The DWP capital thresholds should be £10.5k and £27k
That is if they'd been adjusted to take into account inflation.
Given inflation the £6k and £16k thresholds from when they were introduced in 2006 are effectively £3.5k and £9.2k in 2025…
It also means that in 10 years from now the inflation adjust figures will be about £2.5k and £7k…
Given it took the DWP about 15-20 years to increase the thresholds (the previous were £3k and £8k) a threshold increase is long overdue.
I imagine politically it would be unpalatable but without it, the value of benefits will decrease over time and the thresholds will act as an even bigger disincentive for benefit claimants to pull themselves out of poverty. So remember what whenever they talk about social mobility. And remember that they are going to start monitoring peoples bank accounts based on these limits.
It feels like these thresholds are basically going the way of the Christmas bonus which was worth a fair bit of money (£10) when it was introduced but might buy you a multi-pack of Freddos now.
Comments
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And apologies if this might be in the wrong group, I'm not used to this forum.
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I fully agree, unfortunately it'll unlikely change anytime soon.
They go on about getting people off, but ironically keep them on. So if someone was allowed to save enough because they want to leave the dwp system they can't because OF the DWP system.
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I spend all my money on my disabilities, I honestly can't understand how one accrues many thousands of pounds in savings?
I wonder how many working people have £27K in savings?
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I'd say about 1/3. The average is about £17k and that's not taking into account the equity they've built up in their principal home or the value of their pensions. And they also benefit from ISA tax allowances.
Benefit recipients are generally very poor by UK standards, few have any savings equity or meaningful private pension pots.
To add insult to injury they're much more likely to pay the high rents of the private sector.2 -
Milions of workers rent too, and many live wage to wage, just like alot of us. Being in work doesn't mean you are affluent, especially not in your 20s and 30s.
You are right, there will be no support out there to do anything about the savings cap.
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I'm not disputing that millions of people who work rent in the private sector, remember too that almost 50% of UC recipients are in work too.
But the chances of you being affluent if you are in work is vastly higher than if you were on benefits. And I'm sure some politician's eyes will light up when I say this but it's absolutely true that there is no route out of poverty on benefits without working. Being on benefits, especially long term is how people remain poor and that is obviously made worse if you have no savings.
The only exception I guess is if you received some massive inheritance but that's the exception not the rule and not a social policy. Maybe it's an argument for the government creating some kind of universal inheritance fund maybe through a land value tax.2 -
I accept though that non-means tested benefits like PIP is an exception to this rule. I should have been clear in not including that as there are plenty of wealthy people in work who receive PIP.
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AND the Personal Tax Free Allowance for hard working people should be raised too! Stuck at £12,570 per year since before lockdown and frozen to 2030..... Disgusting! There are people on benefits that get more than that per year.
Governmental/parliamentary Petition raised this year to increase the working people's Personal Tax Free Allowance to £20,000 and it has to be discussed by government due to the sheer amount of votes. Conclusion - not possible to do this currently as not affordable!
This needs sorting for working people too!
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Money will never be enough. People will always want more of it. And that keeps pushing up prices, meaning everyone else needs more money as well, creating a vicious circle.
Personally I'd prefer the gov't focus on 'things' such as accessible & affordable housing, accessible and effective health treatment, alternative forms of support for people who don't fit into perfect 'boxes'.
Money is only useful if it can be traded for goods or services. There's no point having more of it when we can't access goods or services to spend it on.
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I refuse to save money or have any large savings. I never want anything apart from necessities as to me money is the root of all evil. So I will always live by my means.
Also personally if your on benefits, I don't think you should have any large savings so the benefit cap is good as it is to me.
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I should imagine most but not all people on benifits also get there rent paid and some council tax if you put that into the equation they are not doing to bad
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Agreed. You also have to think of the people who are paying this bill, it's not the government, it's the man in the street.
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The real issue isn’t whether people should have savings, it’s that the thresholds haven’t been touched since 2006. £6k and £16k then are worth far less now, so the system is harsher in practice than it was back then. If they had been uprated properly, we’d be looking at around £10.5k and £27k.
The rules assume people will bounce back into work, but for many who become disabled or seriously ill there is no return, ever. In that situation, savings aren’t a luxury, they’re the only way to keep a roof watertight, a boiler running, and the bricks from crumbling. Yet UC forces people to drain those funds before they qualify for support.
It’s a policy designed for short‑term setbacks, applied to people facing permanent change. That mismatch is exactly why the thresholds need urgent review.
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We had someone on recently, who said we should have the same lifestyle as full time workers. Totally naive and lacking in self awareness I think.
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Agree!
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The working people's Personal Tax Free Allowance needs urgent review but was refused. I would suggest the working people get there review first for quite obvious reasons. The pathetic working people's Personal Tax Free Allowance could well be why some people choose not to work. I am happy I am not paying 40% tax out of my wages to that Accounts Clerk Reeves and that is definite!
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Should people who own their own home have a higher savings threshold than those who rent? Landlords are responsible for repairs but a home owner has to pay for their own..
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I could imagine the public outcry if someone on benifits getting there rent paid by the government whilst having 27 grand for emergencies that the landlord would and should cover would go down rather well
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The current outcry is bad enough without additions.
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Self entitlement is alive and well these days though, Michael.
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