Welfare Reform and Work Bill — Decline Second Reading — 20 Jul 2015 at 21:50

The majority of MPs voted to support the Welfare Reform and Work Bill at its second reading, allowing it to continue on its path to becoming law.

MPs were considering the Welfare Reform and Work Bill^[1]

The Bill provides for:

• Reducing the household benefit cap from £26,000 to £20,000 (£23,000 in London).
• Freezing the rate of many major benefits and tax credits for four years; excluding pensioner benefits and many benefits related to disability.
• Limiting the child element of universal credit to a maximum of two children.
• Reducing rents in social housing in England by 1% a year for 4 years from April 2016
• Stopping those on certain benefits being able to claim additional help towards their mortgage payments; replacing the scheme with a loan.
• Requiring a series of reports to be produced by the Secretary of State on employment, apprenticeships and troubled families.

The motion being debated was:

• That the Bill be now read a Second time.

The amendment rejected in this vote sought to replace that with:

• That this House,
• whilst affirming its belief that there should be controls on and reforms to the overall costs of social security, that reporting obligations on full employment, apprenticeships and troubled families are welcome, and that a benefits cap and loans for mortgage interest support are necessary changes to the welfare system,
• declines to give a Second Reading to the Welfare Reform and Work Bill because the Bill will prevent the Government from continuing to pursue an ambition to reduce child poverty in both absolute and relative terms, it effectively repeals the Child Poverty Act 2010 which provides important measures and accountability of government policy in relation to child poverty, and it includes a proposal for the work-related activity component of employment and support allowance which is an unfair approach to people who are sick and disabled.

Impact on Public Spending on Welfare Benefits

The Bill seeks to implement elements of the summer 2015 budget^[3]. The budget document states the working age benefit and tax credit freezes were forecast to save £4 billion a year by 2019. The benefit cap reduction was forecast to save £100m in 2016-17 increasing to £495m in 2020-21. The reduction in social sector rents also reduces the spend on welfare benefits via a saving in Housing Benefit. The changes to tax credits in respect of children were forecast to save £1.3bn by 2020-21.

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• [1] Parliament's webpage on the Welfare Reform and Work Bill
• [2] Overview of the Welfare Reform and Work Bill from explanatory notes prepared by the Department for Work and Pensions
• [3] Summer 2015 Budget Documents

Debate in Parliament | Source |