Benefit Cap

Work and Pensions – in the House of Commons on 28th June 2021.

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Photo of Beth Winter Beth Winter Labour, Cynon Valley

What recent assessment she has made of trends in the number of households subject to the benefit cap.

Photo of Mims Davies Mims Davies The Parliamentary Under-Secretary of State for Work and Pensions

The most recent publication shows the proportion of capped households remains low, at 2.9% of the overall housing benefit and universal credit case load as of February 2021.

Photo of Beth Winter Beth Winter Labour, Cynon Valley

Today is a day of action for the “Right to Food” campaign, which I fully support. I can offer the Minister one possible policy to alleviate food poverty: drop the benefit cap. Food insecurity disproportionately affects families who are also most affected by the cap. The Child Poverty Action Group found that lifting the cap could take 150,000 children out of poverty. Will the Minister please explain her reasoning for not lifting it?

Photo of Mims Davies Mims Davies The Parliamentary Under-Secretary of State for Work and Pensions

The hon. Lady will be keen to know that, even in these current times, people moving out of the benefit cap and into work is going in the right direction. There are multiple vacancies in the hospitality, construction, care and logistics sectors. The benefits system provides a crucial safety net for people at their time of need and the benefit cap also provides a strong incentive for claimants to get into work and increase their hours so that the benefit cap does not apply.

Photo of Karen Buck Karen Buck Shadow Minister (Work and Pensions)

Last week, former Work and Pensions Minister Lord Freud described the benefit cap, which is now hitting 120,000 more households than at the beginning of the pandemic, as “ghastly”. Efforts to protect incomes during covid have been undermined as increased universal credit and housing allowance rates led to more families being capped, with numbers rising as the grace period for universal credit expires. If the supposed aim of the benefit cap is for families to go into work and to cut their housing costs by moving, will the Minister explain how families have been supposed to do that in the past 12 months, when neither option was effectively possible?

Photo of Mims Davies Mims Davies The Parliamentary Under-Secretary of State for Work and Pensions

I remind hon. Members that the benefit cap is set at the equivalent annual salary of £24,000, or £28,000 in London, which importantly provides fairness between taxpayers in employment and those with working-age support. Claimants can approach their local authority for discretionary housing payments if they need additional support to meet rental costs, or indeed for hardship grants. The hon. Lady should look out for the forthcoming in-work progression report, which will look at all these matters. We should take all this in the round.