23/01/2012 11:38 GMT | Updated 23/01/2012 14:18 GMT

Welfare Reform: Labour Could Back Bishops Benefit Cap In House Of Lords

The House of Lords is debating the controversial welfare cap the government wants to introduce, with Labour set to back an attempt by a bishop to force the coalition to water-down their plan.

The government wants to cap the total amount a household can receive in benefits each year to £26,000, something opposed by many Liberal Democrats.

Significant objections have also been raised by Church of England bishops, who have a place in the House of Lords. The Bishop of Ripon and Leeds, Rev John Packer, is attempting to change the bill to mean child benefit is excluded from the cap - a move Labour have said their peers will support.

Earlier Labour tabled an amendment which would have prevented those at risk of being made homeless being subjected to the cap, but it was rejected by peers by a majority of 28.

Labour's position on the benefit cap can be seen as something of a flip-flop. Despite their earlier claim to support the benefit cap in principle, they now appear to be set to support a separate amendment to derail the Bill.

Earlier in the Commons the Work and Pensions minister Chris Grayling accused Labour of "tabling a 'wrecking amendment' on the cap", suggesting Labour were claiming to support the changes, whilst simultaneously supporting an amendment which would block it.

The amendment on exempting child benefit tabled by the bishops is now being debated. Bishops believe this would cost the taxpayer around £113m a year.

The House of Lords is unusually crowded, with former Lib Dem leader Lord Ashdown telling peers that he cannot support the government on the cap, because ministers have failed to outline a decent transition to the new scheme.

Ministers were supported by former Ulster Unionist leader Lord Empey, who said in order to change the welfare system, it wouldn't be possible to avoid upsetting one section of society or another, and that welfare reform was necessary.

Lib Dem peer Baroness Hussein-Ece told the the Lords that the price of social housing had "shot up" in many parts of London, thanks to much of it having been sold off and managed by the private sector. She said that areas of central London had extremes of wealth, and suggested that forcing families out of their homes would create "ghettos" similar to those seen in the outlying areas of Paris.

To widespread murmurs of approval, she added she deplored the claim that some families we deliberately having children just to claim more benefits.

"Some of the women from these communities are not in a position to make those kinds of choices," she added, saying many lacked the education to make family planning decisions.

Many MPs were seen in the public galleries of the Lords, who are expected to debate the amendments to the Bill for another hour at least.