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The Guardian - UK
The Guardian - UK
Politics
Andrew Sparrow, senior political correspondent

Government criticised over 'perverse' decision to cut benefits by £170m

With Gordon Brown on the verge of announcing a multibillion-pound package of tax cuts designed to kick-start the economy, you would guess that ministers would not be choosing this as the moment to cut benefit payments by £170m.

You'd be wrong.

The Social Security (Miscellaneous Amendments) (No 4) Regulations 2008 had, until now, passed me by. But there was a short debate on them in the House of Lords last night and I've just been reading the Hansard, which shows that they implement quite a significant benefit cut.

Until the regulations came into force in October people claiming pension credit, housing benefit and council tax benefit could, in most cases, backdate their claims 12 months. Under the new rules pensioners will only be able to backdate their claims for three months, and other claimants six months.

Lord McKenzie, a work and pensions minister, told peers that the new rules would save the government £170m. He said that the proposal was originally announced last year, that it was part of a series of changes that involved increased spending on pensioners and that the government was stopping 12-month backdating because it wanted to "foster a greater sense of responsibility among customers for their financial affairs".
But his arguments did not seem to impress fellow peers, who claimed that the regulations could result in more people being forced into poverty.

And, as the Liberal Democrat spokesman Lord Kirkwood said, the timing was bizarre.

We are now on the brink of a pre-budget statement when the government are expected to reach deep into their pockets to help exactly the kind of people that these regulations affect … That is perverse. The left hand of government does not seem to know what the right hand is doing.

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