Evaluation of the lower benefit cap

About the study

This study was commissioned by the Department for Work and Pensions in 2017 to evaluate the lower benefit cap. The new cap, introduced in 2016 as part of the Welfare Reform and Work Act, applied a lower, tiered maximum that households could receive in benefits.

Findings 

• Findings show that the number of respondents in employment increased significantly between the two survey waves, but the number of claimants making or planning work-related changes had fallen over time.
• Only small numbers of capped claimants had moved house (four per cent in the six months to wave two, and nine per cent to wave one) and moves that had taken place were generally over short distances.
• Claimants reported experiencing wide ranging impacts as a result of the benefit cap, for example, reduced spending on essential and non-essential items and impacts on health and wellbeing.
• There were significant differences in the impact of the cap on housing and employment changes by the type of benefit received (Housing Benefit or Universal Credit) at wave two which were not in evidence at wave one
• Analysis showed few significant differences in outcomes or changes in behaviour by region, suggesting that claimants living in Britain were largely affected by the cap in the same way.
• However, survey findings did show that claimants living in London were more likely to report either increasing their working hours or moving to temporary accommodation/becoming homeless as reasons for no longer being affected by the benefit cap; planning to make employment changes in the next six months; and having made or attempted to make a change to their housing circumstances.

Methodology

The report presents high-level longitudinal findings from a survey of claimants affected by the cap, delivered over two waves, and qualitative research with local authority, Jobcentre Plus and local support agency staff within six sampled local authorities.