http://www.bbc.co.uk/news/uk-politics-20886192

Yeah, spin those figures of misery! Let's focus on the private sector wages and ignore all that's implied by the ongoing debate about a living wage.

Surely benefits are there to enable a basic standard of living for all, and therefore should be linked to the cost of living? There's simply no slack to tighten at the bottom.

We already have schemes in place which guarantee people will always be better off when they work, which is probably the most important aspects of setting benefits when we are talking about capping it.

I'd agree with your sentiment but I'm not sure we actually do have ' schemes in place which guarantee people will always be better off when they work'. I know a lot of the public perception is Daily Mail-esque rabble rousing but I'm fairly sure the current system does have 'singularities' in it where it actually works out better for the people involved not to go to work at say national average wage (obviously if the work you can do is as a premiership footballer, no benefit system on earth is going to be better). I'm sure there are few of them and they're used as sticks to beat the rest of the system but I'm sure they do exist because it would be quite surprising in a system as complex as ours for them not to exist. The benefit system does need to be simplified to eliminate as many of those anomalies as possible. The current administration is doing this to a degree, but unfortunately it's also using that requirement as a smokescreen to try to dismantle parts of the state welfare system that genuinely don't need 'fixing', simply because the tory party is philosophically opposed to state intervention/control/provision.

Based on previous experience (from my work at the DHSS in the 1980s), there were times when someone's benefit would exceed that of people being paid to administer them, and the [LIFTED] still complained.

The things that caused the anomalies were:

a) Mortgages. We would pay interest only on a mortgage - so you needed to know the capital of the lad, work out what the annual repayments would be on the interest and include that in the benefit payment. With interest rates at around 15% or so, this could be quite a large sum. There were times when a mortgage would be huge, and that would be because the property was in a posh area. You have to remember that the rich can fall in hard times too, and if their mortgage passed a certain level, the were procedures to ensure that the was a cap applied. This would be on top of housing benefit (which was automatic when Supplementary Benefit and, later, Income Support was paid - this would cover rates).

b) Large families. There were people who were breeding machines. Some for cultural reasons, but there were also those who had children over the course of their fertile life, and the cynics amongst us (and, believe me, working there made a lot of people very cynical) would argue that this constant production of children would ensure the need to work never happened. This is in the time when if you were a single parent, there were no requirements to work or seek work. So, there were huge families, and all those children added to the sum paid out.

And, yes, there were a few cases where both of these criteria applied, and amounts paid per week could be more than our monthly pay.

The benefits I worked on were paid on top of Unemployment Benefit - which was means tested, and other benefits would be counted against the amounts we paid out. All this has been much altered and streamlined over the years since I stopped working the, but I believe that the general clientele has not changed, and that the anomalies I mentioned still happen.

The problem is that these spikes in the data are the spikes that the papers get excited about, and the politicians like to use to justify their fiddling with the system, and their attempts to nudge us all into thinking how they think (they have consultants working for them for just this purpose). The people who genuinely have a need for state support are forgotten in this free for all witch hunt.

What could be done is to raise the minimum wage by slightly more than the rate of inflation. Over time that will increase the difference between those working and those on benefits. A living wage will also cut the need to subsidise employers paying low wages. Also the average wage is help a lot by those at the very top. IITC bosses of FTSE 100 companies had a pay increase or 49% last year. So that probably means most had pay cuts, or no increase at all. So in effect they are falling closer to the minimum wage each year.

Or alternatively it might cause the rate of inflation to spiral, and increase unemployment as many companies strive to cut their wages bill.

Increasing inflation is the government sole policy to defuse the debt burden. So they will not stop that. Also any increases will be very small and any company that sacks people over such a small increase would probably collapse anyway.