Welfare budget under spotlight today

The welfare budget is set to come under further assault today as chancellor George Osborne delivers his Autumn Statement.

As part of the statement, the Government is expected to provide an update on its economic plans based on the latest forecasts from the Office for Budget Responsibility.

Amongst the key points expected to be announced are plans to deliver a further £10bn of savings in welfare expenditure over the next four years and cuts in departmental spending to fund new infrastructure projects like schools and roads.

Working-age benefits are expected to be cut in real terms – breaking a traditional link with inflation. Other plans floated include withholding housing benefit from the under-25s and restricting child-related benefits for families with more than two children. However, both of these ideas have been opposed by the Liberal Democrats.

Ahead of his speech, the Child Poverty Action Group (CPAG) said it was looking for targeted help for families with children struggling to make ends meet as living costs rise.

Alison Garnham, chief executive of CPAG, said: “Ministers talk about helping the 'strivers', but the truth is that the 'strivers' keep being short-changed. The lowest paid families - often people working long hours with little pay - have been near the front of the queue for cuts as billions in tax credits that protect the low paid have been taken away from family budgets.

“These families are doing their best, are working hard but are finding that the government is making it harder for them to make ends meet.

“It is a matter of great concern that spending decisions keep on asking the poorest families to make more sacrifices when growth targets are missed, rather than those with broader shoulders.

“The Beveridge vision was that we could build our way to a new and prosperous society after the war, and it succeeded. We need the same sense of purpose today, to build and invest in the jobs, housing and childcare that will stimulate the economy and meet the needs of ordinary families.”

On the expectation that details of payment rates, taper rates and disregards for the new Universal Credit will be announced as part of the Autumn Statement, she said the new benefits system will only work if the incentives are right.

She said: "We have already seen the amount of earnings that Universal Credit claimants can keep cut back from original plans. We need to see Universal Credit rates that ensure strong work incentives with adequate support for childcare and a disregard for second earners, or the system will prove to be a multi-billion pound dud.”

Darren Johnson, London Assembly Green Party member, says a complete change of direction is needed to see rents and house prices stabilise in London. He’s urged the Mayor to lobby for radical changes to the Government’s budget in advance of the chancellor’s statement.

He said: “The Mayor must drop his support for huge cuts to the affordable housing budget, and for the welfare cuts that are driving up homelessness and poverty. We need a statement from the Chancellor that puts billions into genuinely affordable housing instead of cutting the budget. We need to reduce the benefit bill by cutting rents instead of cutting help to hard-pressed people.”

“There are many small measures the Government could take, such as freeing councils to borrow and build more homes. But a complete change of direction is needed if we want to see rents and house prices stabilise in London.”