March 10 (Bloomberg) -- A move to cap welfare payment increases at 1 percent was criticized by the Archbishop of Canterbury, who said children and families would pay for it, while the government defended the bill.
Prime Minister David Cameron, seeking to reduce the budget deficit, wants to cap welfare payment increases at 1 percent until 2016. The Welfare Benefits Up-rating Bill is before the House of Lords. Currently, the benefits rise in line with inflation, which the Consumer Prices Index puts at 2.7 percent.
“Children and families will pay the price” if plans to change the benefits system go ahead in their current form, Justin Welby, who officially takes the Archbishop’s office as the Anglican church’s most senior cleric on March 21, said in a report in the Sunday Telegraph. The opposition Labour Party criticized the bill, saying it would affect new mothers.
“Simply increasing benefits isn’t the answer to tackling poverty,” the Department for Work and Pensions said in an e-mailed response to the criticism. “We must ensure that every pound spent on welfare is helping people in the most effective way it can.”
The legislation applies to a range of benefits and tax credits, including income support, child benefit, working tax credits and child tax credits.
In a letter to the Sunday Telegraph, 43 bishops said the welfare changes will have a “deeply disproportionate impact” on families with children. “About 60 percent of the savings from the uprating cap will come from the poorest third of households,” according to the letter.
“Politicians have a clear choice,” Welby, who didn’t sign the letter, was cited as saying in the Sunday Telegraph report. “By protecting children from the effects of this Bill, they can help fulfill their commitment to end child poverty.” Speaking on the BBC’s Andrew Marr Show, Liberal Democrat Lawmaker Paddy Ashdown, who sits in the House of Lords, said the Archbishop of Canterbury’s comments are “important.”
“Of course, all of us are concerned about it, that’s why indeed the Liberal Democrats have such a commitment to making sure that our contribution to tackling the terrible deficit this country was left, in large part but not exclusively by the failures of the Labour government previously, are tackled with fairness in mind,” Ashdown said.
Yvette Cooper, Labour’s equalities spokeswoman, who was also speaking on the Andrew Marr Show today on Mother’s Day, wouldn’t commit a future Labour government to reversing the changes to welfare payments. She said if in power now her party would stop the 1 percent cap, paid for by restricting pensions tax relief on the “very highest earners.”
Cameron and Chancellor of the Exchequer George Osborne are “immoral” by targeting new mothers, she said. Around 340,000 women claim state-funded maternity pay every year, according to Labour.
If the Lords make changes to the bill it will return to the Commons for MPs to consider them. Both the Lords and Commons must agree on the wording before the bill could become law.
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