Thousands of families on 50p a week housing benefit after cap

More than 7,500 families have had their housing benefit cut to just 50p a week as a result of the Government's benefits cap, according to new figures.

Wednesday, 5th April 2017, 8:14 am
Updated Saturday, 8th April 2017, 9:30 pm
More than 7,500 families have had their housing benefit cut to just 50p a week as a result of the Government's benefits cap, according to new figures. Picture by Yui Mok/PA Wire

Official figures obtained by BBC1's Panorama show that at least 67,600 households have lost benefits in England, Scotland and Wales following the introduction of the cap in November 2016. Of those, 11% - or 7,585 families - saw their housing benefit cut to 50p a week.

The Child Poverty Action Group said that the £20,000 cap - £23,000 in London - on the total amount of benefits claimed by a household in a year was "completely arbitrary" and targeted many people who were not in a position to work.

But ministers insist that it leaves claimants on a similar income to many working people and gives them an additional incentive to find a job.

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Of the 370 councils which responded to Panorama's survey, the highest numbers of households affected by the benefit cap were in Birmingham (2,968), Brent (1,239), Ealing (1,056) , Enfield (1,027), Hackney (1,014) and Leeds (993).

Areas with the highest numbers of claimants whose housing benefit payments have been reduced to 50p a week were Birmingham (578), Leeds (223), Manchester (179), Sandwell (169) and Sheffield (151).

The highest proportions of capped households who ended up with 50p a week to pay for their accommodation were in North Hertfordshire (30%), Bolton (29%), Sandwell (27%), Blackburn, Ashfield and Wigan (all 26%).

There were sharp variations across the country in the proportions of capped households facing the most drastic housing benefits cuts. Although many London boroughs reported high levels of capping overall, none had more than 26 households on 50p housing benefit and most were in single figures.

CPAG chief executive Alison Garnham said the benefit cap had been set at "a level that bears no relation to anything else, it's completely arbitrary".

And she added: "We reckon of the people affected by the benefit cap, about 80% of them are not really in a category expected to work because they're sick or have very young children. So, there's an overall question about how this can be a policy about getting people into work, when the group that's targeted isn't really expected to."

Welfare delivery minister Caroline Nokes told the programme: "You have to remember that a household that has only 50p of housing benefit actually is receiving in the region of £20,000 a year outside London, in total benefits. That's about the same as an ordinary family. Four in ten families would be earning that sort of money."

A spokesman for the Department for Work and Pensions said: "We are committed to helping people into work if they are able, and the benefit cap provides a clear incentive to move into employment. Over 26,000 people who were previously capped have moved into work.

"Anyone eligible for working tax credits, carers allowance, and most disability benefits are exempt from the cap.

"The benefit cap restores fairness to the system and the new limit will ensure the amount people on out-work-benefits can claim better reflects the circumstances of many working families in the country. Even with the new cap, households can still receive the equivalent of a pre-tax salary of £29,000 in London, or £25,000 elsewhere."

:: Panorama's The Benefit Cap - Is It Working? can be seen on BBC1 at 9pm on April 5.