So, cutting child benefit for the rich was just to provide cover. The real meat of Osborne’s speech was the announcement to place a cap on benefits for families of £500 per week. Based on all the figures being bandied about today, this means rich families are facing a 4% loss in weekly income, while poor families will lose 16% of theirs.
But this announcement amounts to specious scaremongering of the worst kind. It is populist politics without substance that will send many families- some of them the most vulnerable and most marginalised in our society – into a tailspin.
First, the figures on which the Conservatives have based their policy are an empty vessel. According to the Daily Telegraph (you have no idea how much it hurt to provide a link) 100,000 families in the UK earn more in benefits than they would do if they worked. The figures are based on the Family Resource Survey but the figures being used are well out of date, from 2008-09 to be exact. Moreover, this is a survey, a snapshot taken of a number of families around the country. The results are then hypothecated and are not actual. Also, the methodology is suspect. I know, for I took part in last year’s survey. A researcher comes in and asks you a series of questions. If you can find the paperwork, you give the actual amounts of benefits and tax credits you receive. If you can’t, you guess. How many people know off the top of their head how much they receive in tax credits on a weekly basis? Exactly.
So the burd decided to work it out for herself. Using the DWP tabulation tool to create my own statistics, as the website helpfully says. These are based on actual benefit figures and are not hypothecated. They are the most accurate statistics government provides. Three scenarios for you:
(A number of caveats: the scenarios are based on the last available statistics from February 2010 as the ConDem government has discontinued the tool; they are based on old benefits not the new employment and support allowance; they do not include tax credits income as only people with Phds in applied statistics could work this out; some of the benefits like income support, housing and council tax benefit are income related and the amounts received are affected by the value of other benefits – my calculations may in fact be overly generous)
Scenario one – a family, 2 parents, 1 disabled and not in work, 1 a full time carer, both aged 35 – 44, with 2 dependent children both of primary school age, living in rented accommodation. By my reckoning, their income might be made up of a combination of these average weekly amounts of benefit:
Disability Living Allowance £66.20 (both types at higher level awarded); Carers Allowance £55.15; Incapacity Benefit £51.33; Income Support £99.59; Housing Benefit £108.66; Council Tax Benefit £19.63; Child Benefit £33.70
Weekly total = £434.26, annual total = £22,582
Scenario two – a family of 2 parents, both aged 32, with 2 children, 1 of whom is severely disabled, neither parent works though one is actively seeking employment, the disabled child is under 5, the other child is at primary school and they live in rented accommodation. Their income might be made up of a combination of these average weekly amounts of benefit:
Disability Living Allowance £71.76; Carers Allowance £54.72; Job Seekers Allowance £82.08; Income Support £96.67; Housing Benefit £98.86; Council Tax Benefit £18.17; Child Benefit £33.70
Weekly total = £455.96, annual total = £23,710
Scenario three – 1 adult aged 23, not in work, with 2 children, 1 under 5 and 1 at primary school, living in rented accommodation. This family’s income might be made up of a combination of these average weekly amounts of benefit:
Job Seeker’s Allowance £84.26; Income Support £65.69; Housing Benefit £103.09; Council Tax Benefit £14.57; Child Benefit £33.70
Weekly total = £301.31, annual total = £15,668.12
There are probably lots of flaws in my scenario packages but they are a darn sight closer to the truth of the situation than the Conservatives’ version. Scenario 2 has been included simply to show that in any numbers, the only families likely to be above the cap are those with a disabled child. Yet the Conservatives have promised not to include them in the measure. So who will it impact on?
Some households with a disabled adult might be included if they are receiving either Incapacity Benefit or the new Employment Support Allowance. Otherwise, we are looking at a very small number of families living in areas of high housing costs, as Jason Beattie highlights. Or with a high number of children. It will certainly be nothing like the 100,000 families headlined in the Telegraph.
Which begs the question, what is the point of such a big conference announcement? Specious scaremongering indeed.