Out of work benefits will begin falling below inflation from 2013/14

Benefit wars: IDS on offensive before uprating vote

Benefit wars: IDS on offensive before uprating vote

By politics.co.uk staff

Those out of work have seen their benefits increase nearly twice as quickly as the wages of those in the private sector in the last five years, it has emerged.

Iain Duncan Smith revealed jobless claimants had seen payouts rise by 20%, compared to an average 12% pay rise for those in work.

The work and pensions secretary released the figures ahead of next week's upratings bill is debated in the Commons, when MPs will vote on the government's plans to put the brakes on future benefits increases.

"Working people across the country have been tightening their belts after years of pay restraint while at the same watching benefits increase. That is not fair," Duncan Smith said.

"The welfare state under Labour effectively trapped thousands of families into dependency as it made no sense to give up the certainty of a benefit payment in order to go back to work.

"This government is restoring fairness to the system and universal credit will ensure it always pays to be in work."

Under the coalition's plans, revealed in the autumn statement, the government will legislate to ensure benefits rise by just one per cent for three years, starting in 2013/14.

That effectively means a welfare cut for those out of work, as inflation is set to be significantly above one per cent.

Labour claimed increases in jobseekers' allowance had gone up by 32% since 2002/03, compared to a 36% increase in private sector salaries over the same period.

"Iain Duncan Smith has given the green light to a £14 billion cut to tax credits that's pushing millions of working families into poverty and now means thousands of part time workers are better off on benefits," shadow work and pensions secretary Liam Byrne said.

"Now he wants to hit working families again with his strivers tax bill. Yet this omnishambles government thinks its right to give an average £107,000 tax cut for 8,000 millionaires."