Question to the Department for Work and Pensions:

To ask the Secretary of State for Work and Pensions, what calculation is used to determine the appropriate capital threshold limits for welfare benefits which are means tested and which are not payable in the event that a claimant holds savings or capital above the set threshold.

The capital thresholds strike a balance between protecting less well-off people and the taxpayer, whilst at the same time recognising the conscientious efforts of people who have built up capital. This limit also ensures that the help which comes from taxpayers, many of whom are themselves on low incomes and have limited capital, is directed to people who need it most. Whilst it is important to encourage saving, it has never been thought right for substantial amounts of capital to be ignored, therefore it is also reasonable that there should be a capital limit above which benefits are not available. The current system allows people to continue to receive benefit even though they may have an amount of capital, by gradually reducing the level of their entitlement.