On this page you will find an overview of the changes relating to the Benefits Cap.
The Government introduced a Cap in 2013 in Nottingham, on the total amount of benefit that working age people can receive. This meant that a workless household no longer receive more in benefits than the average earnings of working households. The benefits cap ensures that a couple will receives no more than £26,000 (£500 per week) in benefits, and a single person no more than £18,200 (£350 per week). The Cap is applied by Local Authorities through reduced Housing Benefit payments.
The Government has proposed reducing the cap to £20,000 per year for couples and £13,400 for single people. This breaks the link between the Cap and average earnings. The change is expected during 2016 but a timescale for the change to be rolled out has not yet been announced. The Cap will still be administered though reduced Housing Benefit payments except for Universal Credit claimants who will see their total payment reduced to the level of the Cap.
What does this mean for people in Nottingham
The Government will add up how much money the person gets from a range of benefits including: Housing Benefit, Jobseeker's Allowance, Employment Support Allowance, Universal Credit, Child Benefit, Child Tax Credit and Carer's Allowance.
If the total comes to more than the maximum amount allowed the person's Housing Benefit payments will be reduced. If claimants receive Universal Credit, the Cap will be applied to their Universal Credit payment.
The cap won't apply to households where a partner or any dependant child qualifies for Working Tax Credit or receive any of the following:
- Disability Living Allowance
- Personal Independence Payment
- Attendance Allowance
- Industrial Injuries Benefits
- Employment Support Allowance, if paid with the support component
- Armed Forces Compensation Scheme payments
- War Pension Scheme payments (including War Widows/ Widower's Pension and War Disablement Pension)
What is being done in the lead up to this Change
The new changes to the Cap are still to be confirmed in Parliament. Once they are confirmed, the Department for Work and Pensions will inform the households which will be affected by the Cap. Nottingham City Council will check the information from the DWP and contact each household with details of how they will be affected.
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