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350 families have benefits cut as government’s benefit reforms bite (10 December 2013)

Date: 10/12/2013
Duncan Lewis, Legal News Solicitors, 350 families have benefits cut as government’s benefit reforms bite

Work and Pensions Secretary Iain Duncan Smith has said the government was right to cap benefits to prevent some families receiving more in benefits than the average annual wage.

The coalition government has slashed benefit entitlement as part of its cost cutting strategy to reduce the UK deficit.

Mr Duncan Smith said that 50 families in the UK receive almost £70,000 in benefits annually. The average wage in the UK is £21,555. The UK taxpayer is contributing £2 million annually to enable some families to claim £900 per week in benefits.

As part of the government’s welfare reforms, benefits have been capped to £500 per week. This is a total comprising all benefits received, such as Jobseeker’s Allowance, Housing Benefit and Child Benefit

Tenants in public housing have also had a cut in their housing benefit if they have a bedroom which is not being used. The so-called “bedroom tax” has caused a backlash among its critics, as some Local Authority or housing association tenants have had to move to smaller properties because they can no longer afford to live in their homes.

However, rather than larger properties being re-allocated, recent reports reveal that in areas like Carlisle in the north of England, three-bedroom council properties are being left empty as tenants can no longer afford them as a result of housing benefits cuts.

Mr Duncan Smith has said it is “ludicrous”, however, that some benefit claimants are receiving nearly double the income of “hard working families”.

The £500 per week cap on benefit is the equivalent of £26,000 a year – a £35,000 salary after tax and National Insurance.

The cap had affected 28,000 families in the UK by October this year – out of these, 9,000 had five children or more.

Figures from the Department for Work and Pensions (DWP) have revealed that 51 families have had their benefit cut by £400 per week, suggesting that they had been in receipt of £900 per week in benefits.

This would be the equivalent of a net salary of £46,800 annually or £68,000 gross. Around 300 more families on benefits have seen cuts to their income of between £300 and £400 a week.

The cap in benefits means that some families have been forced to move to cheaper accommodation, possibly out of the area they live in.

The government is considering making further reductions in benefits for families, limiting benefits to the first two children born to a family in the future.

“The benefit cap sets a very fair limit on what people can expect to get from the state,” said Mr Duncan Smith.

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