Mr Osborne speaking at the Conservative Party Conference in Birmingham yesterday announced that they have set a cap on how much they feel a family should receive in benefits. The cap, which will affect around 50,000 workless families, will be set at £500 per week, £26,000 per year tax free, which is actually the equivalent to someone working for £30,000 per year before tax, which exceeds the average wage limit of £26,000 calculated by the present government.
The treasury estimates that families will lose an average of £93 a week.
Mr Osborne told the conference that the government now spends more on housing benefit than it does on policing. He said: ‘If this welfare state is going to gain the trust of the British people, it needs to reflect the British sense of fair play.
‘No more open-ended cheque book. A maximum limit on benefits for those out of work. set at the level that the average working family earns. Money to families who need it – but not more money than families who go out to work.’
Tenants on benefits in expensive areas of London might find that they are forced out into the suburbs, for example if you rent a four bedroom home your benefits will be capped at £400 per week, £1,600 per month, not enough to cover the average four bed rental home in the City.
With a shortage of rental property in certain areas of the UK it’s difficult to predict what, if any effect this will have on the rental market. But according to Shelter it will definitely have a negative effect on the most vulnerable in our society.
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