Upright UK judges admirably refuse to let the ministers run amok with the laws

Part I: Upright judges refuse to let the ministers run amok with the laws

Summary
The UK set up a law to force benefits receivers to work for free.
One of the "enforced slaves" sued the government.
The UK government has lost all the way to the Court of Appeal.

Lord Justice Underhill, announcing that the decision of the high court had been upheld, said that in the cases of those claimants who had already appealed against their sanctions, the act was incompatible with their rights under the European convention on human rights. (The Guardian, 29 April 2016)

The UK judges have once again refused to let their ministers run amok with their laws.

Good upright judges form an essential component of a good democratic country. 

UK: The poor are worse off if they work

According to this report (The Aspiration Tax. How our social security system holds back low-paid workers, Feb 2016, by the EqualityTrust), people on benefits get to keep about 23% of what they earn if they work. In some cases, they may end up with a net loss if they work.

The withdrawal of benefits may be seen as a super heavy tax that discourages the poor from working.

An unconditional basic income has a very clear advantage compared to this social security system. Under the unconditional basic income system, the basic income is not reduced when people work.

Here are a few interesting quotes from the rather long report:

Families currently receiving tax credits, and paying Income Tax and National Insurance contributions, lose 73p of every additional £1 they earn.

Families who move on to receiving Universal Credit, and who pay Income Tax and National Insurance contributions, can lose up to 76p of every additional £1 they earn.

A single parent working full-time on the minimum wage under Universal Credit would lose 71p of every additional £1 they earned.

Out-of-work social security, like Jobseeker’s Allowance or Income Support, is currently withdrawn very quickly. For every £1 that a person earns from work, they lose £1 in social security entitlement. This can mean that people are not better off when they enter work for a small number of hours. 

(The above numbers have not counted the cost of working. Working will incur transport cost, meal cost, etc.) 

And, lastly, a quote from the Director of the Equality Trust:

“We can’t keep pretending that our taxes and benefits system is fair when the rich are given all the ladders and the poor all the snakes."

Make Food Banks Redundant

There are two options.

Option 1. Enlarge the food banks. Put in more government money,

State must back food banks, says Welby: Archbishop of Canterbury steps into austerity row with radical report

"Archbishop called for £150m state-backed system to combat hunger in UK.
Archbishop is to launch a Parliamentary report in Westminster on Monday.
Report's proposals call for bigger food banks to distribute more free food.
Also asks for a provision for free school meals during school holidays."

Food banks are not without stigmas and do not reach everybody in need.

'We hate to be called a food bank'

"A new approach to tackling poor people's hunger recognises that food poverty isn't the only issue they are struggling with. "

Volunteers encourage more people to seek help from Loughton Foodbank

"Some people in need of support from a foodbank are to embarrassed to accept it, according to a charity.

Despite people living below the breadline being referred to Loughton Foodbank by GPs and job centres, manager Heather Scholer says some are wary of a stigma attached to accepting hand-outs. "

Option 2. Make food  banks redundant.

Give back the country's common wealth and investment returns to the people. Give back their citizen dividend, which is rightfully theirs. With a substantial citizen dividend for every citizen, food banks will become redundant.

There are many studies that show many countries can afford a big citizen dividend or universal basic income. It is matter of political will and citizen education, not monetary constraint.

Pension fund charges that make retirees poor

"For too long, pension savers have been at the mercy of their pension provider." 

Pension fund charges make retirees poor.

UK

Excessive pension fund fees capped by minister

"Full frontal assault" on pension charges revealed by minister could add thousands to workers' retirement pots

Pension fees will be legally capped in a move that will prevent workers from being “fleeced” of hundreds of thousands of pounds, ministers will announce on Wednesday.

Steve Webb, the pensions minister, said the limit is part of a “full frontal assault” on charges that can consume as much as half a worker’s retirement savings.

Older workers with long-standing occupational pensions are most exposed to what Mr Webb described as “excessive” fees.

The Coalition will present the cap as the latest in a string of measures they say will help households struggling with the rising cost of living.

The cap could be set as low as 0.75 per cent of the funds being managed, a lower level than previously proposed.

An Office of Fair Trading (OFT) investigation into the £275 billion pensions industry concluded that millions of workers are left short-changed and bewildered by retirement schemes that carry a complex web of up to 18 different hidden fees.

“For too long, private pension savers have been at the mercy of their pension provider. Apparently 'low’ charges such as 1 per cent per year can mount up to a huge sum over the course of a working life.”

A worker paying £100 a month into a pension with a 1 per cent charge will see £160,000 wiped off their retirement pot over a lifetime of saving, Mr Webb said.

UK announces 0.75 percent cap on annual pension scheme charges

Webb said the cap would transfer 200 million pounds ($331 million) "from the profits of the pensions industry to the pockets of savers" over the next 10 years.

But insurer Legal & General said the cap could have been set even lower and that one of the reasons people were not retiring with large enough pension pots was high charges.

"We would have liked the government to have capped auto-enrolment default schemes at 50 basis points, but we welcome the direction of travel," said Adrian Boulding, L&G's pensions strategy director.

However, even 0.75% is 10 times higher than the management fee for Norway's pension funds. Even 50 basis points (0.5%) is still very high.

Norway

According to the Norwegian Ministry of Finance report on the management of the Government Pension Fund in 2013, the management fee was only 0.07% for the Government Pension Fund Global and 0.09% for the Government Pension Fund Norway. The GPFG has about 5000 billion NOK (about US$750 billion).

The annual return, after deducting management fees, of the Norway Government Pension Fund Global is
- 9,93% for the last 12 months (Q3 2014 report)
- 6.3% over the last 10 years
- 5.6% since Jan 1998.

Singapore

The Central Provident Fund, which has a balance of S$260 billion contributed from worker salaries, is entirely managed by the Singapore Government. The government guarantees an interest of 2.5 to 4%, with an average of slightly more than 3%.

The CPF money is reportedly invested by GIC. The reported annualised returns are
- 12.4%,
- 7.0% and
- 6.5% for the five-year, 10-year and 20-year time periods respectively.

In return for the guaranteed return of about 3%, the Singapore government takes away any investment returns over that. For example, for the last five-year period, the investment return is 12.4%. The CPF interest is about 3%. The government management fee works out to be about 9%. This is 100 times more than the management fee rate (0.09%) for the Norway government pension funds.

Return our Citizen Dividend. "People need to quit demanding jobs and start demanding justice."

Why you have the right to a $5K dividend from Uncle Sam | Making Sen$e | PBS NewsHour: (Aug 27, 2014)

This post on citizen dividend has quite a few gems.

"Dividends from common wealth, by contrast, unite society by putting all its members in the same boat. The income everyone receives is a right, not a handout. This changes the story, the psychology and the politics."

"A national dividend system would be simple, fair and immensely popular. It would rest on the principle of shared ownership, not redistribution. Once set up, it would be market-based rather than tax-funded. And it could gain support across the political spectrum: conservatives from Sarah Palin to Bill O’Reilly have lauded Alaska’s dividends."

"Our times demand a reliable flow of supplementary income as well. The best way to provide that is to pay dividends to everyone from wealth that’s logically ours."

From progress.org (Aug 28, 2014), on the above post about citizen dividend:

"What’s needed is for regular people to feel enough self-esteem to demand a fair share of what’s already ours just like the rich feel when winning an enormous share of what’s not theirs. We’re not broke. There is a surplus. It just needs to be shared. People need to quit demanding jobs and start demanding justice."

When will more people around the world be more like Alaskans, demanding their share of their own state's resources?

When will the Alaskans be more Alaskan, demanding a better share of their own state's resources? They only get a quarter of what the state gets from the oil companies, which is a small fraction of the oil wealth. I think Alaskans get less than 10% of their oil wealth in citizen dividends.

I envy Scotland: "free prescriptions, no student tuition fees, social care for elderly people."

Scottish writers on the referendum – independence day?

In the above article, a writer highlights Scotland's "free prescriptions, no student tuition fees, social care for elderly people."

I envy Scotland, because Singapore is the opposite: expensive prescriptions, high student tuition fees, zero social care for elderly people.

It's not that Singapore has no money for that. There is enough to easily pay a universal citizen dividend of $10,000 a year.

UK: Upright judges refuse to let the ministers run amok with the laws

Court rules back-to-work legislation incompatible with European law (4 July 2014)

Justice Lang (from LMH)

Great Great Britain has upright judges who refuse to let the politicians play around with their laws and their people. Democracy needs upright judges to prevent dictatorial rule over the people. If first we have slave labour for benefits holders, soon we will be sending benefits holders to the front lines of war.

"The high court ruled on Friday that emergency laws introduced to shore up back-to-work schemes were incompatible with European law."

"Human rights lawyers successfully challenged emergency legislation introduced by the government after its flagship welfare-to-work schemes were ruled legally flawed. Mrs Justice Lang ruled that the retrospective legislation interfered with the right to a fair trial protected under article 6(1) of the convention on human rights."

"Critics say back-to-work schemes are "slave labour" because claimants are forced into unpaid work experience."

"The Department for Work and Pensions brought in retrospective legislation to overcome flaws identified by three appeal court judges in a case involving Poundland. The appeal court judges unanimously agreed that the 2011 regulations failed to give unemployed people enough detailed information, especially about sanctions – including loss of jobseeker's allowance – for refusing jobs under the schemes."

“It’s shameful for a rich country like ours to be tolerating such levels of poverty."

From
Largest study of UK poverty shows full-time work is no safeguard against deprivation

We can try to eradicate poverty, or

we can console ourselves that the poor "are not that poor".

Smug ministers keep saying they are helping people out of hardship

"Smug ministers keep saying they are helping people out of hardship"

"The study blows apart the idea peddled by the Government that getting a job tackles poverty."

"It found the majority of children living below the breadline have at least one parent in work."

From: Breadline Britain: One in three now living in poverty as chasm between rich and poor widens

It is time for unconditional basic income or citizen dividend.

Forget everything else, we just want our citizen dividend back. 

Public Pension: Singaporeans lack this essential component for retirement

Pensions at a Glance 2013
OECD and G20 Indicators

This report by OECD shows the public and private pensions in many countries. Private pension comes from mandatory employment contribution and other private sources. Public pensions come from the money from the state.

"The OECD average for replacement rates of an average earner from public schemes alone is 41%, compared with 54% with mandatory private pensions included."

For an average earner, the public pension from the state alone is 41% of the salary when working. For example, if a worker earns $3,000 while working, his public pension will be about $1,230.

Here is a small sample from the OECD report, with Singapore added:

	Public pension replacement rates for Earners at 0.5 median wage	Public pension replacement rates for Earners at 1.0 median wage
Australia	52.4	13.6
Austria	76.6	76.6
Israel	44.5	22.2
Japan	49.8	35.6
Switzerland	48.6	32.0
UK	55.2	32.6
USA	49.5	38.3
Singapore	0	0

Singapore does not have a public pension.
It is not a matter of affordability. Singapore is a very resource rich country.

Guardian: Inequality hurts everyone apart from the super-rich – and here's why

Inequality hurts everyone apart from the super-rich – and here's why
Chris Huhne Monday 28 April 2014

This Guardian post gives the economic argument against inequality.

It is one more reason for returning the confiscated citizen dividend back to the people.

The people own the country, they own the citizen dividend / citizen income. It is a mass horror to confiscate their citizen dividend into the government coffer. It is the number one reason for widespread poverty in rich countries.

Every poor adult and child can pin his/her poverty on the government. 

Returning the confiscated citizen dividend will eradicate poverty.

The wealth of nations (The Hewitt version) and the size of your citizen dividend

Public money wealth per capita

This picture is from a post on The Wealth of Nations, by Mike Hewitt, at http://dollardaze.org/ It was done in 2008, and the numbers are outdated. For example, Norway has 1 million Norwegian Krone per capita in 2014 just from the Norway sovereign wealth fund. That is about US$170,000, way more than the amount shown in the chart above.

An updated chart will be useful in calculating how much citizen dividend is possible just from the government's money wealth. This amount does not include other wealth assets such as oil, land, minerals and water.

Using Norway as an example, the sovereign wealth alone is US$170,000. If the sovereign wealth fund makes 5% return, that will mean a citizen dividend of US$8,500 for every child and adult.

The UAE, the top country in the chart, clearly can afford a huge citizen dividend just from its sovereign wealth fund.

The working classes don't want to be working classes

The working classes don't want to be 'hard-working families' by Selina Todd
The Guardian, Thursday 10 April 2014

 "The rhetorical label 'hard-working families' has won Labour no voters and ignores the true nature of social change."

"Hard work has never solved poverty. We work longer hours now than we've done for 50 years, yet the gap between the rich and poor has never been wider."

The working classes shouldn't continue as working classes.

It is time to migrate to the ownership classes. We own our country. It's time to demand our royalties, i.e., citizen dividend, citizen income, or universal basic income.

Citizen Income on The Guardian

How about a 'citizen's income' instead of benefits?

We should look again at our welfare system and consider the idea of a citizen's or basic income - a minimum survival payment granted to everyone - in place of means-tested benefits

• 
• • Hannah Fearn
  • The Guardian, Tuesday 8 April 2014 13.59 B

It is attracting hundreds of comments very quickly. A sample:

• worldgirl TerribleLyricist

  
  

  A citizen's income effectively says that all of us are worthwhile as humans, not just those who can earn a middle-class income and up.
  I have a feeling that eventually this will come to pass. I was just thinking that it would also probably result in an upsurge in arts participation, because it would constitute basic support for artists!

How the next aspiring Prime Minister can win BIG and keep the United Kingdoms united?

Here's the strategy for the next aspiring Prime Minister of UK to win the next election, and to keep Scotland within UK.

The Scottish government pushing for an independence referendum has promised an oil fund, but it is not a people's fund. They have not mentioned a word about any citizen dividend. This is in total contrast to the Alaska Permanent Fund, which is really a people's fund. The Alaska Permanent Fund pays dividends to Alaskans. The fund is not used for anything else. Not for grand sounding projects. Just pure citizen dividend.

This is where the next aspiring Prime Minister of UK can pull back the Scottish people, and at the same time get the other UK citizens excited. Promise a citizen dividend fund. Money in the people's pocket is a lot more reassuring than money is some general purpose wealth fund.

Will Scotland have a sovereign wealth fund?
We propose that, and as recommended by the Fiscal Commission, an independent Scotland should establish a Scottish Energy Fund to stabilise revenues in the short-term and to ensure that a proportion of oil and gas tax receipts are invested for the long-term benefit of the people of Scotland.
The decisions of successive Westminster governments to spend Scottish oil revenues rather than investing a proportion of them represent a major lost opportunity. Norway began transferring money into its oil fund in 1996. The fund is now worth £470 billion, equivalent to around £90,000 per person in Norway, and is the largest sovereign wealth fund in the world.
Analysis by the Fiscal Commission concluded that, had it used its oil wealth to establish an oil fund in 1980, Scotland could have eliminated its share of UK public sector net debt by 1982/83. By 2011/12 Scotland could have accumulated financial assets of between £82 billion and £116 billion. That would be equivalent to between 55 per cent and 78 per cent of GDP.

Be bold in manifesto, Labour told. Yes. Think BIG.

Think BIG. This BIG.
(photo from Telegraph)

Thinktanks from across Labour and beyond urge party leader to 'shape up' and dare to devolve power to people

Labour is told to consider all these:

Neal Lawson, chairman of the thinktank Compass, said Labour needed to "shape up [and] be bolder and more radical" with its policies, especially by devolving more power to people.

Yes. Devolve more economic power to people. Pay everyone a basic income guarantee (BIG), also known as the unconditional basic income (UBI) or the citizen dividend.

In the letter, published in the Guardian, 19 leading figures from groups including the Fabian Society, Compass, Policy Network and Progress express unease at the prospect of Miliband failing to secure a mandate for the kind of change they believe Britain needs. It has been signed by thinktanks from the party's left and right, as well as other progressives, and was drafted before the publication of weekend polls showing the Tories making ground after George Osborne's budget.

In the letter's authors argue that Britain needs "transformative" change. They say: "If Labour plays the next election safe and hopes to win on the basis of Tory unpopularity, it will not have earned a mandate for such change."

Yes, the voters want transformative change. Forget everything else, we just want our basic income guarantee. 

But it warns that the party "must take into the election a vision of a much more equal and sustainable society and the support of a wider movement if these formidable challenges are to be met".

Yes. A much more equal society is one with a basic income guarantee. It is sustainable based on citizen dividend.  

They say: "National government has a continuing strategic role to play but the days of politicians doing things 'to people' are over. The era of building the capacity and platforms for people to 'do things for themselves, together' is now upon us."

The thinktanks instead suggest state institutions have to "give away power and resources to our nations regions, cities, localities and where possible directly to people".

Yes, the last point is the most important -- directly to people. Give power and resources directly to people. Start a basic income guarantee.

Think BIG. Win BIG.

Pension pots 'can be used to buy Lamborghinis', says minister | Money | The Guardian

Pension pots 'can be used to buy Lamborghinis', says minister | Money | The Guardian.

UK pensioners will not be forced to take an annuity. They can take their entire hard-earned pension pot home.

"Pensioners should be trusted to use their retirement savings however they want – even if they decide to buy a Lamborghini, the Pensions Minister insisted yesterday.

Steve Webb said he was ‘relaxed’ about how millions will choose to spend their own money in the biggest shake-up of the private pensions system for a century." (DailyMail)

In contrast, Singaporeans continue to have annuities enforced on their pension pot in the CPF.

In Singapore, the pension pot is small and car prices are astronomical. With the pension pot, Singaporeans cannot afford Lamborghini's. They will have to empty the pot even for a Toyota Corolla, currently priced at S$140,000 (about US$110,000).

Another myth: Top 1% of earners already pay almost 30% of all income tax

IFS warns just 40% of George Osbourne's cuts have been made so far | Mail Online:

"Top 1% of earners already pay almost 30% of all income tax."

This is another common myth. Once you take into account the 100% tax on citizen dividend, the picture can be quite the reverse.

Let's look at the case of Singapore.

Total personal income tax: $7.56 billion (from here).

Estimate of citizen dividend for each citizen: $9,000 (from here)
Singapore citizen population: 3.2 million.
Total citizen dividend income taxed away: $30 billion.

The confiscated citizen dividend is 4 times the total personal income tax!

Who feels this heavy burden the most? The poor, of course, who has little other income.

Singapore cleaners, go to UK if you can.

Singapore cleaner, from StraitsTimes

Here is an advertisement for a part-time cleaner in UK. The pay is typical for UK cleaners. In London, the cleaners earn even more. For example, the City of London Corporation pays cleaners £8.55 an hour.

Cleaners
University of Sheffield - England

University of Sheffield -Department of Estates & Facilities Management Contract Type: Open-ended morning positions available Working Pattern: Working 17.5 hours per week (3.5 hours per day) Faculty: Professional Services Salary: Grade 1 £13,621 - £13,977 per annum, pro rata (£7.06 per hour)

There is a lot of excitement in Singapore that full-time cleaners will in the near future get a minimum wage of $1000 per month ($12,000 a year, which is £5640 a year).

With the new minimum wage, a full-time cleaner in Singapore will get about one-third the salary of a part-time cleaner in London.

To all Singapore cleaners, please go to London if you can.

Also, your money in London will go further. Singapore costs a lot more than London, according to the Economist Intelligence Unit.

Welfare is a pacifier for the poor

A pacifier for the poor

Britain is scared to face the real issue – it's all about inequality. Will Hutton

"It's inequality, stupid. It's inequality that is behind poverty, ill-health and the growth of the welfare bill."

Yes, huge inequality itself creates poverty. Huge inequality creates even more inequality. The very rich compete among themselves to drive up prices of everything. The middle rich may enjoy a momentary happiness when they see their worth goes up. Then they find that they are priced out of other things. The poor of course end up paying more for everything.

Inequality is especially bad when two conditions are present.

One. When you are in a small country, e.g., Singapore, inequality is especially bad. When you are priced out, you are kicked out of your country. Or you spend your whole life working just to own a tiny apartment, if you are lucky enough to be working. If you are in a big country, you have the option of moving to less expensive cities.

Two. When your country has a very open border, you face global inequality. Global inequality, not national inequality, is the real threat that people in many countries are facing.

At one end, you have the super rich from around the world who buy up your properties and price you out. A recent fire in a luxurious apartment block in Singapore confirms this. 90% of the multi-million apartment units are sold, but only 10% are occupied. That is the result of the global super rich who park their multi-millions in empty apartments in Singapore.

At the other end, you have the dirt poor from around the world who flock to your country and drive the wages under survival rates. If you are poor, your wages will be suppressed, if you are lucky enough to keep your jobs.

When global inequality drives people to the edge, the government pushes welfare as a pacifier for the poor, to prevent an open revolt or uprising. As people get wiser, they will not be satisfied with a pacifier. That's when people will demand an unconditional basic income, or an uprising.