Large parts of the country are about to become off-limits for tens of thousands of poorer families because of the planned cut in the annual benefit cap, David Cameron is warned today by housing experts.
The Government is pressing ahead with moves to reduce the limit households can receive benefits from £26,000 to £23,000 in England, Wales and Scotland as a priority after the Tory election victory. The move is expected to quadruple the number of families who lose benefit because of the cap.
However, the Chartered Institute of Housing said larger families would be priced out of their current homes because they would not be left with enough money to cover their rent, and claimed the policy would increase homelessness and poverty. The institutes calculated that couples with three children would be left with £110 a week after their living costs are excluded, which is well below the average rent for a three-bedroom housing association property in the South, the Midlands and many areas in the North. The problem is expected to be just as acute in high-rent areas of Scotland and Wales.
Some groups point to evidence that the benefits squeeze since 2010 has forced families on benefits out of expensive parts of central London, but that it disputed by the Department of Work and Pensions, which says very few of the people affected have moved – and when they have it has only been for a short distance.
A DWP spokesman said: “This type of scaremongering happened when the cap was first introduced – when in fact over 22,000 people who had their benefits capped moved into work, reduced their Housing Benefit claim or no longer are claiming Housing Benefit at all. As well as restoring fairness to the system, the benefit cap provides a clear incentive for people to get into work.”
But Gavin Smart, the institute’s deputy chief executive, said: “People affected by the current cap already face significant barriers to finding work, including a lack of job-seeking skills and affordable childcare. Our UK Housing Review briefing shows lowering the cap would make huge swathes of the country unaffordable for larger families on benefits.”
George Osborne and Iain Duncan Smith have insisted they will push ahead with plans to slash another £12bn a year from the benefits bill.