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George Hollingbery: Some persuasive points have been made in the debate so far and I urge the Government to take them on board. However, I also find the Minister persuasive and I look forward to hearing what he has to say.

I wish to speak briefly about a funding issue that is not strictly related to the amendments. I hope that you will allow me to stray slightly off the selection list, Mr Crausby, on the basis that we are unlikely to have a stand part debate. I wish to talk briefly about parish councils. The hon. Member for Mid Dorset and North Poole (Annette Brooke) talked about horizontal and vertical integration, but I want to go downwards to look at parish councils and where their funding comes from.

At the moment, certainly in my constituency of Meon Valley, several parish councils take in council tax—or rather in precept—pretty much the same as the district council. As far as I can see from the Bill and the consultation on the Bill, there is no provision to pay any of the grant for reducing council tax to parish councils. There is mention of district councils, first-tier councils and precepting authorities such as fire authorities and the police, but as far as I can see there are no arrangements to compensate councils at parish council level for moneys they might forgo because people require council tax benefit. It seems to me that this issue needs to be dealt with.

In my area, Bishop’s Waltham and Denmead parish councils would rely entirely on the beneficence and good nature of the city council to fund their activities if they were not directly grant-aided. I would love to hear the Minister’s thoughts.

John Healey: It is a real pleasure to serve under your chairmanship, Mr Crausby.

I rise to support the amendments and new clause in the names of my right hon. Friend the Member for Greenwich and Woolwich (Mr Raynsford) and my hon. Friends the Members for Sheffield South East (Mr Betts) and for Warrington North (Helen Jones). The problem, which my right hon. Friend the Member for Greenwich and Woolwich hits on directly in his amendment 79, is that council tax reduction schemes will be undermined from the start by the 10% funding cut and the constraints that the Government are putting in place to compensate for the problem that it will create.

Throughout the part of the Bill dealing with council tax, we consistently see hallmarks of the scheme that run contrary to the Government’s declared aims. It shows a lack of true localism and a transfer of considerable financial risk from central Government to local government, which promises to have a severe impact on support for many current recipients of council tax benefit. The Bill also sets out an unrealistically and unfeasibly tight time scale.

The Secretary of State is more sophisticated than the image and manner that he often cultivates would suggest, but his politics on this matter are brutal and brutish. In my view, the intention is simply to transfer to local authorities the financial risk of the increasing cost of support for council tax costs. The Government want to get local authorities to take the blame for the cuts being imposed by central Government.

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Financial risk is crucial for any local authority when it considers the future. Authorities are being asked to take on the new risk without the flexibility to allow them to discharge the responsibilities that they are taking on fairly, effectively or appropriately for their area. Whether the 10% cut leads to pressure on councils’ funding, pressure for them to find cash from other sources or greater cuts for those who are not protected will depend on how the cut is distributed across local authorities, local decisions on the design of the scheme, the make-up of the population within an authority’s area, the proportion of people who are protected by central Government and the degree to which the move from a council tax benefit to a council tax discount encourages take-up among people who are already entitled to support but do not claim it.

Central Government would not make this move if it affected themselves. As my hon. Friend the Member for Warrington North said, they are transferring what is currently annually managed expenditure—the current costs of the council tax benefit scheme are driven by factors that are not under the control of councils—to funding that is covered by the local government departmental expenditure limit. That will put an unrealistic and unfair funding noose around the neck of local government, because the year one base level will involve a 10% cut. My fear is that what could and should be a good move for local government and the people it serves—a locally designed council tax support scheme—is damaged and discredited before it starts by the design of the scheme.

Mr Mike Hancock: May I say how nice it is to see you in the Chair, Mr Crausby?

I wish to raise my concern about the fact that we are approaching 7 o’clock and will hardly get halfway down the selection list. The time available is totally inadequate. Goodness knows what the Government were thinking about, giving us just three days in Committee. It is an absolute travesty. I only hope that they will give us at least one whole day, and possibly two, on Report to allow debate on many of the matters that have not been discussed in Committee.

If the House is to do justice to the Bill, we should at least get a chance to discuss some of the very important amendments that have been tabled. I see them not as wrecking amendments but as helpful, creative amendments that would show the Government the strength of feeling in the House. Legitimate concerns have been raised from both sides of the House on this group of amendments alone, and if I were the Minister leading the Bill I would like to give the House more time to discuss them properly. If we are not careful, we will end up with a dog’s dinner, which cannot be right or fair to local authorities.

The most important issue in this group of amendments is raised in new clause 11, with which I agree entirely. It gets to the very essence of what the Committee has discussed on previous days. It is about the stability and sustainability of local government and its ability to stay clearly focused on its task. Support for new clause 11 is essential to give local authorities a fair chance of implementing the scheme.

The Government have expressed no clear and positive view about what they can do to help local authorities. I ask Ministers what is wrong with new clause 11 if they

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believe in fairness and in giving local authorities a proper opportunity to get the scheme right. Who will benefit if it is got wrong? No one, least of all the people who claim benefits. Most of the blame will fall on local authorities, and once again we are going down the well trodden path whereby the Government decide to disrobe themselves of their responsibilities and pass them off to local government, but forget to put the resources in place to help things happen.

I do not suppose that at the end of this debate the Minister will dish out to Members a scheme that has already been concocted, so that they can take it back to their local authorities and say, “This is the scheme we want you to use. We’ve paid for it, we’ve got it in place, and all you’ve got to do is tweak it a little. It’s tried and tested, and we’re prepared to give it to you.” That is not going to happen, is it?

Mr Kevan Jones: Does the hon. Gentleman not understand that the Secretary of State is a highly political individual who knows exactly what he is doing? He knows that he is going to save money by making this change, and he will give constituents in Portsmouth and Durham the impression that it is nothing to do with him but is down to the nasty councillors who are making the tough decisions.

Mr Hancock: The Secretary of State will be making a grave error of judgment if he thinks he is going to get away with that in Portsmouth, because I will be telling people there loud and clear where the responsibility for the change lies. Above all, I am disappointed that a Secretary of State who was groomed in politics in local authorities and who, having led one, has a fundamental understanding of their problems is not being more responsible towards something that I thought he cherished and cared for. Like the hon. Gentleman, I am disappointed, but I can assure him that people in Portsmouth will not have any illusions about where the blame lies.

Portsmouth is a local authority that is making reductions, and many hon. Members’ local authorities are in the same position. People are losing their jobs, and here we are contemplating another burden that will be placed on them with not even an indication of what it will cost to put in place. I know from bitter personal experience, having led a local authority, how much money can be lost when authorities get the wrong advice on a system. Hampshire county council squandered literally tens of millions of pounds over a 20-year period on schemes that failed in one way or another, and I do not want that to happen again.

Where is the inspiration that we ought to be getting from the Minister about how we can resolve the problem easily? Where is the offer to meet the House halfway on this issue? Nowhere. That is disappointing. If there are to be localised benefit systems, I want us to find a way to get a scheme in place in good time, but in proper time. That cannot happen in the time scale before us. If we are to have a change in the system, it must be seen to be fair and properly implementable. The scheme cannot punish those who desperately try to get into work but are on low pay.

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7 pm

The proposal is nothing other than a disincentive. How many of us would like to cope with losing £20 a week out of the minimum wage? How many of us would still believe that it was worth trying to continue to work? There is a disincentive, for which it is hard to find an excuse. I cannot. I hope the Minister can because I look to him to offer some wisdom about why people on a very low income, who will lose possibly as much as £20 a week, will not see the provision as specifically targeted at hurting them. I thought that we were elected to prevent that.

Mr Syms: I am listening carefully to the hon. Gentleman’s passionate speech. Clearly, apart from potential costs for software and computers, a scheme will have to be drawn up and publicised. All the schemes will be different, which means that there will have to be a lot of publicity locally to ascertain what people are entitled to. We need some answers.

Mr Hancock: I agree entirely. Some hon. Members like me, have close-knit communities that are right next to communities in other local authorities. People on one side of the road will have a different scheme from those on the other side. It will be horrendously difficult to explain why one scheme prevails in Fareham and another in Portsmouth. Indeed, the hon. Member for Meon Valley (George Hollingbery) will have great problems, given the different districts that his constituency abuts. I therefore ask Ministers to consider seriously coming back on Report with something that shows they have heard the cry from local authorities. It is heartfelt and not just for effect. The Local Government Association has not done all that work to sustain its arguments without a great deal of effort.

In the spirit of trying to be constructive, I hope that if we are to have a day—or even two—on Report, creative thinking in the Department will soften some of the provision’s effects. Otherwise, I shall vote against it not only tonight but on Third Reading.

Mr George Howarth rose—

The Temporary Chair (Miss Anne McIntosh): I call Gerald Howarth.

Mr Howarth: George—not only a different party, but an entirely different politics, Miss McIntosh.

It is a pleasure to follow the hon. Member for Portsmouth South (Mr Hancock). Both he and the hon. Member for Mid Dorset and North Poole (Annette Brooke) made a plea for constructive suggestions. I tried to intervene on the hon. Lady’s contribution with a constructive suggestion, but I think she thought that I was going to be disagreeable, and she refused to accept my intervention.

Many hon. Members have mentioned the consequences of protecting pensioners in the overall scheme, and I will not labour the point. It is important to say at the outset that nobody on the Opposition Benches and, I am sure, elsewhere, disagrees with the principle that pensioners should be protected. It is an important principle, to which we all subscribe. The difficulty that we are trying to address is not the Government’s decree

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that pensioners should be protected but their failure to deal with the consequences of that in the context of a 10% overall cut.

Some contributions have referred to the impact. For example, the hon. Member for Poole (Mr Syms) wanted more information about how the proposal would work in practice. I would like to rely on a briefing that the special interest group of municipal authorities—SIGOMA—has given me. It is a local government representative group, but of a particular set of local authorities. It concludes that, to protect pensioners’ council tax credit, the rest of council tax payers nationally will face a reduction of 17% rather than 10%. We are talking about averages, and we discussed the problem of averages earlier. The range means that, at the bottom end, the figure will be 13.4%, and at the high end, it will be 25.2%. Those who have concerns should take those figures into account.

I will talk about Knowsley shortly. It is a Knowsley problem—there is a distinct flavour of Knowsley to it—but every hon. Member will be confronted with it if the scheme is implemented in its current form.

Mr Kevan Jones: Does my right hon. Friend agree that the scheme will disproportionately affect constituencies such as his and mine in Durham, which not only have many people in receipt of council tax benefit, but a growing elderly population?

Mr Howarth: Yes. There might occasionally be disputes about the scale, but every demographer recognises that people are living longer and that there are therefore many more elderly people in the system.

Mr Syms: The right hon. Gentleman is making a powerful point, but is it not more likely that, rather than having a cut of 15% or 17% across the board, the numbers will be more limited, so some people will have a cut of 100% because not as many will qualify?

Mr Howarth: The hon. Gentleman is right. That underscores the point that he and others made earlier: to some extent, we are taking a leap in the dark. Several hon. Members have said that one of the difficulties with local government finance is that, when you change it, the impact is unpredictable. I do not need to rehearse the history of the poll tax to show that. The position that we are considering is exactly the same in that it is unpredictable and volatile.

John Healey: The effect is uncertain, but it is possible to make some projections. In my authority of Rotherham—a member of the SIGOMA group—if the pensioners are protected in the way in which the Government clearly believe that they will be, everyone else who is currently entitled to support, including many who work but get low wages, and therefore require and have a right to that support, will take a cut of not 10% but 19.5%.

Mr Howarth: My right hon. Friend makes a strong point, which I hope to tackle shortly.

Currently, many people, especially young people, have to accept jobs, often well below the level of their qualifications, on a minimum wage, at the same time as having to forge an independent existence from their

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families. I fear that they, or young couples with families, in which the principal earner is on a low wage, will be most affected and put in an impossible position, unless the discretionary powers that the Bill describes are spelled out clearly so that the outcomes cannot be arbitrary. We deserve to know at least what the Government are planning, and that should appear on the face of the Bill. Who are the classes of people? There are vague descriptions in schedule 4, but nothing is spelled out clearly.

I said I wanted to talk about Knowsley and the Liverpool city region. I am indebted to the director of finance in Knowsley for the impartial briefing he has given to me—it is a Labour authority, but he has provided advice on the basis of his financial experience and qualifications. His view is that the 10% cut combined with pensioner protection means that the benefit of other claimants will have to be cut by 18%. If there is provision for others in a local scheme—they could be singled out or ring-fenced—that 18% cut could increase to as much as a 100%, because people could be excluded altogether, as the hon. Member for Poole said.

Mr Kevan Jones: Does my right hon. Friend agree that those same people will also be affected by the Welfare Reform Bill? For example, some will lose money under the under-occupancy rule in addition to their losing their council tax reduction. Many such people are in work.

Mr Howarth: I am grateful to my hon. Friend. If he bears with me, I will cover precisely that point shortly in the context of the Liverpool city region, but I am sure the same trend applies in his constituency.

Mr Syms: Another question is whether we can differentiate council tax payers from non-council tax payers. What happens when there is a split household, in which one person is a pensioner and one is not? What happens when someone becomes a pensioner in-year? There will be so many months when they are not a pensioner and so many when they are. That also needs to be explained.

Mr Howarth: The hon. Gentleman, who is always fair and reasonable, makes a fair and reasonable point. I hope that the Ministers, who represent the two parties in the coalition, will at least take notice of the concerns that have been expressed from the Government Back Benches, even if they do not take notice of what Opposition Members say.

The Office for National Statistics estimates that pensioner take-up of Knowsley council tax benefit could be as low as 53%, but there could be a significant increase in take-up as a result of a localised scheme, which would place a disproportionate burden on other categories of people. If a greater number of pensioners take up the scheme, which is perfectly possible, the 18% I mentioned could be still higher.

My hon. Friend the Member for North Durham (Mr Jones) has been patient, so I shall speak about the effects of other measures. It is important that the changes are not taken entirely in isolation. We will talk about welfare reforms tomorrow, but a series of measures will combine to hit some of the poorest in society.

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When Labour was in government, I remember the Opposition hammering us by saying, “Well, the Institute for Fiscal Studies says something different from what the Government say.” If that is good for Conservatives and Liberal Democrats when they are in opposition, it is good for Labour Members. “The Impact of Austerity Measures on Households with Children”—an IFS report published this month and produced on behalf of the Family and Parenting Institute—found that the planned changes in the tax and benefit system, including those to council tax benefit, will hit the incomes of families with children the hardest. The IFS estimates that the measures will increase child poverty by 2014-15, with the poorest families being around 10% worse off.

Mr Kevan Jones: Will my hon. Friend give way?

Mr Howarth: I will give way in a minute. I just want to finish my point. The measure in the Bill combined with other measures will have a devastating effect on some of the poorest families in our communities.

Ian Mearns (Gateshead) (Lab): This morning at the Select Committee on Education, I asked the Secretary of State for Education whether his Department had done an impact assessment of the benefit changes on children’s welfare and educational prospects. He said that as far as he was concerned, that had not been done but it should be done. Is that a good idea?

7.15 pm

Mr Howarth: My hon. Friend makes his point well with his experience of that Committee sitting. I absolutely agree with the sentiment behind his question.

I want to return to what the hon. Member for Mid Dorset and North Poole said on that point. She is respected on both sides of the Committee for her long and distinguished record of campaigning on behalf of children. I hope she reflects on the fact that child poverty is likely to increase because of the combined effects of the Bill and the other measures that are currently trundling their way unevenly through the benefits system.

Liberal Democrats who have spoken in the debate, and the hon. Member for Poole, made sensible suggestions to get around that problem. The problem, as many Opposition Members and others have highlighted, is that we are being asked to support a measure that contains massive uncertainty. If we get it wrong, some of the poorest in our communities will suffer the most.

My intention in speaking to the amendments is to support amendment 79, which is in the name of my right hon. Friend the Member for Greenwich and Woolwich (Mr Raynsford), amendment 85, which is in the name of my hon. Friend the Member for Sheffield South East (Mr Betts), and new clause 11, which is in the name of my hon. Friend the Member for Warrington North (Helen Jones), but I have a serious suggestion that I believe would command support on both sides of the Committee. I suggest that the provisions should be delayed until they can be aligned with the universal credit system. At that point, a realistic estimate can be made of the impact of the combined changes on those

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poorest families. That is the only way in which we can ensure that there is fairness in the system, and that those who stand to lose the most are not the most penalised.

I should tell Ministers, one of whom will respond to the debate shortly, that all the evidence from reputable sources suggests that the poorest people in our communities will suffer the most, and that child poverty will increase. I am sure they do not want that to happen. My suggestion is therefore reasonable. I doubt they are briefed to accept it today, but I hope they will reflect on it.

Mr David Ward (Bradford East) (LD): We are in the same position as we were in last week, in that we are discussing a measure to which most Members agree in principle. Perhaps not all Members agreed on business rates, but we are discussing consequences.

My understanding—we have been told—is that the sums show that the measure balances itself out nationally, whether at £420 million or £500 million.

Mr Kevan Jones: No it does not.

Mr Ward: Whether the hon. Gentleman believes it or not, that is what we are told. The real issue is the local ramifications—winners and losers area by area.

Mr Jones: Will the hon. Gentleman give way?

Mr Ward: Let me just get on. I want to develop my thoughts if I may.

Mr Jones: But that statement was wrong!

Mr Ward: It does not really matter because we are talking about local ramifications—how the measure affects each area and what each area will be required to do to make up for lost council tax benefit.

The question is where the money will come from to make up the gap, and there are a couple of answers. First, there are the new freedoms that will be extended to local authorities, and locally determined schemes will generate a lot of additional funding. Members have raised the issue of pensioners being protected, and that will pass the burden on to other people.

Mr Kevan Jones: Will the hon. Gentleman give way?

Mr Ward: No. Just sit and listen.

The Temporary Chair (Miss Anne McIntosh): Order. Will the hon. Member for North Durham (Mr Jones) contain himself?

Mr Ward: I sincerely doubt it, but thank you, Miss McIntosh.

Members have noted that if pensioners are protected, the burden will have to be picked up by others, who may be on low incomes. [ Interruption. ] That is not necessarily the case, because we do not know what the new freedoms will generate, and they may generate sufficient funds to make up the gap.

As a result of the proposals, Bradford faces a £4 million loss in council tax. The figure for the funding that will be generated from the new-found freedoms, if they are extended to new areas, is actually very substantial, and it is not far off that £4 million figure.

Helen Jones: Will the hon. Gentleman give way?

Mr Ward: No.

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However, that is not really the point. It does not really matter whether those two figures equate. If they do, it will be pure fluke and pure coincidence. If a local authority can generate sufficient funding from the new freedoms to cover the loss in council tax, it will be sheer fluke, and a policy cannot be based on fluke. The certainty of loss will be there, without the certainty of gain. The certainty of the Government withdrawing the 10% will be there; the uncertainty of what can be generated at this time is clear for all to see.

In addition, the collection costs for the alternative sources of funding for the exemptions on classes A, C and L could be enormous. We must take account of the cost of the arrears and the cost of collecting those additional sources of funding. The Government’s position is, “Don’t worry. You may be losing council tax, but your new-found freedoms will easily generate the funds required to balance that.” However, that is simply not guaranteed authority by authority, and it is based on sources of funds that it will be difficult to collect in some cases. There are huge differences when it comes to residents telling their council, “I’ve got an empty property. Give me a discount” and residents saying, “I’ve got a second home. Please tax me.”

Mr Kevan Jones: There are a lot of second homes in Bradford.

Mr Ward: There are, actually, several hundred second homes in Bradford.

If authorities cannot generate funding from the new-found freedoms, the other answer is for them to find it somewhere else in their budget. They have this wonderful freedom to find other areas where they can balance the books. The problem is that council tax is likely to be high in areas of high need. Areas of high need will have high formula grant, and areas of high formula grant will have suffered a large cut in the local government settlement. All those things together mean that the risk, or the uncertainty people have talked about, is disproportionately likely to hit more deprived communities.

I think it was the hon. Member for Meon Valley (George Hollingbery) who said that 10% is 10%. There may be a lot more council tax in monetary terms in Durham or Bradford than in Meon Valley, but 10% is 10%. However, that is not really the issue, because more deprived, less affluent areas will be disproportionately harmed, given that they have disproportionately more council tax recipients. That is not fair, but the issue of fairness cannot be assessed until the thing has run its course, and we have developed all the possible ways that an authority may have of generating funds.

Of course, there is the issue of whether the software can be introduced, but there are also the unanswered questions. How will the future growth in claimant numbers affect the 90% base in terms of eligibility? Opposition Members talked about the low level of claims by certain groups, such as pensioners, where 65% of those who are eligible actually claim. What will the scheme do to protect authorities from the growth in claimant numbers as a result of increased take-up or deteriorating economic circumstances? What is the situation with the administration grant for council tax support? When will authorities know about that? Where is the evidence that has been collected about the relative difficulty of collecting some of the income from the new potential sources of income? Where is the evidence that that will be done?

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Finally, the proposals are clearly Treasury driven. Most people here have at heart local government and the local government system. That is why we have a generally positive response to localisation measures as they affect local authorities, although we understand that local government must make a contribution to tackling the deficit, as it has through the local government settlement. However, instead of treating local authorities as cash cows, why could we not have treated them as partners in deficit reduction? Why could we not have gone go them and said, “We will keep the council tax, and we intend to reduce council tax benefit over a period of time. In the first year, having given you that warning, we will extend new powers and freedoms to you to collect tax and remove some exemptions. You will yield the money that is generated from them to the Exchequer, so you will keep your council tax, and there will be no 10% cut, but it is on its way. In the meantime, you should generate additional funds from the new freedoms you will be given and yield those funds to the Exchequer in the first year. You will then be weaned off that over a period of time.” In the spirit of the business rates, why do we not do that, with some reward to those authorities that take up the challenge of extending the council tax base by generating money from new sources?

There was a different way to tackle this issue.

Mr Kevan Jones: Vote against it.

Mr Ward: I am going to. Unlike the hon. Gentleman, I am not a party lackey. Sometimes, we have to vote the right way, not simply the way the party tells us.

7.30 pm

The Parliamentary Under-Secretary of State for Communities and Local Government (Andrew Stunell): We have had a wide-ranging debate, and I shall do my best to respond to the key arguments made, quite a few of which spilt over into subsequent groups of amendments, if I may say so. If, as a result, I miss out some of the points, I hope that hon. Members will return to them later. I look forward to it.

The amendments have one fundamental problem: they make it impossible to secure a reduction in Government expenditure on council tax support. Even the Opposition have conceded that those savings must be made in order to tackle the deficit. Spending on council tax benefit has risen from £2 billion in 1997 to £4 billion, and it is essential to bring that back under control. The savings from localisation are a vital contribution to deficit reduction, and it is essential that we have a credible deficit reduction plan. I understand the points of view expressed. It would be much easier to have this scheme without deficit reduction, but it is an unavoidable part of the scheme.

Helen Jones: First, does the Minister accept that the increases in council tax benefit have been driven not by an increase in claims but by increases in council tax? Secondly, will he explain why he believes that the burden of deficit reduction should fall on the poorest people?

Andrew Stunell: On the first point, I agree that it was due to the fact that council tax doubled while Labour was in government. On the second point, as I shall demonstrate—I hope that this expands on the point

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that my hon. Friend the Member for Bradford East (Mr Ward) made—the Bill not only deals with deficit reduction but creates opportunities for local authorities to collect more council tax in other areas. I will come to that in a minute or two.

Taken overall, our reforms will give local authorities a stake in providing support for council tax, which they have not had before, and will strengthen the incentive for local authorities to support residents back into employment, which in turn will reduce demand for support. Localisation gives local authorities significant control over how that reduction in funding is achieved, and it enables councils to design schemes reflecting local priorities.

I want to pick up on a point made a couple of times about whether the Secretary of State would approve schemes. The Secretary of State is not required to approve schemes, and local authorities do not have to submit schemes for approval. The important points are that the schemes should be transparent and that local authorities should be accountable to the law and local areas but not to the Secretary of State.

Amendments 79, 80 and 85 would, in effect, guarantee that there would be no reduction in funding to local authorities and leave authorities with no plan to reduce that funding. In the context of the wider deficit reduction programme, that is neither affordable nor sustainable.

Mr George Howarth rose—

Mr Raynsford rose

Andrew Stunell: I give way to the right hon. Member for Knowsley (Mr Howarth).

Mr Howarth: The Minister just asserted that the Secretary of State does not have any locus in this system. Will he explain, therefore, why paragraph 2(8) of schedule 4 reads:

“The Secretary of State may by regulations prescribe other requirements for schemes”?

What is that if not the power to intervene?

Andrew Stunell: It is a power to intervene but the Secretary of State does not propose to intervene on schemes. [Hon. Members: “Why’s it in there then?] The Secretary of State always has reserve powers. Right hon. and hon. Members have asked what is the system of checking, of feedback and of amendment to the scheme, and that is always provided for in regulations. That is the basis on which we are proceeding.

Several hon. Members rose

Andrew Stunell: I want to make some progress.

It is essential that local authorities plan their schemes carefully and take account of possible changes in demand, as pointed out in the debate. As we have set out previously, we believe that those in-year pressures that hon. Members have mentioned can be managed by enabling any deficit in the collection fund to be shared between billing and major precepting authorities. Our scheme will do that. We are taking powers in the Bill to allow billing authorities to make arrangements with major precepting authorities

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and to vary the amount of precept to be paid to the major precepting authorities in-year to rectify any shortfall in council tax receipts. That could help to protect billing authorities, which could include small district councils—my hon. Friends mentioned that some district councils are indeed small organisations.

Amendment 85 would require the Government to carry out a new burdens assessment on their allocation of grant, but the Government have already committed to consult on their proposals for distributing the grant. We must be clear that local authorities have to make choices, but they will be able to choose whether to pass on the reduction to council tax payers, to use the flexibility over council tax, which my hon. Friend the Member for Bradford East mentioned, or to manage the reductions within their budgets.

To the best of my reckoning, 12 local authorities come within the constituencies of Members who have spoken in this debate, and 10 of those local authorities are in a position whereby if they were to take advantage of the new flexibilities over second homes and empty homes, they would achieve an income increase exceeding the 10% reduction in their council tax benefit grant. I am not saying that it is right for local authorities simply to gobble up all that money, but I want to make the point—

Mr Raynsford: Will the Minister give way?

Andrew Stunell: In a moment. I realise that I failed to give way to the right hon. Gentleman earlier. I will do so in a moment.

As the impact assessment makes clear, the reduction in the council tax benefit fund to local authorities in England is in the order of £420 million. Furthermore, as is also set out clearly in the impact assessment, the total of both the discounts and the other arrangements recoverable from the local tax changes also equal about £420 million. My hon. Friend the Member for Bradford East is right that there is not an exact match between the increase and the decrease, but it remains the case that three quarters of local authorities find themselves in a position whereby should they go down that route, they would have the funding.

It is also open to local authorities, however, to look elsewhere and to put additional money into their council tax reduction funding, and of course they can change the basis on which they allocate that funding.

Mr Raynsford: I thank the Minister for finally giving way. He previously said that the Secretary of State did not intend to use his powers to define schemes. That extraordinary claim was the reason I wanted to intervene. We will shortly come to a group of amendments dealing with the Secretary of State’s default powers and his power to impose a scheme if a local authority does not have one in place. Will the Minister tell us whether the Secretary of State does not intend to use those powers either? If so, why on earth are they in the Bill?

Andrew Stunell: Of course, it would be sensible to debate that matter when we come to the next group of amendments, and I look forward to it. I want to make it clear, however, that the Bill states that if a local authority has failed by 31 January next year to put in place a

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scheme, by default the existing scheme will continue, and that is what the Secretary of State has the power to ensure happens.

Amendment 85 would require the Government to carry out the new burdens assessment, but we are already committed to doing that. We must be clear that local authorities do the job that they have been set. They have the opportunities to raise money in alternative ways and to devise a scheme that is suitable to their circumstances. As for the administrative cost, we have already made it clear that we will be fully following the new burdens doctrine that this Government have set out. The Government will therefore be working with local authorities to assess the net impact of housing benefit centralisation and the localisation of support for council tax, including the transitional costs, which will be covered, where necessary, by the new burdens doctrine.

Mr Betts: The Minister talks about working with local authorities. Presumably the Government have a view about that, despite what they say local authorities might be able to achieve by way of extra revenue generation. He has already admitted that at least a quarter of authorities cannot raise enough money to offset what they have lost under the scheme that we are discussing. Does he therefore accept that non-pensioners in those authorities—which are likely to be the poor authorities, with the highest percentage of people claiming council tax benefit—are going to suffer what the Local Government Association predicts will be cuts of around £6 a week?

Andrew Stunell: No, I absolutely do not accept that. The average reduction if local authorities do not put any extra funding into the pot, from any source at all, is £2.64 per household per week. Every local authority—even those that do not have complete recompense of the one pot of money from the other—will still get significant inputs from the discount scheme, which local authorities can, if they choose, take into account. I therefore ask the right hon. Member for Greenwich and Woolwich (Mr Raynsford) to withdraw his amendment, and I ask my hon. Friends to vote against it if he does not.

Mr Raynsford: We have just heard an absolutely lamentable performance from a Minister who is trying to wash his hands of responsibility for an outrageous scheme that has been designed in a way that reflects very poorly indeed on the members of the parties that comprise the coalition. This is a crude scheme which is seriously cutting the benefits that, at the moment, go to literally millions of poorer people—some in work, some over pension age, some not in work but under pension age. All those people—about 6 million nationally—are dependent on the existing scheme. The Government, in their wisdom, have suddenly imposed the idea that the scheme can be cut immediately, from year one, by 10%. They are then imposing further rules that involve a much larger cut on all those people who will not be protected by the Government’s diktat.

The Minister tries to weasel away from all that by using the figure of £2.40 or so for the average loss. He knows very well that, in proportion to the average claim that people receive at the moment, that means an average cut of 16.7% in benefits to poor people. On top of that, there are the other appalling features: all the risk being

31 Jan 2012 : Column 748

transferred to local authorities, which will have to cope with unexpected increases in cost without any Government support whatever; the possibility of an increased number of claims, because, perfectly rightly, people who currently do not claim the benefit may do so when it is no longer called a benefit and they can feel more comfortable about making a claim. Who bears the cost? Not the Government: once again, it is the local authority that has to bear the cost.

On top of that, we have the appalling timetable for implementation. The Government have not got their regulations ready. They will not have them ready, we are told, until late summer; and yet local authorities will be expected to implement this—a whole new scheme, requiring new software, new application forms and new procedures—in a matter of months. All the experts are telling the Government that it will not work and that it will be a catastrophe. Against all that advice, coming from authorities all over the country and here in the Chamber—virtually every Member who has spoken has expressed serious reservations and called on the Government to think again, delay and allow time for this scheme to be got right—the Minister just tries to dismiss it. This is a lamentable performance, and I intend to press amendment 79 to a vote, so that we can say that to the Government.

Question put, That the amendment be made.

The Committee divided:

Ayes 233, Noes 291.

Division No. 446]

[7.44 pm


Abbott, Ms Diane

Abrahams, Debbie

Ainsworth, rh Mr Bob

Alexander, rh Mr Douglas

Alexander, Heidi

Ali, Rushanara

Allen, Mr Graham

Ashworth, Jonathan

Austin, Ian

Bailey, Mr Adrian

Bain, Mr William

Balls, rh Ed

Banks, Gordon

Barron, rh Mr Kevin

Beckett, rh Margaret

Begg, Dame Anne

Bell, Sir Stuart

Benn, rh Hilary

Benton, Mr Joe

Betts, Mr Clive

Blackman-Woods, Roberta

Blears, rh Hazel

Blenkinsop, Tom

Blomfield, Paul

Blunkett, rh Mr David

Bradshaw, rh Mr Ben

Brennan, Kevin

Brown, Lyn

Brown, rh Mr Nicholas

Brown, Mr Russell

Bryant, Chris

Buck, Ms Karen

Burden, Richard

Burnham, rh Andy

Byrne, rh Mr Liam

Campbell, Mr Alan

Campbell, Mr Gregory

Campbell, Mr Ronnie

Caton, Martin

Chapman, Mrs Jenny

Clark, Katy

Clarke, rh Mr Tom

Clwyd, rh Ann

Coaker, Vernon

Coffey, Ann

Cooper, Rosie

Cooper, rh Yvette

Corbyn, Jeremy

Creagh, Mary

Creasy, Stella

Cruddas, Jon

Cryer, John

Cunningham, Alex

Cunningham, Mr Jim

Cunningham, Tony

Curran, Margaret

Dakin, Nic

Danczuk, Simon

Darling, rh Mr Alistair

David, Mr Wayne

Davidson, Mr Ian

Davies, Geraint

Denham, rh Mr John

Dobbin, Jim

Dobson, rh Frank

Docherty, Thomas

Dodds, rh Mr Nigel

Donaldson, rh Mr Jeffrey M.

Donohoe, Mr Brian H.

Doran, Mr Frank

Dowd, Jim

Doyle, Gemma

Dromey, Jack

Dugher, Michael

Durkan, Mark

Eagle, Ms Angela

Eagle, Maria

Elliott, Julie

Ellman, Mrs Louise

Esterson, Bill

Evans, Chris

Farrelly, Paul

Field, rh Mr Frank

Fitzpatrick, Jim

Flello, Robert

Flint, rh Caroline

Flynn, Paul

Fovargue, Yvonne

Francis, Dr Hywel

Gapes, Mike

Gardiner, Barry

Gilmore, Sheila

Glass, Pat

Glindon, Mrs Mary

Goggins, rh Paul

Goodman, Helen

Greatrex, Tom

Green, Kate

Greenwood, Lilian

Griffith, Nia

Gwynne, Andrew

Hamilton, Fabian

Hancock, Mr Mike

Hanson, rh Mr David

Harris, Mr Tom

Havard, Mr Dai

Healey, rh John

Hendrick, Mark

Hepburn, Mr Stephen

Heyes, David

Hillier, Meg

Hilling, Julie

Hodgson, Mrs Sharon

Hoey, Kate

Hopkins, Kelvin

Howarth, rh Mr George

Hunt, Tristram

Irranca-Davies, Huw

Jackson, Glenda

James, Mrs Siân C.

Jamieson, Cathy

Jarvis, Dan

Johnson, rh Alan

Johnson, Diana

Jones, Graham

Jones, Helen

Jones, Mr Kevan

Jones, Susan Elan

Jowell, rh Tessa

Joyce, Eric

Kaufman, rh Sir Gerald

Keeley, Barbara

Kendall, Liz

Khan, rh Sadiq

Lammy, rh Mr David

Lavery, Ian

Lazarowicz, Mark

Leslie, Chris

Lloyd, Tony

Love, Mr Andrew

Lucas, Caroline

Lucas, Ian

MacShane, rh Mr Denis

Mactaggart, Fiona

Mahmood, Shabana

Malhotra, Seema

Mann, John

Marsden, Mr Gordon

McCabe, Steve

McCann, Mr Michael

McCarthy, Kerry

McClymont, Gregg

McCrea, Dr William

McDonagh, Siobhain

McDonnell, John

McFadden, rh Mr Pat

McGovern, Jim

McGuire, rh Mrs Anne

McKechin, Ann

McKenzie, Mr Iain

McKinnell, Catherine

Meacher, rh Mr Michael

Meale, Sir Alan

Mearns, Ian

Michael, rh Alun

Miliband, rh David

Miller, Andrew

Mitchell, Austin

Morden, Jessica

Morrice, Graeme


Morris, Grahame M.


Mudie, Mr George

Munn, Meg

Murphy, rh Mr Jim

Murphy, rh Paul

Murray, Ian

Nandy, Lisa

Nash, Pamela

O'Donnell, Fiona

Osborne, Sandra

Owen, Albert

Pearce, Teresa

Perkins, Toby

Qureshi, Yasmin

Raynsford, rh Mr Nick

Reed, Mr Jamie

Reeves, Rachel

Reynolds, Emma

Reynolds, Jonathan

Riordan, Mrs Linda

Ritchie, Ms Margaret

Robinson, Mr Geoffrey

Rotheram, Steve

Roy, Mr Frank

Roy, Lindsay

Ruddock, rh Dame Joan

Sarwar, Anas

Seabeck, Alison

Shannon, Jim

Sharma, Mr Virendra

Sheerman, Mr Barry

Sheridan, Jim

Shuker, Gavin

Simpson, David

Skinner, Mr Dennis

Slaughter, Mr Andy

Smith, rh Mr Andrew

Smith, Angela

Smith, Nick

Spellar, rh Mr John

Straw, rh Mr Jack

Stringer, Graham

Stuart, Ms Gisela

Sutcliffe, Mr Gerry

Tami, Mark

Thomas, Mr Gareth

Thornberry, Emily

Timms, rh Stephen

Trickett, Jon

Turner, Karl

Twigg, Derek

Vaz, rh Keith

Walley, Joan

Ward, Mr David

Watson, Mr Tom

Whitehead, Dr Alan

Williamson, Chris

Wilson, Phil

Winnick, Mr David

Winterton, rh Ms Rosie

Woodcock, John

Wright, David

Wright, Mr Iain

Tellers for the Ayes:

Mr David Hamilton and

Chris Ruane


Adams, Nigel

Afriyie, Adam

Aldous, Peter

Alexander, rh Danny

Andrew, Stuart

Bacon, Mr Richard

Baker, Norman

Baker, Steve

Baldry, Tony

Baldwin, Harriett

Barclay, Stephen

Barker, Gregory

Baron, Mr John

Barwell, Gavin

Bebb, Guto

Beith, rh Sir Alan

Beresford, Sir Paul

Berry, Jake

Bingham, Andrew

Binley, Mr Brian

Birtwistle, Gordon

Blunt, Mr Crispin

Boles, Nick

Bone, Mr Peter

Bradley, Karen

Brady, Mr Graham

Brake, rh Tom

Bray, Angie

Brazier, Mr Julian

Bridgen, Andrew

Brine, Steve

Brooke, Annette

Bruce, Fiona

Bruce, rh Malcolm

Buckland, Mr Robert

Burns, rh Mr Simon

Burrowes, Mr David

Burt, Lorely

Byles, Dan

Cairns, Alun

Campbell, rh Sir Menzies

Carmichael, Neil

Carswell, Mr Douglas

Cash, Mr William

Chishti, Rehman

Chope, Mr Christopher

Clappison, Mr James

Clark, rh Greg

Clarke, rh Mr Kenneth

Clifton-Brown, Geoffrey

Coffey, Dr Thérèse

Collins, Damian

Cox, Mr Geoffrey

Crockart, Mike

Crouch, Tracey

Davey, Mr Edward

Davies, David T. C.


Davies, Philip

Davis, rh Mr David

de Bois, Nick

Dinenage, Caroline

Djanogly, Mr Jonathan

Dorrell, rh Mr Stephen

Doyle-Price, Jackie

Drax, Richard

Duncan Smith, rh Mr Iain

Dunne, Mr Philip

Ellis, Michael

Elphicke, Charlie

Eustice, George

Evans, Graham

Evans, Jonathan

Evennett, Mr David

Fabricant, Michael

Farron, Tim

Foster, rh Mr Don

Francois, rh Mr Mark

Freeman, George

Freer, Mike

Fullbrook, Lorraine

Fuller, Richard

Gale, Sir Roger

Garnier, Mr Edward

Garnier, Mark

Gauke, Mr David

Gibb, Mr Nick

Gilbert, Stephen

Gillan, rh Mrs Cheryl

Glen, John

Goldsmith, Zac

Goodwill, Mr Robert

Graham, Richard

Grant, Mrs Helen

Grayling, rh Chris

Green, Damian

Greening, rh Justine

Griffiths, Andrew

Gummer, Ben

Gyimah, Mr Sam

Halfon, Robert

Hames, Duncan

Hammond, rh Mr Philip

Hammond, Stephen

Hancock, Matthew

Hands, Greg

Harper, Mr Mark

Harrington, Richard

Harris, Rebecca

Hart, Simon

Harvey, Nick

Haselhurst, rh Sir Alan

Heald, Oliver

Heath, Mr David

Heaton-Harris, Chris

Hemming, John

Henderson, Gordon

Hendry, Charles

Herbert, rh Nick

Hoban, Mr Mark

Hollingbery, George

Hollobone, Mr Philip

Hopkins, Kris

Horwood, Martin

Howell, John

Hughes, rh Simon

Huhne, rh Chris

Hunter, Mark

Huppert, Dr Julian

Jackson, Mr Stewart

James, Margot

Javid, Sajid

Johnson, Gareth

Johnson, Joseph

Jones, Andrew

Jones, Mr David

Jones, Mr Marcus

Kawczynski, Daniel

Kelly, Chris

Kirby, Simon

Knight, rh Mr Greg

Laing, Mrs Eleanor

Lamb, Norman

Lancaster, Mark

Latham, Pauline

Laws, rh Mr David

Leadsom, Andrea

Lee, Jessica

Lee, Dr Phillip

Leech, Mr John

Lefroy, Jeremy

Leslie, Charlotte

Letwin, rh Mr Oliver

Lewis, Brandon

Lewis, Dr Julian

Liddell-Grainger, Mr Ian

Lloyd, Stephen

Lopresti, Jack

Lord, Jonathan

Loughton, Tim

Luff, Peter

Macleod, Mary

Main, Mrs Anne

May, rh Mrs Theresa

Maynard, Paul

McCartney, Karl

McLoughlin, rh Mr Patrick

McPartland, Stephen

McVey, Esther

Mensch, Louise

Menzies, Mark

Mercer, Patrick

Metcalfe, Stephen

Mills, Nigel

Milton, Anne

Mitchell, rh Mr Andrew

Mordaunt, Penny

Morgan, Nicky

Morris, Anne Marie

Morris, David

Morris, James

Mosley, Stephen

Mowat, David

Mulholland, Greg

Mundell, rh David

Munt, Tessa

Murray, Sheryll

Murrison, Dr Andrew

Neill, Robert

Newmark, Mr Brooks

Newton, Sarah

Nokes, Caroline

Nuttall, Mr David

O'Brien, Mr Stephen

Offord, Mr Matthew

Ollerenshaw, Eric

Opperman, Guy

Ottaway, Richard

Paice, rh Mr James

Parish, Neil

Patel, Priti

Paterson, rh Mr Owen

Pawsey, Mark

Penning, Mike

Penrose, John

Percy, Andrew

Perry, Claire

Phillips, Stephen

Pincher, Christopher

Poulter, Dr Daniel

Prisk, Mr Mark

Pritchard, Mark

Pugh, John

Raab, Mr Dominic

Randall, rh Mr John

Reckless, Mark

Rees-Mogg, Jacob

Reevell, Simon

Reid, Mr Alan

Robertson, Mr Laurence

Rogerson, Dan

Rosindell, Andrew

Rudd, Amber

Ruffley, Mr David

Russell, Sir Bob

Rutley, David

Sanders, Mr Adrian

Sandys, Laura

Scott, Mr Lee

Selous, Andrew

Shapps, rh Grant

Sharma, Alok

Shepherd, Mr Richard

Simmonds, Mark

Simpson, Mr Keith

Skidmore, Chris

Smith, Miss Chloe

Smith, Henry

Smith, Julian

Smith, Sir Robert

Soames, rh Nicholas

Soubry, Anna

Spelman, rh Mrs Caroline

Spencer, Mr Mark

Stephenson, Andrew

Stevenson, John

Stewart, Bob

Stewart, Iain

Stewart, Rory

Streeter, Mr Gary

Stride, Mel

Stuart, Mr Graham

Stunell, Andrew

Sturdy, Julian

Swales, Ian

Swinson, Jo

Syms, Mr Robert

Teather, Sarah

Thurso, John

Timpson, Mr Edward

Tomlinson, Justin

Tredinnick, David

Truss, Elizabeth

Turner, Mr Andrew

Tyrie, Mr Andrew

Uppal, Paul

Vara, Mr Shailesh

Vickers, Martin

Walker, Mr Charles

Walker, Mr Robin

Wallace, Mr Ben

Walter, Mr Robert

Watkinson, Angela

Weatherley, Mike

Webb, Steve

Wharton, James

Wheeler, Heather

White, Chris

Whittaker, Craig

Wiggin, Bill

Williams, Mr Mark

Williams, Roger

Williams, Stephen

Williamson, Gavin

Willott, Jenny

Wilson, Mr Rob

Wollaston, Dr Sarah

Wright, Jeremy

Wright, Simon

Yeo, Mr Tim

Young, rh Sir George

Zahawi, Nadhim

Tellers for the Noes:

James Duddridge and

Stephen Crabb

Question accordingly negatived.

31 Jan 2012 : Column 749

31 Jan 2012 : Column 750

31 Jan 2012 : Column 751

31 Jan 2012 : Column 752

The Temporary Chair (Miss Anne McIntosh): In view of the debate that we have just had, and the nature of the next two groups of amendments, I inform the Committee that I am unlikely to allow a separate debate on clause 8 stand part.

Helen Jones: I beg to move amendment 66, page 5, line 6, at end insert—

‘(1A) In exercising its powers under section 1(b) the authority must have regard to the impact of the scheme on—

(a) those persons in the area who are in employment or actively seeking employment, and

(b) the levels of poverty in the area, including the levels of child poverty.’.

The Temporary Chair: With this it will be convenient to discuss the following:

Amendment 49, page 5, line 17, at end insert—

‘(4A) In exercising its powers under subsection (1)(b), each authority must have regard to the impact of its scheme on the living standards of those persons in its area who, prior to the introduction of the scheme, were receiving council tax benefit.

(4B) In exercising its powers under subsection (1)(b), each authority must have regard to the impact of its scheme on the living standards of those persons in its area, below pensionable age, who are in employment or are actively seeking employment.’.

Amendment 59, page 5, line 28, leave out ‘2013’ and insert ‘2014’.

Amendment 60, page 5, line 29, leave out ‘2013’ and insert ‘2014’.

Amendment 67, in schedule 4, page 47, line 6, at end insert ‘and set out the steps which the local authority will take to ensure that—

(a) persons entitled to a reduction will be made aware of their entitlement, and

(b) assistance is available to such persons who wish to make an application.’.

Amendment 56, in schedule 4, page 48, line 7, at end insert—

(e) require authorities to have regard to the impact of its scheme on—

(i) the numbers of persons in its area expected to receive a greater or lesser reduction in council tax than that which they had been entitled to receive under council tax benefit, and the amounts by which their entitlement are likely to increase or reduce,

(ii) the living standards of such persons,

31 Jan 2012 : Column 753

(iii) the financial incentive on persons below pensionable age to seek or maintain employment.’.

Amendment 68, in schedule 4, page 48, line 15, at end insert—

‘including local charities, organisations providing advice on benefits and organisations representing older people.’.

Amendment 54,  page 48, line 39, at end insert—

(f) include estimates of the likely impact of its scheme on the living standards of those persons in its area who have been receiving council tax benefit.’.

Amendment 57,  page 48, line 44, leave out ‘2013’ and insert ‘2014’.

Amendment 58,  page 49, line 5, leave out ‘2013’ and insert ‘2014’.

Amendment 70,  page 49, line 13, at end insert—

‘In considering the need for replacement or revision of the scheme the authority must have regard to the impact of any such revision or replacement on the living standards of people in the area including—

(a) those of working age in employment and actively seeking work,

(b) those in receipt of benefits including disability benefits, and

(c) persons of pensionable age.’.

Amendment 71,  page 50, line 23, at end insert—

‘Before issuing such guidance the Secretary of State must have regard to the impact on—

(a) those of working age in employment and actively seeking work,

(b) those in receipt of benefits including disability benefits, and

(c) persons of pensionable age.’.

Helen Jones: This group of amendments deals with the impact of the proposed changes in council tax benefit on some of the poorest people in the country. One of the keys to this issue is something that we started to debate when discussing the previous group of amendments—the fact that people in the same circumstances will no longer receive the same type of benefit. Entitlement will depend on where a person lives and on the population of that area. That is a major change to the way that we treat people in this country. The circumstances of someone who lives in Birmingham could be exactly the same as those of someone living in Bradford, but their benefit could now be different. Someone who lives in Chichester could be treated differently from someone who lives in Carlisle.

8 pm

The basic unfairness is staggering, especially when combined with a 10% cut in the funding available to local authorities. As we heard in respect of the previous group of amendments, there has been a switch from annually managed expenditure, whereby local councils were reimbursed for correctly processed claims, to grants that will have to come within the departmental expenditure limits. The impact is clear: far from achieving the Government’s stated grand aim in the consultation—to

“give councils increased financial autonomy and a greater stake in the economic future of their area”—

31 Jan 2012 : Column 754

the measure simply transfers the financial risks to local councils and hits the poorest people hardest, especially the working poor. What is frequently forgotten in this debate, not least by the Government, is that many people receiving council tax benefit are in work.

The Government say that they want to protect pensioners—and rightly so—but the consequence of the decision, coupled with a 10% reduction in funding, means that those in local authorities with a high proportion of pensioners will suffer more than those in an area with fewer pensioners. How can that system be fair? As we heard from my hon. Friends earlier, the reductions for those of working age will range from 13.4% to 25.2%—a national average of almost 17%. Of course, that situation could get worse. The Government have said that they are minded—only minded—to base their funding on previous expenditure. As a result of that, spending will no longer rise to meet changes in demand. It is, in effect, a cash-limited system. If unemployment rises and more people need to claim, and if more pensioners claim—quite rightly under this system, as we heard earlier—that must be paid for.

Mr Kevan Jones: Does my hon. Friend agree that, contrary to the impression given by the Minister in his winding-up speech on the previous group of amendments—that use of the flexibility on second homes, and growing the economy, could make up the difference—the only option available to most councils is to raise council tax and that councils with a high proportion of band A properties will be at a severe disadvantage when it comes to the amount of money they will be able to raise?

Helen Jones: My hon. Friend is, of course, right. In trying to remedy the problem, the most disadvantaged councils will be those with the lowest tax bases. That has been true throughout all our discussions on the Bill. If demand goes up, councils will be faced under this scheme with either bearing the extra cost or, more likely, redesigning their schemes to restrict the number of those eligible. The Chartered Institute of Housing said it very clearly: council tax benefit awards will be

“squeezed precisely at the point at which there is the most need for help amongst low income households.”

London Councils estimated that if this scheme had been in place earlier, a shortfall of £400 million would have been faced in the five years to 2009-10.

The Government say that councils can do something about this. The Minister for Housing and Local Government says, in what I have to say reads like a rather garbled piece of evidence to the Select Committee, that considering whether to pass on the 10% reduction to claimants or to find the money elsewhere was “old-school thinking”—or what the rest of us might call “doing your sums”. I am sure that councils facing these cuts will have been relieved to hear that they could reduce the bill

“not by unfairly not paying people who are vulnerable and need it”,

which seems to me to be the precise effect of this scheme; no, he said, councils should be ensuring that there is

“a definite interest in starting up that new industrial estate, business park and getting economic activity going so there are jobs.”

31 Jan 2012 : Column 755

Let me say this slowly, so that Ministers can understand it. If a firm closes down or lays off staff, a new business park does not open up the next day. People are out of work; they claim benefit; and if there is not enough money to pay that benefit, councils either have to cut what is available or find the money somewhere else from budgets already facing massive cuts. It is staggering to hear a Government who have presided over a rise in unemployment to 2.6 million and who have seen the economy flatline lecturing local councils about the need to open business parks. Only the Minister for Housing and Local Government, whose overwhelming self-confidence is matched only by the staggering depths of his ignorance, could come out with such nonsense.

It is not surprising that the Select Committee was unimpressed, saying:

“We have seen little evidence to support the hope that the new and better-paying jobs for individuals, immediately sufficient to offset the 10% reduction in the benefit budget will inevitably follow from these incentives.”

It continued to stress what we have talked about throughout this Committee stage—that

“the means of economic growth are never solely in the gift of individual local authorities.”

It is, of course, precisely the authorities that have already borne the brunt of the Government’s cuts that will find themselves in most difficulty with this council tax scheme.

The New Policy Institute estimated that five out of the 10 hardest-hit local authorities are among the top 10 most deprived areas in the country: Hackney, Newham, Liverpool, Islington and Knowsley. In the Liverpool city region, for example, the current proposals would result in cuts of between 17% and 23% for people of working age—those who are not pensioners. Let me give one example. A single person in Halton in a band A property would have to find £179.92 a year extra. In Sefton, which has a higher than average number of pensioners, a minimum reduction of 23% will be required for people of working age. A couple living in a band A property would have to find an extra £226.72 a year.

Those might not seem large sums to Government Members, but to people who have to count every penny, who sometimes run out of money before the end of the week, they are simply impossible to find. That is why we have tabled these amendments—to ensure that the needs of people of working age and those in poverty are taken into account. Where is this extra money going to come from? Do Government Members believe that it can be somehow magicked out of thin air? This does not even provide incentives to work, even if there were jobs to go to. The Government are not clear about the vulnerable households that should be protected. They have made it clear that they want to protect pensioners, but they are singularly unclear about other vulnerable groups. If, as is likely, local authorities will have to protect those on employment and support allowance, jobseeker’s allowance and income support, there will have to be an even bigger cut for the unprotected group—overwhelmingly the working poor. We have a Government who claim that they are freezing council tax, but they are actually increasing it for those least able to pay.

Heidi Alexander (Lewisham East) (Lab): Some people who pay no council tax at present may find themselves paying it for the first time, while others who pay some at present may find themselves paying more. It is hugely,

31 Jan 2012 : Column 756

and sadly, ironic that, while claiming that they are enabling councils to freeze tax, the Government are increasing it for the poorest members of our communities.

Helen Jones: I could not have put it better myself. An especially ridiculous aspect of the proposals is that the extent to which a council is hit will depend largely on the number of pensioners who live in the area. It is essentially a matter of chance. Moreover, if people on passported benefits are protected, it is possible that those in work will face a cut of up to 40%, which would wipe out any gains from the raising of personal allowances. The Government have absolutely no right to boast about a tax cut when they give with one hand and take with the other.

We are attempting to ensure that at least the needs of those of working age are not forgotten when councils draw up the scheme. I fully accept that Labour councils will try to do that anyway, although they have been hamstrung by the Government, but I do not believe that Government Members have demonstrated during our debates on the Bill that they understand how much these sums mean to the very poorest people. If I may use the Prime Minister’s words, they do not get it. They do not understand what it is like to run out of money before the next wage packet or benefit payment. They do not understand what it is like to have to choose between paying a bill and buying the children a new pair of shoes.

Mr Kevan Jones: Did the Minister not make it clear earlier that he “did not get it” when he dismissed a 16% decrease in council tax benefit as though it were loose change?

Helen Jones: My hon. Friend has hit the nail on the head. The problem is a lack of understanding of the fact that trying to find even an extra couple of pounds a week is simply impossible for those on such tight budgets.

This ill-thought-out scheme, which even Government Members agree is being rushed through, is full of holes. First, the Government have failed to align it with their much-hyped universal credit. Most of us would assume that a universal credit would be—well—universal, but that is not the case in this instance. Council tax benefit is to be split from universal credit: there will be one national scheme, another local scheme, two sets of administrative costs, and a huge scope for anomalies. Secondly, the Government are introducing a 10% cut while protecting pensioners. Thirdly, they want schemes that will not create work disincentives.

In a parliamentary answer to my right hon. Friend the Member for Leeds Central (Hilary Benn) on 17 June, the Under-Secretary of State for Communities and Local Government, the hon. Member for Bromley and Chislehurst (Robert Neill) said:

“The Government intend that the general principles of supporting work incentives will be set out in guidance”

—guidance that the Secretary of State will provide, although the Minister tells us that he did not want to interfere in the schemes—

“which will help local authorities to design support.”—[Official Report, 17 January 2012; Vol. 538, c. 629W.]

How on earth can that work? Families will face two means tests, one for universal credit and one for council tax benefit, along with one set of national rules and

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goodness knows how many local rules. There will be one taper for universal credit; if councils fix a different taper for council tax, how can there be an integrated benefits system? If the taper is fixed at the same rate, when will it be calculated, before or after the calculation for universal credit? It simply will not work, and the people who will pay the price are the most vulnerable members of society: people who have lost their jobs, and families who are trying to do the right thing by going out to work for poverty wages. They will find themselves in an absolute mire.

8.15 pm

Mr Jones: As was pointed out earlier, different councils may operate myriad different schemes. Would that not make people’s search for work more difficult? In central London, for example, some schemes might be advantageous while others would make it hard for people to move around to find work.

Helen Jones: My hon. Friend is right; indeed, Government Members expressed similar reservations during our earlier debate. Such a disincentive is precisely the opposite of what the Government say they want.

Mark Tami (Alyn and Deeside) (Lab): It is the people my hon. Friend has mentioned—those who are on the poverty line and do not have any spare cash—who will be in arrears with their council tax. Every day in our surgeries we see people who tell us that the bailiffs are about to arrive. How can the Government’s proposals possibly help?

Helen Jones: They will not help those people, and they will not help councils. We discussed the financial risks for councils earlier, but one of the main financial risks is an increase in the number of defaults because people are simply unable to pay—and, indeed, there is no evenness in that situation. In North-East Derbyshire 49.4% of recipients of council tax benefit are pensioners, while in North Kesteven the proportion is 53.2%. People living there face a bigger cut than people living in, say, Luton, where the proportion is only 28.2%. The scheme will subject people to cuts that are entirely arbitrary and unfair, while transferring the risk to local authorities. Many people will find themselves in real financial difficulty, while councils’ collection rates will fall.

Amendment 67 would require local authorities to make people aware of their entitlement to council tax benefit, and to give the necessary assistance to those who wish to make an application. I believe that good councils will do that anyway, but the Bill puts such pressure on local authorities that some—albeit, I believe, very few—will be deterred from seeking out claimants and informing them of their rights. Authorities are currently reimbursed monthly for expenditure that they actually incur, but the Government intend to pay grants, and we do not know what methodology they will use to set the level of those grants. Although they have promised to set allocations annually for the first two years, there is no certainty about what will happen after that.

The Government have already said, in their response to the consultation, that

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“multi-year allocations would provide greater certainty and better allow local authorities to benefit financially where demand for support was reduced over several years.”

I think my hon. Friends will see immediately where that is going, because we have seen it before. I am talking about the creation of incentives for councils to reduce claims. In a time of economic uncertainty, and when the economy is flatlining, we cannot reduce those claims by bringing in lots of jobs, because the jobs are simply not there for people to get. Not only will local authorities that are experiencing increasing unemployment or falling wages leading to new claims be penalised, but the Government are already considering how to build in incentives to reduce claims.

There will clearly be pressures on local authorities. They will take all the financial risks associated with the possibility of demand exceeding supply, and they will also have to deal with the extra costs of setting up the scheme—which may or may not be fully reimbursed—as well as the costs of revising it regularly, of notifying people about it and of appeals. That final subject has hardly been mentioned so far in our debate, but appeals could well be considerable when people find that their entitlement is being cut. If we add in the Government’s desire to move to multi-year settlements, we can all see that there is a genuine risk of the number of claims being driven down.

That is why we have tabled the amendment. We want to ensure that local authorities must take proper steps to publicise their schemes, and also that they assist those facing difficulties in applying, perhaps because of disability or because they are not sufficiently literate or numerate and do not understand the forms. We have all come across such constituency cases. Having rights is of no use if people are ignorant of them or cannot exercise them, so it is only fair and reasonable that these safeguards should be built into the Bill from the start. Through them, we hope to counter the Government’s incentives to reduce the number of claims from people who have an entitlement to benefit.

Amendment 68 seeks to ensure that before a scheme is drawn up there is consultation not only with precepting authorities and what the Bill vaguely refers to as “others” with an interest, but with organisations that assist and represent people on the receiving end of this Government’s cuts. In respect of this Bill, it is fair to say that so far such organisations have been largely ignored. The big society clearly does not include those who give up their time to assist some of our most vulnerable citizens, and who deal every day with the impact of job losses and the consequences of child poverty and try to help those for whom every day is a struggle. Any redesign of the scheme ought to take account of the views of those who will be dealing with its impact.

As has been said, the impact will be extremely severe because it will come on top of the Government’s other changes to welfare benefits. Let me give an example of a one-parent family living in a three-bedroom house in Knowsley. Assuming that they can stay in their home even though they will be more than £800 a year worse off under the Government’s changes, they will then be hit again by this scheme because in Knowsley there is likely to be a 20% council tax benefit cut. They will therefore have to find a further £170 per year. Those who deal with people in our welfare system and who give advice to people in poverty should be consulted on the design of these schemes.

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We often forget the great number of children who will be forced further into poverty by this scheme. In the Liverpool city region, 14.8% of children in poverty are in working families—those claiming working family tax credit or child tax credit. Those families will also be reliant on council tax benefit. What will happen to them when this scheme comes into force is very clear. More people will be unable to pay, so there will be more pressure, more debt and quite possibly more people falling into the hands of loan sharks. Anyone who does not think that will happen has never walked around a big estate and seen how these people operate. They often wait outside the place where people collect their benefit, and take the money straight off them. That is the reality of life on the edge. That is what many of our charitable organisations and benefit advice agencies deal with every day. It is only right that they should be consulted.

Amendments 70 and 71 seek to ensure—[Interruption.] Yes, it is the same story, I say to the hon. Member for Burnley (Gordon Birtwistle), and it will be the same story for many of my constituents, and his, when this scheme comes into effect. I am terribly sorry the hon. Gentleman does not want to hear about the reality of the impact this scheme will have. That is hard luck for him, but it is even worse luck for the people who will be on the receiving end.

Mr Kevan Jones: Does my hon. Friend also agree that the Bill’s provisions will hit a lot of northern cities—including Burnley, perhaps—much harder than some of the leafier suburbs of the south?

Helen Jones: My hon. Friend is right, but many different authorities will be affected. We heard earlier from Members on the Government Benches who represent south coast constituencies where there are lots of elderly people. They and their colleagues will be very surprised when they begin to realise the impact in their own constituencies of what they have voted for.

Amendments 70 and 71 seek to ensure that in any revision of the scheme by the Secretary of State the impact on all those who may receive, or be entitled to, benefit is considered. We therefore state that it is not only those of pensionable age who need to be considered, but those in employment or seeking work and people in receipt of other benefits, such as disability benefit. We do so because although under the current scheme 5.9 million people receive council tax benefit and 38% of them are over 65, 62%—3.7 million people—are under 65. These amendments seek to put their needs on the agenda, as they appear to have been forgotten by the Government. Also, 67% of claims are passported claims—they are from people receiving income support, jobseeker’s allowance or employment support allowance, for instance. Only 1.7 million of the 3.9 million on passported benefits are receiving pension credit, so most of these people are also of working age.

Other claims—the standard claims—are decided following a means test. Crucially, people who are working may get council tax benefit, subject to an income taper. Claimants lose 20p in council tax benefit for each additional pound they earn over the applicable amount. No one knows what the position will be for those people under localised schemes. The Government may issue guidance but, as usual in respect of this Bill, we

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are debating this topic without knowing what the guidance will say or even if the Government’s preferred options will be affordable for local councils. All local councils will be forced to cut the benefits available to non-pensioners and, as my hon. Friend the Member for Lewisham East (Heidi Alexander) said, they could cease payment entirely to certain groups.

We believe it is right to protect pensioners but, as we are making clear in the amendments, we also believe that others’ needs have to be considered. The Government seem to want to ignore those people as they have done with every other measure they have introduced. They strive to paint a picture of people on benefits as feckless and workshy. They talk about the price paid by hard-working taxpayers as though they were somehow a different species from those receiving benefits. I have to say, as someone who would clamp down ruthlessly on benefit fraud, that the vast majority of people on benefit receive it legitimately, and that most unemployed people receiving council tax benefit have paid taxes and would like nothing better than to be in work paying them again, as would all the disabled people I meet. Those in employment who receive council tax benefit are precisely the hard-working taxpayers—people who go out every day to work in low-paid jobs—whom the Government will penalise for doing the right thing by going out to work for poverty wages.

8.30 pm

I have had people tell me that they are not well paid in work, and I am sure other hon. Members have had the same. They know that they are on a poor wage but they go out to work because they believe it is the right thing to do and they want to set an example to their children and show what hard work means. Those people are going to be hit over and over again. It is time that the Government stopped trying to demonise people. It is time that they faced up to their responsibilities to create growth instead of trying to stigmatise people who are desperate for a job. It is time they ensured that the needs of people who are struggling either to stay in work or to get a job are properly recognised. That is why we have moved these amendments to the scheme that the Government are attempting to bring in. We want to ensure that people of working age and people in poverty, because these people are in poverty, are properly considered when schemes are drawn up or revised. I hope that the Government will accept the amendments, because if they are serious about not wanting to hit those people, there is nothing to prevent them from accepting the amendments. If they do not, we will seek at least to press amendment 66 to a vote.

Annette Brooke: I wish to make some brief comments and refer to the impact assessment on the localisation of council tax benefit, which looks at many of the issues raised by the hon. Member for Warrington North (Helen Jones). I note in particular that the impact assessment flags up some local authority responsibilities. The Child Poverty Act 2010 imposes a duty on local authorities to have regard to and address child poverty and, with their partners, to reduce and mitigate the effects of child poverty in their local area. The Disabled Persons (Services, Consultation and Representation) Act 1986 and the Chronically Sick and Disabled Persons Act 1970 include a range of duties relating to the welfare needs of disabled

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people. The Housing Act 1996 places on local authorities a duty to prevent homelessness, with special regard to vulnerable groups.

Given that local authorities have those duties on them, is there any need to propose the amendments? These issues are important for the very reasons that have been identified—the 10% cut, the different numbers and proportions of pensioners in different authorities and the different balances that mean that some authorities could get more money through the changes to discounts for second homes and empty homes. Some authorities will have great difficulty in protecting vulnerable people. The number could be quite small, but that possibility is there because of the different demographics of different areas.

I understand that local authorities might have to go through an equality needs assessment and I should like to know from the Minister how they should address these issues, which are in the impact assessment on the localisation of council tax benefit. Will there be any question of councils having to go through judicial review? It seems to me that there are going to be protections in the detail of the schemes to be introduced, but also some challenges for local authorities given the difficulties that we are outlining over and over again—the 10% cut, the different proportions of pensioners, and authorities’ different abilities to raise money with the new freedoms and flexibilities. With all those differences across areas, could some areas be faced with judicial review if they cannot address the duties placed on them by existing legislation?

Alex Cunningham (Stockton North) (Lab): I support the amendments on the impact of the scheme. This debate is about people’s lives, about families and people who live on the edge financially, but it is also about local authorities’ ability to deliver services at the standards we have come to expect in our communities. It is a debacle: the Government’s proposals on council tax benefit will simply heap greater burdens on the most vulnerable households and families at a time when the Secretary of State for Work and Pensions is already making life tougher for them. I would have hoped that the Secretary of State for Communities and Local Government had at least talked to his counterpart at the Department for Work and Pensions to ensure that their policies did not conflict in the way they clearly do. The amendments would help to deal with some of that conflict.

“Make work pay.” That is what the Prime Minister has said over and over again, and he is determined to make that happen. No one could or should argue with that statement, but it is vital to create incentives so that it is always better to be in employment than on benefits. The Government’s proposals on council tax benefits will totally undermine that objective. They are simply yet another attack on hard-working families.

I know that council tax benefit is available to those on low incomes who need financial help to pay their council tax bill, but I am shocked that Ministers appear to believe that a 10% cut to the benefit will somehow—perhaps magically; we talked about magic earlier on—reduce the number of people who need it. In these harsh economic times, with high and rising unemployment

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as well as rising energy and food bills, this tax relief is to be squeezed precisely at the point when there is the greatest need for help among low-income households. As others have said, pensioners and vulnerable households are to be protected, and rightly so, from the cuts, but that means that the whole of the 10% saving that local authorities must make will fall on the unprotected group—mainly the working poor.

Mr Kevan Jones: In his response to the previous debate, the Minister suggested that gap could be filled by councils being able to levy extra tax on second homes, and his hon. Friend the Member for Bradford East (Mr Ward) said there were plenty of those in Bradford. How many does my hon. Friend think there are in Stockton?

Alex Cunningham: That is an interesting question, which I wish I could answer. I do not see many empty homes, never mind second homes, in our area, so I think it might be a challenge for us to find some. I am sure we have a few, but I doubt they would fill the gap as the Minister suggests they could. In an authority such as Stockton, with high numbers of older people, the burden on the people the measure hits will be tremendous.

The burden will get higher and higher on ever fewer people. In many cases, the gains made by the working poor from the recent £1,000 increase in the income tax personal allowance will be completely wiped out by the reduction in council tax benefit and the knock-on effects. Surely that is exactly the opposite of what the DWP says it is trying to do? Are the Secretaries of State talking to each other? I wonder. Alongside the rise in VAT and other benefit changes, we are faced with these regressive policies that will hit some people extremely hard—people who already work hard for little reward. These proposals are simply a slap in the face for their efforts to improve their lives.

The Local Government Association has calculated that councils are being asked to share the £500 million cut among 1.3 million claimants, which works out at an average loss of £320 each. That is a significant sum for low earners, especially when the Government claim they are trying to protect work incentives for them. It has been estimated that council tax support for pensioners makes up 50% of the total funding, and roughly a further 25% recipients would also be exempt from the reductions in support because of councils’ duties to support vulnerable groups and tackle child poverty. Such people should of course be exempt, but that could lead to the 10% budget cut falling on the remaining 25% of recipients—on the support provided to low-paid people in work. Those people are working hard for their families, trying to do their best. They have pride in what they are doing, yet this Government are just kicking them.

Ian Mearns: I have just had a brainwave about where an awful lot of these second homes that will fill the gap will come from. When the housing benefit changes kick in, and people are evicted from their properties because they can no longer afford the rent as the property was under-occupied, those empty properties that belong to private sector landlords will be empty second homes. Of course we can raise the revenue from them. Does my hon. Friend think that is a possibility?

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Alex Cunningham: I have known my hon. Friend for many years, and I am used to his brainwaves, which normally apply to education. Of course, he is perfectly right.

The people who will be affected already face higher food and energy bills. Sadly, however hard they work, they are unlikely to get any of the fancy bonuses that will be pouring into the coffers of bankers and everybody else over the next few weeks and months. Quite simply, the proposals merely transfer one of the national costs of rising unemployment to councils and local taxpayers, creating a serious risk that every resident will see further service cuts beyond those already threatened.

In my constituency of Stockton North, the theoretical 10% reduction in council tax benefit will equate to around £1.2 million; within the Stockton borough, the figure is £1.7 million. In reality, as pensioners are excluded from the change, those affected are likely to suffer a 20%, rather than a 10%, reduction. I must add that Stockton-on-Tees borough council’s revenue budget, along with that of every other council across the country, already faces tremendous reductions. In Stockton, there is to be a reduction of £26.5 million. Where will it find the extra money to bolster this budget, when it will need to pay out to an increasing number of people who will have to claim council tax benefit? The cuts that the council is suffering are in addition to cuts of £12.3 million to specific grants; the early intervention grant was cut by £3 million, and of course there was the future jobs fund, which the Government do not appreciate.

Frankly, the Government are giving to those on low incomes with one hand, and taking away with the other. There is no regard at all for the implications for people’s standard of living, and people are living on the edge. I know; I see these people at my surgeries. They do not have that extra £2, £3, £4, £5 or £6 a week to spend on council tax. They need to spend that money on feeding their children. The money to pay extra council tax is not there.

The amendments would save the Government from themselves. They would help the Government to fulfil their commitment to joined-up government—that is if the Secretaries of State bother to talk to each other. The amendments would also ensure that the huge hit to the working poor did not happen. If the Government accept the amendments, they will be recognising the real need, and will have the opportunity to do something about it. Without the amendments, many more people will be plunged into poverty, undoing much of the good work that the Labour party did in government to improve the living standards of the poorest in society. The Government may well find that they have not made work pay; instead, some families will find themselves better off back on benefits and out of work. Where is the pride in that?

Furthermore, the Institute for Fiscal Studies predicts that as a result of the changes in council tax benefit, individual councils could reduce the benefits to such an extent that it would encourage low-income people to move out of the area. The think-tank also points out that the changes would create a complex, two-tier benefit system, with both local and central Government setting policy. That runs counter to the idea of the streamlined universal credit to which my hon. Friend the Member for Warrington North (Helen Jones) referred, which is being introduced by the Work and Pensions Secretary.

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The incentive that changes to council tax benefit will give local authorities to encourage low-income people to move elsewhere is totally undesirable and unacceptable, yet the Government seem intent on banishing the poorest in our society from our towns and cities. Let me give one example of the chaos that could result from the council tax changes and other changes: it is estimated that 20,000 families could move out of central London to find accommodation elsewhere. What an effect that could have on jobs, children and services. If several thousand children move out of central London, inner-city schools may no longer be viable, and other areas may not have the capacity to take them in. We know that the plans of the Secretary of State for Work and Pensions will have that effect, but surely the Secretary of State for Communities and Local Government does not need to help him.

Removing council tax benefit from vulnerable people is not the answer. In-work poverty is getting worse as wages are frozen and the cost of living rises sharply. Around 61% of children living in poverty live in working households with parents who are working hard to feed them, clothe them and send them to school. The figure in 2005-06 was 50%, so more people are now working to support their families, but they are doing so on paltry incomes. Surely no one in this Committee believes that that number should go any higher. That is why the Government must think again about these damaging changes to council tax benefit and adopt the amendments that will protect, if no one else, the working poor.

8.45 pm

Mr Ward: Those Members who sat on the Localism Bill Committee will not be too surprised by what I have to say. Before us is a series of amendments that seek to impose on local authorities an obligation to have regard to different categories and groups when coming up with their new schemes. The Opposition seem to be oscillating between complete outrage that the Secretary of State is using powers to impose various things on local authorities and seeking to impose through legislation requirements that local authorities do certain things before introducing their schemes.

Helen Jones: Is the hon. Gentleman seriously arguing that local authorities should not have regard to people employed on low wages, people actively seeking work or levels of poverty in their areas? What is the reason for that?

Mr Ward: Not at all. I anticipate that any local authority worth its salt would have regard to all the things proposed in the amendments. In fact, that will differentiate good local authorities from bad ones, but it is not for the Secretary of State to specify those things, or indeed for us to do so through legislation, which frankly would be patronising and very centralist. As we said many times in relation to the Localism Bill, people have a right to judge at the ballot box whether their authorities are doing what they should be doing—it is not for this House to tell them.

Mr Kevan Jones: I was going to say that it was a pleasure to follow the hon. Member for Bradford East (Mr Ward), but his contribution kept getting worse.

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Clause 8 of the Bill, headed “Council tax reduction schemes”, sets out the provisions for local councils to draw up their local council tax schemes. Proposed new subsection (2) states:

“Each billing authority in England must make a scheme specifying the reductions which are to apply to amounts of council tax payable, in respect of dwellings situated in its area, by—

(a) persons whom the authority considers to be in financial need, or

(b) persons in classes consisting of persons whom the authority considers to be, in general, in financial need.”

However, the Bill gives no guidance on what local authorities should take into consideration when drawing up their schemes. We could have a plethora of different schemes up and down the country and, as was referred to earlier by Government Members, neighbouring authorities could have completely different schemes and criteria for how people apply for council tax benefit. We know that the Secretary of State will exclude pensioners, but the amendments tabled by my right hon. and hon. Friends would add some criteria or at least set out what the baseline should be.

I am sorry that the hon. Member for Bradford East does not seem to care and trusts that every local authority, good or bad, will consider every single thing, including child poverty. If he had any experience of the Secretary of State’s time in charge of Bradford council, for example—clearly he had—he would know that he had little concern for the poor and the needy.

Mr Ward: I wonder whether the hon. Gentleman carried out a full impact assessment before voting to get rid of the 10p rate of income tax, which affected the most deprived people in the country.

The Temporary Chair (Mr Jim Hood): Order. That intervention is not relevant to the amendments.

Mr Jones: Interventions have to be relevant, as Mr Hood points out, but I would not stand for election, as the hon. Member for Bradford East and other Liberal Democrats did, on the idea of supporting the poor by increasing income tax thresholds, and then support the Conservatives in pushing through this Bill, which is going to affect some of the poorest and neediest in our society—and somehow turn a blind eye to that. As I said earlier in response to his hon. Friend the Member for Mid Dorset and North Poole (Annette Brooke), none of this legislation could go through without the Liberal Democrats, and I am sure that in Bradford at the next general election the Labour party and others will remind the hon. Gentleman’s electorate that he and his party were the ones who put through this Bill, which takes away council tax benefits from the poorest and most vulnerable in our society. So he cannot have it both ways.

The amendment would take unemployment into consideration, and it is important to look at unemployment and how it affects local councils’ claimants for council tax benefit. As you will know, Mr Hood, unemployment in the north-east stands at 11.7%, 3.4 percentage points higher than the national average, while unemployment rates in the south-east are just 6.3%. If we look across the constituencies, we find that the most recent claimant

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count in my constituency was 2,674 people, or 5% of the population; in Beaconsfield, it was 903 people, or 1.5% of the population; in Aldershot, it was 1,749 people, or 2.6%; and in Wokingham—I have to say to the people of Wokingham that I have nothing against their town, but it is always a good example to cite in such debates—it was just 936 people, or 1.3%.

That shows the disproportionate effect of council tax benefit in different areas, and if there is nothing in the Bill to say that unemployment needs to be taken into consideration, it prompts the question, will those councils where unemployment is relatively low take it into consideration when fixing their council tax scheme? The Minister said that the Secretary of State will not need to intervene, but that is not the case, because as my right hon. Friend the Member for Greenwich and Woolwich (Mr Raynsford) points out, the right hon. Gentleman will intervene if he does not agree with a scheme. He has the power to do so, and to change the financial year of a scheme, so what the Minister has said is not the case.

Ian Mearns: In the light of the Minister’s reflection that the Secretary of State is highly unlikely to use his powers of intervention, on what date does my hon. Friend think the right hon. Gentleman became such a shrinking violet that he would not use the powers that were open to him?

Mr Jones: The Secretary of State’s track record is there to see. On his edicts, he talks very much about localism, but in this Bill we already see that he has kept for himself swingeing powers to intervene. Over the past 18 months, we have had diktats to councils on weekly elections, including the idea that to save money they should have fewer pot plants, and lectures on the size of their balances, so I do not accept that he is a born-again devolutionist who is giving powers to local authorities. He will quite clearly intervene when he needs to.

Helen Jones: Does my hon. Friend also agree that the Secretary of State’s attitude to poorer people in our communities can be seen clearly from when he ran Bradford city council? We do not have to look into the crystal ball when we can read the book.

Mr Jones: Exactly. But the Secretary of State is also highly political, and the Bill does not take into account unemployment and other things because, again, that is part of its general sweep. It is about giving local councils not only responsibilities, but blame, because if a local council comes up with a certain scheme, the right hon. Gentleman can say, “It’s not my problem, it’s your local authority dealing with it,” even though he has poisoned the pill that he has given them with a 10% cut in the grant for council tax benefit.

The Secretary of State is also political in saying that councils are free to not put up council tax because they will get grant for three years, but that he can give no guarantee for the year before the next general election. That is because he wants to shift the blame for the decisions that this Government are taking—both Liberal Democrats and Conservatives—on to local councils. Slowly but surely, local councils and councillors of all persuasions are waking up to the fact that they will have to make tough decisions. They will have to not only

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divide the smaller cake after the 10% reduction in council tax benefit, but invent a scheme that is seen to be fair.

My hon. Friend the Member for Warrington North (Helen Jones) spoke about people who are in receipt of council tax benefit. There is a misnomer that is repeated on a number of occasions. Reading the press, one would think that every single person who gets housing benefit or council tax benefit is in receipt of unemployment benefit. They are not. Some of the poorest people in society are working very hard to keep a roof over their head. These changes will affect their ability to keep that roof over their head.

Another concern is that if there are no criteria for the various schemes, there will be a plethora of different schemes up and down the country.

Gavin Barwell: That’s localism.

Mr Jones: The hon. Gentleman says that that is localism, but it will lead to real issues, especially if the Secretary of State is of the Norman Tebbit variety and thinks that people should get on their bike and work. If there are disincentives because of the different schemes in different parts of the country, it will be difficult for people to do that.

The chaos that will ensue in London will be something to behold. Potentially, there will be 33 different schemes for the administration of council tax benefit in London. From talking to colleagues in London, I know that people move across the council boundaries freely. They do not take into consideration the fact that they are moving from one council to another. Some colleagues tell me that 25% or more of their local electoral register churns over every single year. How will people be clear about what the scheme is in one borough as opposed to another? If we add to this the changes in the Welfare Reform Bill, which will have a disproportionate effect in London and drive people out of higher-cost rental areas, there will be administrative chaos.

Individuals will not be clear about which scheme applies to them and some people will get into arrears with their council tax, as my hon. Friend the Member for Alyn and Deeside (Mark Tami) said when he intervened on my hon. Friend the Member for Warrington North. We will get to a situation where the number of evictions increases and where people and their children face insecurity about their homes. It will be very difficult for councils that have a large turnover of individuals to collect council tax. There is nothing to compensate authorities that have a large turnover for that effect. There will be a double whammy for those councils: they will face the 10% cut and it will be difficult for them to collect council tax.

We must also consider the difference in the number of people who claim council tax benefit in different authorities. As I said earlier, County Durham has 63,494 claimants, which is 15% of people aged 16 and above. Last year, that cost £55.1 million. The situation will be the same in other large councils in the north-east, and in other areas such as the constituency of my right hon. Friend the Member for Knowsley (Mr Howarth). There are a large number of people on either unemployment benefits or low wages who receive council tax benefits. We can compare that with some southern councils, and I will give a few examples. Wokingham—

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Mr Mike Hancock: You’re going to buy a house there, aren’t you?

Mr Jones: I am hoping to be made a freeman. I have given it enough plugs in these debates.

The Temporary Chair (Mr Jim Hood): Order. I am sure second home preferences are a matter for some other debate, but not for this one.

9 pm

Mr Jones: In the 2010-11 financial year, Wokingham had 5,159 people claiming council tax benefit, which was 3.9% of the population and cost £5.3 million. That authority covers the constituencies of Wokingham, Maidenhead, Reading East and Bracknell. Hart, in Hampshire, had 3,029 claimants, which was 4.2% of the population and cost £3 million. It covers the Aldershot and North East Hampshire constituencies.

South Buckinghamshire council had 3,024 claimants for the year 2010-11, which equated to 5.6% of the population aged over 16 and led to expenditure of £3.4 million. South Oxfordshire had 5,848 claimants, which represented 5.6% of the population aged over 16 and cost £6.1 million. That area covers the constituencies of Henley and Wantage. Finally, Vale of White Horse council in Oxfordshire had 5,578 claimants, which was 5.8% of the over-16 population and cost £5.7 million. It covers the constituencies of Wantage and Oxford West and Abingdon.

Ian Mearns: My hon. Friend emphasises the differences between local authority areas, and he has compared Durham and Wokingham. A prime indicator of levels of deprivation is the number of looked-after children per 10,000 population, and I just happen to have that statistic for Wokingham. The number there is 22 per 10,000 population, whereas in Middlesbrough it is 104 per 10,000 population. That illustrates the contrast between the levels of deprivation and need in different areas, and I hope he will bear it in mind.

Mr Jones: I will, and that is why it is important to have in the Bill the criteria by which authorities will draw up their local schemes.

The reason why I give the differences between areas is that it is quite clear that Durham will have to draw up its scheme very differently from the other authorities that I have mentioned. They also indicate that, as I said in last week’s debate, the Bill will favour southern councils over northern ones such as Durham. It is not a coincidence that all the constituencies that I read out happen to be Conservative.

Helen Jones: Does my hon. Friend agree that councils will face a further penalty through the cost of appeals once the scheme comes in, which again will be worse for councils with more claimants? I suspect that there will be a lot of appeals, and there will be a cost in both staff time and legal representation. Councils will also face the cost of chasing up unpaid council tax, which will increase hugely.

Mr Jones: I agree, and that will have a disproportionate effect on northern councils such as County Durham. It will also be a complete nightmare for local authorities

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in London. I know that the Bill allows for data sharing between local councils and the Department for Work and Pensions, but given the movement of people in London it will be very difficult indeed for councils to chase people up.

What are the options open to councils such as Durham, given the 10% cut, to make up the difference? The Minister and the hon. Member for Bradford East said that it would be made up by charging a different rate on second homes.

Mr George Howarth: My hon. Friend the Member for Warrington North (Helen Jones) just made the point that councils could be bogged down in appeals. Does my hon. Friend the Member for North Durham (Mr Jones) believe that it is also conceivable that the Bill could be deemed discriminatory under the Human Rights Act 1998? The Bill contains a declaration—as do all Bills, for purposes of the Human Rights Act—that the Secretary of State says that

“the provisions of the Local Government Finance Bill are compatible with the Convention rights.”

Does my hon. Friend think that that might slightly overstate the case?

Mr Jones: My right hon. Friend raises a very good point, because we will have different schemes in different areas. I wonder whether there will be challenges to the criteria that are used to draw them up. The hon. Member for Mid Dorset and North Poole said that various equality Acts applied to the measure. They may well do, but that is not stated in the Bill. If people who find that they are not in receipt of council tax benefit after the measure is introduced feel that their local authority has discriminated against them, that will doubtless lead to court cases. Again, the costs will fall on local authorities, and again, no doubt the Secretary of State will be nowhere to be seen and will blame councils for not implementing the scheme properly.

The hole could be plugged by further cutting benefits for those who are in work and others. Second homes give another method—obviously, there are a plethora of second homes in Bradford.

Ian Mearns: There are loads in Gateshead.

Mr Jones: Obviously, and in other places. They will fill the black hole. We could also increase council tax. However, that is no good for councils in the north-east, where 50% of properties are in band A.

Ian Mearns: Fifty-six per cent.

Mr Jones: My hon. Friend says that the figure is 56%. Only 2% of properties in Surrey are in band A. The ability of councils in the north-east to raise additional funds is severely limited.

John Healey: My hon. Friend is talking about plugging the hole caused by the 10% cut and highlighting the feeble arguments from Ministers about the flexibility around the second home discount. Has he asked himself why the Government have not considered the single person’s discount, which is worth £2.4 billion in total—more than five times the 10% cut?

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Mr Jones: My right hon. Friend makes a good point. The Bill is being rushed through. If we were considering a root and branch, proper review of local government finance, we could examine my right hon. Friend’s suggestion. I suspect that the Government do not want to do that because it affects a lot of pensioners and they think that pensioners may be more interested in voting Conservative than not. For the same reason, they will not go anywhere near revaluation of domestic properties.

My hon. Friend the Member for Warrington North made a very good point about the comments of the Minister for Housing and Local Government, who seems to think that people can somehow magic up economic development in local areas to increase revenues. That is supposedly the entire basis of the Bill: that councils will be free to create extra demand instantly through economic development. It is a damn sight harder to attract businesses to the north-east than it is to the south-east of England.

There is a problem with who is consulted about the scheme. My hon. Friend the Member for Warrington North made a good point about the mess caused by the system having to be tackled by the charitable sector, local credit unions, which will have to sort people out when they get into debt, local branches of Age Concern, citizens advice bureaux and others. It is only right that they are statutorily consulted on the drawing up of the scheme. If they are not, at the end of the process they will have further burdens because they will have to try to sort out the mess created by the Bill—many are having their grants cut already.

I am sure the Minister, in his feeble way, will refuse to accept the amendments because the Bill is part of a strategy. He is part of that strategy, even if he does not understand it. In effect, the Secretary of State wants to give as many freedoms as possible to local government so that he can wash his hands of it and stand up to the electorate and say, “It’s your local council’s fault.” I hope local councillors of all political persuasions are waking up to what the Secretary of State is up to. He is blaming them for his decisions. Until they wake up to that fact and start protesting—some Liberal Democrats bravely voted against the Bill tonight—we will end up with confusion and mess in local government and blame, and some of the poorest and weakest in our society will be affected.

Mr Mike Hancock: Once again, I am concerned about the lack of time, because I would have loved to have had a proper debate on amendments 59 and 60, which go to the heart of the problems we face. The amendments, which were tabled by the right hon. Member for Greenwich and Woolwich (Mr Raynsford), would defer the scheme for a year. Unfortunately, he is not in the Chamber to move the amendments, so it looks like we will not have the chance to pursue the matter. The need to give local authorities more time was one of the things about which Members spoke most eloquently when we debated the previous group of amendments.

It is disappointing that the Minister did not give even a hint that the problems exposed by hon. Members would be given consideration. I have a lot of sympathy for the hon. Member for Stockton North (Alex Cunningham), who spoke of the problems of “outsourcing” 20,000 people from London. He said that that would have an effect on London’s infrastructure and mean

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impending problems for receiving authorities. Any authority that has received large numbers of people after population movements will know only too well of the struggle to put in place the infrastructure needed to absorb them. Suggesting that 20,000 people leaving London will be easy is an easy soundbite, but I simply do not believe it. The Government need to think again if they are suggesting that that is a ground for supporting the Bill, because it cannot be right.

The hon. Member for Warrington North (Helen Jones) mentioned the cost of appeals and how long they will take. When do they kick in? For how long must people appeal? What would the regime be? Would it be a simple paper exercise or could people appear and give details of their circumstances in front of, say, a group of councillors or officials? We need to know. How will they be resolved?

Why should local authorities take into account the impact of the scheme on the aspects outlined in amendment 66? That is a key question. The hon. Member for Stockton North made the point that we cannot ask local authorities to exclude so many people and not ask them to consider the effects on the poorest groups of working people. If they do not consider that, they would be doing a great disservice to the people. The Secretary of State for Work and Pensions was in the Chamber just now, but it is sad that he has not heard more of the debate, because the points being made are relevant for his Department.

However, if the Bill goes through without the amendment, it will cause local authorities serious problems. Any local authority worth its salt would want to take the issues I mentioned into consideration and would like to have some flexibility to help the groups affected. Why not say that in the Bill? Is anyone seriously saying that that would be an unreasonable expectation for local people to have? [ Interruption. ] I am getting a signal that my hon. Friend the Member for Bradford East (Mr Ward) might be of a different opinion from me. I happen to think that setting out those matters in the Bill is the right thing to do, and I have yet to hear a coherent argument to suggest that we should not take that into consideration. Once again, that is why, when we vote tonight, I will vote to support the amendment.

9.15 pm

I must finish, however, where I started. I am disappointed that we will not have the opportunity to vote on the deferments. I do not know whether somebody else can move the amendments I mentioned, in the absence of the right hon. Member for Greenwich and Woolwich, but I hope so.

I should tell the hon. Member for North Durham (Mr Jones) that if I was a betting man, I would be in Ladbrokes tomorrow to see who had made a wager about how many times Wokingham was mentioned in the House of Commons. His speech reminded me of a Pakistani bowler bowling no balls, and there seemed to be a premeditated effort on his part to secure the most mentions possible of Wokingham.

Mr Kevan Jones: Does the hon. Gentleman think I should get a sponsorship deal with the borough of Wokingham?

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Mr Hancock: I honestly believe that the hon. Gentleman is in the market for a property in Wokingham, or if not Wokingham, Hart.

Mr Jones: I could not afford it.

Mr Hancock: I am sure the hon. Gentleman could; he is being far too modest.

On the hon. Gentleman’s point about income tax and higher income tax payers, I am disappointed that we will not get anywhere near the amendments that I and others tabled on excluding higher income tax payers from the 25% discount. I would hope that the Government would give local authorities the ability totally to restrict people on higher income tax from having the 25% discount.

Once again, I am disappointed that we will not have the opportunity to pursue many of these issues, and I implore the Minister to try to secure the maximum amount of time on Report to allow us properly to discuss the amendments that we have not reached.

Andrew Stunell: Again, we have had an interesting and wide-ranging debate. I have to say that the amendments we have discussed cut across the approach we set out for reforming support for the council tax and the whole localisation agenda. In the first debate, there seemed to be broad support for the view that the localisation part of the proposals was the right way forward, and I particularly welcomed the words of the hon. Member for Sheffield South East (Mr Betts), the Select Committee Chairman, who made it clear that that was his view. In the event, that turned out to be rather a contrast with the views of the hon. Member for Warrington North (Helen Jones), who argued strongly against localisation. Then, rather puzzlingly, she said that some of us did not know what was going on in the real world. Perhaps that is not a puzzling thing to say, but I have to say that it is not the reality. With my wife, I brought up five children on family income supplement for two years, so I think I do know what it means when there is not enough money to buy things.

Graham Jones (Hyndburn) (Lab): Will the Minister give way?

Andrew Stunell: No, I will not give way. I am just going to make a little progress.

The hon. Lady said that we did not understand the leeches on the estate who collected the money on payday, but at the same time she seems to be in favour of channelling money through universal benefit, rather than localising it through a council tax reduction scheme. As the Select Committee Chairman rightly said, that is not only localist, but helpful in securing income for local authorities. The hon. Lady reinforced the point with her story of the leeches on the estate.

Helen Jones: I am sorry, but the Minister cannot have it both ways either. The Secretary of State is taking the power to give guidance on what should be included in the scheme, and the Government have already said that pensioners must be protected under the scheme—we agree with that—so the Minister cannot then argue that he wants everything left to local councils, because that is exactly what he is not doing.

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Andrew Stunell: Unfortunately, the hon. Lady has partly misread the scheme. Paragraph 2(8) of schedule 4 provides the Secretary of State with the power to make regulations in relation to the requirements of schemes, and he intends to use this power to require authorities to provide support for pensioners. The purpose of that provision is precisely to safeguard pensioners—a point on which, it would appear, there is cross-party support. It does not require the Secretary of State to approve schemes, and it is not a power to intervene in schemes. I think that I have made that point clear to the House, and if I have not, I repeat it now to make it so.

Several rather whacky points have been made. The hon. Gentleman for Stockport North said—[Hon. Members: “Stockton North”] Sorry, I should know better. The hon. Member for Stockton North (Alex Cunningham) said that Labour had worked hard to close the gap between the rich and poor. Well, I do not know how hard it worked, but it certainly did not work, because the gap between the rich and the poor widened in that time. It did not narrow. He seemed extremely sceptical about whether it was possible for authorities such as Stockton to generate the additional income from discounts and exemptions to compensate them for the loss of council tax benefit grant.

By my count, 18 local authorities have been drawn into the debate in one way or another—all of them by Opposition Members praying in aid councils that they believed would be at a disadvantage. Of those 18, 14 could in fact generate from the discounts and exemptions in their areas more money than they would lose from the loss of council tax benefit grant. Among those authorities is Stockton, which would have a surplus, if it extinguished all the discounts. The hon. Member for Stockton North referred to second homes, but an important part of the new flexibility—and part of the reason Stockton could have a surplus—relates to empty homes. Empty homes discounts provide another potential source of revenue.

When one considers the generality of local authorities, one discovers that were all those discounts and exemptions to be extinguished—as I said in the previous debate, I am not arguing that they should be, but I want the House to understand that the flexibility is there—it would result in an additional income to local authorities in England of £420 million. By what my hon. Friend the Member for Bradford East (Mr Ward) called a fluke, that happens to be the same amount as the 10% reduction. The Government are not arguing that every local authority should simply extinguish those discounts and exemptions. We are simply pointing out that that provides for a significant flexibility, and I would be surprised if a large majority of councils did not choose to make that flexibility a part of the mix when devising a scheme.

Local authorities need to plan carefully to ensure that they can meet demand through the funding that they make available to local schemes. As the hon. Member for Warrington North acknowledged, however, funding for the first two years of localised schemes is derived from the Office for Budget Responsibility forecast for spending on council tax benefit, which reflects existing spending and, therefore, assumptions about underlying demographic changes, including growth in the pensioner population, and council tax increases. Thereafter, of course, the spending review process will provide further opportunities to consider cost pressures.

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Local authorities are already well accustomed to using these powers to determine in what circumstances council tax liability should be reduced, whether in individual cases or a class of cases. Local authorities are best placed to understand local needs, including those of low-income families. Paragraph 2(5) of proposed new schedule 1A to the Local Government Finance Act 1992, which is inserted by schedule 4, already requires local authorities to set out the procedures for making an application for a reduction under the scheme.

Amendments 56 and 70 would require local authorities to take into account the impact of their schemes on the living standards and work incentives of taxpayers, and on poverty levels when designing or revising their schemes. However, local authorities already have clearly defined responsibilities in relation to, and for their awareness of, the most vulnerable groups and individuals in their areas. My hon. Friend the Member for Mid Dorset and North Poole (Annette Brooke) made the point that there are statutory responsibilities on local government when drawing up such schemes, or indeed taking any of its functions forward. An important example is the public sector equality duty in section 149 of the Equality Act 2010, which requires authorities in the exercise of their functions to have due regard to the promotion of equality between persons who share a protected characteristic, while the Child Poverty Act 2010 imposes a duty on local authorities to have regard to, and to address, child poverty. She referred, quite properly, to the Disabled Persons (Services, Consultation and Representation) Act 1986 and the Chronically Sick and Disabled Persons Act 1970, both of which include a range of duties relating to the welfare needs of disabled people. She also referred to the Housing Act 1996, which gives local authorities a duty to prevent homelessness.

Putting all that together, it is quite clear that every local authority is familiar with the need to ensure that any scheme it draws up complies with existing statutory guidelines. That is a continuous process that requires all the relevant decision makers to consider equality, disability and other issues, in forming policy and making decisions. We expect to continue with that sensible approach. There is no reason for unnecessary additional bureaucracy to be imposed on local authorities.

Heidi Alexander: With the best will in the world, is not the problem that, with £490 million less to administer in council tax benefit—a reduction that will come about as a result of the proposals in the Bill—councils will be simply unable to meet the needs of the rising numbers of people who will be unemployed in future?

Andrew Stunell: If I can correct just one small point, the figure is £420 million for England, although the sum for the United Kingdom as a whole is larger. The hon. Lady is quite right that there is to be a reduction in the funding of council tax benefit support. That is not in dispute. My point—and the point the Government are making—is that local authorities have additional income streams open to them in later parts of the Bill. They also have the opportunity to tailor their schemes to suit their local circumstances, and if they choose to draw resources from other parts of their income streams, it is open to them to do that.

Let me turn to amendments 49 and 56. It is unclear how a local authority could take into account the impact of claimants who were receiving council tax

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benefit before the introduction of a local scheme. For example, that would require a local authority to know, several years after the implementation of the reform, whether a person would have been entitled to claim council tax benefit under the old system and whether a change in circumstances meant that a person would no longer be eligible at all. The Bill already provides for local authorities to make transitional provision as they see fit, following changes to their schemes or the introduction of a new scheme. That seems a far better way of proceeding.

Amendment 67 would require authorities to publish, as part of the scheme, the steps that they would take to ensure that people were informed of their entitlement and what assistance they would be offered. That is a sensible requirement, but paragraphs 2(1) and 2(5) of new schedule 1A to the Local Government Finance Act 1992, inserted by schedule 4 to the Bill, already require the authority to set out the classes of persons who are entitled to a reduction, and the procedure for making an application. The provision that the amendment seeks to introduce is therefore already part of the legislation.

9.30 pm

Local authorities will want to publicise the scheme in a manner that ensures that those eligible for support claim what they need to in order to avoid going into arrears with their council tax. Points have been made about the cost of publicity and of introduction. The Government do not think it right to stipulate how local authorities should publicise the scheme; it is for them to decide, and a one-size-fits-all set of regulations would certainly place unnecessary requirements on them. Local authorities are best placed to decide how to publicise information about their own schemes.

Amendment 68 would require a local authority to consult charities and organisations that provide advice on benefits or represent older people. However, local authorities already have a duty to consult other persons who are