Benefit cap defeat 'flies in face of public opinion' - DWP

Published by Ross Macmillan for 24dash.com in Housing and also in Central Government, Communities, Local Government

The Department for Work and Pensions (DWP) says last night's defeat of the £26,000 a year benefits cap in the House of Lords "flies in the face of public opinion".

Peers voted 252 to 237 in favour of a bishop's amendment to exempt child benefit from the £500-a-week cap on workless households due to come into force in 2013.

The bishops argued that the plans could make as many as 80,000 children homeless. This has been disputed by the Government who insist the cap would not result in child poverty.

It has urged them to consider families trapped in the benefits system - placed into houses they can't afford.

A DWP spokesperson said taking child benefit out of the cap will render the plan "ineffective".

It said: "We are very disappointed by this decision and it clearly flies in the face of public opinion. There has to be a limit on the amount of money benefit claimants can receive. We think that limit is set at a fair rate of £26k - the equivalent to someone earning £35,000 before tax, a salary that many working families would be happy to receive.

"If you take child benefit out of the cap - it will simply become ineffective, failing the very principles of our reforms, which is to bring fairness back into our welfare system while ensuring that support goes to those who need it.  We are determined our reforms will be implemented in full and we will take this back to the House of Commons to reverse tonight's decision."

Research published yesterday by the DWP put the number of claimants who would see benefit cuts at 67,000 - 44% of which are in the social sector. More than half those affected are in London.

A YouGov poll shows public support for the £26,000 a year cap (after tax), including among Labour and Liberal Democrat supporters.

According to the poll, 76% are in favour of placing a cap on the amount of benefits that people can claim with 56% thinking the cap should be £26,000 or below.

The cap was expected to deliver £290million savings in 2013/14 and £330million in 2014/15.

A number of social landlords have raised concerns about the benefit cap and its impact on building larger homes.

They argue that aligned with flexibilities to charge higher rents - to replace lost grant - building larger homes is "unviable" because tenants can't afford them.