The benefit cap: what does it mean and why is it unfair?

Peers are to fight plans to cap benefits at £26,000, despite public support. Here is everything you

What is the benefit cap?

A cornerstone of Iain Duncan Smith's welfare reform, the principle behind the benefit cap is that unemployed people should not be paid more than working families. Under the proposals, working-age benefits would be capped at £500 per week, or £26,000 a year. This is equivalent to the average wage earned by working households after tax.

What do voters think?

The public are broadly with Duncan Smith on this one. A YouGov poll shows that 76 per cent of the public are in favour of the benefits cap, including 69 per cent of Labour voters. It also shows that 36 per cent would like to see even tougher measures, with no household getting more than £20,000 in welfare payments.

Why is it unfair?

There are several criticisms levelled against the cap, centering on the impact on children, and on the very families -- those in work and paying taxes -- who it is meant to defend.

It takes no account of children
The benefit cap is the same regardless of how many children a family has. Therefore a family with five children would receive the same amount as a family with just one or two. This has proved particularly problematic, with church leaders have called for child benefit to be exempted, while Nick Clegg conceded that government may need to look at "the place of children who were born, if you like, innocently into another set of rules".

Leaked government analysis showed that the move could push a further 100,000 children into poverty. Duncan Smith's team are scathing about an amendment that would exempt child benefit, saying it would encourage people on benefits to have more children. But what about families that already have many children? They should not be penalised for the fact of their existence.

It ignores employment history
A couple who have never worked will end up being less affected than families on a low to middle income who are suddenly affected by unemployment in the recession. This is because families with parents who have never worked will tend to live in social housing where rents are cheaper. However, low to middle earners are likely to rent privately: they are not poor enough to qualify for council accommodation but not well off enough to buy. There are 680,000 working households claiming housing benefit, making up 14 per cent of the total housing benefit caseload.

As the recession claims more and more jobs, many families who need short-term support could find themselves in an impossible position. Duncan Smith has criticised "people being placed in houses they cannot afford", but for these families, it is a case of rapidly changing circumstances rather than flagrantly living above their means.

It penalises those in the south-east
Rents are higher in the south-east, and cutting housing benefit to £100 a week makes it practically impossible for a family with children to rent privately. In the Guardian today, Tim Leunig says that after council tax, rent and utilities, a family with four children would be left with 62p per person per day to live on.

Critics have said that this will result in "social cleansing" from inner-city areas -- the percentage of privately rented properties in central London available to housing benefit claimants will fall from more than 50 per cent to just 7 per cent. Leunig predicts that many people will remain in these areas, where job prospects are better, but will have to "downsize", with siblings sharing bedrooms and parents sleeping on sofa-beds.

Who opposes it?

Lord Paddy Ashdown, the former Liberal Democrat leader, has said that he is unable to support the reform as it will unfairly penalise children in benefit dependent homes. He said:

I voted with the Government on everything until now. I see it as my job as an ex-leader to support my successor, but I will not support the benefit cap in its present form.

Church of England bishops, led by John Packer, the Bishop of Ripon and Leeds, will today table the key amendment around which rebel Lords plan to gather. It would exempt child benefit from the cap. As outlined above, the government is hostile to such a plan, though Clegg has suggested that there may be some scope for "transitional arrangements" to cushion the effect.

Samira Shackle is a freelance journalist, who tweets @samirashackle. She was formerly a staff writer for the New Statesman.

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Forget the progressive alliance - it was the voters wot won it in Richmond

The Labour candidate on how voters have acted tactically for decades.

The Richmond Park by-election is both a triumph and a setback for the concept of an anti-Tory progressive alliance. As the Labour candidate, I was bombarded with emails and tweets saying I ought to stand down to prevent Zac Goldsmith being re-elected long after it was technically impossible for me to do so even if I had wanted to. I was harangued at a meeting organised by Compass, at which I found myself the lonely voice defending Labour's decision to put up a candidate.

I was slightly taken aback by the anger of some of those proposing the idea, but I did not stand for office expecting an easy ride. I told the meeting that while I liked the concept of a progressive alliance, I did not think that should mean standing down in favour of a completely unknown and inexperienced Lib Dem candidate, who had been selected without any reference to other parties. 

The Greens, relative newbies to the political scene, had less to lose than Labour, which still wants to be a national political party. Consequently, they told people to support the Lib Dems. This all passed off smoothly for a while, but when Caroline Lucas, the co-leader of the Greens came to Richmond to actively support the Lib Dems, it was more than some of her local party members could stomach. 

They wrote to the Guardian expressing support for my campaign, pointing out that I had a far better, long-established reputation as an environmentalist than the Lib Dem candidate. While clearly that ultimately did little to boost my vote, this episode highlighted one of the key problems about creating a progressive alliance. Keeping the various wings of the Labour party together, especially given the undisciplined approach of the leader who, as a backbencher, voted 428 times during the 13 years of Labour government in the 1990s and 2000s, is hard enough. Then consider trying to unite the left of the Greens with the right of the Lib Dems. That is not to include various others in this rainbow coalition such as nationalists and ultra-left groups. Herding cats seems easy by contrast.

In the end, however, the irony was that the people decided all by themselves. They left Labour in droves to vote out Goldsmith and express their opposition to Brexit. It was very noticeable in the last few days on the doorstep that the Lib Dems' relentless campaign was paying dividends. All credit to them for playing a good hand well. But it will not be easy for them to repeat this trick in other constituencies. 

The Lib Dems, therefore, did not need the progressive alliance. Labour supporters in Richmond have been voting tactically for decades. I lost count of the number of people who said to me that their instincts and values were to support Labour, but "around here it is a wasted vote". The most revealing statistic is that in the mayoral campaign, Sadiq Khan received 24 per cent of first preferences while Caroline Pidgeon, the Lib Dem candidate got just 7 per cent. If one discounts the fact that Khan was higher profile and had some personal support, this does still suggest that Labour’s real support in the area is around 20 per cent, enough to give the party second place in a good year and certainly to get some councillors elected.

There is also a complicating factor in the election process. I campaigned strongly on opposing Brexit and attacked Goldsmith over his support for welfare cuts, the bedroom tax and his outrageous mayoral campaign. By raising those issues, I helped undermine his support. If I had not stood for election, then perhaps a few voters may have kept on supporting him. One of my concerns about the idea of a progressive alliance is that it involves treating voters with disdain. The implication is that they are not clever enough to make up their mind or to understand the restrictions of the first past the post system. They are given less choice and less information, in a way that seems patronising, and smacks of the worst aspects of old-fashioned Fabianism.

Supporters of the progressive alliance will, therefore, have to overcome all these objections - in addition to practical ones such as negotiating the agreement of all the parties - before being able to implement the concept. 

Christian Wolmar is an award winning writer and broadcaster specialising in transport. He was shortlisted as a Labour mayoral candidate in the 2016 London election, and stood as Labour's candidate in the Richmond Park by-election in December 2016.