Housing Benefit to Be Targeted In Osborne's Welfare Cuts

Housing benefit could be cut by over 10% in George Osborne's July Budget as the government attempts to deliver its commitment to reduce welfare spending by £12 billion in two years. The Institute for Fiscal Studies said that the pledge to protect child benefit from the social security cuts means HB, along with tax credits and disability/incapacity benefits, would "most likely" take the biggest hit.  Carl Emmerson, IFS deputy director, explained: "Cuts of this scale amount to almost 10% of unprotected benefits. Finding such a reduction without cutting child benefit would mean that even more significant cuts would likely be required to spending on one or more of tax credits, housing benefit and disability & incapacity benefits." Read more on 24dash.

IDS in Bid to Tax Disability Cash and Cap Child Benefit

Benefits for the disabled could be taxed and child benefit capped for those with more than two children under plans to further cut the welfare bill. Iain Duncan Smith is arguing that disabled benefits should be increased for the poor and subsidised by taxing the handouts for better-off claimants. He is also pressing a reluctant David Cameron and George Osborne to restrict child benefit to two children for new claimants. As well as saving money, he believes it would encourage welfare claimants to have smaller families. Read more on the Sunday Times website.

Pressure To Slash Benefits outside Richer South-East

Policy Exchange says lowering the limit would reflect the difference in the cost of living – and save the nation’s coffers £100million a year. Piling pressure on the Government, the think-tank says the cap should be reduced by 10 per cent – to £23,400 – for those living in the rest of the UK. It comes ahead of a major piece of research this month examining how a future government could find further savings in the welfare budget. The Policy Exchange paper will also say that child benefit should be capped at four children and payments progressively reduced after the first child. It says the collective benefit changes would lead to savings of £1billion by 2020. Read more on the Daily Express website.

Cutting Benefits outside London Could Save Millions

The benefits cap should be lowered by 10 per cent for people living outside London and the South East to reflect the lower cost of living outside of those areas, a think-tank has proposed. Policy Exchange said lowering the limit to £23,400 for those living in the rest of the UK could save the UK Government £100 million a year. The right-leaning think tank, with close links to the Conservative Party, will spell out the plans in full in a major piece of research examining how a future government could find further savings in the welfare budget to be published later this month. The Policy Exchange paper will also say that child benefit should be capped at four children and payments progressively reduced after the first child. It says the collective benefit changes would lead to savings of £1 billion by 2020. Read more on the Policy Exchange website.

Benefit Cuts Hit Thousands of City Residents

Hard-Up residents are calling Nottingham City Council at a rate of more than one a minute over worries about benefits changes that came into force last month.  The Post can reveal that between April 2 and 16, the council answered 5,300 calls and had 2,854 face-to-face enquiries, meaning it dealt with nearly 750 queries a day.  Compared with the same period last year, the service has received 71 per cent more phone calls.  The council has taken on an extra 14 benefits advisers to its team of 58, for the next 11 weeks, to help cope with the demand. Staff have also been working overtime and have cancelled holidays.  Research shows that Government welfare changes, which include changes to Disability Living Allowance, Child Benefit and the Spare Room Subsidy, or Bedroom Tax, will take £120 million out of Nottingham’s economy.  Read more on the Nottingham Post website.

Poverty: Children – Parliamentary Written Answer

Chris Skidmore: To ask the Secretary of State for Work and Pensions what estimate he has made of the effect of (a) Universal Credit and (b) the Welfare Benefits Uprating Bill on child poverty.

Esther McVey (edited response): In the autumn statement (2012), it was announced that in light of the national economic situation, certain working-age social security benefits and payments, certain elements of tax credits, and child benefit, would be uprated by 1% rather than by prices (as measured by the consumer prices index ('CPI')) for the tax years 2013-14, 2014-15 and 2015-16. Because the relative poverty income line moves each year in cash terms some families will move below this line over the period.  We estimate that the uprating measures in 2013-14, 2014-15 and 2015-16 will result in around an extra 200,000 children being deemed by this measure to be in relative income poverty compared to uprating benefits by CPI.

Architect of Poll Tax Warns Of Similar Chaos with Council Tax Shake-Up

One of the main architects of the poll tax has warned ministers they are in line for similar chaos over controversial plans to impose council tax on thousands for the first time. Tory peer Lord Jenkin, who helped design Thatcher’s doomed community charge, said plans to cut council tax benefit would hit the pockets of the working poor – just the sort of people for whom the Coalition has pledged to make work pay.  Experts said last night that cuts to the benefit meant that up to 750,000 people could be forced to pay council tax for the first time, or will have to pay more.  In addition, thousands of middle class people could lose out because some local authorities are scrapping discounts on second homes in response to the reforms, which come into effect next April. Lord Jenkin told the BBC that the government needed to be braced for a ‘backlash’ over the complicated changes to council tax benefit, which is paid to 5.9million people.  The warning comes just a day after accountants said another set of changes – this time to child benefit – could also lead to chaos because the reforms are too complex for parents to understand.  Read more on the Daily Mail website.

Cameron Is Repeating the Housing Benefit Myth

Having long abandoned the pretence that "we're all in this together", David Cameron is preparing yet another raid on the welfare budget. He has announced plans to abolish housing benefit for under-25s and indicated that the government is considering "time-limiting" Jobseeker's Allowance, reducing the new benefits cap to £22,000 and restricting payments for large families (specifically, limiting child benefit to three children). As previously signalled by George Osborne, the cuts are designed to save the government £10bn but so far Cameron hasn't chosen to focus on the alleged savings. Rather, he has argued that the plans are necessary to reverse a "culture of entitlement". In his pre-speech interview with the Mail on Sunday, Cameron claimed that housing benefit "discourages" young people from working. Read more on the New Statesman website.

Labour Wants Benefit Cap to Be Set Locally

Labour has called for the proposed total benefits cap to be set locally rather than at the national limit of £26,000. Liam Byrne, shadow work and pensions secretary, told the BBC that the cap on benefits for working age households would work better if it differed in different parts of the country. He said: ‘If you want to send a signal that you are better off in work than on benefits, wouldn’t it make much more sense to have localised caps in different parts of the country because we know there are different levels of housing benefit in different parts of the country?’ Mr Byrne said Labour backs the principle of having a cap despite the party’s peers voting last week to exclude child benefit from the cap. Read more on the BBC website.

Benefits Cap Concessions Expected To Win Support for Welfare Reform Bill

The government is expected to make a series of concessions on its controversial £26,000 household benefits cap to win over wavering Liberal Democrat MPs. Iain Duncan Smith, the work and pensions secretary, is expected to agree that a discretionary fund should be established to ease the burden on families who could be made homeless at a sensitive time in their children's education. The move comes as Labour seeks to work with the Lib Dems - whose former leader Lord Ashdown voted to exempt child benefit - on agreeing a local rate for the cap. In a letter to Nick Clegg, the shadow work and pensions secretary, Liam Byrne, says a local cap could ensure that 20,000 people avoid being made homeless by the changes. Read more on the Guardian website.

Lords Reject Plan for Welfare Cap to Include Child Benefit

The government's welfare reforms took another battering when a cross-party alliance, including many Liberal Democrat peers, voted to exclude child benefit from plans to impose a blanket £26,000 cap on household welfare benefits. In the fifth significant government defeat on the bill, peers voted to temper the cap by 252 to 237. Conservatives are convinced the cap, due to come into force next year is hugely popular, and lambasted Labour for talking tough on welfare and then voting against the proposals. But the coalition assault was weakened by the number of senior Lib Dem peers, including Lord Ashdown, backing calls by bishops that child benefit should be excluded from the cap. Ashdown for the first time voted against the coalition government, intervening in the debate to ask what justification a minister could give morally or otherwise to withdraw a universal benefit for those on £26,000 but not for those earning £80,000. The government will now have to decide whether simply to reinstate child benefit in the cap when the bill returns to the Commons or instead propose some clearer transitional relief. Read more on the Guardian website.