THIS ARTICLE WAS UPDATED AT 7:45AM ON WEDNESDAY 21 SEPTEMBER TO REFLECT A COMMENT FROM THE DWP
The Department for Work and Pensions (DWP) has been urged to review the controversial benefit cap. The Child Poverty Action Group (CPAG) has warned that if it doesn’t, it will be disastrous for tens of thousands of families. The charity has also said that the cap has meant that social security claimants have lost out on over £13,000 a year already.
The DWP put the benefit cap in place in 2013. It restricts how much money it gives social security claimants. The cap is currently:
£20,000 per year (or £13,400 for single adults with no children) nationally.
£23,000 per year (£15,410 for single adults with no children) in Greater London.
In April 2022, the CPAG said the DWP’s cap had caused a real-terms cut of £2,070 a year to families’ social security. The DWP has never increased the cap since it introduced it in 2013. In fact, in 2016 it cut it. But now, the CPAG has crunched the numbers again – and the figures are even more shocking.
£13,000 a year cut by the DWP
The benefit cap hits around 120,000 households, including 300,000 children. Come April 2023, the CPAG says it will affect another 35,000 families. But it has also worked out that 94% of households hit by the cap wouldn’t be if the DWP had increased its levels. Moreover, it affects the poorest people. As the CPAG said:
Capped households are some of the poorest families across the country. An average capped couple with two children is £150 a week below the poverty line.
However, the CPAG says that if the DWP removed the cap, households would be £65 a week better off, on average. It estimates that it would cost the government £500m to do this. It is urgent that the DWP removes the benefit cap, because the CPAG has said that the situation for the families it hits has become even worse.
The charity estimates that because the DWP has never increased the cap, by 2023/24, households outside of London will have seen a real-terms cut of £260 a week – that’s over £13,000 a year. While not all families might actually lose this much, it shows the scale of the cruelty.
The DWP says…
The Canary asked the DWP for comment. We specifically wanted to know if it was reviewing the benefit cap in November. This is when it will review all social security rates, ready for April 2023’s increase. As we previously reported, the DWP can review the level of the benefit cap whenever it wants. However, so far it’s failed to do this since 2016. A spokesperson told The Canary:
The benefit cap provides a strong work incentive and ensures fairness for hard-working taxpaying households by encouraging people to move into work where possible. Up to the equivalent salary of £24,000, it balances fairness for taxpayers with providing a vital safety net.
We recognise people are struggling with the rising cost of living which is why we are protecting millions of the most vulnerable people with at least £1,200 of direct payments, starting with the £326 cost of living payment which has already been issued to more than seven million low income households. It is also why we are also supporting six million disabled people with an extra £150 payment, beginning to land in bank accounts from today.
CPAG chief executive Alison Garnham was scathing of the cap. She said in a press release:
The benefit cap is cruel and irrational at the best of times – many parents subject to it can’t escape it by working more because they are caring for very young children and housing costs are completely out of their control. But in the current crisis its effects will be truly catastrophic for hundreds of thousands of children, pushing many into deep poverty… there can be no doubt that leaving it in place will damage the lives of children up and down the country. It must be abolished before it harms more children.
It seems unthinkable that £13,000-a-year worth of real-terms cuts later, the DWP would not review the benefit cap this year. However, given its track record, there seems to be no reason why it would bother.
Featured image via The Canary and Wikimedia