Category Archives: Benefit cap

The Benefit Cap reduction … its here.

benefit-cap

A quick reminder on the benefit cap and start dates.
The benefit cap is the maximum amount of benefit you can receive in a year previously set at £26,000 per year, it’s now being  reduced to £23,000 for claimants in London and £20,000 for claimants outside London. (Different rates apply for single people and there are various exemptions and qualifications to this – please see gov.uk).  If you receive benefits above the cap level, you will have a cut applied to your Housing Benefit. You will then be responsible to make up the resulting shortfall in your rent from your other benefit income. etc.
You might have seen media reports about the reduction in the benefit cap this week, saying that it came into effect from yesterday.
This is correct for claimants who have already been affected by the existing £26,000 cap. We have 122 of these cases in Sandwell.  Their Housing Benefit has gone down with effect from yesterday (7th November) They could potentially lose all of their remaining Housing Benefit except for a small token payment of 50 pence per week.
However, the government is only applying the cap to all other cases (those who are being capped for the first time) on a rolling schedule, with each local authority area seeing the full cap come in on different dates. In Sandwell, the full cap will only apply from 16th January 2017.
All claimants who will be affected though, have already been informed by the Department of Work and Pensions. If you are a private landlord and your tenant needs advice or support about how they can manage once they have been capped, they should contact the council’s Welfare Rights team on welfarerights_team@sandwell.gov.uk or call 0121 569 3158.
Oliver

Advertisements

Tenant’s can now check online if they are affected by the new reduced benefit cap

Gov.uk

There is an official ‘calculator’ you can find online on gov.uk which will tell a tenant whether they are likely to lose any Housing Benefit due to the reduction in the benefit cap (see my earlier post this week). They have had a calculator on the site since 2013, but it has been set at the old cap level of £26,000. Its now been re-set so that you can do either a calculation based on the old figure – or one based on the new figures (£23,000 for Greater London or £20,000 in the rest of the country) which will come into effect from this autumn.

If you don’t already use gov.uk it’s the main UK Government website, which means any information on there is ‘official’ and can be trusted. You can find the calculator here.

Oliver

 

Benefit cap update … we now have some numbers

The Benefit cap is a government measure which restricts the total amount of welfare benefits you can receive in a year. This is currently set at £26,000 but from this autumn it will be reduced to £23,000 for people in London and £20,000 for people outside London. The cap is applied by making a deduction (either part or full) from your Housing Benefit. Anyone affected way is then responsible to pay any shortfall that arises in their rent from their other benefit income. We now have the long awaited figures from the Department of Work and Pensions (DWP) showing the number of Sandwell households who will be affected by the reduction.

It’s important to stress that these numbers only show the number of households who would be affected if the new cap was to be applied immediately. However, it won’t actually be implemented until the autumn of this year, (we don’t yet have a firm date) and the DWP will be working hard with those affected to encourage them back into employment so that they are no longer affected.

The numbers are actually lower than many people expected. In total, there will be 941 households. This breaks down by tenancy type as follows:

• Council tenants – 402

• Housing Association tenants – 159

• non-standard tenancies for homelessness etc – 15

• Private tenants – 365

A number of these cases (126) are households who have already been affected by the existing benefit cap, so that their benefits have been reduced to the £26,000 limit already in place, but will now face a further reduction to bring them down to £20,000.

When set against our current total caseload – the figures show that relatively, only a small number of people in Sandwell will be affected. In simple terms, it will mainly be larger families in larger accommodation and there will be no impact on most of our benefit claimants. The DWP have produced a benefit cap calculator which lets you work out whether the cap applies to you, but unfortunately, this is still set on the old £26,000 so wont help you work out if you will be affected by the new figure. As soon as we know that the calculator has been updated, we will do another blog post to let you know. In the meantime – you can find more information about the cap, such as what benefits are included in calculating your income and who might qualify for an exemption on gov.uk

Oliver

 

 

 

Landlords and the Benefit Cap

£5 Note (2)

We don’t know exactly when it’s coming to Sandwell, but the government’s proposed legislation to cut the maximum in benefits most people can receive from £26,000 a year to £20,000 (£23,000 in London) had its second reading in parliament this week.

Landlords should be aware that although it’s some way off, it is coming and it is applied by making a deduction from the tenant’s Housing Benefit. Meaning the tenant has to make up any shortfall in rent from their other benefit income. Landlords should be starting to think about whether it will affect how they collect their rents, especially once Universal Credit kicks in.

We can’t yet say how many or which Sandwell households will come in above the new cap. (It certainly won’t be everyone). There is an online calculator on gov.uk which lets someone work out if they would be affected by the current cap, but as this is still set on the £26,000 rate, it wont yet help with the new figure. One very crude rule is that the more children you have, the more likely you are to be affected and the greater the amount of your deduction, as you probably receive more tax credits and have higher Housing Benefit due to larger accommodation.

The current rules are on gov.uk including which benefits are used to work out the cap or are disregard and who is excluded. This can give people at least some idea of what the change might mean for them, even if only on the basis of a rough estimate, rather than a detailed assessment.

As soon as we can though, we’ll post more information on the blog.

Oliver