CentreForum chief economist warns over benefits cap
23 January 2012
CentreForum's chief economist Tim Leunig has issued a warning over government plans to cap benefits at £26,000 a year.
Writing in the Guardian, Tim argues that the cap will force claimants to live on as little as 62p per person per day after rent, council tax and utilities. His analysis applies to a family with four children, living in private rented accommodation in Tolworth, the London Borough of Kingston.
From their £500 a week in benefits, it is calculated that the family have to pay:
£392.31 for rent (the allowable rent for Tolworth, typical of a cheaper property)
£39.06 for council tax (Kingston, Band E)
£28.18 for gas and electricity (DECC English average plus 20 percent for large family, in 2011 £s)
£7.21 for water (OfWAT UK average plus 20 percent for large family)
£6.00 for telephone/broadband (the cheapest BT Anytime package)
This means that the family has £26.23 per week left over - or 62p per person per day.
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