This morning, the Child Poverty Action Group have exposed the six myths of work and pensions secretary Iain Duncan Smith’s regressive reforms; here they are.
The government faces a battle in the House of Lords today over its controversial benefits cap, with bishops joining Liberal Democrat peers – led by former leader Paddy Ashdown – in opposition to the plans that will push 100,000 children into poverty. In 2012. Under this cabinet of millionaires.
This morning, the Child Poverty Action Group (CPAG) have exposed the six myths of work and pensions secretary Iain Duncan Smith’s regressive reforms.
Here they are:
Myth 1: The cap is just for out of work claimants of benefits
Ministers have fostered the impression that this is about ensuring working families get a fair deal compared to those who don’t work. However, ministers confirmed in their impact assessment document that any couple working up to 23 hours a week will still be affected by the cap when it is introduced.
That means that many families not in receipt of any out-of-work benefits (e.g. jobseekers’ allowance (JSA), income support (IS) and employment support allowance (ESA)) and receiving just earnings, tax credits and in work benefits (e.g. housing benefit (HB) and council tax benefit (CTB)) will be hit by the cap too.
Source: For the government’s confirmation that Working Tax Credit – with its 24 hours of work requirement – will be used as indicative of being in work for the cap policy, see the impact assessment (pdf).
Myth 2: Claimants have more money than working families
Most of those hit by the cap will be in private rented households. It is the landlords that get the cash – often paid directly to them – meaning the families are really left struggling to pay for basic costs like utility bills, food, clothes, transport etc. The root problem of rising housing benefit costs is the failure to maintain sufficient supplies of social housing, and the runaway inflation of private rents due to the bubble in the housing market.
The cap does nothing about the root problem and the crisis in the supply of affordable housing is predicted to worsen by housing experts.
Source: For more information on affordable housing crisis, see Shelter’s web page.
Myth 3: Families with a disabled member will not be affected
Disability living allowance (DLA), then the personal independence payment (PIP), will be used as a proxy to identify households that will be excluded from the cap on grounds of disability. However, many disabled people do not qualify for DLA – and even fewer will qualify for PIP.
The government has admitted they expect half of the households hit by the cap to have a disabled person, using the Disability Discrimination Act 2010 definition. Poor decision making for DLA claims with high rates of successful appeals will also mean many families going in and out of the cap unfairly, causing chaos, debt and homelessness.
Source: For the government’s statement, see answer to PQ 68034.
Myth 4: There will be no behavioural changes and social impacts
The government’s impact assessment has assumed that there will be no behavioural changes, and states that there will be no social impacts. However, the measure introduces a couple penalty that will mean some families may be able to receive twice as much in benefit payments if they separate.
A couple with at least two children who are subject to the £500 cap could claim up to £1,000 in benefits if the parents separate and divide the residency of their children between two homes. The incentive for families to break up will not just be financial, as it may also mean that they are able to remain living in the same area so that they can avoid their children changing schools and continue living in the same neighbourhood as networks of friends and relations.
Source: For more information, see the impact assessment (pdf).
Myth 5: The cap will deliver fiscal savings
The cap is likely to reduce benefits spending by £240 million per annum, but it will lead to costs elsewhere in the system that may surpass those savings. Warnings from within government suggest there will be a net fiscal cost.
The private secretary to Eric Pickles, the communities secretary, wrote to the private secretary to the prime minster last year and said “we think it is likely that the policy as it stands will generate a net cost” as a consequence of the homelessness and migration that will be caused, and the costs this will place on local authority services.
Source: You can read the full warning letter here.
Myth 6: This is a new policy
This policy has in fact been tried and failed once before. The ‘wage stop’ in force during the 1970s was a similar policy which aimed to cap benefits at the level of average wages. It proved unfair and unworkable and was eventually abolished.
Source: For more information on the wage stop, see this speech by Robin Cook who successfully campaigned for its abolition.
There’s more on the horror of the reforms in today’s Guardian, which looks at the case of Daniela Pereira:
Last year Daniela Pereira, 28, moved from Kensington to Peckham in order to reduce her rent before the changes but now is having to move again because her age – under 35 – means she can only get housing benefit if she is living in shared accommodation.
“I have a disability, so it’s a bit difficult for me to live in shared houses. I can’t use stairs or do things like the dishes or cleaning up ,so it really impacts on what I can find.”
Pereira worked in catering until developing psoriatic arthritis which makes it difficult for her to walk.
“I was living in Cornwall, but I came to London because I thought it would be easier for me, finding a job, accessing doctors and physio appointments. Peckham was about the cheapest I could find, and I can just about afford food too, but nothing else. I don’t know where to go.
“I’m not being supported to find work. It’s as if they want me to be stuck on benefits for the rest of my life. I don’t want that.”
As CPAG chief exec Alison Garnham said:
“The household benefit cap policy is built on a foundation of myths, but the 210,000 children affected will face harsh realities of severe poverty and homelessness.
“The Bishops in the House of Lords will be putting forward some sensible proposals today that will protect children and families. We hope a government that promised to be the most family friendly ever will prove it today by following their lead.”
Once again, the government of the one per cent are balancing the books on the backs of the poorest… all in it together?
See also:
• Children’s commissioner slams welfare bill – Alex Hern, January 11th 2012
• Five reasons to oppose the welfare bill – Daniel Elton, December 12th 2011
• Cameron’s benefit cap rewards family break-up – Sam Royston, September 5th 2011
• Pickles letter to Cameron reveals inconvenient truth on benefits cap – Pete Challis, July 3rd 2011
• One and half cheers for Lib Dem opposition to Osborne’s benefit cap – Declan Gaffney, May 17th 2011
143 Responses to “Exposed: The six myths of IDS’s benefits cap”
El Negro Jefe ☆☆☆☆☆
RT @leftfootfwd: Exposed: The six myths of IDS’s benefits cap http://t.co/h0Pw4Q2X
Julian
“Then you are told you must find cheaper accommodation however the extra travel time and distance means that it would be unviable to go to that work place what would you do?”
This applies to working people who are not on benefits if they are in rented accommodation. If the rent goes up and they can’t afford it, they have to move. It isn’t very pleasant for the people affected, but what’s the alternative? You can control rents but that is a completely separate issue from the benefit cap.
The problem with increasing benefits to keep up with rents is that it just encourages landlords to increase rents.
Julian
Are you prepared to pay any amount of money in benefits with no limit? How much extra in tax are you yourself happy to pay (if you are working) so that others can live better than you do?
Blarg1987
I do partially agree with your points especially about landlords being encouraged to increase rents, thats why I think the goverment should put a cap on rents but also introduce the living wage to offset the benefits cap which would make these reforms more credible.
With regards to private renters, I agree it is not pleasant but I think enough of these people are in well eniugh skilled employment that their employers value their talents enough to give them pay rises etc to keep the talent.
Where you have say London and an unskilled job such as an office cleaner it will be harder for them to ask for a pay rise.
I think long term this could shoot the goverment in the foot not only with the electorate, but with also their financial supporters who would have to pay more for employees to do the unskilled jobs to cover travel costs etc.
Redisbleu
One has to define what “better than you” means, because believe it or not, I can spend £500 a month just on my disabled son’s needs because it doesn’t get covered anywhere else. Not NHS, not Social Services. That’s what these “benefits” are for, and hello, I was WORKING too, and still had to top up. These “benefits” as keeps getting lumped together to make it sound like we’re all on the take can mean housing benefit (which I have no control over, it goes right to the landlord) to Council Tax (straight to Council, basically government is paying ITSELF), to buying food and clothing (which has tax on it, so guess what I’m a taxpayer too!), all my bills which includes higher heating due to disability, a computer so I can order food as I am housebound and can’t drive – and also helped me do what little work I could do at home. Anything I have goes to my son. His clothes, his shoes, his diet, his transportation, his care, his needs. And that isn’t optional – it’s necessary.
If I was living “better” than you, I’d have my health back. My son wouldn’t be disabled. I’d be working again full time and an athlete again. But if you think this is “better”…I’ll happily trade places with you.