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Welfare Benefits Up-rating Bill 2012-13

Royal Assent

(This Bill is from a previous session)

Summary

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Summary

A Bill to make provision relating to the up-rating of certain social security benefits and tax credits.

The Bill will introduce a cap on increases to the benefit increase rate at one percent over the duration of three years.  

In the Autumn Statement, it was announced that certain working-age social security benefits and payments, and certain elements of tax credits, would be up-rated by 1 per cent, rather than prices (as measured by the Consumer Prices Index ('CPI'), 2.2 per cent), for the tax year 2013-14.

The working-age social security benefits and payments affected are:

  • The main rates of Income Support, Jobseeker's Allowance, Employment and Support Allowance and Housing Benefit; and the work-related activity group component of Employment and Support Allowance¬†
  • Maternity Allowance; and Statutory Adoption, Maternity, Paternity and Sick Pay.
  • The Bill will not make changes to some benefits such as attendance allowance, disability living allowance or the support component of employment and support allowance, all of which will continue to be up-rated in line with price inflation.

Labour has said that they will oppose the Bill on the basis that the benefit cap does not increase in line with inflation. The Opposition has cited IFS research suggesting that the change to tax credits will hit families in work, with shadow work and pensions secretary Liam Byrne calling it the "Strivers' Tax Bill".

The Child Poverty Action Group has criticised a cap on benefit increases and described the measures as a "poverty-producing Bill".