If someone cannot afford to keep a roof over their head, eat, keep warm etc, their productivity will inevitably fall as a consequence.

Thus in-work benefits mean that the individual recipient doesn't end up on the street, sleeping rough – and the employer doesn't see such a decline in productivity, replicated across a number of employees.

We know, form the likes of KPMG, that the living wage helps productivity – along with recruitment, retention and sick rates – so if a company is relying on the taxpayer to make up the difference between, say, the minimum wage and a living one, then it is the company that is benefiting.

There's also something that should be of concern if we start to suggest that work doesn't need to pay – and that the taxpayer will make up the difference. If nothing else, it makes a mockery of politicians' claims.

And for work to pay, it needs to maintain the wage earner in something above destitution and reliance on the state simply to get by.

If it were primarily a subsidy to the employer it would be paid the the employer. The cynic in my says that working tax credits, etc were a Labour ploy to have people beholden to them. They could have raised the tax threshold, etc like the coalition have but no they prefer a dependency culture that gets them votes. Same applies to their expansion of public sector jobs.

PS Labour have a Twitter campaign extolling people who have allegedly joined them. So I looked at their website yesterday and, unless I was looking in the wrong placce, I could not find anything about what they stood for or policy! I took a look at the other main parties and they did. Now, if I haven't missed something that seems to me a wholly disgraceful and inept state of affairs.

Raising the tax threshold is not the answer, the main beneficiaries of that are middle and higher income earners. The lowest paid will see no benefit simply because their working credits will reduce as their take-home pay increases.

High earners don't get a personal allowance.

I was suggesting higher personal allowances rather than tax credits rather than both, although I suppose for very low earners / part-time workers it wouldn't help.

Not necessarily.

See my linked-to piece earlier about public health, corporates and advertising. No money (as far as I know) was ever paid to any corporate, but a specific advantage was given to them indirectly.

So another Brown disaster then.

That was the corporates being invited to committees on public health by [ithis[/i government, and brands being declared okay in 'health' advice published by [ithis[/i government.

I thought we were talking about tax credits?

They do up to £100k "adjusted net income" and only then does it reduce on a £1 for £2 basis. That's why I said "high earners" and not "very high earners"

As I said a couple of posts ago, I responded to you generally in terms of illustrating ways in which big business gets treated especially well.

This is a particularly good way – and shows a subsidy from the taxpayer to corporates that is not paid directly, but is none the less a subsidy.

Are you saying tax credits should be scrapped as they have a secondary effect of "subsidising" business?

I imagine she's saying it is the duty of a profitable employer to sufficiently remunerate its staff, rather than relying on the taxpayer to subsidise their remuneration.

I wonder at yours too - where does the money come from to pay in work benefits, general taxation given the private sector is by far the largest employer it is not a huge leap of faith to suggest it is also the larger contributor to the tax income.. So far from being subsidised by the government they are actually propping up the government.

All I hear on here is government is subsidising big business - nobody has yet produced figures to support that argument that is my point. If Morrisons makes a £500m tax contribution but its employees get £300m in work benefits who is subsidising who?

This.

I have given you an extremely specific example of government subsidising big business by using public health – and the budgets involved – to advertise branded products on behalf of the corporates that it had invited to join the government's public health committee.

On in-work benefits: a number of companies are not paying the living wage to at least some of their employees (and some are, in effect, avoiding paying the minimum wage by cutting hours).

We know this to be factually the case.

We also know it to be the case that people on low incomes require in-work benefits, including but not limited to housing benefit, simply in order to live at a basic level.

If that stopped and people could not keep a roof over their heads or barely feed themselves, this would not be conducive to their performance in the work place. That's not rocket science.

So if companies that are highly successful are relying on the taxpayer to top up low wages in order that their employees can operate at a basic level, it is a subsidy.

We know that plenty of companies are not paying a living wage to their lowliest staff – if you Google every single company that I mentioned specifically in my earlier post, together with 'living wage', there is a mass of information out there about campaigns to change this.

In the meantime, companies are showing remarkable levels of reluctance to do this – that's why the campaigns have been in place for some time and are ongoing. But since the taxpayer is making up the difference, why should they treat their own employees better and potentially reduce their (massive) profits a little (even though the evidence shows that the living wage has a positive impact on productivity etc)?

Whether originally intended as a subsidy or not, that is what it is.