WTF is the 'problem' with in-work benefits?

As 4 months of EU referendum nonsense kicks off, I heard Prince of Darkness and modern Machiavelli George Osborne on the radio saying that "migrants must contribute to the exchequer" for 4 yrs to get in-work benefits.

I don't understand why there isn't more media challenge of this line. Or rather, I do but it makes me sad to acknowledge how pathetic our media is, even the part of it that's meant to be unbiased. The desire for a simplistic dichotomy on the news means that the "debate" has swiftly been reduced to whether or not Cameron's EU deal has "done enough" to protect Britain from the rapacious ways of those sneaky Europeans. To my great annoyance, the third, liberal, compassionate, and largely fact-supported view that actually we don't need protecting, that the EU while flawed has largely benefitted us, and that the "deal" is unfair and unnecessary... is nowhere to be seen or heard. And while we're immersed the political fantasy land of debating between two obnoxious counterfactual viewpoints, there's not much point in holding anyone to account is there? That would spoil all the fun.

But let's examine that "contribute to the exchequer" thing. After all, it's being used to justify 4 years of pay bias against a group of UK workers primarily identified by their country of origin. It's not "benefits" as commonly demonised by sections of the right-wing press so much as the conditions under which UK employment contracts are formed. Isn't it unfairness, racism and xenophobia to want to treat one group of workers differently in UK law due to -- frankly -- their ethnicity?

Now restricting access to unemployment benefit -- if done right -- seems kind-of reasonable. I can get on board with the idea that we welcome immigrant workers, but what country wants to invite non-workers to come purely on the basis of our unemployment terms? Ok, it turns out there aren't many such people and the policy would probably have little practical effect, but I can see logic in it and it's not obviously unfair -- again, if done right.

Child benefit was one of the other contentious points in the deal-making, and here I don't have the knee-jerk lefty liberal gut reaction that I'm perhaps meant to. I honestly get a hinky sort of feel about child benefit for non-resident children, which I guess many do. But the analysis isn't straightforward: for example, because we're not in the Eurozone, that benefit money can't really "leave the country" -- it goes into banks with a UK presence via forex, and in principle gets reinvested.

But restricting in-work benefits just feels like straight-out discrimination to me. A year ago a hot news topic was how in-work benefits accounted for a large fraction of welfare spending because of substandard basic wages; if this is the case, then in-work benefits are a government subsidy to employers. Removing that subsidy based on a worker's origin isn't "reasonable" as claimed, nor does it have anything to do with a largely Daily-Mail-fantasy "something-for-nothing culture", but simply ensures a non-level playing field. Which is probably the whole point, playing to the favoured tune of DM & Express readers, but to sell it as "fair" is disingenuous, and IMHO it was reasonable for EU states, particularly those who supply much migrant labour, to oppose it. (It is unclear to me from reports exactly what has been agreed for now, other than a vague "7 year term".)

And the "contribute to the exchequer" line is pure nonsense. A quick Google found this briefing document which claims that 90% of UK income tax, from 2/3 of employees is collected via PAYE. And since 2013 PAYE reports and payments need to be made every month. A newly-arrived migrant worker with a job will have "contributed to the exchequer" within a month, and of course we have been over the statistics that EU migrants actually make more of a net contribution to govt funds than natives do. So where did the magic "4-year delay" figure come from, other than an out-of-a-hat election-sweetener for bigots and xenophobes?


Comments powered by Disqus