Lowering the benefit cap to £20,000 ‘an option’
The benefit cap could be lowered even further, to £20,000 a year, Treasury sources have indicated.
The cap currently limits the amount of benefits a family can receive at £26,000, and is set lower for single people. It is set to reflect the average working household income and the DWP estimates around 40,000 households will be affected.
A senior aide to the Chancellor said: “We've had representations. We want to see how the policy beds in, but clearly over time lowering the cap is an option.”
The Government hopes the cap will save about £110m in the first year, and £300m over the next two years.
Conservative party chairman Grant Shapps told the Daily Mail that housing benefit for unemployed under-25s should be scrapped as they can continue living with their parents.
He said: “Welfare should not be a way of life. If you are a working family and you have another child, you know it's going to mean quite a severe impact on your living costs. Yet in the welfare system, it's almost turned on its head, so additional children are actually recognised, with no limit.
“A young person who's out of work is given an advantage over a young person who's in work when it comes to moving away from their parents because of housing benefit.
“So there's a bizarre incentive which means if you're not in work you can more easily move out and get your own place. That is a matter of basic fairness.”
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