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About 40,000 London households will be affected initially
A government-imposed cap on many benefit payments nationwide is beginning in four London boroughs.
Couples and lone parents in Haringey, Enfield, Croydon and Bromley will not receive more than £500 a week while a £350 limit applies to single people.
The cap is set to be imposed across England, Scotland and Wales between July and September.
Jobseeker's allowance, income support, child and housing benefit count towards it, but not disability benefits.
The move is part of efforts to cut spending; the amount is said to reflect the average working household income.
'Difficult choices'Employment minister Mark Hoban told BBC Radio 4's Today programme: "People want to see a benefits system that's fair, affordable and gets people into work. And we are seeing that."
End Quote Mark Hoban Employment ministerIf they want to escape the benefits cap, the best way to do it is to move into work"
He added: "This is about fairness. There are people in this country making difficult choices about where they live and who don't claim housing benefits."
"If they want to escape the benefits cap, the best way to do it is to move into work," Mr Hoban said.
The cap is not yet law in Northern Ireland.
The Department for Work and Pensions says about £90bn was paid out in benefit payments to people of working age and their families in 2009-10. It hopes the cap will save about £110m a year.
Jobseeker's allowance, income support, child benefit and housing benefit are on a long list of payments which count towards the calculation of the cap, which will result in an average cut of £93 for the 40,000 London households initially affected.
People on disability benefits will be exempt from the cap. To encourage people to seek work, ministers have decided that people with a job who receive Working Tax Credit will also not be affected.
Ministers claim that the threat of the introduction of the cap has already spurred 8,000 claimants who would have lost out to find jobs.
Labour argues that a better way to cut the benefits bill would be to offer guaranteed jobs to the long-term unemployed.
Shadow work and pensions minister Stephen Timms said: "For all the Tory rhetoric, the true picture of this government is one of economic failure.
"They are having to borrow £245bn more than they planned, not to pay for the investment needed to grow our economy, but to pay for more welfare spending caused by high unemployment."
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