM Revenue and Customs, who are responsible for paying tax credits and child benefit, spent £46.59bn (figures sourced from the Guardian), the total sum of money paid into pensions by the DWP was £74.22bn almost double the whole budget the HMRC has to pay out for child care costs. It isn’t just pensions either, the DWP paid more into Housing Benefit and Disability living allowance than the HMRC paid into Child Benefits in 2011 – 2012, which begs the question, is the way money is distributed throughout the benefits system a true representation of what population of the country needs that money more?

What this doesn’t take into account is the amount of ‘real’ benefit you retain once that sum of money has been given to you, this is because the figures above relate to the quantity of money which was given out to the public by the government but does not show us how much they then took back from you in taxes such as VAT, National Insurance, Council Tax, Duties, income tax and licences.

Real cost of benefits in the UK

If you are a working couple who have children and share childcare between you whilst working full time, the amount of benefit you receive, if any at all, may well be nulled by the residual tax you pay in other areas, especially income tax. In a report published by The Centre for Welfare Reform called ‘Who Really Benefits From Welfare?’ (Simon Duffy 2012) suggests that people are becoming aware of faults in the welfare system and finding themselves poorer for working.

As a working parent you probably find that unless you are in a very well paid job, or you work directly for the government, your finances are a periodic balancing act between quality of life and paying the man, especially since you have decided to work which can be a heart-breaking decision when you are forced to leave your new little bundle of joy. For many mothers maternity pay just doesn’t cover the cost of living, especially when you have a partner who works full time and receives no benefits, therefore many mothers are forced to go back to work early and pay out for childcare or rely on family members for support, and with more and more grandparents taking on regular childcare responsibilities how long will it be before calls are made for grandparents to receive their own childcare benefits?

Money is becoming tighter in working families

Now, I’m not a financial analyst or a politician, I’m just a father of three who works full time and writes in his spare time, so these figures are difficult to process if you don’t have a good grounding in money, but what I do know is that since my eldest was born nearly ten years ago to when my youngest was born just less than eight months ago money has got a lot tighter for us. I work for the same company and have seen an increase in wages higher than the national average every year yet the amount of disposable income I have after I have paid out all the necessary bills has become much less. I’m sure many other working parents have seen the same, my partner had to go back to work early after having our son because the maternity pay is so low and we both work full time doing opposite shifts because childcare is so expensive.

So I take you back to my original question, what is the real cost of the benefits system in the UK?, the answer is time with our children because as money gets tighter and the welfare system unfairly distributes money to the public, parents who work will be forced to work longer hours and miss out on quality time with children in their younger years which is so important to all of us.

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About Steven Petter

About Steven Petter

Steve has three children, Connor, Harmony-Skye and Fletcher. He is a Martial Arts enthusiast as well as an avid reader of books about Philosophy, he began writing short stories and also writes music reviews.

Website: Steven Petter

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