MPs reinstate benefits cap and 'bedroom tax'

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

The Government has overturned a series of defeats to its Welfare Reform Bill including the £26,000 a year benefits cap and penalties for social tenants under-occupying their homes.

It rejected amendments made by peers in the House of Lords and reinstated the original proposals into the legislation.

MPs voted by 334 to 251 to overturn the Lords amendment - tabled by a group of bishops - which would exclude child benefit from the £500-a-week cap on benefits to working-age households.

It's understood ministers will use a rule known as "financial privilege" to ensure Parliament approves the cap.

Disability Living Allowance (DLA) and Working Tax Credit claimants will be exempt from the cap. Households also in receipt of the support component of employment and support allowance, but not in receipt of DLA, will also be exempt.

The Government also reaffirmed its commitment to "transitional arrangements" to the cap to minimise its impacts.

Those who have been in work for the previous 12 months will get a nine-month "grace period" before the cap kicks in.

Employment minister Chris Grayling: said: "We always expected that we would provide a grace period—a degree of transition—for people who simply lose their jobs and find that their circumstances have changed dramatically through no fault of their own. We will not penalise those who are in work and doing the right thing. We will put in place a nine-month grace period for those who have been in work for the previous 12 months and lose their job through no fault of their own.

"In addition, the Secretary of State and the Prime Minister have made it clear that we will provide transitional support to help manage families into more appropriate accommodation—as we did when we introduced the housing benefit cap. So we will follow the same model of additional money for discretionary housing payments that we adopted for the introduction of the housing benefit cap last year."

MPs also voted to overturn a Lords proposal calling for social tenants with one spare room to be exempt from new "under-occupancy penalties" linked to housing benefit. It won the vote by 310 to 268.