Benefit Cap may be poverty-trapping people into taking the lowest-paid work

New DWP Commandant David Gauke is crowing again, after quarterly statistics showed 34,000 households that had been subjected to the minority Tory government’s harsh Benefit Cap* have been “incentivised” into work.

But the question is:

What kind of work?

We already know that child poverty in working households has increased massively. This is because the Tory plan to end child poverty has always been to move parents from unemployment into work – but ministers have consistently ignored the fact that wages have fallen, in real terms, by more than 10 per cent since 2008.

Then there is the fact that many of the jobs on offer are zero-hours contracts that provide no wage security whatsoever.

So the announcement that 34,000 households have moved out from under the Benefit Cap and into work is a meaningless statistic.

Perhaps Mr Gauke could tell us how many of those households are actually better-off now?

I doubt it. The Tory government tries never to publish figures that are critical of its policies.

The latest quarterly benefit cap statistics have been released today (3 August 2017) by the Department for Work and Pensions.

Since the introduction of the cap in April 2013, 150,000 households have had their benefits capped. Around 81,000 of these are no longer capped, with 34,000 households having moved into work.

Work and Pensions Secretary David Gauke said: “It is right that people who are out of work are faced with the same choices as those who are in work and these figures show that the benefit cap has been a real success. But behind these figures are thousands of people who are now better off in work and enjoying the benefits of a regular wage.

“With record levels of employment and over three quarters of a million vacancies at any one time, even more people have the opportunity to change their lives for the better.”

The benefit cap incentivises work, including part-time work, as anyone eligible for Working Tax Credit (or the equivalent under Universal Credit) is exempt.

Anyone working and receiving Working Tax Credit is exempt from the cap, as are households where someone receives Disability Living Allowance (DLA), Personal Independence Payment (PIP), or the support component of Employment and Support Allowance (ESA). Those claiming Carer’s Allowance or Guardian’s Allowance are exempt from the cap.

*The Benefit Cap itself has been made harsher by the Tories since its introduction in 2013. At that time, benefits were capped at £26,000 per household – the same income as an average working family.

Since then, it has been reduced to £20,000 a year outside London and £23,000 in Greater London (reflecting higher rent costs).

So Mr Gauke’s claim that people who are out of work are faced with the same choices as those in employment is a lie; the Benefit Cap places them under financial strain in order to force them into any job they can get, no matter how low-paid.

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2 thoughts on “Benefit Cap may be poverty-trapping people into taking the lowest-paid work

  1. PJB

    Exactly what Tories want and in time no one will be in decent days work for a decent wage, they are trying to go backwards create a whole new world where people work for peanuts.
    The unions need to get strong with the Tories and when Labour get into power then they can change the law, if there’s any Police left.
    They proved they could wipe thier feet on us by that £15,000 thousand they payed MPs and probably more.

  2. Dez

    Look at the adverts for low paid staff usually notes in eateries and pubs etc where they focus trying to recruit those who are attracted to reduced hours so they can balance all their benefits to try and make ends meet. The Cons really do not get it other than to accomplish their fiddled employment numbers….ie Con merchants by name and nature.

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