Welfare cap – government in retreat

On 4 October 2010 George Osbourne – in a keynote speech to the Birmingham Tory Conference – promised to introduce a welfare benefits cap.

“So, for the first time a cap on benefits. No family on out of work benefits will get more than the average family gets by going out to work.”


He didn’t cite a figure, but news sources pitched it the cap at either £20,000 or £26,000.

Note that’s not a cap just on Housing Benefit (HB), it’s a cap on a family’s total welfare benefits take.

In his budget speech later the same month Osbourne made the first move to introduce the cap, focusing just on HB. The plan was a £20,000 cap on HB to start April 2011 for new and existing claims.

Even this initial phase of capping welfare benefits has now had to be put back to January 2012 for existing claims. It looks almost impossible to me to add all the other welfare benefits into the cap.

My prediction is we will hear no more about a total cap on welfare benefits, the idea will stop with HB – and even then will be further watered down to allow ‘exceptional’ cases.

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