Benefit Cap set to affect Housing Benefit claimants

What is the Benefit Cap?

The Government’s Welfare Reform programme includes an element called the Benefit Cap, which will limit the total amount you can receive in benefits. The overall aim is to encourage people back into work, and cut the benefits bill at the same time.

When does it come into force?

That depends on where you live. It’s being introduced in 4 London Boroughs (Bromley, Croydon, Enfield and Haringey) this April (2013) and will be rolled out to the rest of the country by the autumn.

How will it affect me?

If you receive benefits including Jobseeker’s allowance, Child Benefit, Income Support or Housing Benefit, the total amount you can receive each week will be limited (or capped). If you’re affected, you’re likely to have received a letter from the Department of Work and Pensions (DWP) already.

If you’re a single adult, your total benefits will be capped at a maximum of £350 a week. If you’re a single parent (with children living with you) or a couple, the maximum weekly limit is £500. This means that your Housing Benefit could be cut to make sure your total benefits don’t send you over this limit, and you’ll be expected to make up any shortfall in the rent yourself. The measure is expected to hit people living in areas of high rent (such as London and the South East) particularly hard.

What exemptions are there?

You won’t be affected if you qualify for Working Tax Credit, Disability Living Allowance or have reached pension age. You’ll also get 9 month’s grace if you’ve just lost your job through no fault of your own.

How can I avoid the cap?

By qualifying for Working Tax Credit you can avoid the cap altogether. To do this, you’ll need to work a minimum of 16 hours a week if you’re a lone parent, 24 for couples (with at least one person working 16 hours) and 30 hours a week for single people over the age of 25.

What happens if I can’t pay my rent?

If you find yourself affected by the cap and unable to pay your rent in full, talk to your landlord straight away. Reasonable landlords with good, long term tenants may prefer to lower the rent a little, to avoid having to find new tenants. You might be able to come to a suitable arrangement between yourselves.

In exceptional circumstances, your local council might be able to help you with a discretionary housing payment, but this will usually only cover a short period. Another alternative is to move to a cheaper home in order to reduce your costs.

Talk to your personal advisor at the Job Centre Plus for further advice, or consult a Shelter advisor on their free helpline – 0808 800 4444

Paying your rent should be your top priority. If you fall into arrears, you could face eviction and, potentially, homelessness.