JRF response to proposals to reduce the benefit cap

In response to Conservative plans to lower the benefits cap to £23,000, Helen Barnard Policy and Research Manager at JRF said:

“The evidence shows that out of 27 000 people affected so far by the Benefit Cap, only 2000 managed to get work, the vast majority just got poorer. Even where the cap does result in small numbers of people moving into work, if that work is low paid, insecure and unconnected to a ladder to better-paid work, it may not result in much improvement either in their living standards or in the cost to the country. In fact, there is evidence that pushing people into poor-quality work can reduce their chances of getting more stable, better-paid work later, meaning that they remain dependent on in-work benefits and are more likely to become unemployed again.

“Lowering the cap further will not tackle the underlying drivers of a rising benefit bill, namely: a lack of affordable housing and too many low-paid jobs. It makes a false comparison between in-work and out-of-work households, ignoring the considerable benefits received by those working on low incomes. It also ignores the differing needs of families of different sizes.

“Based on the evidence so far, if the benefit cap was lowered the majority of people affected wouldn’t get work or move house – they would just get poorer.”