Benefits

House of Lords written question – answered at on 20 June 2011.

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Photo of Baroness Lister of Burtersett Baroness Lister of Burtersett Labour

To ask Her Majesty's Government, further to the Written Answer by Lord Freud on 24 May (WA 399-400), whether they will estimate the number of households who would be subject to the proposed benefit cap, if (a) child benefit, and (b) any other relevant benefits or tax credits, were treated as part of the median income at which the benefit will be capped.

Photo of Lord Freud Lord Freud The Parliamentary Under-Secretary of State for Work and Pensions

If the benefit cap is applied as described in the spending review 2010, it is estimated that around 50,000 households will be affected.

We are looking at ways of easing the transition for families and providing assistance in hard cases.

It is estimated that including (a) child benefit in the calculation of the median income would result in a negligible reduction in the number of households affected.

It is estimated that including (b) all relevant benefits or tax credits in the calculation of the median income would reduce the number of households affected by approximately 30 per cent.

Relevant benefits refer to payments that are taken into account in the calculation of the sum of benefits when applying the benefit cap. Note that disability living allowance and working tax credits are not included, since the claimants of these benefits are excluded from the benefit cap.

Analysis of those affected by the benefit cap has been modelled using survey data-as such there is a degree of uncertainty around the results.

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