Benefit cap could be lifted by DWP to boost payments…

Benefit cap could be lifted by DWP to boost payments in cost of living crisis

The levels of the benefit cap could be changed to help people deal with the cost of living crisis, the Department for Work and Pensions is reported to have indicated.. The cap has been the same since 2016 with campaigners saying it's no longer fit for purpose.

It puts a limit on the level of state support and in the North East it is set at £20,000 a year for couples (with or without children) or single claimants with a child of qualifying age, or £13,400 for single adults with no children. The figure is higher in Greater London, where the corresponding limits are £23,000 and £15,410.

In the UK as a whole, around 120,000 people are affected by the restrictions. The Child Poverty Action Group (CPAG) has called for the benefit cap to be scrapped completely, reports BirminghamLive.

The DWP has said it is looking at reviewing the cap between now and April 2023 in light of the cost of living crisis. When asked by the Work and Pensions Committee if the level of the policy might change in light of "rapidly rising costs", Work and Pensions Secretary Therese Coffey told MPs: "We do have this statutory duty - I think I've had some advice because now we no longer have the Fixed-term Parliaments Act on exact timing - I'm slightly concerned as to whether we have a real reflection of life, but I'm getting some advice on that."

Asked again if the Government might review the cap, Ms Coffey said: "Yes, we may. I just want to make sure it's as normal a landscape as possible." She confirmed the cap has not been reassessed since 2016.

This year a further 35,000 people are expected to be affected by the benefit cap this year. It has seen, on average, a family on Universal Credit having their benefits reduced by £50.77 a week, while an average family on Housing Benefit has seen a cut of £48.19. That works out at around £200 a month sliced off their expected income.

Analysis by CPAG of the latest DWP data shows that the vast majority (86%) of households whose benefits were capped had children. Those at the upper limits will have seen no increase in their income when all state benefits were increased by 3.1% last April, well below the current inflation level of 9%. The charity says this would mean a real-terms income cut of £2,070 in London and £1,800 elsewhere.

The DWP pointed out that its new cost of living payments will not be affected by the cap, which means that everyone on means-tested benefit will receive £650, split into two instalments. In total, people on Universal Credit will get an extra £1,200 in cost of living support, the Government said.

The £150 payment to those on health and disability benefits will also not be affected by the benefit cap, it stated.

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