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UK Benefit Cap Implementation

Outline: Benefit Cap will see benefits capped at average earned income after tax and National Insurance for working households of £500 a week for couple and single parent households.

Main Digest

The Department for Work and Pensions today confirmed the four London local authorities where the Benefit Cap roll out will start in April. It will be introduced in Bromley, Croydon, Enfield and Haringey and rolled out across the country throughout the summer. The cap will be in place across the whole country by summer 2013.

The Benefit Cap will see the amount people can receive in benefits capped at the average earned income after tax and National Insurance for working households of £500 a week for couple and single parent households - the equivalent of £26,000 per year.

It will apply to the combined income from JSA, Income Support, Employment and Support Allowance, Child Benefit, Child Tax Credits and other benefits.

Certain households including those with someone in receipt of Disability Living Allowance or the Support Component of ESA and war widows and widowers will be exempt. To increase the incentive for people on out-of-work benefits to find work, households with a member who is entitled to Working Tax Credit will also be exempt from the benefit cap

The Department for Work and Pension's has allocated £100 million in Discretionary Housing Payments to help support vulnerable people affected by this change.

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