Cameron on benefits

I haven't written much before now on the upcoming EU referendum because the focus of debate—at least, as framed by the Tories—centres on matters which are of very little concern to me. Indeed, I think that by focusing on these things rather than matters which should be of much more fundamental concern about what the EU is doing, or shows every sign of doing in the near future, we are actually reducing the chances of getting the EU reforms we really need.

Here is a short clip from last night's news which shows the hypocrisy behind David Cameron's stance on immigrants receiving in-work benefits.


Anyone who gives the matter any thought at all will be able to see the fundamental flaw in his argument. Our system is set up in such a way that every single non-immigrant will, as he puts it, "get benefits out of the system" before we put a single penny into the system. A very great deal of benefits, in fact.

Everyone who has grown up in the UK will have benefitted from years of completely free education and health care provided by the state; and will almost certainly have made use of free social services and facilities provided by local authorities. On top of this, the government will have made direct cash payments for each child while they are growing up.

Looked at in broad terms, a person will only start "paying into the system" when they start work (apart from paying a little tax in the form of VAT on purchases) and it will probably take twenty years or so before the taxes they've paid into the UK system balance the benefits they took out of the system while they were growing up. On average, a person will probably "break even" in their forties; then for the next twenty years or so they will be net contributors to the benefits system; then they will retire and take money out of they system again in pension payments and increased health and social care. In round terms: 20 years of taking from the system, 20 years of paying it off, 20 years of being a net contributor to the system, 20 years to get it back again.


Now consider the position of a newly-arrived immigrant working in the UK. From the very first day they will be a net contributor to the UK system because of the tax and national insurance they pay.

That is why it is utterly offensive for Cameron to suggest that we should stop immigrants receiving in-work benefits for any amount of time, let alone four years. An immigrant receiving in-work benefits is certainly not getting "something for nothing". In fact, they will be anything up to 20 years ahead of the average UK citizen in terms of paying into our system.


Looking at the bigger picture, if there is any issue that should be addressed, it is the fact that the UK is benefitting from the education and expertise of immigrants at the expense of the country they have come from. It should be a very major source of concern that the UK encourages, for example, qualified doctors, nurses and other health professionals to work in our national health services. This holds true for all immigration, not just immigration from within the EU. Indeed, as has been said many times by many people, our NHSs wouldn't survive without them.

Bookmark and Share


Anonymous said...

Well said.

WelshnotBritish said...

"Unemployed Britons in Europe are drawing much more in benefits and allowances in the wealthier EU countries than their nationals are claiming in the UK, despite the British government’s arguments about migrants flocking in to the country to secure better welfare payments."

Presumably all those 'shirkers' will have their benefits stopped and will have to return to the UK.

Anonymous said...

In truth, I too don't so much worry over the educated immigrants. Nor the non-educated ones just so long as they are polite and helpful, willing to work hard and cheap to employ.

But what I do worry about is your contention, MH, that people in the UK have grown up on free education and free healthcare.

I have paid and continue to pay an enormous amount of tax so that people like you and perhaps your own children can benefit from 'free' healthcare and 'free' education. And my hope is that, in time, you and yours will contribute too so that other people may benefit from these 'free' services.

Just because you haven't had to pay for something yourself doesn't mean that someone else isn't having to scrimp and save merely to provide 'free' benefits for others.

MH said...

Thanks for the link, Stu. The right-wing press has a strange blind spot when it comes to the benefits that UK citizens in other parts of the EU get. Free movement is one of the main reasons why being in the EU is a good thing. But whether that is enough to make up for the bad things about being in the EU is open to debate.


The way you put it makes it appear that you don't expect educated immigrants to be polite or helpful, 21:40. I expect everyone to be polite and helpful ... including, dare I say it, the non-immigrant population.

However I do thank you for paying an "enormous amount" of tax. I'm relaxed about people getting filthy rich—as long as they pay their taxes—although perhaps not as intensely as Peter Mandelson used to be about it.

My point, of course, was that even an enormously rich person like you gets years of benefits out of the UK system before they put anything into the system. I got 16 years of free education, 22 years of free healthcare, and lots of other benefits from the welfare state before I started paying any serious money into the system, and it probably took another 15 years before I had paid more into the system than I had taken out of it.

Why should there be one rule for people like me, but a completely different rule for immigrants? It's blatant discrimination.

The sad thing is that the Labour Party's response was not to re-assert the basic principles of equality and fair treatment for everyone, whether immigrant or non-immigrant, but to say that they too wanted a ban ... but only for two years. Perhaps you could call that a half-arsed response to a complete-arsed proposal.

Anonymous said...

Here's an idea, MH. If immigrants don't get in-work benefits for the first four years, then it's only fair for them not to have to pay in-work taxes for the first four years either.

Anonymous said...

'I got 16 years of free education, 22 years of free healthcare ....'.

Lucky you. But for most it is a cost their parents, married or otherwise, are happily willing to bear in the form of taxation and national insurance contributions. Children represent a heavy expense to the nation as a whole.

What a strange outlook on life you have.

MH said...

Lucky? Give or take a few years, I'm no more or less lucky in this regard than anyone else.

According to David Cameron, parents have nothing to to with it. If you listen to what he said, the principle to be applied is that "you don't get benefits out of a system until you've paid into our system."

That is clearly not true for any non-immigrant, not even you. So why should it apply to immigrants?

MH said...

And I quite like the idea of no benefits, no tax, 11:06 ;-)

Anonymous said...

'you' is the family/taxpaying unit (and all those that don't earn enough to pay tax but still have to pay it via other means; sales taxes, council taxes, fuel taxes and so on.

If we visit the 'immigrants country' are we entitled to receive reciprocal benefits? Or indeed any benefits at all? I suspect not.

MH said...

You shouldn't use ignorance as an excuse for prejudice. Follow the link Stu posted (21:05) and you'll see that, "Unemployed Britons in Europe are drawing much more in benefits and allowances in the wealthier EU countries than their nationals are claiming in the UK."

Anonymous said...

That link proves the point .... strip out the major European countries where reciprocal arrangements apply and you'll see that 18 British are receiving welfare from the newly joined states. And yet nearly 34,000 are claiming welfare the other way.

Every penny spent on helping others is a penny that can't be spent on you.

MH said...

The link may well prove a point ... but not the point you were making. You had suggested that UK citizens weren't entitled to any benefits at all in other member states. The link shows they are entitled to, and get, benefits in other member states.

And yes, I suppose that "every penny spent on helping others is a penny that can't be spent on you" ... but so what? We have a welfare state in which people with greater needs get help from those with fewer needs. For me, that's something to be proud of.

The point at issue here is whether we treat all people who live here fairly, on the same basis. Cameron wants to treat immigrants from the EU differently, and this is wrong. But, worse than that, he is basing this proposed discrimination against immigrants on an entirely bogus principle.

Anonymous said...

I seriously don't see the benefit of 'free movement of labour'. There was movement of labour before the EU, so, that wasn't invented by them. But what benefit does a country like Bulgaria or Latvia or Poland get from many of its brightest young people leaving to work in UK or Germany after the state investing thousands of pounds in their education, health and cultural education? How are these countries (like Wales in a smaller version of the UK open labour market) meant to compete and catch up.

The dogmatic insistance on free movement of labour means thinks like the NHS are now in question (possibly will be radically changed), incomes are kept low, there's a shortage of housing which can only, ultimately, be answered by a huge house-building project - but which local peopla and parties (including Plaid in Cardiff and Caerffili) will campaign against. Why would Spain want to be a huge retirement home for north europeans - what benefit is that to them?

The EU was fine in 1992. It should have stayed there - but increase its members to bring in the East European states. The EU played a pivotal role in making sure the East isn't full of dodgy states like Belarus - for that it doesn't get enough credit. But there was no need for the Euro or to go for deeper union. Had it stayed within it's 1992 'constitution' it would be a far more popular instutition than it is now.

I fear for its future. But seriously, what are the benefits and arguments for free movement of labour? (this is a genuine question).

MH said...

I'm not sure that I could offer much more than a personal view on the benefit of free movement of labour, 09:20. But it might be worth noting that it is complemented by free movement of capital. The two go together.

I think it is best to look at it on two levels: how it benefits (or doesn't benefit) individuals and companies, and how it benefits (or doesn't benefit) the member states. For me, the benefits of free movement at a personal level are obvious. I can move wherever I want, and I (or a company) can invest money wherever I want without having to ask any government for permission to do so. I don't see how anyone could possibly object to having this freedom.

At government level, things are more problematic, especially if a lot of movement happens. My view is that, in general, governments should put up with the consequences because they value the freedom of people to make their own choices without government interference.

But I agree with you that it is a problem if the brightest young people leaving to work elsewhere ... and I made that point myself at the end of my original post. As you say, it is as much a problem for Wales as it is for Bulgaria, Latvia or Poland. My own answer has always been not to look to control migration directly, but to look at the underlying reasons which encourage that migration (these are almost always due to a lack of economic opportunity in the poorer area) and address those instead. More economic development/opportunity in the poorer area is usually the answer. This is where free movement of capital helps.


For me, the biggest potential for things to go wrong is when a richer country actively or passively encourages immigration for its own economic advantage, and I think the UK is more guilty of this than many in the UK would like to admit.

It has often been said that the health services of the UK would collapse if it were not for the number of immigrants that work in them. I'd agree, but think we need to ask why we have such shortages. I would say that there is something very wrong in a country that is not training enough health professionals itself. But the same is true on a non-skilled level too. Why do we rely on so much cheap migrant labour in agriculture, food processing and construction, for example? There's a typical right-wing press hate story here. But I would ask why there are 7,000 east European migrants working in a town where there are about 8,500 locals unemployed. And if the answer is that they do jobs which the locals don't want to do, my answer would be to raise the minimum wage until it becomes a proper living wage, because the locals will then be more inclined to do the work.

Put bluntly, the UK has encouraged a cheap-labour economy, and if people think levels of immigration are too high the finger of blame needs to be pointed at those who encourage and perpetuate this cheap-labour economy. Remember that we wouldn't have the "problem" of in-work benefits such as tax credits unless successive UK governments had created and perpetuated an unsustainable low-wage system. The significant increase in the minimum wage is a step towards putting this right, but only a step. What we really need is a living-wage economy.


On the subject of the size of the EU, I agree with you. The EU grew too big, too quickly. But we should remember that the UK was the most vocal of those wanting this rapid expansion. The Tories wanted it for political reasons, precisely because the Thatcher and Major governments wanted to use expansion as a way of preventing closer integration of the EU15. A bigger EU would be too big and too diverse to integrate.


These are my thoughts. I'd like to know what others think.

Anonymous said...

Free movement and its effect on Bulgaria, Latvia, Poland etc is a tough one.

Why would those countries have a "right" to hold on to their people? Why would Wales have such a right? Younger people in particular leave Latvia because its economy and its public sector does not produce good enough opportunities for them.

Is free movement damaging Poland and Latvia, and why do those states and their governments support free movement so much even if it hurts them? Presumably because it's democratically wise to do so.

Is the Polish economy being hurt by out-migration, or is it a net benefit because people send money back?

This needs further research but objecting to free movement because it hurts Poland and Baltics doesn't seem consistent with the views and beliefs of those countries and their populations. At first glance, anyway.

Post a Comment