The benefits cap is your Policy of 2012

By Peter Hoskin
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Time for the the fifth result from our end-of year readers’ survey: those for Policy of the Year. The overall winner, by some distance, was the benefits cap, which secured 57.6 per cent of the vote. The list of runners-up reads as follows:

• The higher and higher basic income tax allowance: 24.1 per cent.
• The replacement of GCSEs: 13.1 per cent.
• The introduction of Police and Crime Commissioners: 5.3 per cent.

At which point, some of you might be thinking: which benefit cap are we talking about? There have, after all, been two in town this year. There’s the one that the Chancellor announced in 2010, but that has rumbled along in Parliament ever since, and will be introduced in 2013, to cap the amount that any one household can receive in benefits at £26,000 a year. And there’s the one that he announced in the last Autumn Statement, to cap the uprating of several key benefits at 1 per cent a year.

Well, the answer is both, really — not least because these two benefit caps are similar in several respects. Fiscally, they’re both designed to cut back a benefits system that has sprawled outwards, incessantly and expensively, for decades now.  Politically, they both chime with one of Osborne’s favourite themes: the contrast between, as he put it in his conference speech, “the shift worker, leaving home in the dark hours of the early morning,” and “their next-door neighbour sleeping off a life on benefits”.

In the case of the first benefits cap, it’s worth noting that there are problems facing the policy. Some departments have raised concerns about its effects, and it has already been pushed back slightly after Whitehall’s computers said no.

But, despite all that, the politics of the cap are firmly in Mr Osborne’s favour. Polls show that the measure has wide support from the public, who, if anything, think it could go further. I mean, to take a poll at random, this YouGov number found that 36 per cent of people think that the cap should be less than £20,000 a year. In the same poll, only 9 per cent of people reckoned that there shouldn’t be a cap.

But the politics are considerably murkier in the case of the second cap, to uprate benefits at 1 per cent a year. This is probably because the policy more obviously impinges on “strivers,” whose in-work benefits will also be affected. And so when folk are simply asked whether benefits should rise by more than the Chancellor is proposing, they tend to answer in the affirmative. But when more context is provided, such as that benefits have been rising at a faster rate than wages, they swing behind Osborne’s policy.

In the end, the argument over benefits will be won or lost in the framing. Ed Miliband, who opposes Osborne’s caps, will want to keep it about the money in your back pocket. George Osborne will want to it to be about wages and deficit reduction. And the upshot, as I wrote recently, is that this year’s Policy of the Year is set to be one of the political battles of 2013 and beyond.

> The four other Picks of 2012 announced so far are Jesse Norman as Backbencher of the Year; Nick Clegg as Yellow B**tard of the Year; Boris Johnson's re-election as Conservative Achievement of the Year; and Owen Paterson as the One to Watch in 2013.