THE roll-out of a new system capping the benefits a household can claim to the average working wage of £500 per week has received a mixed reaction in Sunderland.
The benefits cap applies to people receiving jobseeker’s allowance, child benefit, child tax credits and housing benefits, and limits payments to the equivalent of £26,000 a year.
As of this week, this will affect about 100 Sunderland households, which have been receiving more than the cap, according to figures from the Department of Work and Pensions.
The city’s Tories welcome the move, which they say will stop high claims which make it impossible for people to move into work when they want to and also provides an incentive to find work for those who do not.
Coun Robert Oliver, leader of Sunderland Conservatives, said: “The cap, which amounts to £26,000 a year, is greater than average earnings on Wearside where housing, and other costs are less than in other parts of the country, so it can only be considered fair.
“The limit of £500 a week ensures no one can claim more in benefits than the average working household, and there is a clear incentive for people to get a job as those eligible for working tax credit are exempt.”
However, Labour councillor and deputy council leader Henry Trueman branded the changes “ridiculous”, saying they target those most in need.
“It’s absolutely ridiculous, the way the poor and most vulnerable are being affected,” he said.
“We’ve got to look at benefits reform, but it’s absolutely disgraceful, the way they have done it. I just feel for the number of people in Sunderland who are going to be hit.
“The only place they will come to for help is the council, and I don’t know what we are going to do to help them, but we will help where we can.”
Independent group leader Coun Colin Wakefield said time would tell how people would be affected.
“I think most working people welcome the benefits cap as long as it’s applied fairly,” Coun Wakefield said.
“We all see the extremes of benefits abuse, but they are probably, in truth, in a minority.
“The real worry is how it would affect working people on low incomes, and I think it will affect the wrong people in some cases.
“It’s a concern, but hopefully the thing will bed in relatively quickly and fairly.”
There is no cap on people who receive disability living allowance or its successor, the personal independence payment, nor on those claiming industrial injuries benefit or a war widow’s pension.
Work and pensions secretary Iain Duncan Smith said: “The days of blank cheque benefits are over, and the benefit cap is a key part of this.”