A cap on the total amount of benefits that people of working age can receive has begun rolling out across the country. Couples and lone parents will now not receive more than £500 a week, while a maximum £350 will be the limit applied to single people.
The benefits cap is not due to be rolled out in Edinburgh until 15 August, but claimants should really be making preparations for the introduction NOW.
The cap is an element of the government’s radical overhaul of the benefits system, which Work and Pensions secretary Iain Duncan Smith argues is necessary as the present system is ‘unfair’. The government has set the cap at a level they say reflects the current weekly household income.
Most benefits – Jobseeker’s allowance (JSA), housing benefit and child tax credits all count towards the cap, but there is no cap for people who receive Disability Living Allowance or its successor, the Personal Independence Payment. Those eligible for Working Tax Credit are also exempt.
“The benefit cap returns fairness to the benefits systems,” Mr Duncan Smith said. “It ensures the taxpayer can have trust in the welfare system and it stops sky-high claims that make it impossible for people to move into work.
“The limit of £500 a week ensures no-one claims more in benefits than the average household and there is a clear reason for people to get a job – as those eligible for Working Tax Credit are exempt.”
The DWP says about £90bn was paid out in benefit payments to people of working age and their families in 2009-10, and it expects the cap to save about £110m a year.
Shelter Scotland has issued the following advice:
‘If the benefit cap will affect you it’s a good idea to:
- reduce your spending and focus on rent payments
- make up any shortfall between your housing benefit and your rent by using other income.
If you still can’t afford your current home then you may have to consider moving somewhere cheaper. If you’ve received a letter from the DWP warning you that your benefits may be reduced, or you’re worried that you’ll be affected by the cap, talk to a money adviser who’ll be able to help draw up a budget.
It’s important to prepare for this as early as possible to avoid falling behind with your rent and being evicted. If you’re worried that you’ll be threatened with homelessness because of the benefit cap speak to an adviser in your area.’
The benefit cap will be implemented across the country by 30 September.
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