The government has ruled out a series of recommendations to improve financial support for low-income households in response to the cost of living crisis.
In a report published in July, the cross-party work and pensions committee of MPs urged the government to take a series of measures to alleviate the impact of rising energy, food and rent costs.
But in the Department for Work and Pensions’ response to the committee – which was sent on 24th August but was only published on Thursday – it ruled out most of the committee’s main demands.
The committee recommended that the annual uprating of benefits in line with inflation be brought forward from next April, so that benefit payments would more quickly reflect the extent to which costs have risen. Tory MP Kemi Badenoch, recently appointed as secretary of state for international trade, called for benefits uprating to be brought forward in her leadership election campaign.
However, the DWP’s response said: ‘There are no plans to change the up-rating period: using a consistent period for up-rating, for example, the 12 months to September to measure inflation means any peaks and troughs even out over time.’
The DWP also rejected the committee’s recommendation to review the adequacy of benefit levels and suspend deductions from benefit payments.
The committee called for the DWP to increase the Local Housing Allowance (LHA) housing benefit, which has faced real-terms cuts since 2021. The DWP’s response said: ‘[LHA] rates are not intended to cover all rents in all areas. Investment was significantly increased in April 2020 and rates have been maintained at those levels in cash terms; we are forecast to spend over £28.5 billion to support renters with their housing costs this year.
‘The assumption in the Spending Review 2020 expenditure forecast is that Local Housing Allowance rates will continue at their current level through to 2025–26 but this will be reviewed annually by the Secretary of State alongside wider benefit uprating decisions.’
The DWP response was sent while Boris Johnson was prime minister and Therese Coffey was welfare secretary, meaning that the prime minister Liz Truss could take a different approach. However, the new welfare secretary Chloe Smith was already a DWP minister, and Truss’ cost of living announcement adopted none of the select committee’s recommendations that the DWP response had rejected.
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