Poverty Alliance hits back at government benefits cap report


The Poverty Alliance has hit back at claims that the UK benefits cap is helping people get back into work.

Director of the Poverty Alliance in Scotland, Peter Kelly, spoke out after the Department of Work and Pensions released a series of reports analysing the progress of the benefits cap after one year of implementation.

Moving from unemployment into work was the main focus of the reports, with the key claim that households subjected to the cap “were 4.7 percentage points (41 per cent) more likely to enter employment compared to similar uncapped households.”

However, experts have challenged this central claim, commenting that it only emphasises the nominal movement into work and not the alleviation of poverty itself, with the majority of affected households unable to find work despite attempts.

Kelly told CommonSpace: “This research does not justify the imposition of the benefit cap on families,” he said. “The fact that savings from this move total around PS100m, around PS10m more than MPs expenses in 2012-13, suggests that this high profile policy was more about anti-welfare rhetoric, than finding real solutions to the problems in our benefits system.”

The reports found that around four in five of those affected in February were still affected by the cap in the second survey. Of the 22 per cent no longer affected, only half (11 per cent) were now exempt because of movement into work, while the other half had moved to another exempting benefit.

The reports stated that movement into work is “defined as a household having an open working tax credit claim”, which emphasises only the definition of employment and not the poverty alleviated.

According to the Institute for Fiscal Studies, total expenditure on welfare for 2014 was around PS168bn, putting the total of PS100m saved by the benefits cap at around 0.06 per cent.

Kelly continued: “We also need to be concerned that the majority of people in these studies, around 60 per cent, had not moved into employment and so had endured a cut in their income that did not result in finding employment. We believe that better support and more quality jobs would help people, not cuts to their benefits.”

While around half of claimants were interested in finding work, only two in five were successful (11 per cent), and only four per cent of claimants found full-time work. Around two out of five of those surveyed were in rent arrears, and one in two said they regularly run out of money before the end of the week. Most participants cited finding affordable childcare as a major barrier in finding work, with four in five claimants in the study being women.

SNP work and pensions spokesperson Dr Eilidh Whiteford MP said: “What we need is a welfare system that supports people back into work rather than punishing them, and a government which is committed to investing in the economy and creating jobs rather than one fully committed to austerity at all costs.

“That is exactly why these powers should be held in Scotland’s hands – rather than in the hands of George Osborne and the Westminster establishment.”

The reports came from a two wave telephone survey carried out in February 2014 (1,200 claimants) and August/September 2014 (468 claimants). The report’s purpose was to assess the success of the benefit cap in achieving it’s goals of increasing movement into employment, adding fairness to the welfare system, and saving money.