Benefit cap could mean people are expected to live on 62p a day

An analysis by Time Leunig at the London School of Economics suggests that after basic expenditure on Council Tax, utilities and rent, people may be living on 62p per day. Families are to receive £500 a week maximum in benefit. Families hit the hardest will be large families, especially those in the South East where living costs are high. Families with low to midddle incomes will be affected most, those previously in work. These households do not have enough money to buy a house yet have too much to qualify for social housing.

Here is the breakdown of figures by Tim Leunig:

  • £392.31 for rent (the allowable rent for Tolworth in the South East, typical of a cheaper property)
  • £39.06 for council tax (Kingston Council, London, Band E)
  • £28.18 for gas and electricity (Department for Energy and Climate Change English average + 20% for large family
  • £7.21 for water (OfWAT UK average + 20% for large family)
  • £6 for telephone/broadband – the cheapest BT anytime package

This leaves £26.23 per week left over for the family, which is 62p per person per day.

The £26,000 working age household benefit cap is being debated today in the House of Lords.

For more information visit the Guardian website.