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welfare
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child poverty action group

Blog: Early warnings about the lower benefit cap

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Article Tags:
welfare
opinion
child poverty action group

Kirsty McKechnie
Kirsty McKechnie

Kirsty McKechnie from the Child Poverty Action Group highlights worrying examples of how the benefit cap reduction is hitting people in Scotland

The reduction of the benefit cap from £23,000 to £20,000 per household is currently being rolled out across Scotland.

If someone is entitled to benefits and tax credits in excess of the cap, they will have their housing benefit reduced.

As the person who gathers case evidence for CPAG in Scotland’s Early Warning System (which looks at how welfare reforms impact on families) I can tell you about some of the people who are already being affected by the lower cap.

The DWP announcement regarding the lower cap, stated the intention behind the reduction was to make work pay more than ‘welfare’, at the same time as supporting those who cannot work.

However, in practice, it appears that not everyone who cannot work is exempt from the cap; and that the support pledged for those who are affected by the cap may not be available.

The case studies we have received include:

  • A refugee with six children who will be affected when they move into their permanent tenancy shortly.

  • A homeless person staying in local authority temporary accommodation with a rent of £305 a week. (The cap for a single person is £257 a week, which is all they will receive to cover their housing costs and all other living expenses)

  • A couple, with children, who work from October to February, are affected by the cap in the months that they are not working. They would need to have worked for 50 weeks out of the previous 52 before they would be exempt.

  • A young couple with two children of their own, who also have their nephew living with them, are subject to the benefit cap and the local housing allowance cap on their private sector tenancy. Any financial support they receive for the child they provide kinship care for is having to be paid towards their rent.

  • A lone parent has four children between the age of one and ten, the youngest of whom has recently been diagnosed with a severe disability, but is not likely to be entitled to disability living allowance (and therefore exempt them from the cap), until the child is older. The parent was already subject to the higher benefit cap, receiving a discretionary housing payment, but still having, and struggling, to pay £120 a month from income support and child tax credit towards her £900 a month rent. The lower benefit cap limit means she will now be required to pay £172 a week! To be able to work the client would require childcare for her four children, including someone who is specially trained to look after the child who is disabled.

    • Announcing the lower cap, the DWP assured: “to support those affected by the benefit cap, over £1 billion of discretionary housing payments will have been provided to local authorities by the end of this parliament.”

    However when one client applied for a discretionary housing payment after their housing benefit was reduced by £33 a week, the response stated:

    “due to funding constraints within our discretionary housing payment budget and the increased number of cases, we are not in a position to award discretionary housing payments for cases affected by the benefit cap.”

    With the Scottish Government anticipating that 4,000 families will be affected by the new benefit cap level in the first year, that is a lot of families facing difficulty paying their rent, who may not be able to work, or access discretionary housing payments.

    CPAG in Scotland’s second tier advice line for frontline advisers and support staff in Scotland can answer any queries you may have about the benefit cap, or any other benefit issues. It can be contacted on 0141 552 0552 or advice@cpagscotland.org.uk.

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