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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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Gotheteeshirt   16/07/2013 at 16:03

In the 70s after the disastrous break-up of my marriage I turned to gambling and drinking and lost my job. Starting a new relationship and having a child we were given a social house. I rented an allotment and spent hours growing food. A used freezer at £15 stored the surplus. We had a second child. The children had the best education in the world. Two parents who loved them talked and read books, showed by example that if you sowed and cared you ate. The level of benefit in real terms I estimate at about a third of today's. Money was extremely tight. We each kept £2 per week for spends and that included clothes. They were and are today the happiest of our lives. Expectations were zero. Families disowned us. We brewed the surplus produce and still have a precious bottle stored as an heirloom. I said that if it were guaranteed that the money would come forever, I would never work again. I did not keep the promise. After 6 years I sought work. My partner was heartbroken at the thought of our Shangri La ending. I started work but when genuinely ill after a short time suffered the torment of having the support pulled from under me. Eventually all is well. Work and a pension and two sons in good jobs made things right. But if the support had been two or three pounds more and the Dole had not pushed and prodded or if I had had a thicker skin, I would still be digging my allotment.

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