A SCOTS-born mayor of a London council said the authority is being forced to move some of its poorest tenants to homes miles outside the city because of the Government's housing benefits cap.

Sir Robin Wales said Newham Council in east London has written to 1179 housing associations – including one in Stoke-on-Trent, 160 miles away – to find accommodation for the 32,000 families on the waiting list.

The Kilmarnock-born elected mayor said a combination of spiralling rents in the borough, which will host the London Olympics, and the housing benefit cap meant it could no longer afford to put up tenants in the private rented sector.

However, Housing Minister Grant Shapps said the Labour-controlled council was "playing politics" ahead of next month's local government elections.

Sir Robin, who studied at Glasgow University, said the borough, one of the country's poorest, was struggling to cope with an influx of families from wealthier parts of the capital forced out because of the housing benefit cap.

He said ministers ignored a warning by the Department for Communities and Local Government that capping benefits would lead to a homelessness crisis.

He said: "We are one of the poorest areas in the country, we have massive overcrowding, we are trying to deal with the people who are here.

"What happens? The Government pursues policies that push people out from the centre of London to here. There just isn't the capacity to deal with them and we end up chasing round the country trying to deal with people who are in need."

However, Mr Shapps insisted there was no justification for forcing families out of London. He said an internet search showed there were 1000 homes available for rent within a five-mile radius of Newham within the cap.

He said: "The system is still very generous and I think Newham is perhaps playing politics. Not only do I think it's unfair and wrong, I have also made the legislation and guidance very clear they are not to do this."

Gill Brown, chief executive of Brighter Futures in Stoke-on-Trent, one of the bodies contacted by Newham, said London boroughs should not be allowed to "dump" tenants on cities such as Stoke.

She said: "There is a real issue of social cleansing going on. We are very anxious about this letter, which we believe signals the start of a movement which could see thousands of needy people dumped in Stoke with no proper plan for their welfare.

"We have seen in the past relocation putting a strain on other services because the medical, education and justice systems are unprepared for an influx of very needy people."

Shelter chief executive Campbell Robb said: "This is the terrifying reality of our housing crisis – hundreds of families potentially forced to move halfway across the country, uprooted from schools, support networks and employment opportunities.

"Most worryingly, this is only the thin end of the wedge, as further reductions in the housing safety net start to bite."

Prime Minister David Cameron's official spokesman declined to comment directly on the Newham scheme, but said: "We are making some reforms to the benefit system. Even after the reforms come through, people will still be able to claim nearly £21,000 a year to cover their rent through housing benefit.

"It was important we took action to reform the housing benefit system, which was becoming increasingly expensive."

Labour housing spokesman Jack Dromey said: "Britain is facing a growing housing crisis. Soaring rents and collapsing affordable house-building are making families homeless and forcing them to move hundreds of miles from home."