Sandra Osborne:
Indeed. Councils face massive cuts in their budgets and daily increases in the demand for services, and they are inadequately funded to provide discretionary assistance to those who face bedroom tax arrears. That is not helped by the kind of council beauty contest that the Scottish National party has
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encouraged between Labour-led and SNP-led councils, or any other combination of council leadership, about who is doing most to protect tenants from eviction. All councils, I am sure, are doing their best to protect tenants in difficult circumstances.
Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op): Does my hon. Friend agree that one thing that could be done in Scotland would be the enactment of the Member’s Bill introduced by my former colleague, Jackie Baillie MSP, in the Scottish Parliament?
Sandra Osborne: I am going on to refer to that.
In East Ayrshire council, 2,300 tenants are caught by the bedroom tax, and more than 1,400 are already in arrears as a result—that is 62%—and the figure grows every month. The council estimates that it will have £500,000 of arrears by the end of the financial year as a result. In Scotland, as my hon. Friends have said, we have the added dimension of an SNP Government on pause, while they throw everything into their referendum campaign.
Dr Eilidh Whiteford (Banff and Buchan) (SNP) Will the hon. Lady give way?
Sandra Osborne: I do not have time, sorry.
Even scrapping the bedroom tax is relegated to a “things to do after independence” file—a very fat file indeed. The SNP boasts that it will abolish the bedroom tax after independence. People should not hold their breath waiting for that day to come, but nor should they have to wait for a Labour Government to scrap the tax. The Government should have the decency to scrap it now, and they would do so if they had an ounce of decency.
We need action here and now, and if the coalition Government are not prepared to act others must do so. That is why Labour has introduced a Bill in the Scottish Parliament to ensure that any social tenant who is genuinely unable to pay the bedroom tax will not be evicted. The Church of Scotland said in support of the Bill:
“Whilst we recognise that local authority budgets are being continually squeezed, forcing those who cannot afford these additional payments to carry the burden for this flawed policy is not fair.”
It is for times like these that the Scottish Parliament was created. The bedroom tax is a perfect example of just how the Scottish Parliament could act to make a real difference to tenants across Scotland, when the UK Government refuses to listen, but that would mean making devolution work for vulnerable Scottish families, and the SNP cannot allow that to happen. When it comes to the bedroom tax, the SNP, like the Tories, has its own agenda and priorities. This Government see nothing wrong with the bedroom tax, as we have heard. In fact, some Government Members do not even think that it exists. The SNP see it as an opportunity for building resentment. Only Labour sees it for what it is—a social injustice which must be scrapped.
3.39 pm
Mike Freer (Finchley and Golders Green) (Con):
Having sat through 90 minutes of a Westminster Hall debate last week ostensibly on housing supply, where
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housing supply was barely mentioned, I am not surprised that housing benefit has barely been mentioned in today’s debate. We have had the same old stories as we heard last week and in previous weeks trotted out yet again. The Labour party is still fiscally incoherent and still policy incoherent.
Thirteen years of Labour created the problem. For 13 years, the Labour Government did nothing about it. They created the perfect storm of insufficient house building, record overcrowding and housing benefit out of control. This is a Labour problem and even a Labour solution, as we heard earlier today.
Mrs McGuire: Is it the Government’s case, then, that they inherited a bad situation and have set about making it worse?
Mike Freer: No. The crux of the matter is that we inherited a bad situation and we are setting about putting it right. That is what this is about. At least the Labour housing spokesman on the London assembly had the honesty to stand up and say that the Labour party got it wrong and that it should apologise, as my hon. Friend the Member for St Albans (Mrs Main) mentioned. He also pointed out that every Conservative Government have built more social housing than any Labour Government in recent history. Even in Mrs Thatcher’s last year, the then Government built more social housing than was built in all 13 years of the Labour Government, so we do not need lectures on housing supply and social housing from the Opposition.
Gareth Johnson (Dartford) (Con): Is not the central issue of this debate the fact that it is wrong to ask the taxpayer to pick up the bill for some people who have accommodation that they simply do not need?
Mike Freer: My hon. Friend is right. My casework is about families living in overcrowded accommodation who cannot get into the right accommodation. That is what we need to put right.
With reference to London, as that is the most populous part of the UK, let us not forget how Labour’s Ken Livingstone destroyed social house building at a stroke when he was Mayor. His arbitrary thresholds ground social house building to a halt because builders built to the threshold and then they stopped.
Mike Freer: No, I am sorry. I have given way once and I am running out of time.
Under that policy, we got no social housing at all on smaller developments because builders built to the threshold. That was Labour’s legacy in London. Of course there are difficulties, as the population makes the transition to the new arrangements, but, as I mentioned, I cannot be alone in the Chamber in having to deal with constituents in accommodation that is too small for them, where children and parents are sharing bedrooms, where children of different sexes approaching puberty have to share bedrooms, or where living rooms are doubling up as bedrooms.
What about the families consigned to emergency accommodation? We do not hear much about that from the Opposition today. That is a problem forgotten by
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Labour and being dealt with by the Government. It is argued that it is cheaper to subsidise spare rooms than to move people or adapt homes, yet the overall costs of converting larger properties to smaller accommodation would be repaid by the savings on emergency accommodation alone.
Sheila Gilmore: Will the hon. Gentleman give way?
Mike Freer: No. I have given way once already and we are running out of time.
Mike Freer: You can bob up and down as much as you like. I have given way once.
The capital cost of adaptions for disabled people moving into smaller accommodation is also likely to be offset by the savings in rehousing those who are in temporary accommodation. In my authority, the average cost of adaption for a disabled property is £7,000, yet my council spends on average on emergency accommodation £14,000 for one placement. So one placement would pay for two houses to be adapted. Again, the fiscally incoherent Labour party argues that the cost of downsizing is offset by the housing benefit, but what about the larger families already in the private sector who may then be rehoused in those properties that become vacant? Little is said of that saving.
This is a completely one-sided debate. What about the private rented sector? People in such accommodation do not get spare rooms. What about the people in my office? They work, yet they do not even get a flat of their own. They have to share. You are quiet on the private sector. Let us make it fair. This was your policy. You were quite happy to tax the private sector spare rooms, but now you say no.
Madam Deputy Speaker (Dawn Primarolo): Order. The hon. Gentleman should calm down and stop accusing the Chair of everything. He repeatedly uses “you” when he should be directing his accusations to Opposition Members, not the Chair.
Mike Freer: I would never be rude to you, Madam Deputy Speaker, as you well know, but I feel passionately about this. I was raised in a two-up, two-down, with no outside toilet—[Interruption]—with an outside toilet and no inside bathroom. Opposition Members might laugh, but I know what it is like to live in poor accommodation and I do not need lectures from them about what it is like to live in poor accommodation. The Conservative party is the party of aspiration; it is the party that is solving the mess; and I will vote for the amendment.
3.45 pm
Ms Karen Buck (Westminster North) (Lab):
In powerful speeches from the Front and Back Benches, we have heard arguments against the bedroom tax, all of which were predicted and laid out by the Government in their impact statement. The impact statement made it clear that if this policy worked, in so far as it allowed people to downsize and their properties to be occupied by
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other social tenants, it would not save money, and that savings would come about only if the policy did not work. Contrary to the statements from some Government Members, those two objectives are mutually incompatible.
The impact statement showed that an estimated one in three of those affected would go into arrears. The Government knew that arrears were the likely consequence of this policy, and that is what we have seen. What we have not heard is another truth, which is that two thirds of those people affected by the bedroom tax are also affected by the Government’s cuts in council tax benefit. Out of their very low incomes of £75 or £105 a week they are having to make a contribution of £14, or in some cases £20-plus, for their bedroom tax and their council tax.
Mr Jim Cunningham (Coventry South) (Lab): Is not one of the big problems the lack of accommodation? It is ridiculous to try to move people from large to small accommodation when we do not have it. Will that not contribute to the housing bubble?
Ms Buck: My hon. Friend is absolutely right. I was about to make that point. The impact assessment also told us—as has been mentioned already this afternoon—that the distribution of properties across the country does not match the two objectives of downsizing and dealing with overcrowding. In the north-west, in Yorkshire, 43% of social tenants are affected by the bedroom tax, and I think the figure is worse in Wales. That is more than double the rate for London, yet it is London that has the most serious problem of overcrowding: one in six properties is overcrowded. So the policy is predicated not just on people moving from one property to another in their neighbourhood or community, which might have some sense to it, but on people moving from one part of the country to another, from one end of the country to another. Frankly, that is not how people live. People are not sticks of wood. People are not crates of dry goods that can be put in a container and taken from London to Liverpool or Wales, because that is how the distribution of property suits their needs.
Chris Ruane (Vale of Clwyd) (Lab): I agree entirely with my hon. Friend that this will lead to the mass movement of vulnerable people around the country. What impact does she think that will have on seaside towns, which have many hundreds of houses in multiple occupation, which are not fit to bring children up in, or for anybody to be living in?
Ms Buck: My hon. Friend is right. We are already seeing some of the impacts of this and other housing and welfare policies impacting detrimentally on seaside towns, in the same way as happened in the 1980s and 1990s. But the fact is that this policy simply cannot achieve the objective of tackling overcrowding because the larger properties are in the wrong place, and the numbers demonstrate that. It will work only if people do something that they do not want to do, which is to leave their homes, communities, networks, grandchildren, and families—to leave the people for whom they provide care.
That is also why those Government Members who have repeatedly made the argument that the Labour Government introduced a local housing allowance that
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applied a restriction on bedrooms in the private sector are so fundamentally wrong. A third of all private tenants across the country have lived in their homes for less than a year. Whether we like it or not, and whatever changes we might want to make to it, the private rented sector is highly mobile. Some 40% of all social tenants have lived in their homes for 10 years or more.
People went into a social property believing that it was a home for life. They believed that they would be able to bring up children, look after elderly relatives, care for people, live in their communities and contribute to them because they had a home there. That has now been removed, and it has been removed—this is the absolute cruelty of the bedroom tax—retrospectively. The situation simply cannot be compared with the private rented sector, because people in that sector move around much more and they are not impacted retrospectively.
Dr Coffey: I agree with the hon. Lady that this is retrospective, unlike her point about local housing allowance, but the principle is the same, although it might not have been applied retrospectively when it was introduced by the previous Government. On her point about private mobility, it is we on the Government Benches who are trying to help people buy their homes.
Ms Buck: There is no attempt to do anything of the kind, otherwise people would be looking at longer-term tenancies and introducing that. The fact is that there is no principle in this. The principle of a tax being retrospective, as it is in this case, is the only principle that matters.
Even within the Conservative-led London borough of Westminster, which has a serious overcrowding problem, people are still unable to move. They are unable to move within the borough, let alone to Liverpool or Wales. Of the 405 families affected—it is a small number, because London is not the most affected by the bedroom tax—only 40 have been able to move. Half of them are in arrears and half of them are disabled.
I will conclude my remarks by referring to one of the many difficult cases that have been brought to my attention. A gentleman e-mailed me at the weekend. He wrote:
“I’m a 50-year-old single man living in a two-bedroom flat and have been hit by the so-called Bedroom Tax. I’m on employment support allowance and have been suffering from Chronic Depression and Anxiety for several years now and I’m now finding these latest attacks on the weakest and most vulnerable in society very difficult to deal with. I have little money and now find my rent arrears total nearly £800 as a result of the Bedroom Tax. I’m continuing to pay the previous level of rent, but the council have now sent me a letter saying that the next step will be to serve me with a Notice of Seeking Possession if I don’t pay the arrears in full. I simply can’t do this.
I’m loth to downsize for several reasons. My main reason is that I’ve lived at my present address for over 29 years and there is a lot of sentimentality connected with my home… because I lived here with my brother, who sadly passed away… This is my last link to him and I really couldn’t envisage living anywhere else. I’m feeling increasingly fatalistic and helpless and my thoughts are turning more and more to ending my life, which is something I’ve successfully avoided since my brother’s death. This latest setback just seems so insurmountable and there really doesn’t seem to be any sympathy or understanding… I no longer have anywhere to turn.”
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He asked me to vote against the bedroom tax this afternoon, and I will be very proud to honour an obligation to him by doing so.
3.52 pm
Jeremy Lefroy (Stafford) (Con): It is an honour to follow the hon. Member for Westminster North (Ms Buck) and my hon. Friend the Member for Finchley and Golders Green (Mike Freer), both of whom illustrated the passionate arguments on both sides of the debate. On one side, there are the concerns about overcrowding, and many constituents have come to see me about that. One constituent, in particular, has been trying for 10 years to move out of her two-bedroom house with her partner and three children and into a three-bedroom house. On the other, there are concerns about people who find themselves in the position the hon. Member for Westminster North has just outlined.
Housing policy in this country has been in a bit of a mess for years, under many Governments. I remember the attempt at housing market renewal in north Staffordshire, when the previous Government tore down hundreds, if not thousands, of perfectly good houses in an attempt to boost house prices. What a misguided policy.
Emily Thornberry: Does the hon. Gentleman agree that it is a sensible policy to interview people in social housing as they reach retirement or as their children leave home and discuss the possibility of their moving into homes for life so that they can give up the three or four-bedroom houses in which they have brought up their families and hand them over to families who need them?
Jeremy Lefroy: That is an eminently sensible policy and I am glad that the hon. Lady has raised it.
“notes the Government’s continuing commitment to monitor the effects of the policy and the use of Discretionary Housing Payments”.
I welcome that openness. Indeed, this debate is a good opportunity, about seven months into the policy, for the Minister to hear about what is taking place on the ground. Having yesterday met local authorities from the area that I represent, I want to give a few figures and describe a bit of the experience that they set out to me.
As of 30 September this year, in just a small part of my constituency and in one of the social housing providers, 371 out of 467 affected households were in arrears—over three quarters. Another provider had 19 affected households that were at “notice seeking possession” stage. That has arisen only since April, although, importantly, I understand that those 19 households are now being sorted out through the application of discretionary housing payments.
Chris Ruane: I believe that £100 million has been set aside for DHP, but that it is going to be cut by 33%. What impact does the hon. Gentleman think that cut will have on the tenants he is talking about?
Jeremy Lefroy: I thank the hon. Gentleman for his intervention. I will come to that later in my speech. Discretionary housing payments are extremely important because they provide flexibility; indeed, I would wish for a bit more flexibility.
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My authority is working very hard to assist people who are in difficulties as a result of this policy. I want to draw out a number of things from its experience. First, it is vital, as the hon. Member for Islington South and Finsbury (Emily Thornberry) said, that local authorities work with social housing providers to help all those affected.
Lilian Greenwood: Will the hon. Gentleman give way?
Jeremy Lefroy: This will be my third intervention, but as it is the hon. Lady, I will.
Lilian Greenwood: I wonder how it will be possible for local authorities to help all those who are affected. Nottingham was allocated £696,000, and over 6,000 tenants in the city are affected. Its total missing housing benefit amounts to over £4 million. It is no surprise when Nottingham City Homes tells me that over half its tenants are in arrears. There is simply not the money to assist all those who are affected.
Jeremy Lefroy: I am sure that the Minister has heard that. He mentioned the extra £20 million, which I should hope that Nottingham would bid for. Perhaps that sum could be increased; in fact, that is something I would ask for.
Discretionary housing payments are extremely important, as shown by the experience of my local council. As the Chair of the Select Committee, the hon. Member for Aberdeen South (Dame Anne Begg), said, the system needs to be administered more flexibly so that, perhaps, hard cases that are currently excluded are included. Again, I am sure that the Minister is listening.
We have heard about tenants getting into debt and therefore being unable to move. That Catch-22 situation has to be dealt with. People who are in arrears must be able to move if they are in arrears as a result of this policy and not of historical arrears. The Government could consider the rates that are charged, which are set at 14% and 25% for one-bedroom and two-bedroom properties. Perhaps there could be a lower rate that was increased gradually over the years as additional appropriate housing was provided. This must not result in evictions. Some councils have no-eviction policies, and that is a very commendable approach. I would look for all possible measures to be taken prior to eviction being enforced.
Many unintended consequences of the policy were mentioned by the hon. Member for Liverpool, West Derby (Stephen Twigg) and, particularly in respect of rural areas, by my hon. Friend the Member for St Ives (Andrew George). Those need to be looked at very carefully, and am sure that the Minister will do so.
The Government could also look at the costs of administering social housing. Let me put this in perspective. In South Staffordshire, the discretionary housing payment pot is £90,000, and people are working very hard to make the system work. I was therefore a little surprised to read that the salaries and benefits of the directors of one of the local social housing providers were £223,000, £160,000, £149,000, £136,000 and £139,000. Given that those salaries are paid from the earnings and taxes of hard-working people, perhaps the Minister will look at how housing associations that pay such salaries could themselves contribute to discretionary housing payments.
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The Government have committed to monitor the effects of the policy. This debate is a good chance for the Government to listen to reasonable suggestions for changes to the policy in the interests of all our constituents.
4 pm
Hywel Williams (Arfon) (PC): As time is short, I refer the House to my speech on this matter in Westminster Hall last week and to a speech I made in February, when Plaid Cymru, the Scottish National party and the Green party called a debate on this very issue. I am glad that the Labour party has asked for this debate and I will support it as it supported us in February. I also refer the House to my amendment (b).
The aim of the under-occupancy penalty is allegedly to free up the logjam in available housing, but one of my fundamental objections to it is that the Government are using tenants as a battering ram to do so. That is unacceptable. I asked the Secretary of State a few days ago,
“what estimate he has made of the number of people in Wales who will move house as a result of the social housing under-occupancy penalty.”
“The Department is not able to reliably estimate the number of people in Wales who will move house as a result of the Removal of the Spare Room Subsidy due to the small sample sizes involved.”—[Official Report, 4 November 2013; Vol. 570, c. 95W.]
Clearly, the Government do not expect huge numbers of people in Wales to move. They do, though, expect to make substantial savings on housing benefit. That is the reality—not moving people on, but making savings on benefits. The direct experience of my constituents is that they cannot move on. There is nowhere for them to move to.
Earlier this year, I asked the Government what research had been undertaken on private market elasticity—the ability of the market to provide—in response to the bedroom tax in rural Wales. I was told that no such research had been undertaken before the charge was brought in. There would apparently be research in 2015, and reports would be published in 2016, a full two and half years after the charge was introduced.
More fundamentally, I am concerned about the effect on estates. I was brought up on a council estate. It was a very stable area, with a mix of people from a variety of backgrounds. Many of them were the sort of people who had seen their children move on, but who still lived in three-bedroom houses and provided such estates with the anchor and stability that we believe to be so important. They knew the difference between a house and a home—a distinction that has eluded the current Government.
I will end by referring briefly to funding for hardship and to my amendment—I regret that it has not been selected—which also stands in the names of my right hon. Friend the Member for Dwyfor Meirionnydd (Mr Llwyd) and my hon. Friend the Member for Carmarthen East and Dinefwr (Jonathan Edwards).
My own local authority of Gwynedd has a review group on hardship payments. It brings together people from the voluntary sector, Shelter, the Department for Work and Pensions and even the Member of Parliament. Gwynedd county council, to its credit, has added substantially to the fund, with the result that the number of people in arrears is fairly small at present.
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Katy Clark (North Ayrshire and Arran) (Lab): In my constituency, some people who originally were successful in getting the hardship fund are being told when they reapply that they cannot have it because they are not showing sufficient hardship or because they have not shown that they are doing enough to rebudget. Is the hon. Gentleman familiar with that experience? This week a constituent told me that they now have to choose between heating and eating because they are not getting the fund payment.
Hywel Williams: The hon. Lady makes a telling point and the group in Gwynedd is certainly concerned about that. It goes to the very heart of the cash-limited nature of the fund, which is something that I objected to when the social fund was introduced: it pitted one payment against another, bringing an element of competition to something that should be there to fulfil people’s basic needs, and that is one reason why I object to this policy. I hope there will be no evictions and that the Minister will clear up uncertainty about the fund’s future.
I would also like to hear those on the Labour Front Bench pledge to adopt a “no evictions” policy—the subject of my amendment—where they have the power to do so. Labour’s policy of abolishing the bedroom tax will not come into force until at least 2015, should it win the general election. However, Labour is in power in 77 councils, and the Welsh Labour Government have power to adopt a “no evictions” policy with immediate effect.
If Labour is serious about scrapping the bedroom tax, it should also be serious about preventing the worst effect it can have on tenants. For me, that is particularly true for the Welsh Government, where the Welsh First Minister has the power to stop evictions. For example, Labour in Rhondda Cynon Taf voted with Plaid Cymru for such a policy. The Scottish National party in Scotland has pre-eviction procedures, and I understand that Labour colleagues in the Scottish Parliament are proposing a Bill to bring in a “no evictions” policy—I think they are; possibly they are not. Perhaps they are not sure themselves.
In the Welsh Assembly, Jeff Cuthbert AM said:
“We cannot undo the bedroom tax. We can seek to reduce its impact and we are trying”—
all very laudable. Lesley Griffiths AM said that
“there would be a very high cost, not just a financial cost, but also in terms of the quality of life of people in relation to eviction and then rehousing.”
Plaid Cymru’s Jocelyn Davies asked Carwyn Jones, the First Minister:
“Will you tell us which social landlords in Wales are also going to adopt this no-eviction policy?”,
“That is a matter for local authorities to decide. I can well understand the thinking behind the no-eviction policy, but it is for each local authority to decide how it wishes to approach this inequitable situation.”
With all due respect to the First Minister of Wales, he is wrong. It is in his power to decide. It is time for those in power in Wales, long on rhetoric and slow to act, to give a lead. If he will not give a lead in Wales, might he not be led by Labour here in Westminster?
4.6 pm
Graham Evans (Weaver Vale) (Con):
It is a pleasure to follow the hon. Member for Arfon (Hywel Williams), and I declare at the start that I have more experience of
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council housing than many colleagues. Similar to the hon. Gentleman, I too grew up on a council estate, in south Manchester, with my mother, father and four siblings. It was not big, but it was home. We lived there because we needed to and because the state was able to help us find a home that we could fit into and was affordable to my hard-working parents.
Social housing is there for those in need. Housing needs change as families expand and contract. The needs of a family with four children are different to those of a divorced empty-nester. The hon. Gentleman used the example of a council estate where a house is also a home and a place to live. In my personal circumstances, when my father died 30 years ago and my mother was on her own in a three-bedroom house, she moved out and now lives in a one-bedroom flat, thus releasing that property back to the housing stock.
Mr MacNeil: How often does the hon. Gentleman envisage that people should move homes during the course of their adult lives?
Graham Evans: I cannot really answer that because it varies so greatly. I have moved several times but I am now settled with a family and envisage not moving for a while. It varies due to individual circumstances.
Chris Ruane: Does the hon. Gentleman agree that the three great stresses in life are death, divorce and moving house, especially if someone is being evicted or forced out? What effect does he think the bedroom tax will have on the mental health and well-being of people forced out of the homes they love?
Graham Evans: The hon. Gentleman raises a very good point and he is right to say that moving house is one of the most stressful things in life.
In my constituency, a disabled lady who lived in a three-bedroom property had to sleep in the lounge and was not able to get upstairs. An appropriate home was found for her with one bedroom on the ground floor and she is very happy. Her old house is now filled by a young family with two children and one on the way. Moving house is very stressful, but sometimes it is the right thing to do.
The debate is a rare example of when I can use Karl Marx as a policy template. We can consider the social housing market using the phrase:
“From each according to his ability, to each according to his needs!”
That is to say, what people can afford is what they need. It is a simple enough concept to support low-income families but, in reality, housing policy has moved far away from it.
First, let us consider the ability to pay. Housing benefit payments almost doubled from £11.2 billion to £23 billion under the previous Government. That is a cost of £900 per household per year. If hon. Members ask my constituents whether paying £900 per year to pay for other people’s rent on top of their own is reasonable, they will get a short response. In fact, if the Government had not taken action—this Government are prepared to take the tough decisions when Opposition Members are intent on driving Britain to economic ruin—the cost of social housing would have risen to £25 billion in the next financial year.
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Secondly, let us consider the need element. As I have set out, I understand the importance of social housing and why the country needs it. Let me be clear that the right type of housing should be available to those who need it. A quarter of a million families are in overcrowded accommodation, and 2 million households are on social housing waiting lists. In part, that is because of the lowest housing growth since the 1920s, and that was under a Labour leadership. Some who do not need social housing insist on remaining, blocking families who have urgent need.
Ian Mearns (Gateshead) (Lab): The hon. Gentleman gave the House some statistics, but will he concede that, unfortunately, many of the vacant properties he describes are in the wrong places for the people who need them?
Graham Evans: There is an element of that in various communities. In my area, people like to live within their own communities. I accept that. The problem is not straightforward, but it is not insurmountable either. People can swap homes within local communities, but I agree with the hon. Gentleman that that is a problem. The problem is not insurmountable for good local housing trusts or local authorities. It might not happen overnight, but with a little bit of creative thinking, moves can be accommodated—people can downsize and upsize.
Mrs McGuire: The hon. Gentleman accepts that the situation cannot be changed overnight, but does he believe it is fair that people should be caught in the trap of having to pay the bedroom tax? He is contradicting his own argument.
Graham Evans: I am sorry I gave way to the right hon. Lady.
I want to make one final point. Opposition Members have had nothing to say about someone earning £140,000 a year who uses social housing, not least because the person in question is Bob Crow, the leader of the National Union of Rail, Maritime and Transport Workers.
Unless we reassess ongoing housing needs, we will be unable to support those who need it the most. The changes need to happen, and it is important that they happen now, to restore fairness to the social housing sector in line with the private sector.
4.13 pm
Derek Twigg (Halton) (Lab): There is no doubt that the bedroom tax is a brutal, callous and unfair policy that affects some of the poorest and most disadvantaged people in our communities, not least those who are disabled. They have been forced into arrears and further debt, and forced to go to food banks. The policy is having a major effect on many people in our communities.
I want to address some of the points that Government Members are using to justify what they are doing, such as the cost. We do not know whether the cost savings are achievable. Some hon. Members argue that they are not, but there is a great deal of doubt. For instance, the Government would have to take account of the £65 million increase in discretionary housing payment budgets that has already been set aside for 2013-14; the additional
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costs of fitting aids and adaptations for disabled tenants who move; the significant additional costs to housing associations that face increasing rent arrears, re-let times, rent collection and tenant support costs, and the impact of lost development capacity, at a time when the Government are trying to drive increased supply; and the additional indirect costs to other public services, such as homelessness, health, social and advisory services, of coping with the knock-on effects and consequences of tenants moving or accumulating debt. All need to be taken into account, which undermines the Government’s case for savings.
The Government’s amendment mentions
“the potential beneficial impact of this policy on those living in overcrowded accommodation”.
It is worth noting the word “potential”. I asked the Minister to provide figures, or any evidence, to justify the claim that there would be a significant “beneficial impact”, but he was not able to do so.
Government Members have been talking all afternoon about the private rented sector. It is important to understand the difference between sectors, and it is clear that some people do not. The method for calculating housing benefit in the private rented sector is local housing allowance, which is entirely different. It is a fixed allowance paid depending upon household size and circumstances, with no reference to the size of home occupied. A tenant can choose to use the fixed allowance to under-occupy a larger home in a lower-value area without any reduction in benefit. Rents in the private rented sector are not regulated. It is necessary to impose tighter benefit restrictions to curb excessive market rents. Social rents are regulated and are approximately 40% lower. The private rented sector performs a different role from the social rented sector, as hon. Members have made clear. In general, it provides shorter-term accommodation for younger households. Some 28% of household heads in the private rented sector are over the age of 44, compared with 60% in the social sector. That is a significant difference. What is being asked for is a retrospective change.
The Government’s brutal changes are affecting real people in my constituency. I spoke to Mrs Knight on Saturday morning. She has had adaptations throughout the house to ease difficulties that her husband is experiencing: a walk-in shower, a bio bidet, a wheelchair access door leading outside, hand rails on the doors, a drop rail in the bathroom, a rail fitted to the bed, raisers on the seat, and a through-floor lift into the bedroom. They are losing a significant amount of money—£700 a year. They have lived in the house for 29 years and brought up their family in it.
Chris Ruane: My hon. Friend has just given a comprehensive list of the improvements made to his constituents’ home. If they move to other accommodation, will the council have to pay again to put in those facilities again?
Derek Twigg: As usual, my hon. Friend makes an important point. Of course the council will have to pay again, and it is significant expenditure.
What about large families that have split up, where some of the children stay with their father for three or four days a week but he has been hit by the bedroom tax? How is that helping families? How does that help parents to stay in touch with their children? The excuse
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given by the Minister at the time was that it would depend on who had responsibility for the children, but it is causing problems for families.
What about a single man who has lived in a house all his life and has recently become unemployed, finding himself having to live on £70-odd a week and trying to find the difference for the bedroom tax? We talk about the discretionary payment system, but they are temporary payments and finding a job in my area is not easy.
In response to a question I put to the Prime Minister earlier in the year, he said:
“Let me be clear…pensioners are exempt, people with severely disabled children are exempt and people who need round-the-clock care are exempt.”—[Official Report, 6 March 2013; Vol. 559, c. 949.]
That turned out not to be true and I challenged the Leader of the House on it the following day. On the Monday, the Government dropped their appeal to overturn the decision of the Supreme Court on the exclusion of disabled children. People with a disabled child and two spare bedrooms are hit by the bedroom tax. When universal credit comes in, pensioners with one person in the household under the pension age will be hit by the bedroom tax. Disabled people, unless they have a full-time or part-time live-in carer, are not exempt. Disabled people whose family members or friends are supporting them are not exempt. This is a terrible policy. It needs to be changed quickly.
4.19 pm
Bob Blackman (Harrow East) (Con): It is an honour to follow the hon. Member for Halton (Derek Twigg), who has given a reasoned and reasonable speech, and my hon. Friend the Member for Weaver Vale (Graham Evans), who provided a different perspective. I start from the principle that it is morally indefensible that 1 million families are waiting for a council property and that 250,000 families live in overcrowded accommodation while at the same time 1 million empty bedrooms are allowed in the social rented sector. Anyone who tries to defend that is extremely foolish.
There is a fundamental philosophical difference between the Opposition and the Government. People in social rented accommodation cannot expect to live in the same home for life without any change to their circumstances being recognised. People in social rented accommodation should stay there for a period and then move on and up when they can. My mother and father started in council accommodation and were the first in our family to buy their own home. Then, during the Thatcher revolution, the rest of my family were able to acquire their own homes, and we became a proper property-owning democracy.
Katy Clark: Does the hon. Gentleman not accept, however, that that was not the initial purpose of social housing? The initial reason for social housing and building council houses was not to deal with social need, as he and other Government Members have said, but to improve the standard of housing in this country? Is that not what council and social housing is about?
Bob Blackman:
During the second world war and the 1950s, there was clearly a need, which was why the Conservative Government in the 1950s built record numbers of council properties—to enable people to live in decent accommodation. I agree about that. Clearly,
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however, social housing should be based on need, not expectation for life, and as people start new careers and move on, they should vacate social housing for the benefit of others in greater need.
Bob Blackman: I am not giving way again.
The Labour party clearly does not recognise this fundamental change that needs to take place.
Bob Blackman: The hon. Lady can keep popping up and down, but I am not giving way.
The Labour party would hand out £500 million of taxpayers’ money while presiding, as it did, over record low levels of housing development. It failed to provide the housing needed during its term of office, and this Government are now trying to turn that around after many years of neglect. The last Government allowed social rents to increase, knowing that housing benefit would pick up the costs for the vast majority of tenants: about 80% of tenants were receiving the maximum housing benefit. That is fine while people are fully occupying those properties—they will be in need, because they will have been assessed as being in need—but once they are under-occupying those properties, it becomes right and proper for Governments and councils to say, “It is time for you to move on and for a family who need that property to move in.”
Earlier, someone challenged the position in the private sector. On average, home owners occupy their property for seven years before choosing to move on, but of course some people fall on hard times and have to sell their property in a rush or lose everything when they lose their job or become disabled. We have to have sympathy and ensure supply for those people across the board. In the private rented sector, on the other hand, we need longer tenancies, because currently they are often for six months or less. Clearly, however, we need some equalisation between the private and social rented sectors.
There are other courses of action that councils can consider. My own local authority has brought in incentives for people who under-occupy to move out. It will give them cash incentives to enable them to buy their own property or move to a smaller property when their families have moved on. That is the right sort of approach. There should be a carrot and stick approach. If someone chooses to under-occupy, they will get less benefit. If they choose to occupy a property that they no longer need, they should not expect the public sector—the taxpayer—to fund them.
Sheila Gilmore: I thank the hon. Gentleman for giving way. It is hard to know where to start in responding to what he is saying. If this were a matter of choice, it would be a very different issue. Why is it appropriate to apply a financial stick to people who do not, by definition, have the financial capacity to move on because they are on benefits? In those circumstances, there is no choice to be made. An amendment was tabled to the Welfare Reform Bill which would have resulted in this measure applying to people who had been made a reasonable offer but refused it. Does the hon. Gentleman regret the fact that the Government did not accept that amendment?
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Bob Blackman: I thank the hon. Lady for her rather long intervention, which I thought became more of a speech. We need to be clear that people do have a choice. People can choose to under-occupy, and if they so choose, they should not expect the taxpayer to pick up the cost through housing benefit. There must be a clear incentive for people to move on.
Mr MacNeil: Will the hon. Gentleman give way?
Bob Blackman: I am not giving way a third time.
The Opposition need to accept the principle of the change, which is that anyone who under-occupies should bear the cost. All afternoon, we have heard a series of heartbreaking stories of people being required to move from properties that they have lived in for a long time. I have every sympathy with people who have been fed the story that they have a home for life, that they can expect to live in it for ever and that the taxpayer will always pick up the cost. The reality is that that is the story that Labour has always sold people.
That illustrates the difference between the parties. Labour would rather have everyone working for a public authority, being dependent on public housing and not being aspirational. We believe in helping people to achieve their aspirations and get to a decent position. We believe in improving the situation in the private sector and enabling people to work and to aspire to being the best that they can be. That is the difference between us. We are the party of the hand-up; Labour is the party of the hand-out.
4.27 pm
Mr Nick Raynsford (Greenwich and Woolwich) (Lab): I draw the House’s attention to my entries in the Register of Members’ Financial Interests, including the chairmanship of a social housing provider.
This is a cruel policy, based on an unsound and in some respects fraudulent premise. It is cruel because it is causing anxiety, fear and misery to large numbers of people who have done nothing wrong. It is cruel because it is deepening poverty and deprivation in an arbitrary and unfair way, and because the large majority of those who are adversely affected by it can do nothing to mitigate its impact.
The policy is also cruel because it conflicts with basic human instincts, such as the instinct of a parent to have their children to come to stay at the weekend if they normally live with a former partner elsewhere. There is also a basic human instinct for a disabled person to have a carer stay overnight from time to time, or to have a spare bedroom for medical needs such as dialysis.
Nick Smith (Blaenau Gwent) (Lab): A constituent of mine is unable to share a bed with his wife due to his painful disability. The bedroom tax will leave his family £9.52 a week worse off. Does my right hon. Friend agree that the bedroom tax pays scant regard to the pain that it causes?
Mr Raynsford: My hon. Friend makes an obvious and clear point that illustrates one of the deeply unfair and cruel impacts of the policy.
The policy runs against basic human nature when teenage children are told that they cannot expect to have a bedroom of their own, particularly at a time
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when those in charge of education are emphasising the importance of children having a bedroom in which to do their homework, so that they can do well at school.
Ian Mearns: I have seen an estimate that 375,000 children could be affected by the bedroom tax. Is it the Government’s deliberate policy that up to 375,000 children might have to move school because of moving house as a result of the bedroom tax, so disrupting their hard-earned education?
Mr Raynsford: My hon. Friend, along with many other colleagues, has forcefully made the point about the destructive impact on communities and the impact on people who are unfairly forced to move because of the bedroom tax and other measures.
I have talked about the cruelty of the policy. I shall now show that it is unsound and in some respects based on a fraudulent premise. That premise is that the bedroom tax is about making better use of the social housing stock. This is simply wrong when the supply of smaller lettings available to those adversely impacted is hopelessly inadequate. It is wrong when, according to the Local Government Association, less than a quarter of those hit by the tax have the option of mitigating it by moving into smaller accommodation. It is clearly wrong when the largest single group of people known to be under-occupying social housing—notably those who are over retirement age—are exempt from the tax.
I can understand why, politically, the Government do not wish to be seen to be penalising elderly people, but they cannot on the one hand claim that these measures are about achieving better use of the social housing stock and then entirely ignore the largest group of people known to under-occupy accommodation. Recently visiting a 91-year-old pensioner living in a four-bedroom property brought that home very clearly to me. The council is giving priority for a move locally not to people like her, although that would be logical, but to people who are hit by the benefit cut of the bedroom tax, because it is only right that those people should be given priority, to protect them from the tax. We thus get these absurd and perverse consequences where the policy works against the very objective that it is supposed to achieve.
We have heard about the other perverse consequence—the extent to which the policy is leading not to better use of the housing stock, but to increased vacancies among larger properties in areas where people simply cannot afford to occupy and pay the bedroom tax, and to increases in rent arrears, which is not just bad for the affected tenants, putting their tenancy at risk, but bad for the landlords who require rental income to fund increased investment in social housing.
On all the bases, then, on which this policy is being promoted, it is not succeeding and it is having perverse and damaging consequences. The hard truth is that this is not a policy prompted by a desire to make better use of the country’s social housing stock. If that were the real intent, pensioners would not be exempt, and the Government would be increasing, not cutting, investment in new social housing. Indeed, if the impact of the bedroom tax were, miraculously for everyone affected, to find alternative smaller accommodation, the policy would fail because the Department for Work and Pensions would be left with a half a billion pound hole in its budget.
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The whole wretched policy emerged not out of an evidence-based study of patterns of occupation, need and mobility in social housing, but out of a crude cost-cutting imperative that was introduced in total disregard of the human consequences. It is a deeply flawed and cruel policy, based on unsound premises, for which all those who are responsible in the Government should be ashamed. The sooner this wretched tax is abolished, the better.
4.33 pm
George Hollingbery (Meon Valley) (Con): It is an honour to follow my hon. Friend the Member for Harrow East (Bob Blackman) and the right hon. Member for Greenwich and Woolwich (Mr Raynsford), with whom I have sparred on a number of occasions on similar issues.
We need to pose ourselves a question: what is dealing with the spare room subsidy about? Is it about reducing the housing benefit bill? Yes, of course it is. The Government propose a £500 million saving, which is important. Let us not delude ourselves, however. We face a structural problem with housing: there is too little of it, and what there is of it is too expensive. The only way meaningfully to reduce the housing benefit bill is to increase the supply of housing hugely—something that we all know will not happen overnight. It did not happen on the watch of the previous Government, but it is happening at least in part on this Government’s watch. Although an important saving is being made, reducing the housing benefit bill is not the principal thrust of the reductions in spare room subsidy.
Jonathan Edwards: May I take up that point, which is raised in the Government amendment? Notwithstanding the bedroom tax, the cap on benefit and the annual real-terms reduction in the uprating of benefit, the Office for Budget Responsibility still predicts that the housing benefit bill will rise. This is a failed policy.
George Hollingbery: What the hon. Gentleman says demonstrates that, as I have just pointed out, what we need is a massive increase in the amount of housing that is built. That was a failure on the part of the last Government, and it has not been easy for this Government to rectify it during the current recession. I believe that we are doing a great deal to try to rectify it, but the real answer is to build a very large number of new houses. That cannot be done in an instant, which is why the housing benefit bill is almost bound to rise in the short term.
This is, in my view, a policy about behavioural change and about the chronic underuse of publicly owned housing assets. Those who live in social housing have no incentive to downsize, because they have tenancies for life. I understand the motivation behind that: as has already been pointed out today, these are not just tenancies, but homes. However, the position is not sustainable given such a limited supply of stock. The Government have, of course, taken action to end tenancies for life, but that will take a very long time to feed through the system. Meanwhile, there are vast numbers of people on housing waiting lists and large numbers living in overcrowded homes, while 1 million or more dwellings have an extra bedroom. That cannot be right.
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Katy Clark: Will the hon. Gentleman give way?
George Hollingbery: I will, but by doing so I shall take time away from Opposition speakers.
Katy Clark: Does the hon. Gentleman not accept that that there is a complete mismatch between the types of homes that are available and what the Government want people to do? In North Ayrshire, for example, 2,260 council tenants are affected by the policy, but only 59 tenants in under-occupied properties have been able to move since April.
George Hollingbery: The point is well made. I entirely accept that there is indeed a mismatch in many parts of the country. However, it is not impossible for people to move between local authority areas. That happens in the private sector, and there is no good reason why it cannot happen in the public sector. Certainly, it is more difficult, but there is no reason why it should not happen.
I recently visited a young family in Wickham, which is in my constituency. The couple had one child and another on the way. There was one bedroom upstairs, with a small bathroom, a kitchen-sitting room-dining area downstairs, and that was it. The child was living in a cot in the sitting room. Just yards away were two and three-bedroom homes under-occupied by lifetime tenants.
Madam Deputy Speaker (Mrs Eleanor Laing): Order. I must apologise to the hon. Gentleman. The clock is wrong, and I should warn him that he does not have five minutes and four seconds left; he has only four minutes and one second.
George Hollingbery: Thank you for that warning, Madam Deputy Speaker.
The situation that I have described cannot be right, either in terms of the use of resources or in terms of plain fairness. According to the switching site HomeSwapper, those who have successfully moved as a consequence of these changes often say that their understanding of the unfairness of the situation was a significant part of their motivation. However, it is also important to note that the potential reduction in housing benefit payments was what made them actually do something about it.
The unfairness is, of course, only exacerbated by the rules governing the private rented sector, under which only the space that is needed is paid for. That has been referred to at length this afternoon. Presumably, if the principle of ensuring the right number of bedrooms is unfair in social housing, it is also unfair in private housing. That point too has already been made. The motion
“calls on the Government to end these deductions with immediate effect”.
I can only imagine that the Opposition will propose similar changes in the private sector, as the same principle applies. If so, how much will it cost, and if not, why not?
It is clear that the Opposition’s thinking on this matter has been, to say the least, inconsistent. In 2011, I was a member of the Committee that considered the Bill that became the Welfare Reform Act 2012. We had a long discussion, and a number of amendments were tabled to clause 68, which established the principle of the spare room subsidy reduction. All the points that
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were made were salient, the amendments—most of which were tabled by the hon. Member for Westminster North (Ms Buck), who is no longer in the Chamber—were perfectly sensible, and, in large part, the Government have introduced provisions to deal with them. Interestingly, however, no Division was called on a stand part motion, and no attempt was made to remove the clause on Report. I am a novice in these matters, but my interpretation of what happened is that the Opposition accepted the principle. If that is not the case, I should like to hear why it is not.
The Opposition’s difficulty with welfare reform as a whole is clear. Recently, the hon. Member for Westminster North, who very ably took large parts of the Welfare Reform Bill through Committee, including clause 68, was reported as saying that the Opposition had not won the public debate on welfare, and it appears that she is right. Ipsos MORI carried out a survey of 2,000 people in late August this year from which it concluded that:
“By a margin of 3 to 1, the majority of the British public believe that the benefits system in Britain is too generous.”
Interestingly, it also revealed that the public broadly supported the Government’s position on the spare room subsidy.
Back in April, Peter Watt, former general secretary of the Labour party, wrote on the “Labour Uncut” website:
“I don’t know what Labour’s position on welfare reform is”,
“Labour has in the past also talked tough on welfare and that it would like to reduce welfare bills. The problem is that it is currently fighting a battle in which it is opposing the government’s attempts to achieve this. So Labour appears confused.”
Today, in this motion, we see yet another example of this confusion.
It must be right, at a time of acute overcrowding co-existing with a great deal of under-occupancy in the social housing sector, for the Government to take action to encourage change. A broad policy of this sort will inevitably throw up real-life difficulties when applied in the particular, but the Government have been very careful to deal with as many of them as possible and have made many exceptions to the general rule. They have also made substantial amounts of money available through discretionary housing payment to ease the transition for those who are affected.
Furthermore, evidence shows that over 10% of those who have been affected by the change so far have come off benefits entirely, which must surely be welcomed by all. Change of this sort is never easy to implement, but that does not mean it is not fair in principle and that it is not necessary. In this case, it is both, and I will certainly vote for the Government’s amendment this evening.
4.41 pm
Lucy Powell (Manchester Central) (Lab/Co-op): It is an honour to follow the hon. Member for Meon Valley (George Hollingbery) and my right hon. Friend the Member for Greenwich and Woolwich (Mr Raynsford), who made an excellent contribution.
I am pleased to be called to speak in this debate and I am proud that the Labour party now has a commitment to axing this appalling policy. I am proud of Opposition
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Members’ contributions to this debate, which stand in stark contrast to some of the drivel we heard from the Government Benches, much of which showed a lack of understanding of and basic research into how this policy is being delivered on the ground.
One example of that was in the contribution of the hon. Member for Suffolk Coastal (Dr Coffey), who said people should simply work an extra three hours a week to pay for this. If she knew the policy, she would be aware that those in work and receiving housing benefit who work an extra three hours a week will lose 85% of that extra income to pay for their rent and council tax. Therefore they would still have to pay the bedroom tax.
I am the MP for Manchester Central and my constituency has the highest number of people affected by the bedroom tax in the country—over 4,000. That is not just a number; it is people struggling desperately as a result of this unjust policy.
I have three main criticisms of this policy, and they build on the points made by my right hon. Friend the Member for Greenwich and Woolwich: it is a morally wrong and corrupt policy; it costs more than it saves; and it does not even work. By any measure, that is a pretty damning indictment of a policy.
It is morally wrong because it is such a blunt instrument and it is punishing all sorts of vulnerable people who have done nothing wrong. We have heard many examples from colleagues, charting the human cost of this disastrous policy. I want to highlight one other.
Elizabeth has a very disabled son, Ryan. Their case has been highlighted by the Manchester Evening News and the Daily Mirror, both of which have been running excellent campaigns against the bedroom tax. Ryan is a disabled adult and requires around-the-clock care, including overnight care. He is not excluded from the bedroom tax policy, however, because he is not the tenant of the property. Therefore, they are subject to the bedroom tax. After many weeks and months of anxious worrying, Elizabeth finally, after my intervention, was awarded the discretionary housing money. However, this does not take away from the fact that she is not sure what is going to happen next year or the year after that. That is the kind of anxiety people are facing. On the discretionary housing payment, I am delighted that the Minister has today said that if more claimants qualify but the £1.9 million that Manchester city council has received is not enough, the Government will guarantee those payments.
This policy also costs more than it saves, as is highlighted by the case of my constituent, Alan. He is in his late-50s and he has worked for most of his life. He lives in a two-bedroom property because no one-bedroom properties were available for him. He was made redundant and is now on benefits of £71.70 a fortnight. His social housing costs £60 a week and he has been asked to pay the bedroom tax out of that money. If he wants to move to the private sector, which is the only real option for him, that will cost him at least £100 a week in rent, which the housing benefit bill will have to pay. So that is going to take costs up, not down.
The final point I wish to make is that this policy does not even work. Many Government Members have talked about how it deals with overcrowding and people on the housing waiting list. In Manchester, 19,000 people are on that list and that figure has not moved one jot since this policy was introduced, because all the slack of
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available property is being taken up by people doing housing swaps. The only properties becoming available are two-bedroom properties in blocks of flats, which are unsuitable for families with children. So those properties are going to people in band 5—people who are not most in need. Those who are most in need are being pushed further and further down the waiting list.
Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op): My hon. Friend is making a strong speech, in which she mentioned families with children. Did she share my shock at Lord Freud’s comment that families who are separated should get a sofa bed to deal with the problem of being hit by the bedroom tax? Was that not a shocking thing to say about the situation of families in this country?
Lucy Powell: It was a shocking thing to say. It showed a complete failure to understand what family life is like and to understand that many fathers—I thought the Conservatives claimed to be the party of the fathers—have contact with their children only if they have a spare bedroom for them to stay in, so they will be losing that contact. That is a disgraceful aspect of this policy.
Perhaps if the Government had done a little more research, analysis and modelling before introducing this proposal, they might have foreseen some of these knock-on consequences. Labour Members are all for looking at how we can deal with some of the issues relating to under-occupancy and housing shortage, but this sort of brutal, blunt instrument does nothing to address that—in fact, it does quite the opposite. We need a long-term strategy bringing together the housing associations, other policy makers and tenants to work out how we can best use a carrot and stick approach to deal with under-occupancy. What we have from this Government is a morally corrupt policy that does not work and is going to cost the taxpayer even more.
4.47 pm
Margot James (Stourbridge) (Con): In debating today’s motion, it is instructive to look back at the manifesto on which Labour Members stood at the last election. They talked about the need for “tough choices on welfare” and stated:
“No one fit for work should be abandoned to a life on benefit, so all those who can work will be required to do so.”
They also promised reforms to housing benefit so that the state does not subsidise people to live on rents that working families could not afford. As we have heard from my hon. Friend the Member for Birmingham, Yardley (John Hemming), when they were in government they intended to introduce the very same measure. So what happened?
Labour has reverted to type, defending those who are getting more than their fair share out of the system, to the detriment of hundreds of thousands of others who are worse off through no fault of their own. They include the 6,687 households on my local authority of Dudley’s housing waiting list. That is why Labour has opposed every single measure this Government have taken to reform the welfare state.
The public know that the catalyst for the reforms we have introduced was the ballooning deficit left to us by the previous Government. The overriding mission behind
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the reforms had a much wider moral purpose: to make work pay, to end the something for nothing culture, to ensure a strong safety net for those who cannot work and, in the case of the reforms to housing benefit, to reduce overcrowding and homelessness.
Julie Hilling (Bolton West) (Lab): The hon. Lady is talking as though the only people in social housing are those on benefit or not working. It is an in-work benefit. More importantly, many people in this country who work for the minimum wage and work very hard will never be able to afford to purchase a property. That is why we have social housing and why we have homes for life for those people.
Margot James: I thank the hon. Lady for that intervention and I agree with much of the principle behind it. Of course, some people will never be able to afford to buy their own homes—although this Government are intent on helping as many people as possible to own their own homes—and that is the purpose of social housing and housing benefit. There is no argument with that principle, but we must be cognisant of the number of people who, at the moment, cannot even get council housing or privately rented social housing. That is one of the driving purposes behind the reform.
The subsidy has become something of a totemic issue for the Opposition. They want to position the end of the subsidy and the creation of a level playing field between all recipients of social housing support as a modern day poll tax. Whatever the merits or otherwise of different systems of raising taxes locally, there is no doubt that the poll tax lacked public support. That is the difference, and it is worth exploring why the policy we are debating today enjoys public support.
The MORI poll that my hon. Friend the Member for Meon Valley (George Hollingbery) mentioned found that 78% of respondents supported the need to reduce under-occupation and overcrowding in social housing, whereas 54% of them agreed that people of working age who live in social housing should receive less housing benefit if they have more bedrooms than they need. Some 60% of those polled believed that those affected should seek work or work longer hours if they could.
Emily Thornberry: The hon. Lady drew a parallel between the bedroom tax and the poll tax, and said that the difference between the two was that the poll tax was not popular. Does she therefore accept that the bedroom tax is a tax?
Margot James: I certainly do not. It is not a tax. A tax is a Government levy on somebody’s income, whereas we are clearly talking about reducing a subsidy.
Let me return to the subject of work. Many groups are exempt from the measure, including people in receipt of state pensions, families with disabled children, foster carers and other groups. Those who are in a position to seek work or extra work should either do so or try to swap their property for accommodation that meets rather than exceeds their needs. If their accommodation exceeds their needs, that is not a tenable or fair position for the long term. We are talking about only a few extra hours of work a week at the minimum wage. Instead of conducting a campaign of misinformation against the reforms to housing benefit—reforms that Labour accepted
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were necessary at the last election—local authorities should instead be helping people to downsize to accommodation that meets their needs, freeing up much-needed housing stock for the 2 million families on housing waiting lists.
I commend the Government for taking the tough decisions and, moreover, for their commitment to build 170,000 new social houses by 2015. In addition to this measure, that will help to ease overcrowding in many homes. I also hope that the Government will take a lead in encouraging housing associations and local authorities to convert some of the excess of large properties at their disposal so that we can begin to meet the needs of the 60% or so of people applying for social housing for single occupancy. I hear far more complaints from constituents who endure overcrowded accommodation than I do about ending this spare-room subsidy. I find the contents of my postbag quite instructive in that regard, so I shall support the Government amendment.
4.55 pm
Steve Rotheram (Liverpool, Walton) (Lab): In the lead up to the 2010 general election and in a desperate attempt to detoxify the brand, two words were bandied about to persuade the electorate that there would be a different kind of Tory if the Conservatives were elected. Those two words were “compassionate conservatism”, whatever that is. Wolves in sheep’s clothing—that is what I call it. No one standing on a Tory ticket in the next general election should be in any doubt whatsoever that once again it will be two words that will define their heartless brand of ideological politics—“bedroom tax”.
What happened to the Prime Minister’s mantra that we are all in this together? What happened to the Chancellor’s claim that he would not balance the Budget on the backs of ordinary people? Whatever happened to big society? Almost two thirds of those affected by the bedroom tax in my part of the world are disabled—that is 21,000 people hit the hardest while millionaires get tens of thousands of pounds every year in a Tory tax bung. Before the inevitable accusations of being feckless or unemployable are levelled against any of my constituents by Members such as the hon. Member for Monmouth (David T. C. Davies), whose rant should be videoed and played to anyone who doubts that it is the same old Tories, let me point out that 6,000 people on Merseyside who are now in rental arrears had never missed a payment in their life until the coalition’s welfare changes. The majority of those clobbered by this Con-Dem con trick are ordinary working people on low wages. This is entirely a Tory and Lib Dem-manufactured hardship imposed on those who need help the most, driven not by fiscal constraints but by political dogma.
I want to concentrate on three consequential areas of this policy. First, the Government have not given sufficient regard to the impact that it has already had on housing associations.
Ian Mearns: My hon. Friend is right that there is a significant impact on housing associations. The Home Group, a large housing association that has many properties in my borough of Gateshead and thousands of properties across the north of England, has seen a 53% increase in arrears in the past 12 months, mainly as a result of the bedroom tax.
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Steve Rotheram: My hon. Friend is right. In areas such as Liverpool and other major UK cities, rent arrears have increased dramatically, which means that housing associations have to find a way to combat the decrease in income while, at the same time, they are expected to commit to building more one and two-bedroom houses. That has the potential to affect their asset base and their ability to borrow money to build those houses.
Secondly—again, colleagues have mentioned this—this is a policy that will cost the Exchequer more than any potential savings. On Merseyside, housing demand is inversely proportionate to supply. As a consequence of not having enough of the right housing type it is virtually impossible for people caught in the bedroom tax trap to move into suitable social housing, so they are forced to consider renting in the private sector, even if that costs more than staying in their existing property and even if no one wants to move into the house that they are kicked out of. It is the economics of the madhouse, and it is our neighbourhoods that are suffering, decimated by a reckless and irresponsible Government inflicting poverty, creating urban blight and breaking up established communities. They are carrying out Thatcher’s legacy by causing instability that destroys the very fabric of society on which established communities are built.
My final area of contention is the social engineering that this Government are imposing on the poorest areas. Moving house may mean kids moving school, as has been mentioned, but it is also about families moving doctor and dentist, and mothers and older children who used to live within walking distance having to travel many miles to see each other. Many families have been forced out of the homes that were theirs for many decades. If they had been paying a mortgage instead of rent, which they could have done, they would have owned the property outright by now. For many they are homes, not houses. Hard-working families have been penalised simply because they could not afford a deposit. Surely that is not what is meant by “compassionate conservatism”—an oxymoron that will be consigned to the annals of political history alongside “Lib Dem principles”.
Be in no doubt that the overwhelming majority of the British people will not support a policy that punishes the poorest, the disabled, our armed forces, those riddled with cancer, the suicidal, the frail and the vulnerable. As the hon. Member for Stourbridge (Margot James) alluded to, this is the Tory poll tax of the 21st century. To think that this policy is a vote winner is severely to underestimate the compassion of the British people. I will always put my trust in the real people outside this place, rather than in a bunch of born-to-rule Tories who have no concept of what ordinary people have to contend with on a daily basis, and a Lib Dem party that has long since sold its soul.
5.1 pm
Mr Tobias Ellwood (Bournemouth East) (Con): I was getting flashbacks to 1970s socialism during that contribution—[Interruption.] The hon. Member for Liverpool, Walton (Steve Rotheram) is very proud of that; that is good to hear.
It is said that a lie can be halfway round the world before the truth has got its boots on, and such is the case with Labour’s bedroom tax. I am pleased that the
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name of the debate has changed, and I welcome the chance to clarify the details of the policy. I am sorry that the debate has been somewhat binary. Some good points have been made by Members on both sides and some pertinent questions have been asked. The hon. Member for Manchester Central (Lucy Powell) posed a very important one: how does somebody who is told to go out and work in order to pay for that second room manage to do that? I hope the Minister will elaborate on this, but the universal tax credit system will come in to address that.
The debate has illustrated the cultural divide that exists between this Government and Labour. On one side there is an attitude of responsibility and holding welfare reform to account, and on the other there is a continuing concept of offering welfare as a lifestyle choice. That is no longer possible. After 13 years of Labour the cost of housing benefit doubled to £21 billion. That is unacceptable. The cost to taxpayers was £900 per household. The system was getting out of control. There was no house building programme, leading to overcrowded accommodation, and there was no management of the housing stock, which left some families receiving housing benefit of more than £100,000.
Katy Clark: Does the hon. Gentleman not accept that the reason that housing benefit has gone up is the rising cost of rent in the private sector? Does he not accept that this Government’s policy of trying to force house prices up is putting rents up, which will make the housing benefit problem even worse?
Mr Ellwood: The hon. Lady makes an important point. I cannot accept that a doubling of housing benefit to £21 billion is accounted for by the private sector alone. There are other aspects, such as the type of housing we are building. We were building the wrong type of houses—60% of new houses built needed to be for single occupancy, but only 30% were. That is Labour’s legacy. It raises the fundamental question of today’s debate: in these financially tough times, should those on housing benefit be allowed to stay in accommodation with more bedrooms than they really need? This Government say no and Labour says yes, even though it said no in 2008 when we had exactly the same debate on private sector housing, proving that a little inaccuracy sometimes saves a ton of explanation.
Mrs McGuire: Will the hon. Gentleman give way?
Mr Ellwood: Very briefly; we are eating into other Members’ time.
Mrs McGuire: I do not think that the hon. Gentleman was in the Chamber for the earlier clarification, given by my hon. Friend the Member for Westminster North (Ms Buck), that the local housing allowance was not retrospective. This tax is retrospective and it penalises people for not changing their circumstances.
Mr Ellwood:
I welcome the hon. Lady to the debate. It is clear that Labour still has not learned from its mistakes. In the last eight years of government, Labour lived beyond its means. In 2002-03, it spent £26 billion beyond its means. Four years later that rose to £33 billion. In its final year of office, the deficit rose to £156 billion. That always accumulates, which means that by 2010 when
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Labour departed office we had a debt of more than three quarters of a trillion pounds. Where are these benefits that Opposition Members endorse? Where will that money come from? To date, Labour has refused to support a single reform to the benefit system put forward by the Government. Aside from failing to recognise, first, the need for reform of our complex system, and secondly, the consequences to society in promoting a something-for-nothing culture, Labour has voted against £83 billion-worth of welfare savings introduced by the Government, proving that it has yet to learn the lessons of the past.
Labour owes the taxpayer an explanation as to how it would afford to keep its complex, costly and broken benefit system in place. The challenge is simple. Thanks to the housing shortage, created under Labour, some 400,000 people are in overcrowded housing. Yet there are almost 1 million spare rooms throughout the UK paid for by the taxpayer at a cost of around £0.5 billion a year. This policy better matches our housing stock, but also protects the most vulnerable, such as pensioners, those in foster care, disabled children and those requiring overnight care. They are all exempt, as indeed are those who have served in the armed forces.
Those affected by the policy, as others have made clear, who are living in larger than necessary housing have four choices. First, they can participate in a house swap scheme, which has not really been embraced by all councils. Secondly, they can pay the reduction in housing benefit, which equates to about £14 a week for a room. Thirdly, they can sub-let that room. Finally, they could apply for the hardship scheme, and a couple examples have been given of that. I am pleased to hear the announcement today that if councils run out of that hardship funding, they can apply for more. That is a message that needs to be sent from both sides of the House, to ensure that councils do not run out of this important support.
The policy already exists in the private sector, introduced, as I say, by Labour in 2008. I welcome this policy and the debate, which I hope will help Labour Members to recognise how inaccurate and misleading some of their comments have been. I am pleased that the hon. Member for Aberdeen South (Dame Anne Begg) is in her place. I have a lot of respect for her, but she spoke eloquently about a council home being a home for life. I cannot agree with that analysis. A council home should be there as a method of support for those trying to get on in life and for those in a difficult period of their life. It should not just be given to somebody as a gift, early on in their lives, never to move away from. That is the distinct difference between the two sides of the House, on which we will have to agree to disagree.
I welcome the policy and the debate, and I look forward to the Minister clarifying some of the many points that have been made by Members on both sides of the Chamber.
5.9 pm
Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op):
I rise to speak on behalf of approximately 2,000 people in my constituency who are affected by this iniquitous and cruel bedroom tax. I have listened to the whole debate, and if anything shows the dividing line between Government and Opposition Members, surely
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it is this issue. My constituents watching this debate in the hope that the Government will be persuaded to change tack and admit that they have got this wrong will be horrified at just how out of touch Government Members appear to be: not only do they not understand their own policy, but they simply do not understand the impact it will have or how housing benefit works. The notion that people can simply go out and get extra hours of work to pay for the bedroom tax, or deal with the reduction in working tax credits or the fact that wages are not rising, shows just how out of touch the Government are.
The Government are also out of touch because they appear to have no idea of the circumstances in which ordinary people live. Listening to Government Members, one might think there was a swathe of empty rooms across the whole UK, but my constituents who have come to speak to me about the bedroom tax are the grannies who help with the child care and often have the kids at the weekend—[Interruption.] Someone says, “Pensioners.” It might have escaped the Government’s notice, but not all grannies are pensioners yet. My younger sister is a granny, but I am not at that stage quite yet.
There are also the kinship carers, who are not covered in the way foster carers are, particularly those who provide informal care in families that are having difficulties. There are also people trying to do the best they can to bring up their families after relationships break down. One of the cruellest things about this policy is the fact that the needs of children do not appear to have been taken into account at any level whatsoever. How can we say to a child who has been used to living with their mother but going to stay with their father at weekends or during the holidays, “You’re no longer entitled to sleep in a proper bed when you visit.” That is the result of this iniquitous bedroom tax. I wrote to Ministers about that and received a response that seemed completely out of touch with the way families make those arrangements. It is also unacceptable, in my view, simply to suggest that families should take in lodgers. Would Government Members be happy to do that in their family homes?
I do not have time to talk about all the issues, but I want to point out the problems for disabled people. Many disabled people in my constituency took the homes offered to them by the council, even if they were not ideal or in the areas they wanted, because they were on the ground floor and could be adapted for their needs. It makes no sense at all to take them out of a two or three-bedroom flat that has been perfectly well adapted and move them to an area where they will not necessarily have the same care and support systems in place simply because that is what this Government believe is the right way to go about things. It does not make economic sense, and it makes no sense with regard to communities or the provision of social care.
As I said at the outset, I think that there is a clear dividing line here. Some hon. Friends have said that there is no longer any compassionate conservatism, but I am not sure that there ever was. If anything, this debate shows that the Government are out of touch and have no ideas how to solve the problems, and this afternoon they have certainly shown that they simply do not care.
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5.13 pm
John Hemming (Birmingham, Yardley) (LD): I feel slightly unhappy about being told that I am out of touch. Yes, I was a millionaire by the age of 27, but I was on benefits in 1981 and both of my parents were born in Birmingham council houses, so I understand the importance of social housing and that there is a value in security of tenure. I find it rather sad when, as has happened in Birmingham, people are evicted from their family houses for under-occupying, perhaps because their parents have died. That is sad. However, we find ourselves in a society with problems. A lot of families live in overcrowded conditions. Those people come to see me and I cannot just ignore them. It is not a bedroom tax; it is a bedroom rent. People are paying rent for the spare bedroom. If somebody buys a house and it has an extra bedroom, they pay for it. If somebody rents a property, they pay the rent for the property. If they have a property in the private sector and they are on housing benefit, the local housing allowance sets limits based on the number of bedrooms.
On 19 January 2004, a Labour Minister said:
“We hope to implement a flat rate housing benefit system in the social sector, similar to that anticipated in the private rented sector to enable people in that sector to benefit from the choice and flexibility that the reforms can provide. We aim to extend our reforms to the social rented sector as soon as rent restructuring and increased choice have created an improved market.”—[Official Report, 19 January 2004; Vol. 416, c. 1075W.]
That is in Hansard; anyone can get hold of it.
John Hemming: When I am down to two minutes, I will take interventions.
The Labour party in government recognised that there was a problem with pressure on housing. We cannot suddenly magic up 1 million more rooms overnight. The reason there was not a lot of pain when the local housing allowance was introduced is that it did not affect anyone who was already on housing benefit; it only affected new claims. The hon. Member for Westminster North (Ms Buck) was very good on that point. To be fair, if we applied the same approach now, or had done so back in April, so that this did not affect anyone until they got a new tenancy, nobody would really bother about it. The problem with that is that we have a deficit. [Interruption.] Labour Members seem to forget the deficit, but we need to deal with these issues. However, we have found £180 million of the £500 million savings, so for over a third of people this need have no effect. To get my support, the Government will have to deliver more on discretionary housing payments, because that is the area I am concerned about.
Mrs McGuire: Let me deal with the consultation document. I shall quote from Hansard:
“Yes, it was in the consultation document, but we listened to the consultation responses and recognised that it would be inappropriate to roll it into the social housing sector.”––[Official Report, Welfare Reform Public Bill Committee, 2 November 2006; c. 453.]
That was the response of the Minister in the debates on the Welfare Reform Bill to which the hon. Gentleman is referring. The reason I know it was said and can confirm it is that I said it.
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John Hemming: It was an idea that the Opposition produced when in government because they recognised there was a problem. [Interruption.] I quoted precisely; I do not know what else was said in the debate.
Because of the situation with the bedroom rent, three tenants in my constituency have found a way in which they can all three exchange properties so that no bedroom rent is paid, an overcrowded family has found somewhere comfortable to live, and everybody is happy. The problem is that the council is saying that one of the doors in one of the properties is a bit distorted, so the transfer cannot happen. That is complete nonsense. It is like the nonsense of saying that someone cannot move if there are housing arrears. We had a case like that in Birmingham before the bedroom rent was introduced. People knew beforehand that it was coming in, so they planned for it and arranged transfers to avoid it. We had a case when someone was told they could not move because they were in arrears, and we managed to sort that out.
The hon. Member for Kilmarnock and Loudoun (Cathy Jamieson) asked about people with children in the house accepting lodgers. I have had children for many years, and we have had lodgers. We even had four refugees from Croatia as lodgers. There was a slight problem one day when one lodger used the milk and found that it had been expressed for the baby the previous night—that was a bit of a surprise for the lodger—but we got on with it.
Lodgers are not necessarily strangers. There are four options. The fact is that the Government have changed the rules so that people keep the first £20. If a single man who lives in a three-bedroom flat takes in two lodgers—I deal with such real cases—they can end up £40 a week better off and without any bedroom rent. That would be far better for them financially than their current position. Those arguments need to be put to people so that they can best decide whether they should move in order to get the discretionary housing payment. I emphasise again that I want to maintain the discretionary housing payment, which deals with the issues.
5.20 pm
Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP): I am not sure how many lodgers the hon. Member for Birmingham, Yardley (John Hemming) keeps, but he certainly seems to be in favour of the principle. The lodgers in his house no doubt put him in a better financial position.
I do not plan to detain the House for long. When the bedroom tax is viewed in an island context, it can be seen for what it really is: an attack on the living standards of the poorest. On an island, the poorest can be almost anyone’s neighbours, friends or relatives. In the social rented sector in my constituency, fuel poverty is between 33% and 61%, depending on how it is measured and counted.
On the island perspective, I am grateful to John Maciver of the social housing landlords’ Hebridean Housing Partnership for supplying me with figures. In Na h-Eileanan an Iar, 188 people are affected by the bedroom tax and there are more than 2,000 properties. On one island, the Hebridean Housing Partnership took over the housing stock from the council a number of years ago, and of the 105 properties, 50% are occupied by single people, but only 20% of the stock is designed
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for single occupancy, so some people will always be penalised by the bedroom tax. There is no solution on the island to this policy from Westminster and this Government.
Katy Clark: Does the hon. Gentleman support Scottish Labour’s proposed Bill in the Scottish Parliament that says that there should be no evictions and that the Scottish Government should provide full funding to Scottish councils for the costs of the bedroom tax?
Mr MacNeil: The hon. Lady should know that the underlying problem is that Scotland has a Government whom it does not elect. If the hon. Lady joined me, we would not be in this situation in the first place.
Fiona O'Donnell: Will the hon. Gentleman give way?
Mr MacNeil: No. I have given way once, but I might give way again later.
Importantly, the number of those on the islands who are suffering from the bedroom tax can vary throughout the year as a result of seasonal work. Some people need to move house every six months due to the seasonal nature of employment. To those who say that they should move to other islands, I say that the reality in the Hebrides has always been difficult. Indeed, I was 17 years old before I first crossed the sound of Barra to South Uist. In fact, I spent two years in school in Lewis before I went to South Uist. Communities are distinct and far away from each other. Therefore, a move would be socially isolating for people initially, and of course they would lose whatever employment they had on the original island that they lived on.
To answer that bureaucratic problem by building houses would definitely be inefficient, because the needs and variations of people’s lives change all the time. In fact, the bigger the house, the better in many ways, except for the bureaucratic problem that is being created here.
I will give an example of the difficulties involved in moving from place to place on the islands. I once flew to Stornoway and beside me on the plane was Michael MacKinnon, an elderly gentleman from the island of Vatersay who has since sadly passed on. He was travelling to a hospital appointment and I asked him by way of conversation—in Gaelic, of course—when he had last been to Stornoway. He said it was his first time and, had it not been for his hospital appointment, he would have been very much looking forward to it. I was surprised. Michael was a well-travelled merchant seaman. I said to him, “I suppose you’ve been all over the world, Michael.” “Yes,” he said, “I’ve been to Pitcairn island in the middle of the Pacific 13 times, but not to the other end of the Hebrides.” One thing I can say for Pitcairn island is that it does not have the bedroom tax, although perhaps the Government might want some of my islanders to move there.
That is an illustration of how the bedroom tax can affect local people in the Hebrides. It does not and cannot work. It penalises the poorest and those in our society who circulate money the fastest. Some people have wealth, while others have the cash flow and they have it by necessity.
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Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op): Does the hon. Gentleman accept that one solution to the problem would be to offer Scotland the same opportunity as Northern Ireland to exempt all existing tenants from the bedroom tax? I understand his unwillingness to accept the principle of the bedroom tax, but if parties in Northern Ireland can agree to that, surely those in Scotland could agree to provide such assistance to our constituents.
Mr MacNeil: The hon. Gentleman should know that welfare is devolved in Northern Ireland, but I am glad that he supports the principle of devolving welfare to Scotland. In fact, we can devolve everything to Scotland by voting yes on 18 September next year.
The chairman of the US Federal Reserve, Ben Bernanke, once said that the best form of quantitative easing for Japan about 10 or 20 years ago, when it was going through its economic travails, would be to pile cash in a helicopter and shovel it from above over any Japanese city, down on the citizens below. What is happening at the moment is the opposite of that because the Government are taking money from those who circulate it in the economy. The quickest way to stimulate demand in the economy is to put money into people’s hands; the Government are taking money out of their hands.
The money that people are losing would quickly end up in the hands of small businesses, yet in Scotland alone, £54.5 million has been taken out this year. Trickle-down economics never worked, but hoover-up economics certainly does work. Quantitative easing in this country has been a welfare subsidy of epic proportions to bankers and those who are already rich, yet this afternoon we are discussing how to take even more money from those who can ill afford it.
There are further complications with the bedroom tax. Discretionary housing payments have two important conditions. People cannot claim retrospectively and must apply for a housing transfer, but many people in my island constituency feel that is dishonest and do not want to do it for the simple reason that they do not want to move house. They also know that they might be moved to another island if the policy was to go through to its ultimate logical possibility. Of those 188 people in the Hebrides, only 80 or 90 have so far claimed discretionary housing payments. Hebridean Housing Partnership is in rent arrears, and more worryingly, 20 people have not engaged with, responded to or acknowledged the process at all. They are reckoned to have drink, drugs or mental health problems, and ultimately the tax could end up further destabilising their lives. At the very least—I make this plea to the Department for Work and Pensions —we should allow retrospective claims. Some people are currently trying their best to manage, but I feel that they may fail in their attempts and need support. That support should be retrospective.
Further complications are added by seasonal work, and the small amount that people earn from jobseeker’s allowance while having to pay for essentials such as food and big annual demands such as the TV licence. Losing £10 from 70-odd quid a week is quite a lot and a huge hindrance in life.
Some people watching this debate probably begrudge what other people have, but they should look to countries such as Norway and Denmark where the unemployed do far better, society is far healthier and unemployment
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is far lower. To those who are still begrudgers I say, “Look at the wealth disparity in the United Kingdom, the fourth most unequal country in the OECD, where sadly the super-rich are getting richer.” That is where the real societal flaws are.
I have known the father of the Chief Secretary to the Treasury, Mr Di Alexander, for 10 or 15 years, and he has worked in social housing. He is, of course, very proud of his son, but he has stuck to his principles. I strongly admire what he has said about the bedroom tax, which was absolutely spot-on. If we listen to anybody on or connected to the Government Benches, it should be Mr Di Alexander.
5.28 pm
Ian Swales (Redcar) (LD): I previously opposed this policy not because I think we should necessarily pay money for spare bedrooms, but because the consequences that we have heard about today were highly predictable, and I shall speak about some of them. It is no wonder that we have a crisis in rents and social housing availability when 421,000 social houses were lost under the Labour Government—a truly shameful record.
We have also heard about the different effects of the policy in different parts of the country, and I find myself identifying most with the hon. Member for Liverpool, West Derby (Stephen Twigg), given the characteristics of my constituency. Social housing is in reasonably plentiful supply and regeneration is required in many areas, but we are now getting housing blight because of the availability of three-bedroom houses that people do not want to take. Previously, smaller family units were put into those houses, but people will not take them now.
As most hon. Members have said, there is a suitability of stock problem. My constituency made the front page of the newspapers after a calculation that said it would take 37 years to make available one-bedroom accommodation to all those who need it.
Catherine McKinnell (Newcastle upon Tyne North) (Lab): The hon. Gentleman is making some interesting points. I recognise that situation in Newcastle. Given that Government policy is punishing people for a problem—the stock available—not of their making, will he vote with the Opposition?
Ian Swales: I worry that housing policy tends to be dictated from inside the M25. It becomes less appropriate the further away from the M25 that we go.
My constituency has a discretionary housing payments problem. The last figures that I have seen show that there were 1,307 applications, but that only 358 awards were made. That happened because the money ran out, not because the applications were inappropriate.
We also have a one-size-fits-all penalty in the calculation for the amount of the spare room subsidy. In my constituency, the cost of an extra bedroom is about £7, but people are penalised by about £11. Therefore, people who should move from a three-bedroom property to a two-bedroom property get less housing benefit than they would get if they were in a two-bedroom house, which is deeply immoral.
Like many hon. Members, I have campaigned on various issues. I am pleased to welcome the Government’s concessions on foster parents, serving military personnel
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and disabled children. I also welcome the trebling of discretionary housing payments, but there is a lot of unfinished business. The hon. Member for Aberdeen South (Dame Anne Begg), the Chair of the Work and Pensions Committee, made some good points. I would make a plea for the exemption of disabled adults. Children are exempt when they need separate bedrooms for medical reasons. Let us do that for adults, instead of making people go through the demeaning process of applying. In my local council, people have to apply every quarter, and the application form is deeply intrusive.
As the hon. Member for South Derbyshire (Heather Wheeler) has said, many people are perfectly willing to move to right-size accommodation, but it simply does not exist anywhere in their area. In the north of England, we have a shortage of one-bedroom accommodation. In fact, some one-bedroom accommodation is being demolished in my constituency.
Steve Webb: My hon. Friend is making a thoughtful speech. I assume that he has a Labour-run local authority. If it has told him that the money for discretionary housing payments has run out, will he ask it why it has not applied for our additional funding? It appears not to have done so.
Ian Swales: I thank the Minister for that response. His announcement of that extra funding is the first I have heard of it. I will ask my local authority why it has not applied.
We need to recognise that some people simply cannot afford right-size accommodation and that it does not exist in their area. The Government should seriously consider a policy of treating those people as willing but unable to move and give them concessions in the system.
In my area, there have been some helpful consequences. I have been thanked by a number of families who have managed, owing to the policy, to get a bigger house in the area where they want to live. One social housing provider I met was surprised by the number of large families moving into their houses from overcrowded private rented accommodation. I do not know why that provider was surprised; surely, we ought to have expected that. Only the week before last, I was in an excellent hostel run by Coatham House, a charity in my constituency for homeless young people. It has said that it has seen a dramatic fall in the number of homeless young people. It put that down to the policy. Hon. Members might think there are bad reasons for that—I can think of those, too—but there might also be good reasons.
Many points have been made in the debate. The hon. Member for Gateshead (Ian Mearns) mentioned the financial stability of some of the stock transfer social housing providers. Some of them are highly leveraged and threatened by arrears, which will increase when direct payments begin. They could find themselves financially unstable.
I welcome the Government’s efforts to free up the system. One of the first cases that I dealt with as an MP was that of a single man living in a three-bedroom house. He wanted to downsize, but the system was so rigid that he was told that he would be moved to the bottom of the waiting list, with no guarantee of how and when he would get his next social house. Guess what? He did not move. I welcome that the system has, to an extent, been freed up and that exchanges are happening more often.
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I welcome the continued commitment to review the policy, as it does need continual review. Despite the views that I have expressed in my speech, it is hard to welcome the hypocrisy evident from the Labour party on this issue. I look forward to the Minister’s response.
Mr Speaker: Order. I am sorry to disappoint the House, but speeches have tended to be at the limit, with lots of interventions taken. I have to reduce the time limit with immediate effect to four minutes, otherwise colleagues will not get in. People do not have to take the full time, but they can.
5.35 pm
Mr Russell Brown (Dumfries and Galloway) (Lab): Dumfries and Galloway council does not have any housing, so in my constituency we depend on three or four registered social landlords. The two biggest social landlords are Dumfries and Galloway Housing Partnership and Loreburn Housing Association. Opposition Members have been good enough to explain the human consequences of this measure: its impact on disabled people and their carers, and on the access fathers from broken relationships have to their children. While foster carers have been supported, kinship carers have not. For single homeless people in my area, the situation has become very difficult indeed, as no one-bedroom properties are available. I also have to say, in case it has passed people by, that the cost of moving home for the poorest in society comes at a price that many cannot afford to pay.
I have two or three points I would like to raise with the Minister. I congratulate my hon. Friend the Member for Halton (Derek Twigg), who laid out how the local housing allowance came into being. The big difference between what has gone before and what we are faced with is the simple fact that when this legislation came into effect people were trapped—they had nowhere to turn. The idea that 1 million empty bedrooms and 250,000 overcrowded households could all of a sudden be put right is totally wrong. Last year, my Tory-run council wrote to the coalition Government to tell them to rethink the bedroom tax, because one-bedroom properties simply were not available. I have to ask: why do the Government not listen to their own?
The Minister of State, who opened the debate, is consistent—he always comes out with the usual nonsense about it being everyone else’s fault. On the complaint about the inherited position, not once did I hear anyone on the Government Benches talk about a school that we built that they did not want, a hospital that was built that they did not want, or infrastructure we put in that they did not want. Investment was not the problem for this nation—it was the banks. Government Members want to forget that.
I am amazed that we still have this legislation. Whatever lies behind it, there must have been Government targets. Was it about saving money? Seven months in, how much money have the Government saved? Was it about swapping people around in the system to make sure that those who were under-occupying moved out and that those who needed larger homes got them? Has that succeeded? Will the Minister tell us how many families have been able to downsize? How many social tenants have moved into the private sector because no social housing was available? I say: bring forward that review. As we have heard time and again from Government Members, the Bill
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was introduced because it was populist, and for no other reason. It is about kicking people in society when they are down. That is the true face of compassionate Conservatism.
5.39 pm
Mr George Howarth (Knowsley) (Lab): Much of my speech will be about facts, figures and statistics, but contributions thus far, certainly from the Opposition, have focused on the real impact of this policy on people’s lives. Be they people with disabilities, people with access to children at weekends that they cannot maintain or others—there are many more—these are real people, and this has real consequences for their lives, so this debate is about not just facts, figures and statistics, but how this policy affects people’s lives.
Mr Nigel Dodds (Belfast North) (DUP): For precisely that reason and because Northern Ireland will be worse affected than any other region of the UK, does the right hon. Gentleman welcome the fact that the Northern Ireland Executive and political parties there are joining together to prevent this from hurting the vulnerable people of Northern Ireland?
Mr Howarth: Absolutely, I applaud what is happening in Northern Ireland.
Since the introduction of the bedroom tax, rent arrears in Merseyside have increased by £2.2 million—not to £2.2 million, but by £2.2 million—representing a loss of income that could have built 125 houses in the region, creating jobs and bringing all the other consequences. Some 60% of those in the Liverpool city region in arrears because of the bedroom tax are in arrears for the first time. It is not a habit of theirs, but a direct consequence of the bedroom tax.
Barbara Keeley: We have some frightening statistics in Salford, too, but those are very large numbers, particularly the loss of spending power. Do those figures cover the Minister’s constituency and will she be explaining to people in the region how these things came about?
Mr Howarth: They do indeed. I hope the Minister will respond to these statistics, because her own constituents will be interested to hear.
We have experienced a 30% increase in void—empty—properties, including a 130% increase in three-bedroom houses. This is not, therefore, just a matter of releasing unused bedroom space for those on the waiting list; there is no demand for three-bedroom properties, which is why they become void properties. Staggeringly, the result has been a loss of rent to local landlords of £616,622 per month, compared with £397,000 in the same period last year. Those are the direct consequences, in one city region, of the bedroom tax.
Where are our people supposed to go? In my city region, we have an excess of three-bedroom properties and a shortage of two and one-bedroom properties. We can debate all day who is responsible for that, but it is a fact, so where are people to go? There is a shortage of social housing for them to scale down to. Interestingly, York university’s centre for housing policy report, which
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has been referred to frequently in this debate, concludes that 41.5% of people losing money because of the bedroom tax and having to move will enter the private rented sector. That is the conclusion of an unbiased, peer-reviewed report.
Now, here is the rub. This measure is supposed to be saving some money. The average rent for a three-bedroom housing association property in Knowsley is £74 a week, compared with £132 for a three-bedroom house in the private rented sector. If someone were to scale down from the three-bedroom housing association property to a two-bedroom house in the private sector, they would be paying £115 a week, compared with the £74 they were paying before.
As my right hon. Friend the Member for Greenwich and Woolwich (Mr Raynsford) said earlier, this policy is morally bankrupt. It is also incompetent. It presumes that people can just move around at will, and that a property that is right for their circumstances exists somewhere in their area. That is not the case. There is growing evidence that, rather than saving money, this policy is costing more.
5.45 pm
Kwasi Kwarteng (Spelthorne) (Con): I apologise for not having sat through the whole debate; I was in the Gambling (Licensing and Advertising) Bill Committee. However, I have to say of those speeches that I have heard from the Labour Benches: I have heard it all before. Initially, Labour Members dubbed the measure the “bedroom tax”—
Chris Ruane: Initially? It still is.
Kwasi Kwarteng: They still persist in calling it that. We have to remember why the legislation was brought in, and the serious nature of the economic position in which we found ourselves. One of the great things that this Government have achieved is a measure of welfare reform. Labour Members vigorously opposed the housing benefit cap, but it has proved to be an incredibly popular and well-regarded policy. There were prophecies of ethnic cleansing in London and absolute devastation, but the policy has largely worked and welfare reform is on course.
It is a misrepresentation to talk about the spare room subsidy as a tax. It is not a tax, by any definition. There is also a serious problem of overcrowding. About 1.8 million people are living in overcrowded conditions, yet there are literally millions of spare rooms. What are we, as a country, going to do about that? Are we going to continue to subsidise people living in larger accommodation that they do not necessarily need, or are we going to try to achieve a fairer distribution of accommodation?
Barbara Keeley: The hon. Gentleman has mentioned millions of extra rooms and the benefit cap. To many disabled people and their carers, those are not spare rooms. They are needed by people who need to sleep apart, or who have hospital beds or medical equipment. Five thousand carers are being hit by the benefit cap, and a large number will also be hit by this measure. The hon. Gentleman needs to reflect on that fact, if he thinks the measure is working.
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Kwasi Kwarteng: If that were indeed true, why is there a discrepancy between privately rented accommodation and social housing in this context? I hope that the Opposition will enlighten me on this. The last Labour Government might have wrecked the economy, but they at least had some sense of responsibility—unlike the current Opposition. Why did that Labour Government believe that there was a perfectly good reason to equalise the treatment of the private and social sectors?
Sheila Gilmore: Will the hon. Gentleman give way?
Kwasi Kwarteng: I will not; I have only a short time in which to speak.
Labour Members talk about fairness, but is it fair that someone on a low income who is in privately rented accommodation should pay taxes in order to subsidise someone else’s spare room? Is it fair to raise taxation from low-paid workers to subsidise other people’s accommodation?
Ian Mearns: The hon. Gentleman has not recognised that people with disabilities often get priority when it comes to public housing. That is why there is a predominance of people with disabilities and greater levels of ill health in publicly provided housing.
Kwasi Kwarteng: It is an issue of principle—equality between socially provided housing and private sector rents. At the moment, there is a discrepancy that the Government—perfectly fairly and perfectly wisely—are trying to equalise.
It is, I think, very irresponsible of Labour to persist in peddling these half-truths about the nature of what the Government are trying to do, and many people in this country think so, too. It is apparent that this Government measure enjoys a wide body of support. It is exactly on this issue where the Labour party is on the wrong side of public opinion. On welfare, the public are consistently behind the coalition parties in the polls—and this debate shows why.
Labour Members who are sitting rather lemming-like in their places have absolutely no idea about fiscal responsibility and no idea about trying to reform a system that cannot be sustained. The notion that Labour would be tough on welfare has been shown to be untrue. It is not the case that Labour is tough on welfare. On the basis of the bits of the debate that I have had the pleasure—or, rather, misfortune—to listen to, I felt I was back in 1974. We have gone back to an early-70s, socialist-style model, in which there is no sense of responsibility, no sense of any fiscal constraints under which Governments have to operate and not even any sense of fairness when, as I mentioned, the taxes of people on lower income are being used to subsidise the spare room.
What is particularly frustrating for Government Members is to have to listen to the same old debates, the same old primary-school name calling of “the bedroom tax” and all the rest of it, which are completely lacking any grounding in reality. We have said that we want fairness. Councils are able to use discretionary payments, and we hear anecdotally that councils are refraining from using them. These are the anecdotes that we hear. It is now time for the Labour party to wise up and get realistic about the nature of the challenges we face and the overcrowded nature of much of this country’s social housing.
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5.52 pm
Jack Dromey (Birmingham, Erdington) (Lab): As dawn broke on a May morning, a 53-year-old grandmother, Stephanie Bottrill, went to the table in her house—a house she had lived in for 18 years—and wrote notes to her son, her daughter, her mother, her friends and the grandson on whom she doted. She locked up, left the cat behind, went across the street to her neighbour, put the keys in the neighbour’s door and then walked through a silent estate three miles to the M6, threw herself under a lorry and committed suicide. The note that this lady, driven to desperation, left for her son Steven, 27, said:
“Don’t blame yourself for me ending my life. The only people to blame are the Government.”
Days earlier, faced with having to find £20 extra a week, she had said to her neighbours, “I just can’t go on.” Mr Speaker, what kind of country do we live in, and what kind of Government do we have that drives a decent woman like her to suicide? Once in a generation, there is a tax that is so bad that the next generation looks back and asks. “Why did they do it?” Such was the poll tax; now the bedroom tax.
The bedroom tax is an iniquitous, immoral and unjust measure—cruel in its impact on the one hand, and presenting cruel dilemmas on the other. As for cruel in its impact, three years ago, I helped David O’Reilley, his partner Nikky Cunningham and their daughter to get into a council home. It had three bedrooms—a box room for the daughter and two other bedrooms, one of which Nikky cannot sleep in because, tragically as a result of an operation that went wrong, her loving husband David is a paraplegic. With the special bed and special equipment in the room, it is impossible for her to sleep in it too, so she sleeps in another room—but they have to pay the bedroom tax.
Chris Ruane: To what extent does my hon. Friend think that the Government’s policies are being pursued out of political spite rather than in the pursuit of efficiency?
Jack Dromey: I shall come to that very point shortly.
This tax is presenting cruel dilemmas. “Move,” they are told—but who are they? Two thirds of them are disabled. Move where, in Birmingham? There are 13,736 people who are affected by the bedroom tax, and there are 130 one-bedroom properties available to accommodate them. If they stay, they sink into debt. The Government say “Ah, but we have the discretionary housing payments.” The Government gave £3.77 million to Birmingham and the council topped it up by £2 million, but there are 350 new claimants every week. If the current trajectory continues, the fund will run out by Christmas, and thousands of desperate people in Birmingham will face an unhappy Christmas and a bleak new year.
Not only is this an unjust, iniquitous and immoral tax; it is also the economics of the madhouse. If a disabled man or woman is moved from a house that has been adapted to a house that has not been adapted, the adaptations must be paid for. If someone is moved from a two-bedroom council home to a one-bedroom home in the private rented sector, housing benefit will typically cost £1,500 more a year. There is also the impact of bad debt and administrative costs on house building. Housing
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associations throughout the country are saying, “Just when we need more social homes, fewer of them will be built.”
I know that there are some honourable Members on the Government Benches, and I pay particular tribute to the excellent contribution made by the hon. Member for St Ives (Andrew George), but let me say this to Government Members more generally. Have they no sense of shame about the pain that they are causing to war veterans, children, the disabled and carers, three quarters of whom have said that they are having to cut back on heating and eating as a result of the bedroom tax? Have they no sense of shame when they hear about Nicky Cunningham, the wonderful wife of David, her paraplegic husband? She said to me yesterday, “Jack, they treat us as if we are good for nothing and contribute nothing to society. Us a burden? We are already living with a burden. Why do they do this to us?” There is no answer to that question, other than to do what a Labour Government will ultimately do, and confine the bedroom tax to where it richly deserves to be: in the dustbin of history.