Monday, 13 June 2011

Benefits cap plan to be relaxed, says minister

Scheme to prevent benefit claimants getting more than £26,000 will be waived for 'exceptional circumstances'

A benefit cap of £26,000 is to be relaxed in "exceptional circumstances" – such as for large families, the welfare reform minister Lord Freud said. In what will be seen as a concession to the Liberal Democrats, Freud said that changes would be introduced later in the year ahead of the introduction of the cap in 2013.

The cap is designed to ensure no family receives in benefits more than the average net income of a working household. "We're looking at exceptional circumstances which some people may find themselves in and we're going to be putting out arrangements for that later in the year," he told the Politics Show on BBC1. Asked what form the changes would take, Freud said: "Wherever we think that there's something happening that is undesirable and we're looking very carefully at how to draw up those protections."

George Osborne announced the £26,000 cap in his speech to the Tory conference last year in which he unveiled other welfare reforms, including the removal of child benefit from higher rate taxpayers. The chancellor said: "So, for the first time a cap on benefits. No family on out of work benefits will get more than the average family gets by going out to work."

Osborne said that benefits of workless families would be capped at £500 per week – £26,000 a year – which is the median net income of a working household. The cap will be applied in part by reducing housing benefit, affecting about about 50,000 families.

Freud said there were already exemptions. "We have got quite a lot of protections in this cap. Firstly of course, if you are in work, you are not affected. Secondly if you're a disabled person or there's a disabled person in the household, you're not affected. If you're a war widow or a widower, you're not affected." If you’re a Tory you’re not affected.

The Guardian