Government "set to breach welfare spending cap"

Ministers reportedly seeking vote on the self-imposed welfare cap after tax credits rethink

By Josh May

25 Nov 2015

The government is reportedly seeking Commons time for a vote on the welfare cap, a sign that the chancellor could be set to breach his own fiscal rules.

The Charter for Budget Responsibility, introduced by George Osborne, requires ministers to stay within the welfare spending envelope announced at the most recent Budget.

“If the government wishes to change the level of the welfare cap after it has first been set... it will seek the approval of the House of Commons via a debate on a votable motion,” the Charter dictates.

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If ministers breach the cap, they must come to the Commons within 28 days to explain why spending is higher and how the Government will reduce it.

Sky News says the government is preparing for a Commons vote on the issue.

“It'll be breached ... he's not going to get it for next year,” a Westminster source told the broadcaster.

The Office for Budget Responsibility will today update its assessment on the government’s compliance against the cap as part of the Autumn Statement. The failure to stay within the cap is likely to be a result of plans to mitigate cuts to working tax credits, which had been intended to save £4.4bn of the £12bn welfare savings.

The chancellor promised to look again at his plans after the House of Lords voted against the policy. He is reportedly looking to find money to allay some of the effects of the tax credit cuts from the housing benefit budget.

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