Chancellor George Osborne’s other announcement to introduce a cap on benefits at £26,000 is even more unfair than the child benefit changes.
Our guest writer is Pete Challis, chair of the ALG Housing Committee (1990-99)
The media have made much of the unfairness in the proposals to remove eligibility for child benefit to any family where there is a higher rate taxpayer. The unfairness that one person earning more than £43,875 will lose their child benefit while two earners whose combined incomes is £80,000 will keep child benefit was immediately seized on.
But chancellor George Osborne’s other announcement to introduce a cap on benefits at £26,000 is even more unfair. It takes no account of housing costs, family size or council tax and penalises couples.
To illustrate the postcode lottery that is being created and the impact, compare the following. (Note that the calculations do not include child tax credits, which is a further factor and penalty.)
Take a couple (Couple A) on job seekers allowance with 4 children living in a 4 bedroom home in the private rented sector in Camden. They pay £400 a week in rent (£20,800 a year) – the new ceiling being imposed from next year, their council tax is £1,332 (Band D). Their job seeker’s allowance (£5,343) immediately takes them over the cap.
Their job seeker’s allowance is effectively cut from £102.75 a week to £74.38 a week and they effectively lose all child benefit.
Now take the same couple (Couple B) on jobseekers allowance with 4 children but this time living in a 3 bedroom home in the private rented sector in Camden. They pay £340 a week in rent (17,680 a year), their council tax is still £1,332 (Band D). They keep job seeker’s allowance (£5,343) and child benefit for Child 1 but effectively lose some child benefit for Child 2 and all child benefit for children 3 and 4.
Compare them with a single parent on jobseeker’s allowance with 4 children who also lives in a 3 bedroom home in the private rented sector in Camden. The rent is £340 a week (£17,680 a year), their council tax is now £999 (single person discount Band D). They keep job seeker’s allowance (£3,432) and they keep child benefit for all their children.
In order to keep all their child benefits the couple (Couple D) must move into a 2 bedroom home with a rent at £290/week, the children share the two bedrooms and they sleep in the living room but they keep their Jobseekers allowance and all their child benefit.
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|
Camden |
Camden |
Camden |
Camden |
Birmingham |
| Couple A | Couple B | Sngl prnt C | Couple D | Couple E | |
| HB | £20,800 | £17,680 | £17,680 | £15,080 | £11,369 |
| CTB | £1,332 | £1,332 | £999 | £1,332 | £1,261 |
| JSA | £5,343 | £5,343 | £3,432 | £5,343 | £5,343 |
| CB 1 | £1,056 | £1,056 | £1,056 | £1,056 | £1,056 |
| CB 2 | £697 | £697 | £697 | £697 | £697 |
| CB 3 | £697 | £697 | £697 | £697 | £697 |
| CB 4 | £697 | £697 | £697 | £697 | £697 |
Alternatively, if the couple (Couple E) could move into a 5 bedroom property in Birmingham (£218.63 a week) they would be unaffected by the cap.
48 Responses to “Housing benefit changes even more unfair than child benefit cuts”
jeff marks
@Chris
we allow people to starve every day outside the UK. and we allow people to die of preventable diseases. the 26k you wish upon some jeremy kyle watching slob could send 100 children to school in africa. could by 50,000 antimalarial bed nets. are you mental or taking the piss?
Chris
@jeff marks
hahaha you’re a funny man.
threeskins
The total amount of money that is wasted by the gov add to that the amount of money lost to tax avoidance and you have a sum of money that over shadows the money paid to us jeremy kyle watching slobs, which by the way is not a very original slur,an MP in the commons coined that particular gem, as with many comments here not at all original, copy and paste by mouth.
jeff marks
wasted by government by being given to people that give nothing back.
and no – people being paid to sit at home overshadows all government expenditure. about 1 in 5 people of working age in this country are paid to stay at home. New Labour’s shame. And don’t say there isn’t any work to do.
Chris
@jeff marks
You fool, you have no idea what you fucking talking about. I see CCHQs strategy is going to be vilification of the physically and mentally ill, endless tirades about scroungers to divert attention from the greatest transfer of wealth from the low and middle income majority to the corporate vested interests. I thought Cashcroft had stopped funding all the bloggers and online angry people but it seems they’re here to stay. Unemployment is currently at 7.7%, there are 750,000 18-24 year old NEETs. How the fuck are IB and ESA claimants kicked onto jobseekers going to find work when there are so many able bodied without compromised medical histories looking for work? The idea that those people claiming IB/ESA are all malingers is pathetic and shows your total lack of understanding and compassion, the fact that many are former manual workers such as plumbers who can’t work because of illness related to their profession shows you up as who you really are.
We can’t all get jobs as online advocates from Lord Cashcroft.