Three dozen benefit-claiming families in Northampton get 50p-a-week for rent

The cuts, introduced in November 2016, are part of the Government’s drive to get unemployed people back to work by imposing an upper limit on the total amount of benefits they can receive. The cap currently stands at £23,000 a year in London and £20,000 in the rest of the country.

But in Northampton, BBC researchers say 35 of the 273 households (13 per cent) subject to the £20,000 cap have had their housing benefit cut to just 50p a week.

Tonight's Panorama episode will question whether the policy is working after a charity labelled the caps "completely arbitrary".

Chief executive of the Child Poverty Action Group, Alison Garnham, told Panorama: “The benefit cap is set at £23,000 for people in London, £20,000 for people outside of London, so that means the total amount of benefits they receive will be stopped at that amount.

"This is a level that bears no relation to anything else, it’s completely arbitrary.

“We reckon of the people affected by the benefit cap about 80 per cent of them are not really in a category expected to work because they’re sick or have very young children.

"So, there’s a, there’s an overall question about how this can be a policy about getting people into work, when the group that’s targeted isn’t really expected to.”

Across the UK more than 67,600 households have been capped so far, according to figures provided by 370 councils that responded to BBC Panorama’s survey.

Of those, 11 per cent, or 7,585 families, have had their housing benefit cut to 50p a week.

In total the Government estimates 88,000 households will be affected by the benefit cap – though some experts think the figure will be much higher.

But the Government says the benefit cap tries to level up “the playing field between families who are in work and who are reliant on benefits".

Minister for Welfare Delivery, Caroline Nokes, said: "What we sought to do was incentivise work because we know that the outcomes for children will be better if they’re in families that are working.”

Asked if she thought everybody who was capped could go back to work, she said: "There’s the flexible support fund and our new personal support package for jobseekers is about trying to make sure that people have absolutely the most amount of support, to enable them to make the right decision and the transition into work.”

Asked how people were supposed to pay for their rent when their housing benefit was 50p, she argues: “…you have to remember that a household that has only 50p of housing benefit actually is receiving in the region of £20,000 pounds a year outside London, in total benefits.

"That’s about the same as an ordinary family. Four in ten families would be earning that sort of money.”

Panorama: The Benefit Cap – Is it Working? will be shown tonight (Wednesday, April 5) at 9pm on BBC One.