Benefits cap hits capital jobless

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The government's carrot and stick approach to encouraging the unemployed into work would appear to be all stick and no carrot. The effects of the benefits cap are beginning to be felt across the UK as claimants find their income affected.

The measures, which the government insists have broad popular support, place limits on the total benefits available to claimants, with couples able to claim no more than £500 in total per week and single people limited to £350. The figures might seem generous, although these include housing benefit and child benefit, so claimants living in areas with high rents face serious consequences.

The government claims the new rules have had an immediate impact, pushing 12,000 people into jobs. Iain Duncan Smith, the Work and Pensions Secretary claimed that his measures have the unemployed running scared, or words to that effect. "What the job centre staff have told us is that they've seen a genuine increase since they've alerted people that they're likely to be in the cap," he said. "We will always be there to support those who need help but the days of blank cheque benefits are over."

The problem is that the caps will have a different effect across the UK. "In many parts of the country, families won't be able to pay high private rents because of the cap," Ruth Davison of the National Housing Federation pointed out. "There will be more demand for than ever for affordable housing, particularly in Greater London where nearly half of the people affected by the benefit cap live."

It seems that one, possibly intended, consequence of the cap will be to force the poor out of the capital. It is a notion that has already occurred to some boroughs that have attempted to shift housing benefits claimants out to less expensive areas, such as Merseyside. This controversial "social cleansing" may become much more prevalent in the capital in the future, even if Boris Johnson has a stern word with his Tory colleague IDS.

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