Cap on benefits rises branded 'outrageous' by city's Labour MPs

DERBY'S Labour MPs have criticised a Government policy to limit annual increases in working-age benefits to 1% "shameful" and "outrageous" after their party failed to stop the plan.

Derby North MP Chris Williamson and Derby South MP Dame Margaret Beckett added that the country's leadership was now "more reactionary and dangerous" than when Margaret Thatcher was in charge.

The Government says that with public sector pay rises capped at 1%, a similar limit should apply to benefits such as jobseeker's allowance, employment and support allowance and income support, as well as elements of working tax credit and child tax credit. Benefits have historically risen in line with inflation, which is currently standing at 2.7%

On Tuesday, MPs rejected a Labour bid to block the proposals by 328 votes to 262 after five hours of heated debate.

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Four Liberal Democrat MPs went against their party's coalition agreement with the Tories by joining Labour in voting against the proposals.

Heather Wheeler, the Conservative MP for South Derbyshire, said it was "absolutely incredible" that Labour should have sought to block the plans at a time when working people had not had pay rises.

But Dame Margaret said: "Iain Duncan Smith [the Work and Pensions Secretary] is suggesting that anybody getting any kind of benefit should be counted as scroungers. This is an outrageous insult to people who would like nothing more than to have a better-paid job where they wouldn't have to claim benefits."

Dame Margaret said Labour agreed that cuts and savings were needed but that the Coalition's policies went "too far and too fast".

She criticised Chancellor George Osborne as making a decision on the basis of "a political position he thought he could get away with by blaming the previous administration".

She said "I believe they are using the excuse of economic problems to attack the welfare state."

Mr Williamson called the proposed three-year cap "a shameful act".

Mrs Wheeler said: "I find the Labour opposition's stance on this absolutely incredible. We are in a situation where people have not had pay rises for four years and those in the public sector have had a pay freeze for two.

"It amazes me that they see the sensible measure of limiting increases in benefits as the wrong decision."

Liberal Democrat councillor Bob Troup, who represents Blagreaves ward in Derby, was not surprised to see four of his party's MPs support Labour.

He said: "It does affect a large proportion of working people but I wouldn't have supported Labour. We've got to tackle the size of the welfare bill. It's too high and the country can't afford it."

An "impact assessment" of the proposals published by the Government suggested single parents would be most affected by the cap, losing £5 a week. The majority of working-age households in receipt of state support are likely be an average of £3 a week worse off.