Coffee House

Welfare cap will change the way cuts are made

26 February 2014

The Sun’s report that pensioner benefits will be included in the overall cap on welfare spending highlights an interesting shift that this policy will cause.

George Osborne will set out the detail of the cap on Annually Managed Expenditure in the budget in a few weeks’ time. It will put pressure on all Work and Pensions Secretaries to keep future welfare spending under the limit, meaning there will be internal pressure within the department for cuts, rather than the battle for savings between the DWP and the Treasury that we’ve grown used to. Instead of the Chancellor bearing down on DWP with a package of cuts, the DWP will be working constantly on finding cuts that stop it reaching that AME cap.

But the pensioner benefit aspect of the story also represents a victory for Iain Duncan Smith, who is not as recalcitrant about cutting spending as some might suggest. He has had a package of welfare cuts sitting on his desk for months which include pensioner benefits. Now they’re in the cap, that’s a signal that they’re up for serious debate too.

Give the perfect gift this Christmas. Buy a subscription for a friend for just £75 and you’ll receive a free gift too. Buy now.

Show comments
  • drydamol1


    So it takes years and 11,000 Deaths before a Draconian
    Government Policy is deemed News Worthy. Atos and Capita have both declined to
    be interviewed is that because they have not yet been briefed by Smith of the
    Broken DWP .

    Hundreds of thousands of Taxpayers Money has
    been spent on an inadequate Service flawed from its inception by a system
    constructed by one of the World’s Largest Disability Insurers Unum banned in
    several States of America for not being ‘fit for purpose ‘ .

    What UK Establishment Clowns allowed a suspect operating
    company already having been criticised to oversee the biggest Benefit Reform
    this Country has ever seen .

    The same clowns have trusted them to run our pension
    scheme NEST .If we listen to this Government any longer forget Care in the
    Community start building new Asylums .

    ID Smith is as bright as a 2 watt lamp but so dogmatic he
    steadfastly adheres to a Tory mantra
    “its teething troubles” the man who studied Fascism in Italy is so bogged down
    Osborne has had to take over the Workfare Programme .

    Cross Party Talks have included
    Jobseeker Claimants should be forced to
    go Fruit Picking or be Sanctioned and anyone receiving Benefits that attend a
    protest is also Sanctioned .The Lunatics Run the asylum .

  • fozz

    Just found today what my state pension is going to be. This is my reward for 48 years’ contributions and 30 years is the maximum after which you don’t get any more pension. How about that for a non-bargain? You’d think that after 30 years they’d tell you that you’d paid the max possible and let you off further NI contributions. By oh no – they need the money to pay for the pensioners who are retiring at the time you are paying. I mentioned this to the bloke at the Pensions Call Centre and he suggested I take it up with my MP!! Somehow I can’t be bothered.

  • an ex-tory voter

    It will also be important to note that most over 50s feel they have contributed. They therefore will not take kindly to a slow, deceitful, “inflation hidden” reduction in their pension benefits whilst the nation is funding overseas aid, medical tourism and unrestricted access to the British benefits system by overseas dependants. To name just one or two areas where the over 50s see successive governments squandering taxpayers money.

    In order to get this one past the electorate the government is going to have to prevent or drastically reduce anything that the over 50s see as being “a waste of money”.

    • saffrin

      Wot like Somalia, Southern Sudan, the Ukraine, HS2 and Lord Smith’s wages?

      • Fergus Pickering

        Yup! That’s the sort of thing.

    • HookesLaw

      What is being referred to? The basic pension itself or other associated benefits?

  • Alexsandr

    difficult one
    yes you need to cut the benefits to pensioners, but also you need to remember that most over 50’s vote. So upsetting them may be counter-productive.
    many have been paying taxes for 40 years and think ‘now its payback time’

    • MirthaTidville

      Your are very right, but this lot, have so far, shown scant regard for the voters,especially those of the Tory Party that Dave seems to hate the most. They could be in for a rough ride..

      • Alexsandr

        well I am already fed up with them for stealing my SERPS.

      • Makroon

        This will become the latest Tory offer of life-support to UKIP.
        Of course, a new Labour government would either simply repeal the budget control or redefine it out of existence (Gordon Brown as expert advisor).
        The naive Tory faith in “legislation” is rapidly approaching Blairite levels.

Can't find your Web ID? Click here