‘Heartless move’

The introduction of a “heartless” new benefit cap that will leave some families more than £100 a week worse off has been slammed as “cruel” and “hypocritical”.

The cap, announced by George Osbourne last year and brought into force today (November 7), means that the annual welfare payment limit for unemployed households has now dropped from ÂŁ26,000 to ÂŁ23,000 in London and ÂŁ20,000 in the rest of the UK.

The move, which will impact poor children the hardest, has been condemned by politicians, charities and trade unions. Unite said the attack “will make a dire situation worse” for 112,000 struggling families with a total of 320,000 children and will lead to an increase in poverty and homelessness.

The current ÂŁ26,000 cap, set in 2013, effects around 20,000 families. However, that figure is set to more than triple to 64,000 under the new ÂŁ20,000 limit. It is estimated that nearly two thirds of those effected will be single mothers.

For childless households the annual limit is ÂŁ15,410 in London and ÂŁ13,400 throughout the rest of the UK.

“Despite Theresa May’s warm words on the steps of No 10, when she said she wanted to help families who are ‘just managing’, she is allowing the reduction of the so-called ‘benefit cap’ to go ahead,” said shadow work and pensions secretary Debbie Abrahams.

“Charities are warning of an escalation of homelessness which currently includes over 100,000 children living in temporary accommodation,” she added. “Widows and widowers, veterans and disabled people up and down the country will lose up to ÂŁ100 per week.”

The Department of Work and Pensions pointed to statistics that show 23,000 households who had their benefits capped in 2013 have found work. The claim was contradicted by Institute for Fiscal Studies (IFS) analysis which suggested that “the majority of those affected will not respond” to the new limit by finding work.

The IFS report said, “For that majority it is an open question how they will adjust to the loss of income.”

‘Different agenda’

Head of Unite Community Liane Groves said, “In her first speech as Prime Minister, Theresa May told the nation she wanted to fight injustice and make Britain a country where everyone, regardless of their background, would be a given a fair chance.

“Doubtless she would say this is still her aim, but her decision to lower the benefit cap for tens of thousands of struggling families, including 40,000 single mums, reveals a different agenda.

“It’s a heartless move that will push more and more into poverty, homelessness and debt – making an already dire situation worse,” she added.

“Theresa May is punishing the people she so recently vowed to standup for and hobbling the life chances of countless children across the nation. Her actions are hypocritical, cruel and unjust.”

The cap came as the Resolution Foundation warned that incomes for the poorest half of households risked stagnation or reduction over the course of the present parliament.

The foundation called on Chancellor Philip Hammond to scrap “damaging cuts” to in-work welfare, in the face of inflation and low wage growth that could reduce average earnings by £1000 a year by 2020.