Rent Officers (Housing Benefit Functions) (Amendment) Order 2001

[back to previous text]

Mr. Stunell: First, does the Minister accept that it is not possible to rent in the private sector in my constituency at housing benefit levels? My second point may be trivial, but although the Minister is right that one of the appellants suffered a decrease, he was not a resident of my constituency.

Malcolm Wicks: Yes, but he was a resident of someone's constituency. Although the action was taken on the ground that it would produce good news if the Court of Appeal gave the right judgment, the result must have been quite a blow for that tenant. That suggests that the matter is rather more complex than the hon. Gentleman sought to make it, though that, no doubt, was because of the shortage of time.

On the hon. Gentleman's first point about rent levels, it would be absurd for me to make a judgment about the situation in his constituency. I heard his assertion, but I am not sufficiently equipped with knowledge of the local rent data to confirm or qualify it in any way. However, there should be transparency in the definition of ''locality''. As I have said, we do not feel that we can have fixed boundaries. It may be administratively simpler to have local authority boundaries, but, as we all know from our own areas, housing markets are not coterminous with local authority, or any other, bureaucratic boundaries. For that reason, we must leave it to the good sense of the rent officer, who is in a better position than most of us, to determine these matters in the local housing market.

None of us wants a situation in which poor people are driven into the poorest areas in our conurbations or localities, and I take it that the Committee is united in not wanting that kind of ghettoisation. Again, I put it to the hon. Gentleman that the issues at stake are complex. If we moved to having five times the number of localities in some conurbations or, as I am advised, 10 times the number of localities across the nation, some people might benefit in terms of local reference rents, but in poor localities the reference rent would be very low. That would have the opposite effect from that intended by the hon. Gentleman because, given the impact of local reference rents on housing benefits,

Column Number: 15

the poor would be able only to let property in poor areas, which would be the reverse of what he wants.

Rent officers have received internal guidance on the new order, which is standard practice within the agency. Copies of the guidance are, of course, available on request. I hope that when we come to a vote–there may be a vote if I have not persuaded the hon. Gentleman of the justice of my cause–I hope that my hon. Friends will support the order.

5.27 pm

Mr. Boswell: I echo the appreciation of your chairmanship of what is becoming a fascinating Committee, Mr. O'Hara. Those–not me–who have been trained by the Jesuits may have heard about debating the number of angels on a pinhead. I thought that consideration of precise distinctions among ''locality'', ''vicinity'' and ''neighbourhood'' would be like that, but the order has raised a matter of public concern and several important administrative issues.

Uncharacteristically, I find myself in a median position. I understand where the hon. Member for Hazel Grove is coming from because his constituents have a problem. Clearly they have suffered from this change, which is undesirable, and it is his duty to bring the matter to the Committee's attention. I have not encountered similar problems in my constituency, although it may happen and a change to interpretation or practice by the local Rent Service might trigger it. However, the problem may not be universal.

I sympathise with the Minister because by any fair definition, and I apply this to myself, the order is at the margins of operation of the Department for Work and Pensions. Indeed, he is being assisted by the hon. Member for Basildon (Angela Smith) because the matter is not something with which he would deal on a daily basis, although I am aware of his wide knowledge and expertise in social policy. Given my experience, I can see a Minister who is faced with an adverse court judgment and a series of administrative problems on which he may have quickly to mediate. I am mollified by his reassurance that this is not a malign plot to reduce the overall level of local reference areas for rents, and that he seeks a measure of stability.

I have two comments on the order beyond those that have been rehearsed so far. First, and the Minister will be familiar with this because we discussed the point endlessly in relation to the Learning and Skills Council, there is the issue about whether sufficiency and adequacy are the same or different, because he has replaced one term of art with one or one and a half, according to taste. I am worried that if that has given rise to an adverse judgment in the Court of Appeal, and if he has slotted in a new set of terms, albeit with some slightly more sophisticated definitions, several years down the track, he, or one of his successors, might have to deal with another set of adverse consequences for hon. Members or their constituents. There might be a series of adverse judgments in the Court of Appeal, which would trigger more head

Column Number: 16

scratching and the adoption of a fresh set of terms, or even a return to the original set, because the matter had not been resolved. The problem that the Minister has perhaps yet to address is that his new definitions might themselves break down because they are insufficiently precise.

The second point, which is worth taking time to consider, is that in fact the order is two orders in one. For all practical purposes, an implicit part of it is a virtually identical provision dealing with the Scottish situation. I have never seen anything quite like it. On first reading it, I misread it as two orders printed together that were to be debated together. I appreciate that a unified social security system for Great Britain is a reserved function, but given that the order updates the 1997 Scottish order, I wonder whether there are any relevant consequences of devolution that the Committee has not spotted, and on which it should spend a moment or two.

I want to turn to some general points, and to ask the Minister about some wider concerns about housing benefit. During exchanges between the Minister and the hon. Member for Hazel Grove, I was struck by the fact that there is a tension. At one extreme, we could define the whole of Great Britain as a single locality, and try to produce an heroic, split-the-difference definition of a local reference rent level. As a Member of Parliament for a London constituency, and like any Member with a constituency on a metropolitan fringe, the Minister will know that that would be an extremely silly and unfair thing to do. At the other extreme, we could create an unmanageably large number of localities. Perhaps not wholly ingenuously, the Minister said that there might be some operational difficulties. If push came to shove, my inclination would be that rent officers operate with as much refinement as they think necessary. If there have to be a few more areas, so be it. It is clear, however, that there are limits to the process.

We do not want changes to be driven by Government diktat, rather than by changes in the market or in the rent officer's appreciation of market conditions. The Minister has a proper interest in restraining the cost of housing benefit, but he has rightly had to give assurances that there is not a hidden agenda, involving forcing relatively needy people out of higher-priced housing and into the inner cities. Such a measure might be desirable, in that, for other reasons, we should all like some of our inner cities to be repopulated, but it certainly ought not to be brought about by housing benefit regulations. Nor should such a policy be unsupported.

My third general point relates to the work of the Rent Service itself. The Minister says that he is prepared to show us his guidance, and I hope that he will allow rent officers to operate professionally in assessing local reference areas and rents, rather than primarily at the behest of Ministers. As it happens, I know more about the district valuation service than the Rent Service. From time to time, both are criticised as having been nobbled by Ministers, or as working at the behest of Government to keep down the cost of compulsory purchase, rents or housing benefit. Instead, they should operate in an unfettered,

Column Number: 17

professional way, but within the parameters set by Ministers.

It is extremely important–the Minister has taken us some way on this–that Government policy in this area be transparent and explicit. If there is to be a change–for example, the Minister is understandably worried about the huge cost of housing benefit–he should explain it directly, not use salami tactics through some kind of discreet advice to rent officers.

I mentioned that we have some wider considerations about housing benefit, although I shall not trouble the Committee's indulgence on them for long. The by-product of this interesting debate is that we can at least touch on them–I hope that that is in order. Although this is an especially controversial and remarkably opaque document, it is by no means the only piece of paper about housing benefit to come out of the Department. We elicited the information that there were 40 circulars and a significant number of statutory instruments in the 11 months till 30 November last. A strikingly large number of pieces of paper embodying changes, and changes in interpretation, come out of the Department.

That leads on to the issue of wide variation in the practice of local authorities, which are not strictly covered by the order, but have to implement housing benefit, and how that happens. It is worrying that, in the last year for which figures are available, 50 per cent. of all councils did not prosecute for benefit fraud, as that could include the collusive activities that I touched on in an intervention. It always shocks me that local authorities still do not have a standardised form of application. One would think that if this is a national benefit, albeit locally delivered, some practices could be brought much more into line.

I close my brief remarks by saying that an area for concern has been exposed. The Minister has taken us some way towards meeting that concern but has conceded that the whole area of housing benefit is, perhaps, under-explored in this place, although we sometimes cover it with our constituents, and requires much attention in future–more than it has received. I sometimes think that we do not quite realise the scale of what is at stake here. I recently asked the Minister's Department a question that showed that in the pensioner group alone the cost of housing benefit is, give or take a few million pounds, identical to that of the minimum income guarantee. They both cost about £4.5 billion a year. One could add to the cost of housing benefit that of council tax benefit, another £1.4 billion.

Although we tend to debate such things as the basic retirement pension and the minimum income guarantee, and no doubt have the pensions credit to come, the cost of housing benefit more or less mirrors such costs for the pensioner population, and has a significant benefit for the population at large. If nothing else, our debate has performed a considerable service in uncovering some stones and some real concerns about operation. I hope that the Minister will take seriously the points that have been made on the order and more widely. We would all feel more comfortable if housing benefit operated fairly in

Column Number: 18

terms of locality, but also had a stronger national grip and consistency of practice than it has hitherto enjoyed

Several hon. Members rose–

Previous Contents Continue

House of Commons home page Parliament home page House of Lords home page search page enquiries ordering index

©Parliamentary copyright 2002
Prepared 14 January 2002