COMMONS

Benefit cap inquiry launched

22 February 2017

The Work and Pensions Committee launches an inquiry into the benefit cap and how it affects British households. The Committee welcomes written submissions. Deadline is Friday 7 April 2017.

Call for written submissions

The Committee invites written submissions addressing the following points:

  • The cap is intended to incentivise behavioural change amongst claimants and secure savings for the Exchequer. To what extent is it achieving that?
  • To what extent has claimant behaviour responded to the cap, through moving into work, moving house etc? What effect does the lower cap have on incentives, what are the barriers to behavioural change and how can they be overcome?  
  • Does the cap address high underlying rates of housing benefit and child maintenance in a fair way?
  • What are the consequential costs of the cap for other public spending, such as that by local authorities?
  • What are the consequences for Discretionary Housing Payments (DHPs) and what impact does use of DHPs have on behavioural change?
  • Are there unintended consequences (either positive or negative) of the cap?

Deadline for written submissions is Friday 7 April 2017.

Submit your views through the Benefit cap inquiry page.

Inquiry background

The benefit cap - which limits the income households receive in certain benefits - was reduced from £26,000 a year to £20,000 a year outside London and £23,000 within London in November 2016. The Government estimates that, in the absence of any 'behavioural changes' from claimants, 88,000 households are affected by the new cap, compared with around 20,000 under the previous policy.

Around a third of the affected households are expected to be in London or the South East although the cap will affect households across Great Britain.

Committee comments

Rt Hon Frank Field MP, Chair of the Committee, said:

"Quite often when the Government reduces a benefit, the justification given is that it will incentivise work, and obviously encouraging and supporting the strivers is a laudable goal. People can escape the benefit cap if they move into work. The Government needs to be challenged to put much more resources in helping families whose benefits are going to be in cut in this way to know that there is an exit and one which they might be able to grasp soon."

Karan Buck MP, Member of the Committee said:

"The Government’s argument for the Benefit Cap is that it will incentivise work. Set against this is the fact that many of those affected have been found to be incapable of work. Neither does the cap reflect the reality of housing, even of homeless households.  The Committee will want to look at the actual impact the cap is having, who is affected and how it interacts with other factors, from health to housing."

Further information

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