Benefit cap and mortgage interest

Does anyone know whether the benefit cap will be applied against claimants who do not receive Housing Benefit but do get help with mortgage interest?

The initial (April 2013) cap will only be applied by reducing HB so people with SMI will escape.

When UC is in place then the cap will be applied against the total UC including SMI where the claimant has no earnings.  As SMI is not going to be paid if there are any earnings then (a) the UC total is likely to be lower because there’s no SMI in the sum and (b) The UC total may be higher because, with a higher earnings disregard due to the absence of housing costs, net earnings would be lower and therefore UC higher - take your pick (and with an escape clause if earnings are over the threshold figure of £99 odd pounds a week - from memory).

So quite neatly encapsulating one of the main reasons why UC is being introduced, as per IDS in front of the Work and Pensions Committee on 17th September:

“Mr Duncan Smith: With respect, Chairman, the whole point about this is that Universal Credit collects up those benefits that are relevant to work-the means-tested elements of it-and basically what we do is we simplify that process and make sure that they act as an incentive to go back to work.”

From Hansard, here:

http://www.publications.parliament.uk/pa/cm201213/cmselect/cmworpen/uc576-iii/uc57601.htm