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9th February 2012
There has been much debate in Westminster about the Government’s Welfare Reform Bill. Most people agree that welfare savings have to be made and accept that benefit levels should reflect the need to make work pay. All parties support a cap – a limit – on the overall amount a household can get. The Government’s figure of £26K reflects average wages and is superficially attractive. The devil, however, is in the detail.
The Government has included in the savings things like help for cancer patients, support for some disabled children and child benefit which most people regard as a benefit paid to mothers for their children. It is these proposed changes which the Lords – Bishops, all parties and crossbenchers together – threw out as unfair.
There is also a question over whether average wages is the best comparison. The biggest benefit for many claimants is housing benefit and yet the money by-passes the claimant going straight to the landlord. Housing benefit already reflects local rents, varying depending where you live. Ignore the housing benefit issue and work incentives become more complex. £26K seems a lot more in some areas because average earnings in those areas are a lot lower.
The Government intends to plough on regardless even invoking financial privilege to close down further debate in the Lords. Their one size fits all cap could result in increased homelessness in areas of highest rent, particularly London, unless at the same time the Government addresses the issue of rents and housing benefit. That would create a problem for the families themselves, additional cost instead of savings for the taxpayer and homeless people being pushed to areas where accommodation is cheap or in strong supply including seaside towns.
The Government may be winning the votes but I’m not sure they are winning the argument.
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