Cost of Living Means-tested Benefit Claimants 2023-09-04
2023-09-04
TAGS
Response quality
Questions & Answers
Q1
Partial Answer
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Context
The MP notes that while the government provides significant cost of living support to households on means-tested benefits, these benefits can be completely lost if a claimant earns £1 more. This creates a disincentive for people to take on extra work.
What steps his Department is taking to help claimants in receipt of means-tested benefits with increases in the cost of living. If someone is on one of those means-tested benefits and they earn £1 more, they have the potential to lose the full payment. I wonder if the Minister has noticed any change in people's behaviour as a result of that disincentive to take on extra work.
It is vital that those on low incomes, or indeed those who are keen to work more, see the incentives. In the spring Budget, we announced an ambitious package of measures to support people to take up work and, importantly, to progress by making sure that they are always better off. We are also supporting them with a significant investment in childcare and, of course, the largest ever cash increase to the national living wage, taking it up to £10.42. I would say to those people that they should look at the benefits calculator on gov.uk, because they will always be better off in work.
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Assessment & feedback
No data or observations about changes in behavior due to the disincentive were provided.
Looking At The Incentives For People
Announced Measures To Support Taking Up Work
Response accuracy
Q2
Partial Answer
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Context
The MP notes the generous cost of living support provided to households on means-tested benefits but highlights that earning an additional £1 can result in a complete loss of payment, creating a disincentive for extra work.
The Government are indeed giving generous cost of living support to households on certain means-tested benefits this winter. If someone is on one of those means-tested benefits and they earn £1 more, they have the potential to lose the full payment. I wonder if the Minister has noticed any change in people's behaviour as a result of that disincentive to take on extra work.
It is vital that those on low incomes, or indeed those who are keen to work more, see the incentives. In the spring Budget, we announced an ambitious package of measures to support people to take up work and, importantly, to progress by making sure that they are always better off. We are also supporting them with a significant investment in childcare and, of course, the largest ever cash increase to the national living wage, taking it up to £10.42. I would say to those people that they should look at the benefits calculator on gov.uk, because they will always be better off in work.
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Assessment & feedback
No data or observations about changes in behavior due to the disincentive were provided.
Looking At The Incentives For People
Announced Measures To Support Taking Up Work
Response accuracy
Q3
Partial Answer
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Context
The MP notes that rents have risen sharply over the past couple of years, while local housing allowance for people claiming means-tested benefits to pay their rent has been completely frozen since 2020. The Member wrote to the Secretary of State about this issue.
Rents have risen very sharply over the past couple of years, but the support for people claiming means-tested benefits to pay their rent, determined by local housing allowance, has not changed at all since 2020—it has been completely frozen. I wrote to the Secretary of State about this over the summer. Is the Minister able to give the House any assurance that the forthcoming benefit uprating statement will include a realistic increase in local housing allowance?
I know that the right hon. Gentleman is very interested in this subject, as am I. Again, there is help for households, with the local housing allowance rate being set at the 30th percentile in 2020. The Government are projected to spend around £31 billion, or around 1.2% of GDP, on support for renters in 2023-24. It is absolutely right that we support people to be better off. The LHA is not intended to cover all rents in all areas, but I take a close interest in this subject.
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Assessment & feedback
No assurance was given about an increase in local housing allowance for the upcoming statement.
Noting That She Takes A Close Interest In The Issue
Mentioning Projected Spending On Support
Response accuracy