MPs reverse Lords welfare defeats

Commons chamber and Lords chamber Ministers say the proposals are backed by the public

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MPs have overturned a series of defeats inflicted on the government's welfare reform bill in the House of Lords.

The coalition won seven key votes in the Commons, rejecting amendments made by peers and reinstating their original proposals into the legislation.

These include plans for a £26,000 annual limit on total household benefits, including child benefit.

Ministers say they will use a rule known as "financial privilege" to ensure Parliament approves the cap.

A special committee of MPs from all parties approved the move on Wednesday.

This will mean the Lords cannot send the same amendments back to the Commons when they re-consider the bill for a final time, preventing what is known as "ping pong" between the two chambers and effectively ending parliamentary opposition.

The measure, which the government says it will also apply to Lords amendments on employment and support allowance (ESA), relates to the principle that the Lords cannot oppose tax and spending decisions agreed by the Commons.

During nearly seven hours of debate in the Commons, the government won a series of votes on controversial aspects of the bill with large majorities.

They voted by 334 to 251 to overturn the Lords amendment - tabled by a group of bishops - which would exclude child benefit from counting towards the £26,000-a-year cap on benefits to working-age households.

The cap is set at the equivalent to the average post-tax salary of a working household.

Labour say they support the cap in principle but argue that rather than one national cap - there should be local caps, set by an independent commission.

'Transitional arrangements'

In the Commons, Work and Pensions Minister Chris Grayling said that idea was "ill-thought out" and "would be more credible if it was not being made at the very last minute".

He said there were already exemptions to the cap - such as families in receipt of Disability Living Allowance (DLA) and Working Tax Credit - and outlined "transitional arrangements" to minimise the impact.

David Cameron taunted the Labour front bench and called for a reaction on welfare reforms

People who had been in work for the previous 12 months would get a nine-month "grace period" before the cap kicked in and he said people in receipt of the "support component" of ESA - for people deemed unable to work due to illness - but who do not receive DLA, would not be penalised.

Additional payments would be made to families in certain circumstances, following a similar model used when the housing benefit cap was introduced - at a cost of up to £80m for 2013/2014 and £50m in 2014/2015.

And he said the policy would be reviewed "in a transparent way" - as they would with any major policy change of this kind.

For Labour, Liam Byrne told MPs there were "dangerous flaws" in the "one-cap-fits-all approach".

He dismissed government claims that Labour had never raised the issue of a local cap before and said they had made plenty of calls for safeguards in the cap.

He said the government had already "burnt a third of the savings they proposed for this measure" - because they had got the policy wrong - and the proposal had become a "dog's breakfast".

The government's decision to use financial privilege rules has been criticised by Labour peers.

And former Conservative chancellor Lord Mackay - who led a Tory rebellion in the Lords against charges for parents to access the Child Support Agency - suggested it was "a waste of taxpayers' money at a time of considerable austerity" for peers to pass amendments which were then rejected out of hand.

'Waste of money'


  • Exclude child benefit from overall cap
  • Not charging single parents for Child Support Agency if they've taken steps to reach a settlement
  • Exempt cancer patients from means testing of ESA
  • Means test other ESA claimants after two years, not one as planned
  • Allow young disabled people who have never worked to keep claiming "contributory" ESA
  • Exempt social tenants with one spare room from "under occupancy" penalties
  • Limit reduction to lower rate of "disabled child element" of Child Tax Credits

Earlier MPs voted down Lords changes to reduce entitlements to employment and support allowance (ESA).

They voted by 324 to 265 to back the government over plans to stop young disabled people who have never worked, due to illness or disability, from being able to claim "contributory" ESA - usually paid to those who have paid a certain amount of National Insurance.

They backed ministers by 332 to 266 over plans to means-test the same allowance after 12 months for those judged capable of working at some point in future.

Four Lib Dem MPs, including former leader Sir Menzies Campbell, defied their party leadership over the issue.

And MPs voted down a peers' amendment that would have exempted some cancer patients from means testing by 328 to 265.

They also reversed a Lords amendment limiting a reduction to the lower rate of the "disabled child element" of Child Tax Credits under the new Universal Credit system, by 324 votes to 255.

Critics say the move will hit working people facing severe financial difficulties - and could cost them over £1,300 a year.

The government says it wants to target support at the children with the highest care needs - and say there will be transitional protection so those already in receipt of the benefit will not lose money.

MPs also voted to overturn a Lords proposal calling for social tenants with one spare room to be exempt from new "under-occupancy penalties" linked to housing benefit. It won the vote by 310 to 268.

It also overturned the Lords amendment calling for single parents not to be charged for accessing the Child Support Agency by 318 to 257 votes - but only after ministers said they would reduce planned upfront fees to £20.


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  • rate this

    Comment number 485.

    It was facinating to read the BBC "Family on Benefits" link. I am all in favour of my taxes being spent on a safety net for those unable to find the means to cover their essential outgoings. To my mind, £800 to Sky TV, £1500 mobile phones, £2600 cigarettes are not safety net. REFORM NOW!

  • rate this

    Comment number 484.

    Parts of the bill are wrong, disability for one. Reductions in other areas are necessary and fair. What is absent is a debate on social repsonsibility. State benefits exist to provide basic human security needs for those who fall on hard times. It is not a lifestyle. 'Family life of Benefits' article: not heating or eating or poverty. Smoking, drinking, sky, mobiles are luxuries. Be responsible.

  • rate this

    Comment number 483.

    Perhaps the government in their haste to burn Fred "the shred" Goodwin at the stake should have allowed him to expiate some of his sins (and those of his fellow bankers) by coughing up his fair share of taxes etc to make sure that there is enough money to support the genuinue cases of need instead of having him tried and executed by a kangaroo court

  • rate this

    Comment number 482.

    I would like to know when the average salary became as little as 13k if a combined working househoulds average is 26k a year?
    I think if you work you should get extra help to stay afloat - but I do think this magic 'avaerage salary' changes all the time to suit what the MP's want!

  • Comment number 481.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this

    Comment number 480.

    I think that whether you are disabled or out of work you should receive basic benefits. Enough to survive. No more. Certainly not enough for luxuries like this chap gets. I do not see why any of these people expect me to pay for them to have a good time. I certainly would not expect it and in fact would refuse it if offered. I think that is called pride.

  • rate this

    Comment number 479.

    I agree with the cap in principle. But I also agree with the variation in the amount if housing costs are high in a certain area. Forcing someone to move and perhaps loose a job as a result will not help the current economic problems. I'm not sure that the BBC is presenting this debate in the most neutral way. 'Raymond' from the £30,000 a year article is not the least bit sympathetic.

  • rate this

    Comment number 478.

    I am absolutely delighted. Its about time we stood up for this country and got rid of all the scroungers. Normal working people have had enough. Those who NEED benefits, ok. Those who abuse the good nature of our system need to start thinking again. Human rights ? Its time that was also put to bed. ENOUGH IS ENOUGH....

  • rate this

    Comment number 477.

    Coming from a country where there is absolutely no welfare system, I tend to think that the UK should be proud of a system that provides for those that are in need. Like all systems there will be those that will abuse them and it is quite understandable to constantly review the system to tighten it so as to stop it being abused and not lose track of the initial purpose of the system.

  • rate this

    Comment number 476.

    I've read about "the wrong people breeding" on this blog. Spot on. And I bet most of them vote Labour. Well done Cameron for sticking to your guns, despite a few misguided bleeding heart bishops.

    "Labour" are so far away from the real working class (what's left of it) they may as well be Martians. The Tories don't WANT to inflict cuts, they HAVE to.

    All the money is gone. Remember?

  • rate this

    Comment number 475.

    I agree with the cap. I work full time to subsidise these people who don't want to work. Why do they have so many children if they can't afford them? Why have mobile phones for everyone, why have sky tv, why smoke, why eat expensive junk food? Sadly, it's not benefit receipients that ae to blame, that lies squarely with do gooders that have allowed this to happen. Life isn't a free ride.

  • rate this

    Comment number 474.

    Lets see what comparrisons can we make.

    1. Precriptions!
    2 Pensions (chanced from RPI to CPI

    Any advantages?


  • rate this

    Comment number 473.

    I think a better alternative to a fixed cap would be a scaling cap depending on how many years you have worked paying tax. So someone who has worked hard all their life and has fallen on hard times gets enough to get by, whereas someone who has not worked a day in their life will get a much lower cap to give them only the bare essentials. Also exceptions need to be made for disabled people.

  • rate this

    Comment number 472.

    We should reform the benefits but in a constructive way. Re-housing people is not the answer e.g. re-house everyone in Central London to the cheapest place in the UK, Is there enough housing? moving away from their families? children in last year of schooling? to name but a few questions it raises. There is no 1 Utopian answer and it needs careful planning not another knee jerk reaction.

  • rate this

    Comment number 471.

    To add to my earlier post (#413), this was aimed at people (and I know as a fact this happens) who CHOOSE to have more children because they will be BETTER OFF as a result, all paid for by the taxpayer while they stay at home and enjoy a great lifestyle.

    Yes there would need to be appropriate balances and those genuinely in need should be supported but the above kind of thing can't be right.

  • rate this

    Comment number 470.

    407 pete "just look at the amount of people who claim for depression and bad backs - but do not want treatment!!"

    Actually if you have long term term pain, especially back pain, there comes a point when the NHS no longer provides physio. Believe me, I know!

    You can't lump everyone with a similar diagnosis together, there are genuinely depressed people and people with chronic back.

  • rate this

    Comment number 469.

    How about linking benefits to previpus contributions. Someone made redundant after 20 years in work should get more (at least by way of transition) support than your average Somali family living on benefits in a Hampstead mansion.

  • rate this

    Comment number 468.

    Labour have now indicated that they will be voting the changes today. Bashing the bankers goes down well in the Labour heartlands but cutting benefits of the feckless is quite another matter. As Ed pointed out in PMQs – it`s a class issue at the end of the day.

  • rate this

    Comment number 467.

    "dividends paid from profits are not liable to NI, only tax...we won't hold our breath"

    Unfortunately this sort of change is what is needed not only to promote growth, but to deal with the equality gulf. There can be no justification for a tax on employment if employment is something you value and want to encourage.

  • rate this

    Comment number 466.

    Its not that people on benefits are getting too much, its that hard working people are not being paid enough! If they have worked out that £26,000 is needed to live safely - then forget corporation taxes that are avoided anyway and force them to pay a minimum wage of £10+ and see how many people start finding work!


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