Benefits payment cap introduced on Monday
The controversial cap on benefits imposed by the government has been rolled-out into four London boroughs today.
The move means that parents in Bromley, Croydon, Enfield and Haringey will not receive more than £500 total a week in child and housing benefit, income support and jobseeker’s allowance (JSA).
The cap will also affect single people, allowing them to claim no more than £350 per month. There are, however, some exemptions and disability allowance is not included in the capped total.
The cap is to be implemented nationwide in July and is expected to be in full force by September. Its purpose is to limit benefit payments to equal the average income through work as well as to cut government spending.
When originally planned, the government expected the cap to save the welfare bill £275m a year, although this has now been re-evaluated to £110m.
An anticipated consequence of the lower benefits allowance is changing people’s attitudes towards work and to slowly wean people off benefits such as JSA and into work.
The cap provides a huge incentive and it is expected to encourage benefit claimants to find work to support themselves rather than depending on money from the government, with some previous benefits payouts labelled “outrageous” and “unfair”.
There are concerns towards the welfare of children affected by the cap, with the added risk of increased child poverty.
Parents interviewed by the BBC claimed that the cap will leave them without the necessary money for school uniforms and trips and will force them to cut back on food spending.
With the higher rent prices in London and the South East, some are even worried that they will not have enough income to pay their rent and these are the places expected to be hit hardest by the cap.
However, the cap will please many tax payers as it makes the benefits system fairer and means that no claimants receive more than the average income of a working family.
The £500 a week maximum equates to approximately £35,000 a year before tax and an approximate 12,000 households previously received welfare totalling over £34,000 a year (equal to the salary of £47,000 after tax).