Wednesday, May 22, 2019

Big jump in working-age welfare spending

"The grey columns show historical spending, and the dark blue columns show forecast spending. Since 2002 working-age welfare spending (including main benefits, Working for Families tax credits, and supplementary and hardship assistance) has increased in dollar terms. Part of the increases after 2005 can be attributed to the introduction of Working for Families, and from 2008 to 2010 the impact of the Global Financial Crisis (and domestic economic downturn) can be seen to have increased pending (as unemployment rose).
Between 2010 and 2016 overall welfare spending fell slightly, reflecting the economic recovery and potentially the impacts of welfare reforms, and changes to Working for Families that kept spending and recipient numbers relatively flat. The increased welfare spending forecast from 2018 onwards is largely the result of the Families Package changes (increases to the FTC, AS, OB/UCB and FCA and the introduction of WEP and BSTC)."

The above is from one of the background papers provided to the Welfare Expert Advisory Group.

(WEP = Winter Energy Payment and BSTC = Best Start Tax Credit. Yes, you can receive a tax credit without actually ever paying any tax).

NB Hats off to whoever wrote that background paper. Simple, concise and thorough.

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