MPs recommend pausing deductions from benefits to help with cost of living

The Work and Pensions Committee has recommended pausing deductions from benefits to help struggling families.

According to MPs, automatic repayments to the government and others owed by people receiving benefits should be paused to help struggling households with the cost of living crisis.

The Committee has called on the Department for Work and Pensions to pause the deductions and restore them gradually only as inflation reduces, or when benefits have been increased to accurately reflect the rise in prices.

MPs argued that long-standing problems with the social security system have been exposed by the cost of living crisis and rising energy, fuel and food costs.

The report argues that deductions from benefits from the DWP are contributing to hardship with some households being pushed to depend on food banks.

The Committee has also recommended that the government review and increase the benefit cap. The benefit cap has been frozen since it was lowered in 2016.

The report also notes that current legacy benefit IT systems are not fit for purpose.

Finally, the report explains that benefit increase in April 2022 was based on the CPI rate from September 2021, which was 3.1 per cent - inflation in April 2022 was nine per cent. This represents a real-term fall in income.

Rt Hon Sir Stephen Timms MP, Chair of the Work and Pensions Committee, said: “Inflation is at a 40 year high, with spiralling energy, food and fuel prices adding up to a cost of living crisis not seen for a generation and a bleak outlook for many families. Deductions by DWP from benefits are contributing to the hardship and the Government should give those struggling some much needed breathing space by following its own advice to other creditors and pausing repayments until the threat of inflation recedes."

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