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More than four in five households hit by the benefit cap are unable to take on work to escape it, a cross-party group of MPs has said.
A report published today by the Work and Pensions Select Committee found that only 18% of those affected by the policy have been assessed by the Department for Work and Pensions (DWP) as capable and expected to look for work.
It called for the cap to only apply to people in this category – that is, people claiming Jobseeker’s Allowance or work-related Universal Credit elements – and be scrapped for homeless households in temporary accommodation.
Frank Field, who chairs the committee, said it “would be difficult to think of a more cruel cut”.
“A policy aimed at people who could work but were choosing not to is now being applied to single mothers with newborn babies and people with serious health conditions,” the report said.
The benefit cap, introduced through Housing Benefit in 2013, restricts the amount a household can receive to £23,000 a year in London and £20,000 in the rest of the UK.
Today’s report accused the DWP of “over-claiming” the impact the benefit cap has on encouraging people into work and said that the government’s own figures indicate that just 4.7% of capped households affected will move into work because of it.
Official statistics show that 205,000 households have had their benefits capped since the policy was introduced, with 53,800 since moving into work.
The committee also warned that the cap “can cut far deeper into the entirety of a household’s income” under the new Universal Credit system because all benefit types can be limited.
And it said the benefit cap savings of £190m a year represent just 0.1% of the total welfare bill – with even this figure likely to be an overestimate.
Heidi Allen, a committee member who was a Conservative MP until she quit the party to join The Independent Group last month, said: “All government policy must be based on evidence, yet there is scarce evidence to suggest the cap is moving people into work – not least because 82% of those affected by the cap are not in any case expected to work because of health or caring responsibilities.
“This cap and the benefits freeze are outdated policies, not taking into account the increased cost of living since their inception.
“Bluntly, the government doesn’t have the objective or moral grounds on which to maintain its position.”
The DWP has been contacted for comment.