Derwent Living is calling on ministers to scrap plans to penalise people who cannot find work by cutting their benefit payments.

As part of the Government's radical overhaul of the benefits' system, people who have claimed Jobseeker's Allowance for more than a year will have their Housing Benefit cut by 10% - despite passing government assessments that they are actively looking for work.

The average weekly Housing Benefit received by someone in receipt of Jobseeker's Allowance is £91.35 and so a cut of 10% would lead to a yearly average loss of £475. 

This suggests that a single claimant aged 25 or over would be left with just £56.31 a week to pay for all their household bills, food and transport costs. Those aged 16 - 24 would be left with £42.71.  

Tens of thousands of people being moved from Incapacity Benefit onto Jobseeker's Allowance may have not worked for some years due to ill health or disability - for these people a cut in benefit could destabilise their housing situation, exacerbate health problems and leave them further from the labour market. This measure will penalise people actively looking for work, add complexity to benefits administration and threaten to increase homelessness amongst vulnerable people.  

The policy is expected to be introduced in April 2013.

Derwent Living is backing a national campaign, led by the National Housing Federation, the trade body for housing associations, demanding the proposal is dropped from the Welfare Reform Bill. The campaign has been backed by several MPs and many more members of the public. 

As a first step, Derwent Living chief executive Peter McCormack has written to local MPs Chris Williamson and Margaret Beckett demanding that they support this campaign and lobby against this measure in Parliament. 

Mr McCormack says: "Derwent Living takes the welfare of its customers very seriously and is very concerned that this measure could cause a lot of hardship for a lot of local people.

David Orr, chief executive of the National Housing Federation, said: "This proposal is clearly a punitive measure which will add further hardship to people when they are down and it contradicts the Government's commitment to fairness".  

For more information about Derwent Living, please visit their website here: www.derwentliving.com