THE UK is heading in the direction of a "United States-style welfare system", where working-age provision is "barely providing enough for people to live on without relying on charitable handouts", the Bishop of Leicester, the Rt Revd Tim Stevens, warned on Monday.

During a debate in the House of Lords on the Welfare Benefits Up-rating Bill, which will limit the increase in most benefits and tax credits to one per cent for the next three years ( News, 11 January), Bishop Stevens said: "It looks like part of an ideologically motivated attempt to alter the very nature of the welfare state."

He cited evidence that working families would be "among those worst affected" by the Bill. The House of Commons Library has estimated that if only out-of-work benefits were subjected to the cap, 80 per cent of the proposed savings would disappear. Bishop Stevens argued that the "inevitable impact" of the Bill would be a further increase in child poverty.

"Families that are already in a financially precarious position due to debt problems, lack of family support, and so on, will be particularly vulnerable."

Representing the Government, the Conservative Baroness Stowell argued that: "We have sought to find a balance between making necessary savings, and protecting those who are least able to increase their spending power. . . We will have failed if we still have a welfare system which does not make work worthwhile."

Another Conservative, Lord Bates, said: "The roots of this Bill in this Parliament lie in the bill for the previous Parliament: the doubling of the national debt, and the biggest budget deficit in the developed world and in our own peace-time history."

He spoke of figures showing that from 2003 to 2010, the previous government had overseen an "unsustainable" 60-per-cent rise in the welfare bill, as 90 per cent of workers were eligible for some form of welfare: "I have never quite been able to get to grips with the idea that profligacy is compassionate, and that sound management of your finances is somehow hard-hearted." Labour's Baroness Hollis said that "Benefit expenditure overall has grown - partly because tax credits help to offset low pay and lowered hours of work, but mainly because pensioners are protected from any cuts. . . These cuts fall on the vulnerable but voiceless rather than on those of us with resilience and resources, but who, of course, are more likely to vote."

The Bill will be considered by a House of Lords committee on 25 February.