[Malcolm Armsteen]

Still don’t really get it. How do you get to 10% ?

Because the employer also pays an extra 1.25%.

[Abernathy]

I’m feeling really thick now. I still don’t see how it’s 10%. Tubby confusingly says it’s now 12%, and Malcolm, equally confusingly, says that employee’s rise of 1.25% + employer’s rise of 1.25% = 10%. But it isn’t is it? Isn’t it 2.50% ???

Please help a thicko to understand !

[Malcolm Armsteen]

It's a rise of 10% on the rate (eg 10% of 12%) not a rise from 12% to 17%.

[Abernathy]

What rate ? p

[Bones McCoy]

What rate ? p

Would it help if I called it a percentage of a percentage.

Alternatively the amount you'll be paying in NI will increase by 10%.

[Abernathy]

Yes, but I still don’t understand how. The contribution rates paid by employers and employees are increasing by 1.25% each. HOW is that 10%?

I’m honestly not taking the piss here, I’ve been googling it like mad but I still don’t see it.

[Boiler]

Yes, but I still don’t understand how. The contribution rates paid by employers and employees are increasing by 1.25% each. HOW is that 10%?

I’m honestly not taking the piss here, I’ve been googling it like mad but I still don’t see it.

This is why they differentiate using "percentage" and "percentage points".

Let's do a worked example. For the sake of argument, let's have a pay packet of £1000.

Now, we need to take a sum of that as NI, which we will assume to be 12 per cent - so that's 12 pounds in every 100: so the NI payment will be £120.

Now, the proposed increase is 1.25 percentage points - thus making the new rate 13.25 per cent.

This makes the new NI contribution from our fictional pay packet £13.25 in every hundred pounds, so the new contribution is £132.50.

If you compare the contributions, the new contribution is just over one-tenth higher than the previous sum - a tenth of £120 is £12. Add that to the £120 and you get £132.

One in ten is equal to ten in a hundred - or ten percent. Note the absence of the term "points".

So the "ten percent" is the factor by how much the NI contribution increases, which means an additional 1.2 points on top of the original 12.

Another way of looking at it: the 1.25 percentage points increase is the absolute figure, but the ten percent increase is a relative figure.

Trust me, I found it confusing when I first heard the term several years ago.

Hope this helps?

[Boiler]

Another way of expressing it, which does away with the stupid and confusing "percentage points" stuff:

If NI is 12.5 pence in the pound and it is increased by 1.25 pence in the pound, how much of an increase expressed as a percentage is that?

[Malcolm Armsteen]

[Abernathy]

Thank you, Boiler. I think I understand it now.

Makes me wonder how many other Joe Soaps out there will be as confused as I am?

[Boiler]

Thank you, Boiler. I think I understand it now.

Makes me wonder how many other Joe Soaps out there will be as confused as I am?

Glad to help, Abers - just wish I was a bit better at explaining such things. It was bad enough explaining Thévenin, Kirchoff and the effect of multimeter resistance to one of the new recruits a couple of weeks ago when we were fault-finding - they don't seem to get taught that now.

As for confusion - you won't be alone. If the meejah used "pence in the pound" when referring to taxation rates I reckon it'd be more helpful.

[Malcolm Armsteen]

That’s the plan

[kreuzberger]

That’s the plan

It's fucking scary, it really is. How many times do we hear in otherwise credible outlets of "200% less" whatever? If that is a mathematical (and grammatical) concept, I sure as hell can't get my head around it, but, as we all know, numbers are now a subset of political campaigning currency. They are deployed in order to garner a reaction.

Deficits and wasted fortunes are reported without emphasis, but washed up souls on Kent's beaches are in their FAHZANS.

Back to the original confusion;

12 is 20% more than 10.
12 is 2 percentage points more than 10.

I originally scraped a B in maths at O-level but it wasn't until I started an advertising career that I really got my trousers pulled down over a poor grasp of percentages. Learning the hard way, one might say.

Anyone who thinks that they are facing a thruppence uplift in their NIC contributions is in for the same rude awakening.

[The All New KevS]

Now then. What's going on here?

[davidjay]

Now then. What's going on here?

The alpaca effect.

[Abernathy]

This is very interesting. What was it Big Gandalf said ? “And now, at the turning of the tide, I return to you”.

[mattomac]

Populists don’t raise taxes….

I had a theory when the new normal looked more like the old normal that this May happen, guess we will see but it’s the second in a row form yougov so the trend is certainly good.

[Boiler]

Now then. What's going on here?

A blip, nothing more.

I remain of the view that opinion polls are a worthless waste of energy resources: the only poll that matters is the one held on polling day.

[Crabcakes]

Now then. What's going on here?

A blip, nothing more.

I remain of the view that opinion polls are a worthless waste of energy resources: the only poll that matters is the one held on polling day.

I agree - BUT the one thing it does help do is shut people up who are keen to put the knife in for their own purposes. Will Richard Burgon be contemplating a disruptive leadership challenge if Labour are in the ascendancy? I mean possibly, because he is *really* thick, but I suspect it's a lot less likely.

And there's also just the general impression, and the snowball effect. A PM who makes unpopular decisions riding high in the polls is someone not afraid to take tough choices. A PM who makes unpopular decisions while the polls slide is "beleaguered" and "losing their grip".

[Dalem Lake]

Now then. What's going on here?

A blip, nothing more.

I remain of the view that opinion polls are a worthless waste of energy resources: the only poll that matters is the one held on polling day.

Agreed, nothing to get excited about. Bar something spectacular I bet the Tories will be back up at 40% by the end of next week. Sadly Labour just do not seem to have any game at the moment. I know the next election is three years away but I do hope that behind the scenes Labour are formulating some sort plan to fight the Tories.