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Housing benefit cap is right and fair

October 2012

Sir William Beveridge

Sir William Beveridge

Priti Patel
Conservative MP for Witham


The Department for Work and Pensions recently published shocking data showing that more than 1,380 people claimed over £30,000 each per year in housing benefit, 360 received over £40,000 and 110 people were given over £50,000.

Under Labour, households could receive up to £104,000 per year in housing benefit, enabling them to live in expensive areas far beyond the means of most people who work. It is wrong that taxpayers continue to subsidise expensive properties for those on housing benefit, which is why I welcome the Government’s commitment to make work pay and to cap the amount of any household on out-of-work benefits at £26,000 per year.

Seventy years ago, when Sir William Beveridge introduced our welfare system, he set out to slay the ‘five giants’ of: Want, Disease, Ignorance, Squalor and Idleness. However, what we have seen over the past decade is a distortion of this, with the benefits system creating an endemic welfare dependency and in some quarters a lifestyle choice, as opposed to the safety net that had originally been intended.

In 2010, the then new government was confronted with a welfare challenge of five million people, 12 percent of the working age population, on out-of-work benefits. One million people had been on benefits for a decade or more and one in every five UK households were workless, resulting in almost two million children growing up in workless families. Under Labour, housing benefit soared and the rents for those on housing benefit rose by far more than market rents. As a result, the Labour government ended up spending £192 billion a year of taxpayers’ money on welfare payments – more than the combined spending on defence, education and health.

Such entrenched worklessness and welfare dependency has led to a determination in government to review the welfare system so that it is seen as a means of temporary support and the beginning of a journey back from dependence to independence, thus ending the ‘something for nothing’ culture. This Government’s reforms will restore fairness to a housing benefit system which spiralled out of control, with many people trapped on welfare living in million pound houses that hard-working families could only dream of. Capping housing benefit and reforming the benefits system is the right and fair thing to do. These measures, alongside the Work Programme and Universal Credit, will help to ensure that our welfare system is once again a genuine safety net for those facing real hardship.