More than 600,000 households are now receiving more in benefits than the average worker earns, in a stark snapshot that will fuel fresh anger over Britain’s soaring welfare bill.
The analysis, produced by Conservatives, shows 625,618 households were handed more than £32,200 last year, roughly what a typical worker takes home after tax.
Despite years of promises to control spending, payouts on this scale continue, with around 16,000 households receiving more than £60,000.
The figures have intensified criticism of Keir Starmer and his government, already under mounting pressure to get a grip on public finances while pledging increases in defence spending.
Critics say the numbers expose a system drifting dangerously out of balance, where in some cases benefits outstrip full-time wages, undermining the principle that work should always pay.
Neil O’Brien, who led the analysis, warned that the scale of high-value claims among working-age households shows welfare reform has stalled. He argued the cap on benefits is no longer doing its job, allowing ever larger payouts to slip through.
The controversy centres on a long-standing exemption. Introduced under George Osborne, the benefit cap was meant to limit how much households could receive. But the cap does not apply if one member qualifies for certain disability payments, meaning entire households can receive uncapped support.
Conservatives say this has created a loophole that Labour has been warned about and failed to tackle, despite the growing cost. They argue it allows households to receive vastly different sums depending on technical eligibility, rather than genuine need.
Conservative Shadow Minister, Helen Whately said the current system risks rewarding inactivity, warning that some households can receive tens of thousands more than working families. She said reforms would force the cap to “do what it was meant to do”, ensuring employment is always the better option.
Labour has pushed back, insisting those receiving the highest payments are among the most vulnerable, often including people with severe disabilities. But critics say that defence avoids the broader issue, that the system as a whole has expanded rapidly with too little scrutiny.
The numbers underline that growth. Around 800,000 working-age households now receive more than £30,000 a year in benefits, a sharp rise in recent years. Even after a slight drop, the number receiving above the average salary remains far higher than before the pandemic.
Altogether, these households account for roughly one in 30 across Britain, with hundreds of thousands receiving £40,000 or more.
With the welfare bill now standing at around £155 billion, pressure is building on ministers to act. Conservatives estimate closing the exemption loophole could save up to £1 billion, money they say could be better used elsewhere or help steady the public finances.
For many voters, the issue cuts to a simple question of fairness, whether a system funded by taxpayers can justify paying out more than many of those taxpayers earn.
As the political battle lines harden, Labour faces a difficult choice, defend a system critics say is spiralling, or risk more backlash by tightening support in an already strained economy.
