Households with disabled person will be average of £156 a year worse off under Government benefits plans

Millions of disabled people will lose out under the Government’s plans to keep the annual rise in benefits below the cost of living, it emerged last night.

Pensions minister Steve Webb has confirmed that one in three households with a disabled person will be £156 a year worse off on average of under new rules capping the rise in most benefit payments to 1 per cent – 1.7 per cent below the current rate of inflation.

The disclosure comes days after his boss, Work and Pensions Secretary Iain Duncan Smith, insisted that the Government was “protecting disabled people”.

Labour claimed the details proved the Government had been hiding the truth about the real impact of their “strivers’ tax”.

The cap, announced by Chancellor George Osborne in his autumn, is expected to save £1.1bn next year and double that by 2018. He pledged that benefits paid to the most vulnerable claimants would go up in line with the cost of living.

But Mr Webb said, in a parliamentary answer: “The Department estimates that approximately 34 per cent of households where someone describes themselves [as] disabled are affected by this Bill, with an average change of income of around -£3 a week in 2015-16 compared to uprating by the consumer prices index (CPI).

“This represents around 3.4 million households in Great Britain.”

Shadow work and pensions secretary Liam Byrne said: “This is shocking. It tells you everything you need to know about the priorities of this Government that David Cameron and George Osborne are cutting support for disabled people at the same time as giving 8,000 millionaires an average tax cut of over £107,000.”