Alliance is set to undermine welfare reforms

Ministers fear a combination of Church of England bishops and rebel Liberal Democrats could undermine a planned £500-a-week cap on benefit payments when peers vote on the measure today.

Former Lib Dem leader Lord Ashdown yesterday became the most high-profile figure so far to speak out against the plans, denouncing them as “completely unacceptable” in their current form. He said that as president of the United Nations’ children’s agency, Unicef, he was not prepared to support them in today’s vote on amendments to the Welfare Reform Bill.

“I voted with the government on everything until now,” he said. “I see it as my job as an ex-leader to support my successor, but I will not support the benefit cap in its present form.”

Despite the divisions in his own ranks, however, Deputy Prime Minister Nick Clegg said he was fully signed up to the changes.

“I completely back Iain Duncan Smith on this,” he said. “It surely can’t be fair, it can’t be right, that you can be earning, if you like, more on benefits than someone going out earning £35,000.”

Mr Clegg suggested there was some scope for softening the impact of the changes through “transitional arrangements” around the introduction of the cap.

However he flatly rejected an amendment tabled by the Bishop of Ripon and Leeds, the Rt Rev John Packer, which would exclude child benefit payments from the £500-a-week limit.

“If you did that it probably wouldn’t make much sense trying to have a cap at all,” he said.

Ministers appear determined to ride out the opposition, believing there is strong public support for their plans to curb the benefits dependency culture and “make work pay”.

Mr Clegg brushed aside “apocalyptic” claims that thousands of families – particularly in London and the south-east of England – could be forced to leave their homes as a result of the changes.

“This is not going to be some sort of punitive programme of mass homelessness,” he said. “Of course we won’t allow that to happen.”

Labour, in contrast, reacted cautiously, suggesting that it would try to find a compromise between the government and the bishops.

“Labour won’t be voting against the benefits cap because we support the principles and the responsibility to take a job if you can work,” a spokesman said. “But we will be seeking to amend the bill, to bring a compromise between the bishops and the government because we don’t think council taxpayers should be hit with a massive bill for homelessness.”

Bishop Packer said he hoped to win support in the Lords for his amendment, which was intended to protect the most vulnerable families.

“What we’re talking about tomorrow is children in families where the welfare benefits have been cut to a point where they are less than parliament actually has said they should be, because that’s what a cap does,” he said, yesterday.

However, Mr Duncan Smith launched a blistering attack on the bishops, accusing them of ignoring the concerns of ordinary families who try to “do the right thing”.

“The question I’d ask these bishops is, over all these years, why have they sat back and watched people being placed in houses they cannot afford? It’s not a kindness,” he said.

“It’s all very well for the bishops to express a political opinion, but I would love them to ask about the poor people on low incomes who are working hard and sharing rooms.”