Thu 4 June 2020

In the chaos of Brexit, as Theresa May’s Government teeters on collapse, the pointless suffering incurred by austerity is being ignored.

The “human cost” of the Government’s benefit cap was slammed today by a committee of MPs who found the policy had not achieved any of its aims and had instead created hardship for already vulnerable people.

A report published by Parliament’s work and pensions committee said: “We are hearing harrowing stories from all over the country of people going hungry, parents struggling to feed their children, families shivering in their homes because they can’t afford heating, and tenants building up crippling rent arrears.”

The majority of those affected by the cap – 82% – are trapped as the Government itself has assessed these people as not required to find work because they are unwell or disabled.

The committee’s chair, MP Frank Field, said “it would be difficult to think of a more cruel cut”.

But, what is the benefit cap? Why was it introduced? And what has the reality been for households up and down the country? Here are the key facts.

What is the Benefit Cap?

  • As part of its austerity regime in 2010, the Coalition Government announced plans to restrict the benefits paid to most people of working age.
  • The cap limited the total amount of money a household could receive in benefits to the average earned income of a working household’s take-home pay. This equated to: £23,000 a year for families in London (or £15,410 for a single person) and £20,000 a year (£13,400 for a single person) in the rest of the UK.
  • The benefit cap was part of wider welfare reforms which aimed to make the system “fairer and more affordable”.
  • Then Work and Pensions Secretary Iain Duncan-Smith said: “The principle is that people who are unemployed and on benefits should not be receiving more than average earnings. It is a matter of fairness, so that those who are working hard and paying their taxes do not feel that someone else will benefit more by not playing a full part in society.”
  • The Government said the key aims of the benefit cap were: to increase incentives for people to find work, to introduce greater fairness between those on out-of-work benefits and taxpayers in employment, and to make savings and reduce long-term dependency on benefits.
  • The benefit cap was first introduced between April and September 2013.

Has the Benefit Cap Worked? No.

  • The work and pensions committee report found that the benefit cap’s achievements have been “disappointing at best”.
  • The report disagreed that the benefit cap had made the system fairer. This was because families in work were already better off than families who were out-of-work and claiming benefits – even without the cap.
  • The report found that the policy has not saved money, as the Government has claimed. The committee found that its claimed savings of £190 million a year make up just 1% of the savings expected from the welfare reforms, “but even these relatively small savings are likely to be an overestimate”.
  • Recognising that the benefit cap creates hardship, the Government returns a “significant portion of the money it takes” from those claiming benefits by providing funding to local councils to help those who have had their benefits capped and are struggling.
  • The Government has said that the benefits cap was meant for people who could work, but were choosing not to. The work and pensions committee found that the cap had not encouraged people to find work or increase their working hours, in order to escape the cap. Only 4.7% of people affected by the benefit cap moved into work.
  • The vast majority of those affected by the cap – 82% – have been assessed by the Department of Work and Pensions itself as not being required to seek. This is because they have an illness, a disability or are caring for very young children. The report said: “Few of these claimants will be comforted by the minister’s flippant suggestions that they simply move house, renegotiate their rent or even take a lodger. In reality, they are left with no way to escape the cap”.
  • People who are homeless and placed in temporary accommodation by their local council are having their benefits capped, the report found, “through no fault of their own”. This is because of the high cost of such housing. The Government has said that applying the benefit cap to people in temporary accommodation incentivises local authorities to find them a long-term solution. The committee said it “cannot agree with that argument”.

The report concluded: “It is now time for a full audit of this policy… The Government must look carefully at both the financial and the human costs of the cap in its current form, and weigh these in the balance. If it is found wanting, the Government must commit to radical change—and quickly.”

With Brexit continuing to dominate all of British political life, who will stand up and take notice of the continuing, unnecessary suffering inflicted on tens of thousands of families across the country?


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