Plans by the Tory Government to cut the benefit cap could see 1,000 more children in Islington pushed into poverty.
Today's Budget, set to be announced by George Osborne, will include a cut in the amount of social security a household can receive in London by £3,000 per year. Research by Islington Council has shown that almost 600 more households in the borough would be affected by the reduction, on top of around 250 families that are already hit by the current cap.
The council's research has found that up to 1,000 more children in Islington could be pushed into poverty, in a borough that already has one of the highest rates of child poverty in the country.
Cllr Andy Hull, Executive Member for Finance and Performance, commented: "According to the government, the benefit cap is meant to reflect the average income. But average earnings haven’t dropped by £3,000, so why are they cutting this support from families who need it?
"This national, one-size-fits-all policy takes no account of local realities. Rents in London are much higher than elsewhere, and yet the same caps and cuts apply. With such a shortage of affordable housing in the capital, cutting the benefit cap won’t drive down rents; it will just drive people into poverty."
Cllr Hull added: “For Islington, the Government cutting the benefit cap will mean huge losses of around £1.6 million in Housing Benefit – likely to translate into a big rise in tenants’ arrears. At a time when the council’s budget is stretched to breaking point, we can’t guarantee to cover the loss.
"We call on the Government to stop this cut in its tracks. Failing that, we need the Government to provide us with additional Discretionary Housing Payment funds to help us cover the shortfall. We will do our best to support struggling families in our community, but there’s a limit to our ability to shoulder the burden of government cuts and shield residents from their impact.”