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House of Lords

Thursday, 3 April 2014.

11 am

Prayers—read by the Lord Bishop of Leicester.

Payday Loans: Advertisements


11.06 am

Asked by Lord Mitchell

To ask Her Majesty’s Government what steps they are taking to reduce the number of payday loan advertisements watched by children.

Lord Newby (LD): My Lords, payday loan adverts are subject to the Advertising Standards Authority’s strict rules. The ASA will not hesitate to ban irresponsible adverts. The Broadcast Committee of Advertising Practice is currently considering the issue of payday loan advertising on children’s TV and the potential implications for ASA regulation. The Financial Conduct Authority has introduced new requirements on payday lenders, including mandatory risk warnings and signposts on debt advice in adverts. It can ban misleading adverts that breach its rules.

Lord Mitchell (Lab): I thank the Minister for the reply. Daytime television, my Lords, is deluged with advertisements for payday loans, many of them including fluffy puppets, catchy jingles and smiley people. Children see these advertisements and, not surprisingly, when family money is tight, they pester their parents to take out these loans. I intend to table a Private Member’s Bill to ban all advertising of high-cost, short-term loans until after the watershed. Will the Government support me?

Lord Newby: My Lords, I think it is right first to set out the scale of the problem. I am not doubting that there are issues, which is why the Broadcast Committee of Advertising Practice is looking explicitly at this matter. However, to set the issue in context, payday loan adverts in 2012 comprised 0.6% of TV ads seen by children aged four to 15, and, last year, all personal debt ads on children’s television amounted to 0.2% of total ad spend on children’s television. I am not saying that it is not an issue, but the number of ads being watched by children in this area is relatively modest—hardly more than one a week.

Baroness Benjamin (LD): My Lords, payday loans are a form of grooming. So, to protect our children, should there not be an additional clause in the Advertising Standards Authority’s children’s code that refers to the scheduling of adverts that encourage potentially harmful lifestyle choices such as easy access to borrowing, including payday loans?

Lord Newby: My Lords, that is exactly why the Broadcast Committee of Advertising Practice is looking at this issue. We expect to hear from it in the next few months and there may be consequences for the ASA

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code. I have some difficulties about the use of the word “grooming” in this context. It has come to have a specific meaning in relation to sexual exploitation, and, whatever the problems with payday loans—and there are very considerable problems—they are not of that degree of difficulty.

Lord Davies of Oldham (Lab): My Lords, the Minister has indicated that there has been a minor reduction over the past year, but the scale of payday loans is astonishing—and they are directed at children because that is a soft way to get at parents. Is this not something that we all ought to criticise and deplore, and on which we ought to expect authority to take action, because the only reason that daytime children’s television in particular is deluged with these loan advertisements is that it puts pressure on parents?

Lord Newby: My Lords, this Government have taken very strong action in respect of payday loans by giving the FCA very considerable powers in this area, which it has started to exercise. It is a sign of the times that yesterday DFC, one of the country’s three biggest payday loan providers, issued a profit warning and surrendered to a takeover, citing the tougher new regulatory regime. The weather is changing for payday loans.

Baroness Walmsley (LD): My Lords, I appreciate that this is slightly to one side of the Question, but can my noble friend tell me whether any work is being done to find out how many advertisements for easy ways of gambling away your money are seen by children?

Lord Newby: My Lords, I do not have any specific response to that, except to say that the ASA is able to investigate any complaints about the effect of ads on particularly vulnerable groups, which potentially would include gamblers. Certainly, if you watch paid-for sport television, you get a very large number of ads for online betting, which I find distasteful—but, as with many things in life, there is an interesting argument to be had about the line between what is distasteful and what should be banned.

Lord Foulkes of Cumnock (Lab): My Lords, it is a pity that the Minister has resorted to statistics to try to explain this away. All it needs is one of these very cleverly devised adverts to put pressure on children or to influence children to put pressure on their parents, who can ill afford to take out these loans. Will the Minister answer the question put by my noble friend Lord Mitchell: when he brings forward his Bill, will the Government give sympathetic consideration to supporting it?

Lord Newby: My Lords, when the noble Lord, Lord Mitchell, brings forward his Bill, the Broadcast Committee of Advertising Practice will have expressed a view on these loans. The Government will take very considerable account of what it says in forming their view about the noble Lord’s Bill.

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Baroness Symons of Vernham Dean (Lab): My Lords, children do not watch only programmes that are designed for them; in some households they watch programmes all day. Can the Minister tell the House what percentage of advertising in general across the schedule is advertising for payday loans?

Lord Newby: My Lords, I do not have that figure. I will write to the noble Baroness.

Lord Forsyth of Drumlean (Con): My Lords, is there not a case for looking at daytime advertising? On the one hand, you have ads that are encouraging people to take out loans at very high interest rates and on the other you have people being encouraged to go on gaming sites. With hindsight, was it not a great mistake for the previous Government to abandon the principle with respect to gambling and advertising that we should not take any measures that stimulate demand?

Lord Newby: My Lords, it is a highly contentious issue and there are simply different views on it. As I said, personally I find those adverts distasteful, but that is not to say that I necessarily want to ban them all. One problem with a lot of adverts is that they encourage behaviour that might be thought to be irresponsible. There are a lot of ads on children’s TV for expensive toys and games that encourage children to say to their parents, “Can I have that toy and that game?”, which the parent cannot necessarily afford.

Prisons: Education and Training


11.14 am

Asked by Lord Ramsbotham

To ask Her Majesty’s Government what impact prison staff cuts have had on the provision of education, job training and substance abuse programmes in Her Majesty’s prisons.

The Minister of State, Ministry of Justice (Lord Faulks) (Con): My Lords, staff reductions have been made as part of the benchmarking reforms of public sector prisons. Benchmarking is the best means of delivering value for money for the public purse. It either increases purposeful activity or sustains current levels, and refocuses work and job training to enhance prisoners’ employment prospects on release. The Prison Service works closely with commissioners of substance misuse services and education to optimise the provision of these services to meet prisoners’ needs.

Lord Ramsbotham (CB): I thank the noble Lord for that rather disappointing reply. Provision of and access to education and training are two key factors in any meaningful attempt to prevent reoffending. I cannot imagine that anyone responsible for the conduct of imprisonment could be happy about an Ofsted report which finds that, despite some prisons having state-of-the-art facilities:

“Training and education in prisons are very poor and are failing to support offenders into employment… In many prisons, training and education comes too far down the list of priorities for prison governors and other senior staff.”

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Nor could anyone be happy about a London University Institute of Education survey which found that 62% of prison educators criticised the negative effect of payment by results on prisoners as learners, and on the overall quality of education. When prison educators are complaining and prison staff are speaking openly about the difficulties of getting prisoners to education due to cuts in staffing, I hope that Ministers are suitably concerned. Will the Minister please tell the House what steps are being taken to rectify the situation?

Lord Faulks: Many steps are being taken. Work is progressing on introducing a new mandatory assessment for all newly received prisoners by OLASS, the Offender Learning and Skills Service providers. This will ensure that all offenders receive a learning assessment focused on English and maths, rather than those who simply go on to learning. NOMS and its partners are working towards implementing better data about sharing arrangements. I should say that intensive maths and English courses are being piloted in prisons, based on a model adopted in the Army, particularly to address prisoners serving short sentences.

Lord Patel of Bradford (Lab): My Lords—

Lord Howarth of Newport (Lab): My Lords—

Baroness Bakewell (Lab): My Lords—

Baroness Corston (Lab): My Lords, the Minister just referred to purposeful activity for those who are in our prisons. I know of one women’s prison where this activity is filling sandwiches for Pret A Manger. Is this the kind of purposeful activity to which he refers?

Lord Faulks: Purposeful activity covers a number of different areas: work, training, education, PE and programmes designed to tackle the causes of prisoners’ offending. Quite a lot of the emphasis on purposeful activity is to try to allow prisoners to engage in activities where they will have some prospects of work outside, particularly in the catering business. With great respect to the noble Baroness, who I know has great knowledge of these issues, that is in fact not out of step with where they might be able to find employment afterwards.

Lord Dholakia (LD): My Lords, does my noble friend the Minister accept that prisons are overcrowded, and that controls and discipline are difficult to maintain? In fact, there has been an increase of 72% in calls on riot squads, and we have reached a high point in the level of deaths in custody. Under these circumstances, in order to ensure that prison’s objectives of education, training and jobs are not affected by cuts in government expenditure, would the Minister not agree that it is time for automatic inspections by HM Chief Inspector of Prisons?

Lord Faulks: Any violence or instability in prisons is clearly to be regretted. However, the noble Lord will be aware that assaults in prisons are at their lowest level since 2008, and the number of cases of escaping

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or absconding has reduced by more than 85% of what it was 10 years ago. I am afraid that I cannot accept that there are problems as a result of overcrowding. At the moment, although there is no room for complacency, matters are stable in the Prison Service.

Lord Wigley (PC): My Lords, does the Minister recall the debate last Thursday in which it was mentioned that more than 5,000 IPP prisoners are being held in prison, two-thirds of whom are beyond their tariff, and that the main reason for this is the lack of training for rehabilitation? Given that this is costing more than £200 million a year, is it not penny wise, pound foolish to cut back on courses of that sort? Can the Minister give some assurance that these prisoners can have the hope of getting rehabilitation courses?

Lord Faulks: I well remember the debate and the prominent part which the noble Lord played in it. He will also recall the response that I gave him, which was that there was a considerable, co-ordinated effort to ensure that those IPP prisoners were enabled to engage in appropriate activities which would increase the likelihood of, although not guarantee, their release after hearing before the Parole Board. That is happening, and the Prison Service is well aware of the problem.

Lord Woolf (CB): My Lords, on 1 April 24 years ago, if my recollection is correct, the British prison system was subject to a series of riots. A Conservative Home Secretary, now the noble Lord, Lord Waddington, asked me to make a report. Another Conservative Home Secretary, the noble Lord, Lord Baker, received that report and the House of Commons, with one exception, indicated that it accepted the recommendations, limited to 12, in that report. I am very pleased that a Government of whom the Conservatives are part have now focused on the importance of rehabilitation. Does the Minister agree that if you are going to have rehabilitation, it is very important, first, to control the numbers in prison and, secondly, to have the staff needed to cope with that number of prisons, for the reasons identified by the noble Lord, Lord Ramsbotham?

Lord Faulks: The noble and learned Lord is referring to the Strangeways report. I entirely accept that rehabilitation should be a key part of prison. The noble and learned Lord will recall that the transforming rehabilitation reforms mean that those serving short sentences for the first time will now be able to obtain support after leaving prison and will be enabled by means of resettlement prisons to have some continuity in the support that they receive inside and outside. I accept his general observations. It is a matter very much to be borne in mind.

Lord Howarth of Newport (Lab): My Lords, whatever the Justice Secretary is now saying, is not the reality of the situation that his policy is preventing family and friends sending books to prisoners? Does not a state which treats its prisoners with gratuitous harshness and which seeks to suppress the life of the mind put itself and society to shame?

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Lord Faulks: That is not strictly within the Question but entirely predictable. The Secretary of State has not banned books. Each prisoner is entitled to 12 books in their cell. The libraries in prisons are impressive. If the noble Lord would like to visit one of the prison libraries, that can be arranged with my department. It is a matter of great disappointment to the librarians that so many people have criticised the provision of books. What the Secretary of State is trying to do is prevent people sending in parcels that do not always contain books, or not exclusively books, to try to stem the real problem there is in prisons of drugs and other contraband, extremist literature and the like. We are not banning books.

Health and Safety Executive


11.23 am

Asked by Lord McKenzie of Luton

To ask Her Majesty’s Government what assessment they have made of the findings of the triennial review of the Health and Safety Executive.

Lord McKenzie of Luton (Lab): My Lords, I beg leave to ask the Question standing in my name on the Order Paper and in doing so draw attention to my interest in the register.

Lord Bates (Con): My Lords, Martin Temple’s triennial review of the HSE concluded that the functions performed by the Health and Safety Executive are required and that it should be retained as a non-departmental public body. He made recommendations concerning potential efficiencies and opportunities to raise income, and the Minister for Disabled People has asked the HSE to work on these. Other recommendations require further consideration, and we will respond more fully later in the year.

Lord McKenzie of Luton: My Lords, I thank the Minister for what I take to be a positive reply. The Minister will be aware that the report refers to the “nearly universal praise” for the HSE, which it considers a reflection on its,

“impartiality … independence … professionalism and technical competence”.

What assurances can the Minister give that any requirement placed on the HSE to increase its commercial income will not impair those vital attributes, and what more can the Government do to promote the excellence of the HSE and the UK health and safety system?

Lord Bates: I am grateful to the noble Lord for that question. I think that Martin Temple pointed out exactly that. He paid tribute to the work of the HSE, which it does day in, and day out, in maintaining safety standards. One reason why this country enjoys such high standards of health and safety in the workplace is because of the work of the HSE. It is of course necessary to ensure that its work is efficient and effective. For that reason, he suggested that the HSE focus its

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efforts on major hazard sites rather than those areas of relatively low risk. That is what it has been doing over the past couple of years.

Lord German (LD): My Lords, one of the recommendations in the report is to delink the need to prop up the budget and fines for intervention. We have been here before with speed cameras, where there was a suspicion that police forces were increasing their budgets by overuse of speed cameras. How will my noble friend learn lessons from that, and from the recommendation in the report that fines for intervention should not be linked to propping up the budget of the HSE? What steps will he take to implement that?

Lord Bates: It is a good question. The point is that fines for intervention are where visits and inspections have taken place and problems have been found which have resulted in prosecution. In those circumstances, the view of the HSE and of the Government is that the taxpayer should not have to pick up the bill; the person who has not been fulfilling the obligation to implement the rules correctly should pay the price.

Baroness Donaghy (Lab): My Lords, the Minister will be aware that the Health and Safety Executive played a key role on the Olympic construction site. Our country should be very proud that not a single person died as a result of that building work. Following on from the question of the noble Lord, Lord German, the independent report states that the link between funding of the regulator and income from fines is a “dangerous model”. How will the Minister ensure that the HSE’s integrity and independence will be protected?

Lord Bates: That is a very good point. I certainly endorse what the noble Baroness said about the Olympics. There were 46,000 people working on that site and to have not one fatality is exemplary. That gives me the opportunity to point out that that is one thing that the UK does extraordinarily well. Fatalities in the workplace are much lower in the UK, at 0.71 per 100,000 workers, compared to an equivalent rate of 0.81 in Germany, 1.57 in Italy and 2.49 elsewhere. That is an important record, showing that the HSE is working correctly with contractors in major projects, and this will ensure that that work continues in future.

Baroness Sherlock (Lab): My Lords, one question raised in discussion of the review was the desirability of increasing commercial income for the HSE. Notwithstanding the Government’s view of that, will the Minister take this opportunity to assure the House that they have no plans to privatise the HSE?

Lord Bates: Yes, I can very quickly do that. There is absolutely no question of privatising the HSE, but Martin Temple, himself a businessman with a distinguished background in engineering and manufacturing, recognised that there were great opportunities, because the Health and Safety Executive is genuinely admired around the world. A lot of people are coming to look for good-will advice as to how to operate their systems, and I think it

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is absolutely right for the taxpayer that the HSE ought to be free to exploit those commercial opportunities to enable it to continue doing its excellent work around the UK.

Climate Change


11.29 am

Asked by Lord Harries of Pentregarth

To ask Her Majesty’s Government what is their assessment of the latest report of the Intergovernmental Panel on Climate Change.

The Parliamentary Under-Secretary of State, Department of Energy and Climate Change (Baroness Verma) (Con): My Lords, the Government welcome this expert and comprehensive appraisal of climate change impacts. Unmitigated climate change poses a risk to natural ecosystems, human health, global food security and economic development. A combination of adaptation and mitigation will help to reduce the scale of the risk. Even under all those scenarios, some risk will remain. The report represents a consensus of 310 scientific experts.

Lord Harries of Pentregarth (CB): My Lords, I thank the Minister for her reply. Would she agree that the first way in which people are likely to experience climate change is through food—its shortage and its price? The report suggests that wheat yields over the next decade will go down by 2% and over two or three decades by 25%; fish stocks in tropical areas will be down by 40% to 60%. What intergovernmental institutions and organisations are in place to plan for this scenario? What role are the United Kingdom Government playing in that?

Baroness Verma: My Lords, the noble and right reverend Lord poses a number of serious issues that are facing us. As he is aware, the UK has a lead on many of these issues. We work very closely with our EU and international partners to ensure that all of us are signed up to trying to mitigate as much as we can the impact climate change will have on food, but—let us not be in any doubt—unless we bring forward processes, we will face huge difficulties in the future.

Viscount Ridley (Con): My Lords, this latest report clearly states that the impact of climate change by the latter years of the century is likely to be less than 2% of global income and will be small relative to other factors such as economic development. Given that the co-chair of that report, Chris Field, is on record as saying that the really big breakthrough in this report is the new idea of thinking about management of climate change, would my noble friend agree that the time has come to congratulate my noble friend Lord Lawson, who has been saying exactly this for eight years? I declare my energy interests as listed in the register.

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Baroness Verma: I am extremely grateful for my noble friend’s intervention highlighting the great work my noble friend Lord Lawson does in this field. However, as the noble Viscount will accept, I may not always agree with both noble friends. The report highlights the great risk of not doing anything. Whether you are sceptical of climate change or not, what we cannot allow to happen is to do nothing. It is really important, when leading scientists have produced evidence, that we respect that evidence and ensure that we respond to what is being told to us.

Lord Harrison (Lab): My Lords, given that the noble Baroness recently replied to a debate on promoting a low-carbon economy, would she spell out the huge business opportunities that arise from promoting that low-carbon economy? What are the Government doing to help those opportunities arise?

Baroness Verma: The noble Lord is absolutely right. Of course, we have seen a real increase in the low-carbon sector; in the renewable sector itself we have seen since 2010 over £36 billion of investment come to the UK. It is a £3.2 trillion global marketplace out there, of which we have a fair share of £128 billion. There is much more to do. There are great opportunities. As last week showed, Siemens sees the UK as an ideal place for investment, by investing over £300 million in Hull.

Lord Roper (LD): How will the results of the intergovernmental panel affect the position that the Government and their European Union partners are developing for next year’s framework convention conference in Paris?

Baroness Verma: My Lords, my noble friend knows of course that we work very closely with our European partners. We will of course push those that are slightly slower in coming forward in reducing their carbon emissions to do much better. We all need very ambitious targets. I hope that the conference will see that.

Lord Soley (Lab): Is the Minister aware of the number of organisations asking for a single voice, or person, in government whom they can approach about, for example, taxation on different fuels, which does not take into account the advantages and disadvantages in terms of their impact on climate change? That is a particularly important point and the Government could move on it. Will the Minister listen to those many organisations that want a place to go in government with a single message about what government can do to relate to their need to improve performance?

Baroness Verma: The noble Lord is of course right to raise that, but I assure him that climate change is embedded in thinking across all departments.

Baroness Worthington (Lab): In that case, my Lords, perhaps it might be time for the noble Baroness to comment on the fact that we have a climate change sceptic leading our environment department. How can that be?

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Baroness Verma: My Lords, that would be unfair, given that the coalition Government have signed up to ensuring that we have made the largest investment in the green sector during our tenure.

Lord Lawson of Blaby (Con): My Lords, en passant I express my gratitude to my noble friend Lord Ridley. If I may say so, the Minister is quite mistaken in suggesting that the alternatives are either decarbonisation or doing nothing. The IPCC report says very clearly, first, that climate change is far less serious than other changes affecting the world at present and, secondly, that the most sensible response is adaptation, something that, as my noble friend said, I have been advocating for the past six years.

Baroness Verma: My Lords, if my noble friend had listened to my original Answer, he would have heard that it was about adaptation and mitigation. They both work hand in hand, rather than either/or.

Lord Tyler (LD): My Lords, my noble friend expressed appreciation for the contribution made by the noble Lord, Lord Lawson. Would she like to take this opportunity to say how much we appreciate the enormously hard work undertaken by the noble Lord, Lord Deben, and his committee?

Baroness Verma: Absolutely, my Lords. In this House we have experts from both sides of the argument, which is why it is crucial that when debates take place we hear and challenge both sides when we think that there is a challenge to be made.

Lord Brooke of Alverthorpe (Lab): My Lords, would it conceivably help if the Minister could persuade some of the deniers to go down to the West Country and the Levels to help with the dredging and digging?

Baroness Verma: My Lords, what we have witnessed is a severe weather event. What we need to do is to have mitigation systems in place to ensure that those local residents do not have to suffer again as they have done.

Lord Campbell-Savours (Lab): My Lords—

Noble Lords: Time!

Misuse of Drugs Act 1971 (Ketamine etc.) (Amendment) Order 2014

Motion to Approve

11.37 am

Moved by Lord Ahmad of Wimbledon

That the draft Order laid before the House on 5 March be approved.

Relevant documents: 24th Report from the Joint Committee on Statutory Instruments.Considered in Grand Committee on 31 March.

Motion agreed.

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Immigration Bill

Immigration BillDelegated Powers and Regulatory Reform Committee

Report (2nd Day)

11.37 am

Relevant documents: 22nd, 23rd and 24th Reports from the Delegated Powers Committee and 6th Report from the Constitution Committee.


Moved by Lord Taylor of Holbeach

That the Bill be now considered further on Report.

Lord Foulkes of Cumnock (Lab): My Lords, before we consider this legislation, perhaps the noble Lord the Leader of the House or the government Chief Whip can explain why we are taking government legislation on a Thursday when we have been given four weeks for Easter and we will not be sitting for a week in which the House of Commons is sitting. Will she confirm that Prorogation will not take place until 21 May, as already announced, and not earlier as rumoured? This House is not here just to consider government legislation; it is here to debate the issues of the day and to hold the Government to account.

Baroness Anelay of St Johns (Con): My Lords, the noble Lord, Lord Foulkes—I will get the pronunciation of his name right in the end. I beg his pardon; as he knows, I have been very punctilious in persuading others of the difference between Faulks, Foulkes and Fookes. The noble Lord raises several questions. First of all, he has been a Member of the House for a very long while. He will therefore know that the Companion sets out very clearly that, from the end of January, Thursdays are used for government business.

Lord Foulkes of Cumnock: If necessary.

Baroness Anelay of St Johns: So it is of course a time when the Thursday debates come to an end. I have been extremely generous, as the House knows, in giving up government time on Thursdays to have debates. We have had more debates this Session than in any other in living memory. That has been welcomed by this House. On this occasion, we have legislation today at the express request of the opposition Front Bench and it is to accommodate that request that I have enabled legislation today and ensured that there will be no legislation next Wednesday, when debates will take place.

The noble Lord, Lord Foulkes, referred to Prorogation. He will also know that it is a long-standing practice in Parliament that the Prorogation date is not announced until government business has been secured. Therefore, I am afraid that I have to say gently to him that he is wrong to say that the Prorogation date has been announced by anyone—certainly not by me. I am always most cautious to keep to the conventions and the rules of this House. I ask the noble Lord to exercise his patience a little bit longer until I am able to give him accurate information.

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Baroness Royall of Blaisdon (Lab): My Lords, I do not wish to prolong this. Of course, the noble Baroness the Chief Whip is absolutely right about business on Thursdays—that is the norm and I completely accept that. However, there is some discontent on all Benches in this House about the fact that our recesses are prolonged this year, which does not enable this House to hold the Government to account as we would see fit. I do not wish to prolong this debate, but I feel it necessary to make that point because it is our duty as a legislative House to hold this Government and any other Government to account.

Baroness Anelay of St Johns: My Lords, the noble Baroness the Leader of the Opposition says that she does not want to extend the debate—that is a little ironic. I remind her that, as she is aware from discussions earlier this week, we were able to demonstrate that the number of weeks on recess has been consistent over the past three or four years. There is just one issue about the Scottish referendum, which is an unusual matter, and that has perhaps changed the timing. I do not have control over Easter or Whitsun. There is a perception perhaps held by some that there are more recesses than at other times. The figures simply do not bear that out. I suggest that the House is eager to progress with the work that it does well—the scrutiny of legislation—and I know that my noble friend Lord Taylor is keen that the House should address the matters of the Immigration Bill.

Motion agreed.

Amendment 23

Moved by Lord Hannay of Chiswick

23: Before Clause 19, insert the following new Clause—

“Exemption to charges under Part 3

No restrictions on access to tenancies or charges for services under this Part shall apply to persons—

(a) holding Tier 4 (General) visas sponsored by a recognised higher education institution, or

(b) holding Tier 2 visas and registered in full-time undergraduate or postgraduate study at a recognised higher education institution.”

Lord Hannay of Chiswick (CB): My Lords, this is the fourth occasion in recent weeks that the House has debated the cumulative negative impact that the Government’s immigration policy is already having, and is set in future to have, on the higher education sector, one of Britain’s most buoyant and valuable assets. Amendment 23 is designed to avoid that negative impact.

First, I will say a word or two about detail. I and my co-sponsors have not moved, as we did at the Committee stage, to exempt undergraduates and postgraduates from the streamlined appeals procedure. We listened to the arguments advanced by the noble and learned Lord, Lord Wallace of Tankerness, in Committee and concluded that the arguments for and against the new procedures were sufficiently well balanced, so far as students were concerned, to justify reluctant acceptance. We have also removed from the scope of the carve-out

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proposed in our current amendment the issues of bank accounts and driving licences to meet the points raised in Committee by the noble Lord, Lord Taylor of Holbeach.

I shall say a word now—I hope a final word—about the ways statistics on migrants are compiled in this country and then submitted to the UN, an issue highlighted again this week by the publication of the extremely worrying figures from the Higher Education Funding Council for England which demonstrated, yet again, that the optimism expressed by the Minister in previous debates was a bit wide of the mark. As the noble Lord said in his very welcome letter of 24 February, these statistics are already, since last year, disaggregated so that students can be distinguished from other migrants, even though the net migration figures are re-aggregated for the purposes of submission to the UN. However, we are not talking about the way in which the Office for National Statistics compiles statistics. We are talking about the public policy implications in our immigration policy for this category, which is already recognised, as I have said, as being distinct. On that, we are proposing an approach which has been vigorously promoted for several years by six Select Committees of both Houses.

I very much welcome what the report of the noble Lord, Lord Howell Guildford, on UK soft power had to say, which was identical to what was said by the other five committees which had already reported. This view has been supported by members of all three main parties and of none: quite simply, that we should remove full-time undergraduate and postgraduate students from the public policy impact of the UK’s immigration policy. That is what our main competitors—the US, Canada and Australia—are already doing. Doing that in the context of the Bill, as my noble and learned friend Lord Woolf made clear in the Committee stage debate, would send the most powerful message possible around the world that we want our higher education sector to be open to all who are qualified to benefit from it, without any new obstacles or disincentives being put in their way.

11.45 am

In moving the amendment, it would be less than fair if I were to fail to recognise and to welcome the substantial shifts in the provisions on student accommodation which the Minister introduced in the amendments he tabled last weekend and which are grouped on the Marshalled List together with this amendment. He wrote in detail about these proposals to a number of Members—in his letter of 27 March to the noble Baroness, Lady Smith of Basildon, and in his letter of 1 April to the noble Baroness, Lady Hamwee. His key phrase was:

“Where a landlord has proof that a tenant is a genuine student, we can allow landlords to rely on the checks that have already been performed”.

The letter continued:

“Private landlords do not have to conduct immigration status checks when the tenant is nominated by an educational institution”.

He has thus widened considerably the previous exemptions which covered private halls of residence, including houses and flats. His amendments sound more and more like a carve-out for the student accommodation aspects of the Bill and, as such, I welcome them.

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When the Minister comes to contribute to the debate, however, I would like it if he could address three rather important points. First, can he confirm that these exemptions apply to all students: undergraduates, postgraduates and those studying for doctorates? Secondly, can he confirm that if an overseas student is furnished by a higher education institution with a certificate or nomination stating that he has a valid student visa and has been admitted to a course at the institution, then that will exempt the landlord from making checks and from any other provisions of the Bill with respect to student accommodation? Thirdly, I confess that I still find the use of the word “nominated” in Amendment 29 a trifle esoteric. I know that the noble Lord is a great supporter of plain English, so I hope that in his reply he will say in plain English that this in no sense involves higher education institutions in the contractual arrangements between the landlord and the student.

I am a bit less joyful about the NHS surcharge on overseas students. I cannot welcome anything there because the Government have not tabled any amendments in respect of them. It has been argued that the surcharge is modest and entirely fair, and it is true that it is lower than the health insurance charges that an overseas student would pay in the United States. However, that insurance charge in the United States is not imposed by the state and does not discriminate between US and overseas students. A US student would also have to pay for health insurance to cover their health charges while they are at university. Our proposed surcharge does both those things. It is imposed by the state and it discriminates between overseas students and domestic and EU students.

Moreover, there are potential anomalies. A student who came here as an undergraduate and progressed through a postgraduate degree, perhaps to a doctoral course—a not unusual progression—could end up paying more in surcharges for longer than a genuine economic migrant who came here to take a job and was given leave to remain. Does that make sense? Is it fair? Should there not be some kind of cut-off for a student on that kind of progression? This issue was discussed in detail and with great courtesy by the Minister at a meeting on 27 March. He pointed out that issues such as this could well be considered when the secondary legislation to give effect to the provisions of this Bill was being drawn up. I should be grateful if he could confirm that undertaking now.

The answers to my three questions on the accommodation issue will certainly influence my decision and the decision of the other co-sponsors of the amendment on whether to test the opinion of the House on it. I look forward with eager anticipation to the Minister’s response. I beg to move.

Baroness Williams of Crosby (LD): My Lords, as one of the co-sponsors of this amendment, I will add a few further thoughts to the ones so ably mentioned by my colleague, the noble Lord, Lord Hannay. I completely bear him out that the history of higher education in this country for overseas students is one of the most remarkable success stories of any country in the world. For the past 20 or 30 years, we have maintained an astonishing magnetic appeal to young

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men and women coming from other countries, both within the European Union and far beyond it, to a greater extent than any other country in the world—although recently the United States has moved into first place in the league table of such countries.

The noble Lord, Lord Hannay, pointed out that, sadly, the United Kingdom has lost some momentum in attracting overseas students, and I will say a few words about that in a moment. First, I thank the Minister for the immense amount of work that he has done, his willingness to have meetings day after day and the huge amount of effort that he has put into them. I share the view of the noble Lord, Lord Hannay, that nothing would give us greater pleasure than to receive a response that would enable us not to proceed further with this amendment. However, there are still substantial questions out there to be answered.

I will therefore begin by saying that one of the troubling aspects of this situation, which is a relatively new one, is that in the past couple of years the standing of the United Kingdom as regards its acceptability to overseas students has been quite substantially damaged. As an example I will give the House the benefit of what the National Union of Students said about the extent to which overseas students see us as a welcome and welcoming country. It conducted a substantial survey of some 18,000 people in early January of this year and found that 51% of undergraduates from overseas—just over half—said that they had not found the United Kingdom a welcoming place in which to study. In some ways even more troubling is that, among postgraduates who have a degree and are now staying in the country particularly with a view to working to fund the completion of their qualifications, the number was as high as 66%. Two-thirds of postgraduates who responded to the survey said that they had not found Britain a welcoming country in which to study. That is substantially different from figures in earlier surveys, which showed that the United Kingdom was rated very highly as regards the welcome it extended to overseas students.

I will add two other rather hard things. First, many billions of pounds—the estimate is about £3.5 billion—have come into this country as the result of payments made by students to universities for the studies that they have made. Perhaps at least as significant in that context is that the attitude of postgraduates to work-study arrangements that are made is increasingly negative. Our work-study arrangements are now less generous than those of other countries such as Canada, Australia and the United States. I will give a figure for that shortly, but before I do so I will add one crucial fact.

I was for three years of my life the Minister for Education and Science. One thing that is not sufficiently recognised in this country is the extraordinary contribution made by postgraduates and post-doctoral overseas students to the remarkable scientific achievements of this country. In many cases scientific teams are heavily dependent on attracting outstanding young men and women from abroad to take part in our research teams, primarily directed at science and medicine. I could give many examples, but I will give just a couple. The remarkable achievements in connection with graphene in the past couple of years, which led to no less than a

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Nobel Prize, were the outcome of the work of mixed teams of our own people and people from overseas, and that was a very remarkable achievement.

I can give another remarkable achievement, in this case from the University of East Anglia, where a former student who became a postgraduate and continued to work in the field of medicine established that at least one of the regularly prescribed pharmaceutical products designed to deal with diabetes was in fact the source of more frequent heart attacks among diabetes patients than among people of the same age group. That gentleman made a huge contribution by revealing this in detailed scientific papers, as a result of which that particular pharmaceutical product has now been withdrawn and the effect it had on heart attacks among diabetic patients has ceased.

A third example is the remarkable building up of a huge history of China by a mixed team of people, in this case in the humanities, which shows in detail the way in which China has developed, the sources of its growth and the sources of its political difficulties right up to the present time. I will not go on, but any Member of this House who wants more detailed information will find an extensive list of the achievements by postgraduates from overseas, together with British graduates and post-doctoral students, which shows how important that group is.

I will say right away, therefore, along with the noble Lord, Lord Hannay, that we are very pleased that the Minister has addressed the very difficult question of landlords and tenancies and the question of accommodation. I share with the noble Lord, Lord Hannay, gratitude for the steps that the Minister has taken, which have been achieved with a great deal of hard work, innovation and determination to get an answer. We are truly grateful for that and, like the noble Lord, Lord Hannay, I hope that he will be able to confirm this morning that there has been an adequate extension of the plan for undergraduates to postgraduate and post-doctoral students.


However, there are two real problems that must be mentioned. The first is the quite dramatic decline in the number of postgraduates who have managed to get the so-called extension for postgraduate work. This, incidentally, is the source of much of the research I have referred to. You need to go beyond your postgraduate degree—to work in the field—to realise some of its potential. The gap has been quite troubling. In 2011, 46,875 postgraduates managed to get agreement to an extension of a work visa to enable them to put into practice what they had learnt theoretically. In 2012, the figure was 36,505: a drop of more than one-fifth in one year. Will the Minister say something about the effects of the rather more relaxed attitude this year and last towards work-study visas, compared to 2012? The work extension principle is crucial across the piece, not just in science and medicine, for some of the most outstanding young men and women postgraduates in the world.

Secondly, I share the concerns of the noble Lord, Lord Hannay, about the health position. We accept that the £150 which has to be paid on the visa for

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health coverage in the United Kingdom is not unreasonable, and this view is probably shared across your Lordships’ House. However, as the noble Lord, Lord Hannay, said, it becomes unreasonable for a postgraduate who may be studying for four or five years and, perhaps, doing work study for another two or three, who may bring a spouse and a number of children. That makes the health surcharge terribly hard to manage and pay for. It would be unreasonable to suggest it should be withdrawn, but we ask the Minister to look at two possible ways to deal with the issue. One would be to exclude children under 16, who are normally excluded from paying NHS charges for medical attention. The second, mentioned by the noble Lord, Lord Hannay, would be a cap on the amount that a young person working in research and academic teaching would be expected to pay year after year until such time as he was accepted as resident in this country.

I turn to two other issues. First, there is real difficulty with our visa system. I recognise that the Home Office is making an effort to improve the efficiency of visa handling and processing. However, as most people will recognise, there is much evidence from universities of sudden decisions taken to remove, refuse or delay a visa. That has seriously affected our ability to attract overseas students. In one year, Australia changed the whole of its processing of visas to make them much more rapid and efficient. As a result, it leapt up the table of preferred destinations from fairly low down to near the top. Canada had the same experience and is now the second most favoured destination after the United States.

I conclude with a point that I know the Minister is sympathetic to, as he has expressed this to us. In order to recognise that we have a change in attitude to bring about on the part of overseas students, we have to be perceived differently. It may be fair or unfair, but I have read the figures which show we are not perceived as a particularly welcoming country. The Government and the universities need to work closely together to convey a message that overseas students who are legal, good citizens and who contribute to universities are very welcome to enter the country. They need to make it clear to these students that, as long as they have the right attitude to their studies, work and their fellow citizens, they are extremely welcome because this is one of our greatest contributions to the world.

Baroness Warwick of Undercliffe (Lab): My Lords, as a co-sponsor of this amendment, I too add my support to the pleas made by the noble Lord, Lord Hannay. There is no need at this point to further persuade the House of the enormous benefits that international students attending our universities bring to their universities, their local areas and the country at large. To focus minds, I will present one fact: it was announced today in a report by Universities UK that the total economic contribution to the UK made by higher education exports in 2011-12 was £10.71 billion. To put that in perspective, the House of Commons Library estimated the economic contribution of the entire motor vehicle manufacturing industry at £10.4 billion. That is the scale of the industry we are discussing today.

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I think that the Minister and the Government accept that analysis and generally want to encourage students from across the world to study here, which is to be welcomed. But the Government need to be particularly careful that these welcoming messages are not undermined by changes to the visa system that could be perceived as being unwelcoming towards international students. The survey conducted by the NUS, which was mentioned by the noble Baroness, Lady Williams of Crosby, highlights some worrying trends about the way the immigration system is perceived by the very people the Government want to attract.

Some of the measures in Part 3 have the potential to add to that perception. That is why I and other noble Lords tabled our amendment to remove students from these measures and to send a clear signal to current and potential students that they are welcome in the UK. While the Government are introducing new barriers to potential international students, reassurances overseas that the UK is open for business may ring a little hollow.

I have talked of perception and presentation because these are very real concerns when it comes to attracting international students and staff to the UK. However, there are a number of more practical concerns about the impact these measures could have on both students and staff. I want to follow on from the points made by the noble Lord, Lord Hannay, in introducing the amendment, all of which I support. Since this amendment was debated in Committee, the Minister has gone out of his way to provide detail on some of the measures in this part of the Bill, so I hope he will forgive me if I ask him to repeat and clarify some of these points now.

First, on the checks that landlords will be required to carry out before offering tenancy agreements, we should remember that many students coming to the UK will be moving out of their parents’ home, let alone their own country, for the first time. Assuming that the Minister’s Amendments 26 to 29 are accepted, many international students will live in accommodation that is exempted from the Bill, which is helpful. I am glad that the Government agree that the previous exemption failed to capture many students.

However, some students and, of course, the vast majority of international staff will still be moving into property in the private rental sector which is not exempted by the Bill. It is essential that students are able to secure accommodation in good time before their arrival in the UK. Similarly, academic staff at universities will want to make sure that they and their families have a roof over their head before they move here.

Tier 4 student visas can be applied for only a maximum of three months before the date of travel, so they are often received very close to the date that the student arrives in the UK. Students must be able to make at least conditional arrangements before they receive their visas. Will the Minister clarify that it will be legal and proper for landlords to enter into conditional arrangements with potential tenants who do not at the time of entering into that conditional agreement have a relevant visa and that this will be clearly communicated in any official guidance issued?

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Secondly, only those without settlement rights will have to pay the NHS surcharge. Time spent on a tier 4 student visa does not count towards residency requirements for settlement rights. As other noble Lords have said, the Bill could result in the deeply iniquitous situation that an economic migrant who is later granted settlement may have to pay the charge for five years but a student who finds work and stays on here may have to pay for far longer—as long as 12 years in a row—if they studied at both undergraduate and postgraduate level.

With the noble Lord, Lord Hannay, I ask: will the Minister commit to addressing this unfairness when the secondary legislation is drafted? It is easily fixable by, say, limiting to five the number of years for which a person would have to pay the charge. There is provision in the Bill to at least have these charges applied fairly. Will the Minister commit to doing so?

I cannot end without supporting the plea of the noble Baroness, Lady Williams of Crosby, on behalf of postgraduate students. Those with a family are going to be hit really hard by the health charges. One has only to think of the number of our postgraduate courses that survive only because of the number of international students that we are able to attract to see the dangers if large numbers should fall.

I remain concerned that this Bill is part of a wider trend of immigration policy that could mean that the UK fails to capitalise on the extraordinary potential of its higher education sector. Even if the Minister is unable to commit to reversing this trend this afternoon, I hope that he will address at least some of the practical issues that I have highlighted today.

Lord Hodgson of Astley Abbotts (Con): My Lords, I listened with great interest to the debate on this amendment in Committee on 10 March. Unfortunately, I was unable to stay for all of it, although I read it carefully in Hansard, and so was not able to take part, but I would like to make a brief contribution today.

Winding up for the Opposition on that occasion, the noble Lord, Lord Stevenson of Balmacara—that demon of the squash court, as he keeps saying—had some fun at the expense of my noble friend Lord Bourne of Aberystwyth, when he said:

“I congratulate the noble Lord, Lord Bourne, on putting his head above the parapet. Although I think he picked up some of the arguments, I did not think his heart was entirely in it”.—[Official Report, 10/3/14; cols. 1607-08.]

I intend to put my head above the parapet this afternoon, and I have to say that my heart is entirely in it.

Overseas students make an exceptionally valuable contribution that enriches our university life, but as I shall explain, I have concerns about scale, about leakage at the end of courses, and various consequent impacts on our settled population. Further, I think the extent of the beneficial impacts, adduced by various briefings we have had, are somewhat overstated.

I begin by following my noble friend Lady Williams of Crosby in talking about the briefings we have had, some of which have been quite cataclysmic in tone. They suffer, in certain instances, from mixing absolute

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numbers and percentages. It is perfectly possible to have an increasing absolute number and a declining percentage. Indeed, if one looks at market share, as some of the briefings do, it is almost certain that the UK will have a declining market share in an era when global university education is rising rapidly in parallel with people in the UK wanting to study overseas. In addition, as the UK has a historically high level of overseas students and a relatively small population in world terms, our market share is almost certainly bound to be declining.

More importantly, there have been attempts, in my view, to ascribe all the changes in student numbers to the proposals that we are discussing in this Bill. This is fanciful. There is a host of other reasons that influence people’s decisions on where to study—of those, notably, cost. Indeed, there was an article in the Times yesterday with a headline that suggested changes in the system were deterring students, but when you got into the meat of the article it was actually about cost. The piece mentioned cost only in sterling or Euro terms, failing to take into account the other great part of the cost—changes in the exchange rate. A year ago $1.50 bought you £1; today you need $1.66, so if you are a dollar-based student you are facing an increase of 10% in the costs of studying here in the UK. As regards India, which is an even more important market, as many noble Lords have said, a year ago 83 rupees bought you £1; today you need 100—a 20% increase in costs to a student from India.

12.15 pm

Having thus far been somewhat disobliging to the noble Lord, Lord Hannay, and his supporters on this proposal, I support them strongly in one respect: that is, their request that student numbers be broken out of general migration statistics in the way to which the noble Lord referred. Wherever one stands on this issue, clarity and transparency can only help our debate, so I express the fervent hope that my noble friend on the Front Bench has managed to persuade the Home Office of the wisdom of the noble Lord’s approach. I was a member of the committee of the noble Lord, Lord Howell, on soft power, and students are undoubtedly a specialist category. We really need to show them separately to make sure that we are all arguing from the same place on the hymn sheet.

In debate in Committee, I discerned two major philosophical themes attacking the Government’s position. The first is that it is in our national economic interest not to limit—but to maximise, some might say—the number of foreign students. It is certainly true that in the short term, the fees that foreign students pay help the universities. The noble Baroness, Lady Warwick, referred to this. The money that those students spend on living expenses also help the local communities in which they exist, although one could argue about whether students are big spenders. There are also costs to the state and the community, which are in part the reason for the Government’s amendments and the discussions we are having today.

However, this argument goes further and claims a long-term economic benefit because of the cultural and other links established at university. In my view,

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this argument is, at best, not proven. Let us take the case of India, a country which has featured much in our debate and from which we have had many students over many years. It is a country with long historical links to the United Kingdom: accordingly, it is one which would be expected to have the best long-term economic dividend for us. Yet if you examine Indian import statistics when broken down by country for 2011-12—having looked at the numbers, that is not an unusual year—you will find that China’s imports are the largest at 12%, followed by some Gulf states at about 8%, which was probably oil, the USA at 5.2%, Switzerland at 4.6%, Germany at 3% and the United Kingdom at 1.6%. So we are exporting about a third of what the United States does and about half of what Germany does.

I therefore find myself forced to the conclusion that the issue of creating long-term economic advantage by bringing students here may well be yesterday’s argument. In a global world, having studied at a UK university may help at the margin but people buy goods and services that are competitively priced, delivered on time, perform well and are properly resourced as regards after-sales service.

That was the first plank of the argument against the Government but the second has an altogether loftier aim: that we have a duty to export our values to the world. The noble and learned Lord, Lord Woolf, made that point very fairly in his speech in Committee about the importance of the rule of law, and he is of course absolutely right. Development experts tell us that property rights and the rule of law are essential preconditions for a country’s development. However, that lofty and indeed worthwhile aim can be achieved only if the students who come here return to their country of origin. We know that there is leakage. How much leakage there is, we do not know precisely and will not know until our e-border system is up and running but my noble friend on the Front Bench pointed out, again in Committee, that in 2013, of the 124,000 non-EU students who came to this country, only 49,000 left it.

Some noble Lords, such as the noble Baroness, Lady Williams of Crosby, make the point that it is entirely right and fair that this country should cream off the brightest and best students from non-EU countries. I ask those noble Lords just to bear in mind the potential drawbacks to that approach. In an increasingly interconnected world, we all have an interest in global stability. Stable societies emerge because of leadership in government, law, medicine, engineering and so on. If we encourage such potential leaders to come and study here, and then stay here, there may be some economic benefit to us as a country in the short term but there may be long-term political disbenefit.

Finally, I ask those who argue this to consider the impact of increased numbers of foreign students on our settled population. I quote from a Higher Education Commission inquiry into postgraduate education, on which my noble friends Lord Norton of Louth and Lord Boswell of Aynho served. It said:

“Much of the recent increase in postgraduate student numbers is due to rising numbers of international students. Postgraduate enrolments have increased by more than 200% since 1999, compared to an increase of just 18% for home and EU students. The

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Commission is concerned that this increase masks stagnation in the qualification and skill level of the home-domiciled population. We need an emphasis on up-skilling the UK population, ensuring that British students are able to compete in the global labour market”.

I conclude by saying that of course we should attract international students to study here, but we need to do that with realistic aims in mind.

Lord Hannay of Chiswick: I am most grateful to the noble Lord for giving way, but I wonder whether he does not find it a trifle ironical that he is speaking from the Benches of a Government who have exhorted the country, correctly in my view, to succeed in what is called the global race, and above all to maximise the industries and services that we produce best. He has developed an extremely elaborate argument for saying that we must embrace declinism in the higher education sector and we must accept that it is not in our interest to go on growing this potentially extremely valuable resource. Is it not a bit contrary to government policy that one industry in this country should be treated as something that can be tripped up and hampered at every stage while all the others are being encouraged to develop?

Lord Hodgson of Astley Abbotts: I obviously have not made myself clear. I hope that I have made it clear that I am not attacking foreign students because I think that they have an important role to play. I said that, first, the Government’s proposals are not the key determinant of why people come to study here. The key determinant is the overall cost and, in particular, the cost in the currency of the country of origin of the student in question. Secondly, I question—I do not know—that the long-term economic benefits which have been adduced to having students here are not as great as they might be.

Lord Winston (Lab): The noble Lord has talked about costs. Does he not agree that one of the great advantages of having overseas students in this country is the fact that they bring down the costs for internal students reading medicine and engineering in particular? Otherwise, our universities would have to charge them much more.

Lord Hodgson of Astley Abbotts: The noble Lord is right, but if what UK universities are saying is that they want to bring foreign students here to subsidise our university education system, that would be a clearer argument than the rather lofty arguments we hear that our duty is to do this because of our benefit to the world and because it is actually to our long-term advantage. If the noble Lord is saying that it is really all about money in the short term, fine—let us say that and be clear about it. I understand that as an argument and I am perfectly happy to accept its value.

Perhaps I may conclude. I repeat again for the noble Lord, Lord Hannay, that we should attract students to study here, but we need to do so with realistic aims in mind. In our very proper wish to do right by the world, we should not overlook the needs and indeed the rights of our settled population. That is why in my view the Government are right to take

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these measured steps. They are steps that I believe, and which the noble Lord, Lord Hannay, and the noble Baroness, Lady Williams, have acknowledged, have become more measured as the Government have responded to comments and criticisms as laid out in my noble friend’s letters of 12 March and 1 April. That is why I will be supporting the Government if the noble Lord, Lord Hannay, decides to test the opinion of the House on this amendment.

Lord Cormack (Con): My Lords, I hope that the noble Lord, Lord Hannay, will not feel that he has to test the opinion of the House, but I can imagine that he has been to some degree sorely provoked to do so by the remarks of my noble friend. That is because there did seem to be an inherent contradiction in them. On the one hand he protests—I do not doubt his integrity for half a second—that he wishes to see foreign students come here in great numbers, while on the other he seems to be arguing that we should not push it too far.

I do not want to repeat what I said in Committee when I supported the noble Lord, Lord Hannay, but I will briefly refer to one thing that I touched on then. I have the honour of being a member of the senior common room at St Antony’s College, Oxford. As I told noble Lords last time, we have students from 73 countries there at the moment. It is an extraordinarily important centre for postgraduate education—not just in Oxford, not just in England, but in Europe and, indeed, the world. From all over the world students come. In common with students at other colleges and universities, many of them go back and play leading roles in their countries. Some stay and play leading roles in ours. Where would we be in medical science and many other disciplines if some of them had not stayed? I hate to think how many consultants there would be in some of our hospitals—excellent consultants—if it were not for the fact that foreign students had come here, been taught—no doubt inspirationally—by people such as the noble Lord, Lord Winston, and had stayed. We are protecting ourselves, as well as our image as a nation, if we encourage without inhibition and without qualification.

I was very taken by what the noble Lord, Lord Hannay, said, both in Committee and today, and by what my noble friend Lady Williams of Crosby said. However, I have also been extremely impressed by the diligent interest that my noble friend Lord Taylor has taken in these matters. He clearly listened carefully to the arguments advanced in Committee and has tabled a number of amendments today that will go a fair way towards meeting many of the concerns that were expressed in Committee. I thank him for that, and for the infinite patience and trouble that he has taken in talking to me and others, and in trying to recognise where we are coming from.

A word that cropped up many times in our first debate was “perception”, and it has been touched on again today. How are we perceived? Where I take slight issue, not with my noble friend Lady Williams of Crosby but with the National Union of Students’ report from which she quoted, is that my anecdotal evidence from St Antony’s, Hull, Lincoln and other

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universities with which I have a connection would not bear that out. Most of the foreign students to whom I have talked have always said that they feel extremely welcome here—and proud to be here. They are anxious to stay to complete their studies, and most of them are anxious to return to play a leading part in their countries or localities when they go back. The National Union of Students’ statistics, which of course I am not in a position to challenge, clearly depend upon the questions that were asked. I just wonder what questions were asked.

However, I am concerned not with the past or the present so much as the future. It is clear from the article from which my noble friend Lord Hodgson quoted, and from other reports in recent months, that there is a falling off in the number of students coming from certain countries. Of course my noble friend Lord Hodgson is entirely right to say that there are a variety of causes and reasons for this. Of course he is right to say that cost is a factor, but it is not by any means the only factor. What we have to be absolutely sure of is that students coming, or contemplating coming, from other countries still keep the United Kingdom very much at the top of their wish list. From talking to Professor Margaret MacMillan, the Warden of St Antony’s, who herself is a distinguished Canadian historian, it is clear that Canada and the USA are more attractive to many students who would hitherto have put the United Kingdom at the top of their list. I am concerned about that.

I very much hope that when the Bill becomes an Act of Parliament, as of course it will, we will have been able to inject amendments into it that will make it very clear that, in seeking to tighten up our immigration policy, we are not in any way setting our face against students. The Prime Minister himself has said on many occasions that foreign students are welcome here without any cap on numbers. I welcome that. I am sure there is not a single Member of your Lordships’ House who does not welcome that. But it is important that we prove that that is what we mean by the contents of the legislation that we pass.

I look forward very much to what my noble friend the Minister will say when he replies. I hope and believe that he will be able to give the sort of assurances that the noble Lord, Lord Hannay, sought in his speech. I hope that the House will be united in backing his amendment, secure in the knowledge that, supplemented by future regulations, the situation will be as we would wish it to be: namely, that any potential student, be he or she in India, any part of the African continent or anywhere else for that matter, will feel that not only are the doors indeed open but that the “Welcome” sign is above them.

12.30 pm

Lord Sutherland of Houndwood (CB): My Lords, in support of the excellent and measured speech of the noble Lord, Lord Hannay, and of the other signatories to this amendment, I offer not a speech but a quotation. It runs as follows:

“One of the biggest categories of ‘immigrants’ is overseas students—176,000 last year, over a third of the total. They are not immigrants but they are defined as such because they are here for

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more than a year … There has recently been a crackdown on the undoubted abuse of visas by some private colleges but the consequence of tightening the rules has been to drive away bona fide students, especially from India, to the US, Canada and Australia. Universities, and Britain, are poorer as a result”.

These are the words of the member of the Cabinet who runs the department that is responsible for universities: Vince Cable. They are not private; they were in the Evening Standard about two weeks ago. I quote them not to make mischief for the coalition Government, because I believe that the country has benefited from the strength of coalition government, but to say that here at the heart of government, the individual responsible for universities and their impact on this country is clearly at odds with what is happening in legislation today. I think that he is right and that his words bear repeating, which is why I happily support the noble Lord, Lord Hannay, and his colleagues.

Baroness Hamwee (LD): My Lords, I am particularly pleased to follow a reference to my right honourable friend Vince Cable, who has been very energetic in spelling out the value, if I can put it this way, as an import and as an export, of overseas students. I have been worried, and have said so publicly, about the use of the phrase “the brightest and the best” in immigration policy, but I have to say that I did not read my noble friend Lady Williams of Crosby as wanting to cream off the brightest and the best; I do not think that was where she was going.

As has been said, we have a very good story to tell. We are curiously inept in some parts of the system at telling it. The word “perception” has been used, rightly, by a number of noble Lords. We should not get stuck on the overall immigration numbers without disaggregation, but I do not want to repeat all the arguments that I and other noble Lords have made.

I have just a couple of comments on this. I doubt that many people, even in this building, know that the Budget added to the funding of the Education is GREAT campaign, which seeks to attract international students to the UK, and that the number of Chevening scholarships supporting students from developing countries who come here to study is being tripled. I will let those two facts speak for themselves, and I hope they will add a little to the perception.

On tenancies I am very much with the noble Lord, Lord Hannay, and others. I want to make use of this Report stage to come back to some rather focused questions on those amendments.

As I understand it, the health levy or surcharge really is an integral part of the Bill. As the Minister will remind us, in absolute terms it is competitive, and I say that it is very good value insurance. Some anomalies and issues need to be followed up, and others have drawn attention to these. I am reassured by the fact that secondary legislation will, I hope, deal with the detail.

I welcome the student tenancy amendments which my noble friend the Minister proposes but, if I may, I will seek a little more assurance. I was concerned about the numbers and types of properties that students use as accommodation. Given the time, I will try to summarise on the hoof the understanding I have

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gained from Universities UK. I hope that noble Lords will forgive me. It is important to say that about a quarter of international students are likely to still be living in accommodation which is not within the categories specifically defined so far. The Minister has been very generous with his time in meetings and in correspondence, and he foreshadowed the amendment to the halls of residence test at the previous stage. I would have liked to have seen an exemption which focused on the people—the students—rather than on the property.

I am concerned about the term “nominated”, as are other noble Lords. I hope that my noble friend might be able to say that, although this term is used rather differently in other contexts, here it really amounts to “accredited”. I am sure that the Minister will spell out in his reply that there will be guidance, and there will be consultation on the guidance. Perhaps he might also state that, as well as the accommodation owned by a relevant institution, the halls of residence and the nomination for what we might understand to be a private tenancy, where a landlord is approached by a student and none of those three situations is in place, the landlord can in effect obtain the nomination from the university and come within that exemption.

I, too, am concerned about postgraduates and doctoral students, and I looked at the definitions brought into the Bill from the Local Government Finance Act 2012. I hope that my noble friend will be able to confirm that postgraduates and doctoral students fall within the definitions in that legislation. I hope he may also be able to set out the balance between studying and teaching within the work done by, let us say, a postgraduate student, many of whom also teach, that the Government will expect to see in order for the exemption to apply. I assume that research is regarded as study.

I hope—well, I assume—that the relevant orders following from the Bill will be made by the Home Secretary, because many Secretaries of State come within this whole picture. I have probably taken enough time, and the Minister is aware of my concerns. He looked slightly puzzled at my last comment, but I was thinking of the Secretary of State for Communities and Local Government, who makes the order about who is a student. It is a bit of a jigsaw.

The Earl of Sandwich (CB): My Lords, I sense that the House wishes to come to a decision, so I shall be extremely brief in making a couple of points. The noble Lord, Lord Cormack, is always so reassuring and we think that he is going to bridge the gap which exists between the proponents of the amendment and the Government, but I fear that this is not the case. This is a serious disagreement.

I shall speak mainly about higher educational institutions in the widest sense. The noble Baroness, Lady Williams, said that she was concerned about the welcome that we are giving to students—the noble Baroness, Lady Warwick, reiterated that. We used to talk about a climate of disbelief in the Home Office a few years ago; now, I think that there is a climate of frustration, interference with and even prejudice against what I might call the lower order of colleges of education and those which are capable of offering places to

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bogus students, who have rightly to be returned. I am very concerned about the climate in this society that we have.

That gives me, however, an opportunity to say that the Home Office recognises its mistakes. It can correct its mistakes. I had an example only last week where a college in south London with five years of trusted sponsor status, which I have visited, was quite unfairly threatened with the loss of its licence through an association with one of these lower orders of bogus college. It recognised the mistake in the end, but I want to put over that it is a tough environment out there at the moment if you are one of those colleges. Many immigration officers are being put in positions of making educational decisions. I support the amendment; I hope that my noble friend will move it to a Division. The remarks of my noble friend Lord Sutherland were very timely, because this is after all a disagreement within the coalition. It was very welcome to hear the voice of Vince Cable. I am sure that he agrees, as does the noble Lord, Lord Hodgson, that the disaggregation of numbers, although it is not the subject of this amendment, has become almost a separate issue which we should come back to.

Baroness Benjamin (LD): My Lords, I support the amendment in the name of the noble Lord, Lord Hannay. UK universities have worked tirelessly over the years to attract international students, including Exeter University, of which I am the chancellor so I declare an interest. We cannot sustain the level of financial support that universities require and will continue to require without international student support. We also benefit from those students’ academic and cultural contribution. Our country gains so much from these resources. Exeter benefits greatly from its international students, not just financially but also, because of where geographically we are placed, from the culturally diverse, rich mix that such students bring.

I congratulate my noble friend the Minister on all the concessions that he has made after hearing the concerns that many noble Lords have expressed. I thank him, too, for all the meetings that he has granted us. I also invite him to consider further the amendment in the name of the noble Lord, Lord Hannay, which would make a difference to the perception that those abroad have of us as a welcoming nation to international students.

Lord Stevenson of Balmacara (Lab): My Lords, this has been a very good debate which, with one exception, has focused narrowly on the questions being posed in the amendments that we are considering. Of course, we have still to hear from the Minister on his amendments and I am sure that a lot is riding on them. The noble Lord, Lord Hodgson, was very kind to refer to our shared interest in squash. I am a little sad that we did not encounter one another on the squash court, because, given his positioning of putting his head well above the parapet and his heart very much in his game, I think that he would have been easy prey, certainly to be beaten by fair means. But if I was struggling, I think that I would have been able to lop his head off

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quite easily. In what was effectively a Second Reading speech, it was not at all clear which parts of the amendments the noble Lord was supporting or not supporting. I think that we missed that, and the noble Lord, Lord Cormack, put it very nicely when he explained what he felt about that.

Other than that, we have focused hard on the issues relating to students. The quotation given to us by the noble Lord, Lord Sutherland, should be very much in our thinking as we look at these issues. There is no doubt that we are talking here about perceptions. We are talking about whether, in aggregate, the work that the Government are doing through the Bill complements, supports or destroys the currently very effective system of higher education that we have in this country in relation to overseas entrants to and users of it—although the context is not that good given the row that there has been in the past couple of weeks about what is happening to the system of higher education as a whole, which I suspect has a long way to go.

12.45 pm

The amendment deals with a particular exemption to charges under Part 3 and suggests that, effectively, there should be a complete carve-out for students. We are on record as saying that we do not agree with that approach and we will not be supporting the noble Lord should he take the amendment to a Division. That is not because we are against what is being said, but we think that there are two reasons why it does not work in practice. First, we accept the general proposition that those who participate in and use the NHS should contribute to it. Although we have concerns about the system proposed in the Bill, we are prepared to wait for further discussion and debate on the regulations, following the correspondence that we have received from the Minister. Secondly, we believe that there are wider issues relating to accommodation and the role of landlords in checking it which take the debate beyond narrow consideration simply for students. That is not to say that we do not agree with the amendments proposed by the Minister; there are still questions about them, but we are pleased that he has moved in that direction and we will support them.

However, I should like to pick out some issues that have been raised during the debate, in the hope that the Minister will respond. I picked up on three points that the noble Lord, Lord Hannay, made and will add another two. The question of whether the amendments will apply to all students is very important. First, the way in which undergraduates and postgraduates operate within the higher education system is different. Postgraduates often have dependents with them, and we need a system that will work for all concerned. I hope that the Minister can say a few words about how he sees that developing, because it is not entirely clear. The suggestion that we should be looking at students and not the type of accommodation is worth thinking about. It will be difficult to concentrate entirely on the types of accommodation available, because they are not exactly exhaustive and will not necessarily be the same in future. It might be better to focus on the individual, not the way in which they live.

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The second point made by the noble Lord, Lord Hannay, was the question of what exactly would be required to be seen by those doing the checking: will a valid visa and a comprehensive statement that someone had been admitted to a qualifying higher education institution be sufficient? Again, I would be grateful if the Minister could confirm that.

Thirdly, we talked about the question of nomination and what that meant. I agree with those who said that that is a difficult word to get hold of. One can see where the Minister is coming from on this, but, again, I do not know that it does the trick, so it would be helpful if he would say a bit more about that. If he has any doubts, the opportunity to bring something back at Third Reading might be a way forward. It is important that the distinction made by the noble Lord is picked up. We are talking about a system within which the focus is on whether a person has a right to reside in the United Kingdom by virtue of having been accepted at an institution and obtaining the necessary visa. We are not talking about the subsequent arrangements under which a university or higher education institution sets up a contract for accommodation for that person. That way lies madness. It will not work. We had better try to get that right.

My two further points were also picked up by my noble friend Lady Warwick. There is a problem about pre-booking of arrangements and the extent to which those might fall under any checking or testing. It is probably difficult to get that right, but we need certainty that arrangements to be made for people who will not get visas until very close to the point at which they transition to this country work in practice. That point is important to those who have been lobbying about this.

As I have mentioned earlier, my final point raises the question: what exactly are we trying to get at here? If it is true that about 25% of students arriving here who are not from the EEA have valid visas, have been accepted by institutions and live in accommodation that will not be covered by the government amendment, are we really back in the territory in which we started and sending up a “Not welcome here” signal? If that is the case—and I hope it is not—can we do something about that? Maybe there is a way in which we should focus further on the institution and its arrangements with the student, and not so much on the accommodation of the landlord. We have amendments later on today that will look in more detail at the arrangements for private sector landlords who may have students of this category on their books. Maybe we can find a way—perhaps through a pilot; although the noble Lord does not seem to like that word—of testing to destruction whether we have a system that we can work.

The Parliamentary Under-Secretary of State, Home Office (Lord Taylor of Holbeach) (Con): My Lords, I thank the noble Lord, Lord Stevenson of Balmacara, for his thoughtful contribution to the debate. I hope I can address the issues he has raised. We have had a good debate. We always have good debates on this subject. The House is not always in agreement with the Government’s position on issues, but I think we have come closer together as a result of the debate, the provisions of the Bill and the amendments that I have been able to bring forward today.

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I do not want to sound boring, but I will reiterate the mantra that the Government’s objective is to attract the brightest and the best. There is no limit on numbers. We have to say that because it puts right at the top of the page what the Government’s policy is. We will go on, I hope, as we discuss this matter, and as I answer noble Lords’ questions, to demonstrate that the proposals in the Bill are not designed to dilute in any way that central policy.

We have had an interesting debate. I have had an interesting debate going on behind me between my noble friends Lord Hodgson and Lord Cormack. I know that they earnestly believe in the importance of the international student sector. I share that belief. It is a tribute to our education system and the talent of individual students who come here that we benefit enormously through our university sector. My noble friend Lady Williams of Crosby gave examples of outstanding academics who have benefited the world of knowledge and the world of medicine by their presence here in this country. They serve as exemplars of what our academic world is able to achieve. She has given me considerable detail which I am sure she will make available to other noble Lords should they wish to see it.

I turn to the Bill and to the amendments proposed by the noble Lord, Lord Hannay, and my own government amendments. In relation to tenancies, the Bill disqualifies individuals from renting property if they do not have leave to be here. Students will be able to evidence their immigration status simply by showing their biometric residence permits or visas to potential landlords. That is a simple and straightforward check. The Government have nonetheless given this issue further thought. As a result of our debates at Second Reading and in Committee, and as a result of meetings we have had outside this House, we have tabled amendments exempting student accommodation which is owned or managed by a higher education institution, all halls of residence, and any arrangement where the student has been nominated for the accommodation by their educational institution. I just want to emphasise that while the word “nominate” is something that those of us who have political lives associate with nomination papers and so on, nominating is just the naming of an individual as being a student at a higher education institution. That is all it is. It does not necessarily involve the university itself in any contract with the landlord or any renting arrangements that the student may be entering into. It is a form of vouching for the genuineness of the student’s immigration status. That is all. I hope that I have been able to express that in the plain terms that the noble Lord, Lord Hannay, asked for. I say further, and this is important too, that it applies to undergraduates— I think that would be understood—and also to postgraduates and to those completing their doctoral theses, so that all those who this House would consider to be students in the broadest definition of the term are included within this embrace.

The noble Lord raised three points that he wanted me to deal with. The first was the business of whether this extended to graduates. I have confirmed that that is indeed the case. Secondly, he asked whether this genuinely exempts the landlord. Yes, indeed; as long as he is satisfied by the nomination, then he has no need

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to conduct any further checks. If I may say so, this is rather analogous to the position of a person in a tied cottage. It has nothing to do with this part of the Bill but it is an interesting analogy in the sense that the person being employed can be vouched for and the landlord will have done the check on their employment in exactly the same way as the university will have done one on the engagement of the individual with the university itself. There is no contractual obligation on the university in respect of the tenancy that the individual student may be entering into. It is important to emphasise that as well. There is engagement, of course, but there is no contractual obligation.

Where a landlord wishes to rent to a student and does not want to check their immigration status documents, for whatever reason, they may make inquiries with the student’s educational institution and obtain this nomination. Nomination will be simply a confirmation of the student’s status, something that educational institutions already have to provide to students in order to prove exemption from the council tax. A suggestion made by my noble friend Lady Manzoor led us to explore this possibility. The term “nominate” is a broad exemption and it will allow higher education institutions to confirm that the student is exempt without being prescriptive about the form that this should take.

These government amendments will mean that landlords need not conduct an immigration status check as the educational institution will already have done so. The amendment removes the large majority of students from the scope of the landlords scheme. I also reassure noble Lords that the Government intend to make provision within the code of practice to allow landlords to agree a tenancy in principle with the students who have not yet arrived in the UK, allowing them to undertake a check of relevant documentation immediately before the student takes up occupation. In other words, it is possible for these arrangements to be made in advance of the student actually taking up their place at the university. A number of noble Lords had expressed concern on that point.

Perhaps I may park the landlord provisions and go on to talk about the health service surcharge—

Baroness Warwick of Undercliffe: Before the noble Lord does that, might I clarify whether what he is saying is in response to the point I made about a potential tenant entering into a conditional arrangement with a landlord? Is it legal and proper for the landlord to enter into that arrangement even though at that point, because of the time involved and so on, the potential tenant has not actually got their visa?

1 pm

Lord Taylor of Holbeach: Yes, absolutely: that is the case. It is up to the landlord to decide whether they want to enter into a conditional arrangement. In university towns this is a frequent enough experience, is it not? They can check the nomination, which may say that the person has a conditional place at the university. That can be checked immediately the undergraduate or postgraduate arrives to take up

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the accommodation. We do not want to make this difficult. We want to make universities feel that this will help them as well as the students at their university.

I turn to the health surcharge—there are a number of landlord issues I might come back to but I want to try to deal with this as far as I can in order. I urge noble Lords to bear in mind that international students cost the NHS around £430 million a year and more than £700 a head. The NHS has limited funding and cannot sustain this if it is unsupported by those who use that service. The surcharge for students is just £150 a year. It is a very good deal. It is a fraction of the true cost to the NHS and just 1% of the cost of studying in the UK. There is no reason to believe that the surcharge will deter students from coming to the UK because it is set well below the price students pay for health insurance in our competitor countries.

I accept that international students contribute significantly to our economy, but such contributions do not exempt students from health charges in our competitor countries and there is no reason why they should do so here. Noble Lords will understand our reasoning in that regard. The NHS provides quality care to international students and their dependants for a wide range of health issues. I will speak more on the NHS services that international students have used, if noble Lords wish.

Baroness Williams of Crosby: I think the whole House recognises that £150 is a not unreasonable figure. However, there is a very specific and limited case for those in post-doctoral or postgraduate positions who bring their dependants with them. At that point the continuation of the charge, especially if somebody has taken work that enables them to pay national insurance and taxation, begins to feel much more like a burden than like a benefit. Does the Minister agree?

Lord Taylor of Holbeach: Indeed. My noble friend and I have discussed this in meetings. I take the point. It was made by the noble Lord, Lord Hannay, as well. I think he and other noble Lords understood that there will be secondary legislation that will define these issues. I am aware of the concerns expressed by noble Lords in this respect. My noble friend Lady Hamwee made the same point about the length of time that some individuals may pay the surcharge. I do not consider this a serious problem but I commit to considering it carefully before bringing forward the affirmative resolution order.

A number of other mattes were raised. My noble friend Lady Williams of Crosby asked about changes to work-study visas. We do not have any figures on this but she is quite right to point out that we have tried to facilitate this, just as through the graduate scheme we have tried to facilitate higher education and have worked with institutions.

She asked about slowness in the visa system. In fact, 93% of administrative reviews for overseas students—these applications are made overseas—are made within 28 days, so it is quite speedy. That is one reason we are looking to use the method of administrative review more generally in this respect.

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I hope that I have satisfied the noble Baroness, Lady Warwick of Undercliffe, about the breadth of the accommodation amendment. Any undergraduate who chooses to use that facility by gaining a nomination from the university will get the accommodation that they need, and it is quite proper to take up a place in advance.

I was asked by a number of noble Lords about our general approach to working with universities. We have been working at ways to promote this country to students from overseas. It is something in which I believe, and I hope that I have been able to reassure noble Lords that with the considerable sums now being put to one side through the Budget to promote our education facilities to overseas students we have a good offer in place.

The noble Lord, Lord Sutherland, was very keen that the Government should demonstrate unity of purpose on this issue. I hope I have said nothing that discourages him from believing that we have a unity of purpose on this issue. I very much appreciate the work that the noble Earl, Lord Sandwich, does, in particular with the college in south London. He and I have had meetings on it. I know he had a meeting with officials last week, trying to reconcile them to the arrangements. This is not an easy area but we want to work with this sector.

I did not have the benefit of a university education. I went to work at 17 and it has taught me that there are huge benefits in university education. I believe in it passionately. I do not want to see other people denied the opportunities that our university sector provides. I hope that I have demonstrated my wish to engage with the sector and give it confidence that there should be no reason why a properly constructed immigration policy would be incompatible with our policy objective of encouraging the brightest and the best to come and study at our excellent universities. I hope, in the light of these points, that the noble Lord, Lord Hannay, will withdraw his amendment.

Lord Hannay of Chiswick: My Lords, I thank all noble Lords who in Committee and on Report supported the amendments put down in my name and those of the noble Baronesses, Lady Williams and Lady Warwick, and the noble Lord, Lord Tugendhat, whose absence today is entirely due to being in Athens on the business of the House.

I have drawn enormous comfort and support from the way in which each of the debates we have held has been lengthy, thoughtful and devoted entirely to the matter in hand. I contrast that with the fact that the other place, when it took this legislation, never actually got around to talking about students or higher education at all because they were so busy chasing Romanians and Bulgarians around the Chamber. That is perhaps a tribute to the way in which your Lordships’ House conducts its business. We do not miss out really important issues like that of students.

I have a brief comment—or perhaps two—on the contribution of the noble Lord, Lord Hodgson. He raised the question of whether universities were aware and made enough of the fact that foreign students help them subsidise domestic students. All I can tell

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him is that if he talks to anyone in the higher education sector, of course they all know that perfectly well. They know that a number of courses, particularly STEM courses, would simply not be maintainable without overseas student enrolment. However, the noble Lord will recognise that if we are trying to recruit overseas students, this is not a major sales point. It is not terribly wise to go around the world saying, “You may think your fees are a bit on the high side—but don’t worry, they are going to support British students”. I hope he will understand that one has to treat that with a certain amount of care.

Of course, the noble Lord is right about the exchange rate having extreme importance. I can only offer him the advice that Miss Prism offers Cecily in “The Importance of Being Earnest”:

“The chapter on the Fall of the Rupee you may omit. It is somewhat too sensational”.

Lord Hodgson of Astley Abbotts: I understand exactly what the noble Lord says, and I understand about the sales pitch. I assure the noble Lord, Lord Stevenson, that I am not going to make another Second Reading speech, but we in this House have got ourselves into a position where we are talking about what the Government are saying about visas and about “curbs”: that was the word used. In fact, what it comes down to when you read the detail is that the checks and balances that the Government are proposing to ensure that there is some recovery of costs are not the key issue. The key issue is the overall cost of the education, particularly in the currency of the country from which the student comes.

Lord Hannay of Chiswick: Well, I think Miss Prism probably had it about right.

Having considered the possibilities, I was struck by the fact that all three Front Benches are opposed to the amendment. The Official Opposition’s description of the reasons for which they were opposed to it holds about as much water as a colander; but let us leave that to one side.

I thank the Minister for his extremely considerate response, for the work he has done in the past few weeks, particularly on the issue of student accommodation, to try to meet some of the concerns that have been expressed, and for the very clear way in which he has replied to questions I and the noble Baronesses, Lady Warwick, Lady Williams and Lady Hamwee, raised in today’s debate. I found some that of the things that he said really helpful. They are on the record and that is very valuable indeed.

Before closing, I will make one point that is outside the scope of this debate. Within the next year, all three main parties are going to write their manifestos for the next election. It would not surprise anyone, I imagine, that there will be a substantial section on immigration in every one of those manifestos, because it is a burning issue of the hour. I make a plea that when they write these manifesto chapters on immigration, they make it quite clear that in the next Parliament they will not treat overseas students as normal economic migrants in terms of the Government’s immigration policy: that they will reflect and that they will respect

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the specificity of the higher education sector. Frankly, I do not think that they will lose a single vote if they say that, but they will save themselves an awful lot of trouble in the next Parliament. I hope that that plea will be heard and, in any case, I beg leave to withdraw the amendment.

Amendment 23 withdrawn.

Consideration on Report adjourned until not before 2.15 pm.

Housing Benefit (Transitional Provisions) (Amendment) Regulations 2014

Motion of Regret

1.15 pm

Moved by Baroness Sherlock

To move that this House regrets that the Housing Benefit (Transitional Provisions) (Amendment) Regulations 2014 are being introduced without Her Majesty’s Government’s full understanding of the numbers of those affected; regrets that confusion and uncertainty are being added to an already unjust policy; deplores that Her Majesty’s Government’s mishandling has resulted in households being unlawfully charged and further pushed into hardship; and regrets the likely disproportionate impact of the Regulations on the most vulnerable (SI 2014/212).

Baroness Sherlock (Lab): My Lords, this Motion relates to an order brought forward by the Government to address a loophole that they have belatedly discovered in enacting what they call the social sector size criteria and everybody else calls the bedroom tax. The loophole means that people claiming housing benefit continuously for the same home since 1 January 1996 are exempt from the bedroom tax. It emerged recently, as noble Lords may remember from the discussion on a recent Urgent Question, that the group may be even wider as it may affect some people who have inherited this protection from a former tenant who enjoyed it.

People covered by this exemption have unlawfully had their housing benefit cut. When this matter was discussed in the other place, a number of examples of people affected were given. For example, there was a widower in Staffordshire suffering from mental health problems who had to find an extra £14 a week to stay in his home. There was a 56 year-old women from Rotherham with health-related problems who paid over £700 in additional rent, which we now know was unlawful. In Greater Manchester, a woman who cares for her granddaughter paid £200 extra in rent as a result of the bedroom tax, fell into arrears and was threatened with eviction from the home she has lived in for 26 years. Incidentally, Grandparents Plus notes that kinship carers like her are more likely to be affected by the bedroom tax, because they are older and more likely to have spare rooms, technically, because their children have grown up and moved on.

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These people and many others like them are now due a rebate but, rather than apologise for the distress that they have been caused, the Government now want to apply the bedroom tax again to these people and thousands like them. Because local authorities in most cases do not have electronic records which go back to 1996, they are finding themselves having to waste time and money trawling through paper files looking for affected cases. Meanwhile, the Government have brought forward this order to close the loophole, despite having no idea how many people are affected by it.

The Opposition have tried very hard to find out how many people are affected by asking Ministers. On 13 January, the Employment Minister, Esther McVey, gave a Written Answer in the other place. She said simply:

“This information is not available”.—[Official Report, Commons, 13/1/14; col. 449W.]

On the same day, the Secretary of State for Work and Pensions told the other place that,

“the number is likely to be between 3,000 and 5,000”.—[

Official Report

, Commons, 13/1/14; col. 577.]

The very next day, the noble Lord, Lord Freud, told this House that,

“the numbers involved in this anomaly are small and the amounts are modest”.—[

Official Report

, 14/1/14; col. 106.]

However, early reports coming from the ground suggested that the numbers could be rather higher than that. Therefore, under the Freedom of Information Act, the Opposition asked local authorities how many people they believed would be affected. The resulting figures already show that over 23,000 are likely to be affected, even though a third of councils have still to reply and many said that they could not give complete answers because they could not include housing association tenants. Not only is this a mess, but the Government seem to have no idea how many people are caught up in the mess.

We should not be surprised. The bedroom tax was a bad policy in the first place, incompetently executed, with the heaviest price being paid by the poorest and most vulnerable. More than 500,000 households have been hit. Two-thirds of those affected are disabled. Of those affected, 35,000 disabled people have had their homes specially adapted with, for example, wheelchair ramps, wider doors, stair lifts or accessible bathrooms. If they are forced to move, it is estimated that the cost of repeating those adaptations in new properties could reach £234 million.

Some 60,000 of those affected by the bedroom tax are carers. More than 200,000 families with children are affected. On average, people are paying an extra £14 a week—the equivalent of losing all of your child benefit for the second child. Most depressingly, so many of the problems predicted by noble Lords from all Benches during the passage of the Welfare Reform Act have come to pass. According to the National Housing Federation, on average two-thirds of tenants affected by the bedroom tax are currently in arrears; of those, three-quarters have seen their arrears increase since the bedroom tax came in. Of those tenants hit by the bedroom tax who are in arrears because they cannot make up the shortfall, 40% have been issued with a notice seeking possession.

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The impact on landlords is also huge. Nearly three in five housing associations say that they have been affected by the bedroom tax either a great deal or a fair amount. That hides huge regional problems, as I know only too well. About 90% of housing associations operating mainly in the north-east and 80% in the north-west report that they have been significantly affected.

What a mess, and for what? What has been achieved by all this chaos and misery? Has the bedroom tax achieved its aims? Ministers have not been able to explain whether the policy is supposed to reduce overcrowding or to save money; it cannot do both. If tenants stay put and accept a cut in their benefits, the state saves money but no houses are freed up. If tenants are forced to move, no money is saved. The costings assumed that people would not move. During the passage of the Welfare Reform Bill, when the matter was voted on in this House on Report on 14 December 2011, the noble Lord, Lord Freud, explained the Government’s position, saying:

“The introduction of size criteria into the social rented sector from April 2013 is essential to reduce housing benefit expenditure”.—[Official Report, 14/12/11; col. 1300.]

So it was indeed about savings. The Minister explained that it would save around £500 million per annum.

I wonder whether those savings really are materialising as Ministers had hoped. Last Friday, Esther McVey was asked on a BBC Radio 5 Live programme how much money the Government had saved through this policy. She began by saying:

“It was never all about saving money”.

The interviewer interrupted just to ask how much it would save. She came back to the question. The interviewer asked her repeatedly whether there would be savings and how much they would be but could not get an answer.

There is now a real risk that the bedroom tax will end up costing more than it saves. Research from the University of York suggests that the policy could save significantly less than the DWP predicted. The National Housing Federation has said that the savings claimed by the Government are “highly questionable”, partly because those forced to move to the private rented sector will end up costing more in housing benefits. Housing associations say that tens of millions of pounds are likely to be lost through the build-up of arrears. I ask the Minister today to tell the House precisely how much of that £500 million savings per annum has been realised in the first year of the bedroom tax. After taking into account the cost of discretionary housing payments, the cost to local authorities and social housing providers and the payment of higher housing benefits to those who had to move, what is the net saving to the public purse? If it was not about saving money, as Esther McVey has said, what was it about?

The Government have since changed tack and claimed that it is about tackling overcrowding or dealing with the waiting lists. They say that people need to be pushed to move out if they have spare rooms so that others can have their houses. At various times, noble Lords from all Benches have pointed out that, in fact, many of these are not spare rooms, and, even if they were, there were nowhere near enough spare smaller

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properties available in the areas hit by the bedroom tax. Now we know what has happened. A recent BBC investigation showed that, after the first year, just 6% of tenants have moved.

This entire episode should shame this Government. Half a million people have been affected, most of them disabled, losing an average £14 a week from their already meagre incomes. Instead of bringing forward an order to make the bedroom tax apply to up to 40,000 more households, the Government should announce today that they will scrap this unfair, cruel and unpopular tax. I beg to move.

Lord Touhig (Lab): My Lords, I thank my noble friend Lady Sherlock for securing this debate. Of all the Government’s reforms to welfare, it is hard to find another more cruel, more callous and more mean-spirited than the bedroom tax. The policy was dreamt up by people who have no need for housing benefit themselves and probably do not even know anybody who depends on it. While it may make sense in theory, in practice it is having a devastating effect on the lives of vulnerable people. Additionally, the very ideas and theory behind the policy are, I believe, wicked and wrong. Ministers have stressed that the policy is designed to fix a broken system of housing benefit and encourage behavioural change among recipients of housing benefit. This is sheer nonsense. The system is broken, though not because of the behaviour of those who use it; the cause is the housing stock itself. In England, there are 180,000 tenants underoccupying two-bedroom homes but only 85,000 smaller homes available.

The Catholic charity Caritas Diocese of Salford has been working with Michelle. She has three children and lives in a three-bedroom home. Originally she cared for her brother, who has now moved into supported accommodation. Her 13 year-old daughter now uses the so-called spare room. Michelle is trying for a home swap, looking for a two-bedroom home, but nothing is available. The £12 she loses each week means that she now regularly resorts to food banks. This is the reality of the bedroom tax. The only economy left for families to make is on food. When that cannot be done, they have to resort to food banks. In Merseyside, social landlords have referred 553 tenants to food banks.

The cost of the bedroom tax is horrific, but the attitude that it displays towards social housing is also wrong. No longer can people regard where they live as their homes. Housing benefit and social housing appear to be something that the Government begrudgingly provide. My local newspaper, the South Wales Argus, recently reported the story of Kevin Reeve, who has occupied the family home for 50 years and cared for his mother and father, who have both now sadly passed away. He is now underoccupying, losing between £35 and £45 a month and has been forced into trying to move.

The local housing association, Bron Afon, has catalogued the effects of this tax on the local community. It discovered that one person affected is a former solider suffering from post-traumatic stress disorder and depression. He lives with his daughter, who is hoping to go to university. They already underoccupy by one room. They are already cutting down on heating

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their home and eating. His daughter is now questioning whether she should go to university. He is resigned to trying to move. His current home is the one in which he raised his children, the home that he shared with his wife, who, sadly, has now died. He is proud of that home, and we should be proud of him, a veteran who has served our country. Is this the way we repay our servicemen?

The bedroom tax is another example of the chaos, confusion and poor implementation of chronically ill conceived policies by the Department for Work and Pensions. It is clear that this policy is unjustly penalising vulnerable people for something beyond their control. It is causing immense hardship and devastating people’s lives. It shows complete callousness towards those who rely on housing benefit. Many good people who rely on housing benefit feel that they live not in prosperity Britain but in poverty Britain, thanks to this Conservative and Liberal Democrat Government. Those responsible for this policy should hang their heads in shame.

Lord Taylor of Goss Moor (LD): My Lords, I should first declare my interest as chair of the National Housing Federation, which represents the housing associations across England.

I will speak briefly, on a personal basis, to say that I cannot support the Government’s policy on this. I believe it was misjudged in the first place and we are rapidly seeing the proof in the pudding. I cannot support something that deprives people of money that, by any standards, they need—the Government do not give people more in benefit than they need to live on—when they have no option to move somewhere else because of the shortage of smaller homes. That is quite apart from the fact that to describe these rooms as surplus to need is in many cases simply wrong, and even if they are surplus today, they are often not surplus tomorrow. Therefore, for example, a family with young children will have to have those children live in a room together, but after a year they might need to live apart.

This simply does not make sense. I very much regret that the amendments in the name of the noble Lord, Lord Best, on this, were not passed, because that would have secured the Government some of what they wished but given a much fairer deal to individuals; for example by not removing the money if a reasonable alternative has not been offered to them.

However, the most fundamental reason—the proof of the pudding—is that this is not a saving to government any more than it frees up rooms. That is because of the huge cost to housing associations of having to work with individuals to help them, and the cost of the work and the money that the Government have had to put in to support individuals. It has removed capacity from the social housing sector to provide more homes. All of the money lost—and, frankly, the arrears that are being built up—will never be gained back from people who have no ability to pay it. That simply undermines the capacity to solve the very housing problem which the policy was theoretically meant to address but has failed to do.

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Although my instincts are those of a team player, and my track record over a substantial period of time shows that to be the case, this is not something on which I can support my noble friends.

1.30 pm

Baroness Nye (Lab): My Lords, I completely share the views so ably put by my noble friend Lady Sherlock and my other noble friends, so I will be brief.

On the anniversary of the introduction of the bedroom tax legislation, the Government are trying to close by statutory instrument a loophole without any understanding of how local authorities can identify the people affected or the numbers involved. Instead of trying to close this loophole the Government should finally do the right thing and scrap the bedroom tax altogether, because as the Budget figures show, it will cost more money than it saves. According to the BBC, due to the lack of smaller accommodation only 6% of those affected have moved.

I know that the Minister will have heard these arguments many times before, but they bear repeating. He will have heard that the bedroom tax discriminates,

“against the most vulnerable in society”,

and that the Government have shown,

“a lack of appreciation of the housing requirements of children and adults with disabilities and care needs”.

Those words are not from this side of the House but from the motion passed by his coalition partners at their annual conference last year. I welcome the words of the noble Lord, Lord Taylor of Goss Moor, and I hope that more of his colleagues will join us in the Lobby this afternoon.

The one thing the Government have managed to do is to unite the noble Lord, Lord Tebbit, and the Liberal Democrats in the view that this bedroom tax will have damaging electoral consequences for both parties of the coalition. However, there are other voices, too. The chief executive of the CAB says:

“The Government’s solution to spiralling Housing Benefit costs is simply creating more problems. Thousands are being pushed into arrears, 96 per cent of people affected have no alternative smaller homes to move into and some housing associations”—

as we have heard—

“say they are being forced to demolish homes whilst 1.8 million languish on waiting lists”.

The United Nations says that the bedroom tax is taking a heavy toll on the most vulnerable and recommends abolition and that there is a,

“danger of retrogression in the right to adequate housing in the United Kingdom”.

The Chief Executive of the National Housing Federation has described the policy as an,

“unfair, ill-planned disaster that is hurting our poorest families”.

This retrospective “move or pay” tax simply is not working. For instance, in Merseyside more than 26,000 families are affected, but only 155 have moved. The Work and Pensions Committee has found that between 60% and 70% of homes affected by the change contained,

“someone with a disability and many of these people will not be able to move home easily due to their disability”.

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It asked the Government to exempt anyone whose home had been adapted. Instead they are closing a loophole to bring more people into its remit.

Of the 660,000 people affected, two-thirds of those are disabled. The think tank Demos reports that £28 billion will have been taken out of disabled pockets by 2018 due to the cuts in DLA, ESA and housing benefit. Empty properties are increasing, in some areas by a third. In South Shields there are whole empty streets because people are afraid to move into larger houses.

If people end up in emergency accommodation, it costs the country more. But the human cost is huge, too. Grandparents cannot have their grandchildren to stay, so childcare arrangements are affected, and single parents are losing children’s bedrooms. Informal care arrangements for disabled people have come to a halt. A room is not a spare room when carers sleep in it, when couples cannot share a bed for health reasons, or when it houses vital medical equipment such as dialysis machines.

Now the Government have realised that they have been telling local authorities to take away housing benefit from people who were entitled to it all along, so they want to close that loophole. That will mean that local authorities will now have to spend more money and time trying to find out from their records—which go back to 1996 and which they may not have in electronic format—the identity of those people who qualify. It causes bureaucratic chaos and will lead to even greater chaos. This Conservative-led Government should be listening to what people—including their partners in the coalition—are saying, and scrap the whole sorry mess.

Baroness Lister of Burtersett (Lab): My Lords, as the Regret Motion makes clear, we have to understand these regulations in the context of the impact of the bedroom tax.

My noble friend Lady Sherlock quoted Esther McVey on Radio 5. I will take us back to her rather wonderful interview on Radio 4, in which the interviewer had to drag out of her that the Government’s estimate is that only 8% of people had moved—a whole two percentage points more than the BBC estimate which she had been contesting. She was asked if she was disappointed. She replied:

“Well no, because it wasn’t that you had to move house”.

How is that consistent with her statement in debate in the other place? She said:

“The reason that we are putting these measures in place is that we want to ensure we make the best use of our social housing”.—[Official Report, Commons, 26/2/14; col. 311.]

In addition, how is it consistent with the constant refrain:

“How can we justify 1 million spare rooms when other people are sometimes crammed together in a room?”.—[Official Report, Commons, 24/3/13; col. 27.]

Can the Minister tell us exactly how many rooms have been freed up by this policy? As the Work and Pensions Committee report observed, it is,

“a blunt instrument for achieving this”

aim, and one that is causing hardship, as we have already heard from other noble Lords.

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Why, then, have people not moved? As has already been said, it is partly because there is nowhere to move to. In the Independent, on 3 March, it was reported that,

“a severe shortage of smaller council homes across the country is being exacerbated by the right-to-buy scheme—leaving many victims of the bedroom tax with no choice but to accept reduced benefits”.

Also, many people do not want to move because they do not want to lose social networks that are very important to them—a point I have made over and over again in this House. We are not talking about housing in the abstract, but about people’s homes within communities that matter to them.

As Demos said, in a study it carried out on social ties,

“policies can serve to actively undermine the kind of self-help and mutual support that families engage in”.

One would have thought that that would be approved of by a Conservative-led Administration who believe in the big society. Reforms such as the removal of the underoccupancy penalty—dubbed the bedroom tax—have left people with a choice of either finding more money for rent from already stretched budgets or moving away from support networks that make life liveable for many.

We have heard about rising rent arrears, but they are only the tip of the iceberg. Earlier this week I attended the launch of a report by Community Links on the impact of the first year of so-called welfare reform—although I would call it social security cuts—in the London borough of Newham. The person presenting the findings pointed out that many people prioritise rent for fear of eviction. Therefore, there may not be rent arrears, but what other impact is it having on what people can spend on other essentials, and how many people are turning to payday lenders or, even worse, to loan sharks? That morning we heard tales of utter despair—the result of the cumulative impact of this and other benefit cuts such as council tax benefit.

The suggestion has been made: “Let them take lodgers”. Do we know how many people have taken on lodgers as a result of this policy? Some noble Lords who are following the Immigration Bill will know that later this afternoon we will talk about its residential tenancy provisions. Anyone who takes a lodger as a result of the bedroom tax will be turned into a mini-immigration officer and will have to check the immigration credentials of their lodger. Do we really want people on benefit being turned into mini-immigration officers to prevent illegal immigration?

The Minister, Esther McVey, pleaded that the BBC report showed how complex this is. I can suggest a simple solution: follow the policy of the Opposition—which I hope will very soon be the official policy of the Liberal Democrats—and abolish the bedroom tax.

Lord Beecham (Lab): My Lords, I think I am the only serving, elected councillor who is likely to speak in this debate, unless the noble Lord, Lord Tope, in his declining days as a councillor—I believe he is standing down shortly—joins in to proclaim the new, belated Lib Dem policy on the bedroom tax. I bring a snapshot from Newcastle, where 5,400 households are affected,

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at an average cost to each of them of £13.47 a week. If paid, that represents around £3.75 million to be taken out of the local economy, so there is a knock-on effect, quite apart from the housing effect, on that economy. Just under one-quarter of those are working households, one-third have children and, as we have already heard, many have disabled people in them. In my own ward, there are 315 such households.

As has already been pointed out, it is not a simple matter to transfer into a smaller property. In Newcastle, we have 3,558 people seeking one-bedroom accommodation. The average number of available one-bedroom properties per year is 64. It would take a generation or more to accommodate those people. Some 615 are seeking to move down to two-bedroom accommodation. There is, admittedly, a slightly higher availability of this—all of 101 a year. Any effect on the private sector, which in Newcastle is largely taken up with students, will drive up rents. Landlords are increasingly reluctant to take tenants who are on benefits of one kind or another. This policy is not only cruel and inefficient; it is based on a complete misunderstanding—to put it generously—of what happens in the social housing market. It is damaging people’s lives.

I conclude with an anecdote about meeting a couple of people in their fifties—not in my own ward—who benefited from the decision which required the Government to effectively refund the amount paid because of the length of their tenure of the property. I was able to tell them they would be getting the money back but I also had to give the bad news that the Government were seeking to ensure that the money returned to them was spent on paying the bedroom tax. Here were two disabled people, living in a house for just under 30 years, with one of their grandchildren staying with them when I called. This just illustrates the cruelty and incompetence of the measure and I congratulate my noble friend on bringing this Motion of Regret.

Baroness King of Bow (Lab): My Lords, when I saw that the Government were introducing an amendment to the bedroom tax, I mistakenly assumed they wanted to put right the wrongs visited on tenants by this unjust law. Instead, they want to close loopholes and increase the number of people victimised. As one housing expert said:

“This is a shambles caused by the DWP failing to understand the significance of their own legislation”.

This is an extraordinary failing by the Government that disproportionately burdens the most vulnerable, two-thirds of whom, as we have heard, are disabled. These people will have to wait for a Labour Government to abolish the bedroom tax—unless the Minister would like to tell us something quite unexpected today. One way that Labour will fund the reversal is to abolish the Government’s tax cuts for hedge funds. I have nothing against hedge funds—I want to see the City of London thrive because our economy depends on it. However, I do not want it to do so on the backs of the poorest and the disabled. I have rarely heard anything so perverse.

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Austerity demands choices: choices reveal priorities. The Government’s priorities here are absolutely shameful. Why do they not concentrate on closing loopholes to end tax evasion by the richest instead of closing loopholes that hurt vulnerable people so much? I urge the Government to abolish this tax.

1.45 pm

Lord Low of Dalston (CB): My Lords, I realise that time is at a premium so I shall be brief and say just a few words. I remember very clearly, as will other noble Lords, the words of Lord Newton of Braintree who, to the great sadness of all, is no longer with us. In his intervention on Report during debates on what is now the Welfare Reform Act, he warned his colleagues in the Government that this would not last five minutes. Once people started realising what was happening and getting on to their MPs in droves, the Government would be forced to scrap it. It has not worked out quite like that but the bedroom tax is visibly unravelling before one’s eyes. It is not saving any money or freeing up any accommodation. My advice to the Minister would be to recognise when he is beaten. He has not a friend in the House. When you are in a hole the only sensible advice is to stop digging. I advise the Minister to recognise realities and run up the white flag.

Baroness Hollis of Heigham (Lab): My Lords, in her powerful speech, my noble friend Lady Sherlock has explained our opposition to this statutory instrument. It brings more people into the bedroom tax which should be abolished. She has had support from all around the House today. The tax is disastrous. A previous Tory Government introduced and repealed the poll tax in the same Parliament. As the noble Lord, Lord Low, said, this Government should have the courage and decency to do the same.

You do, of course, need sanctions in social security to ensure, for example, that compliance with JSA work search is not voluntary. However, the bedroom tax—for the first time ever—falls on the innocent, disabled and vulnerable. They are punished when they have done no wrong: they simply occupy the house that the council allocated them. The Government have now said to them: move or pay. Most tenants can do neither. As my noble friend Lord Beecham said, tenants who want to move will be waiting three to four years. Arrears mount; single people or couples on the waiting list who want smaller accommodation will never get it; pensioners wanting to downsize cannot. As for overcrowding, outside London six times more families are underoccupying than overcrowding Just helping pensioners to move would sort it, with grace and consent. The bedroom tax destroys sound housing policy.

Will the Government, nonetheless, make their savings? No, because benefit cuts have been shunted on to tenants to become irrecoverable arrears. In Norwich, which has spent every penny of its DHPs, 60% of tenants affected by the bedroom tax are now in average arrears of £300 and mounting. Nationally, around two-thirds of affected tenants are in arrears. DHPs are utterly insufficient, short-term, and a postcode lottery, yet that is the policy on which the Minister, sadly,

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relies. Carers UK says that 75% of tenants trying to pay were cutting back on food, heating, medical supplies and mobility. The fragile economy of tenants collapses, as they turn to food banks, payday loans and loan sharks, with debts from which I doubt many will ever recover. The Government’s notional savings become tenants’ irreversible, irrevocable debts and, in the process, we destroy lives.

Fifteen per cent of affected tenants, nearly half of those in arrears, have already received eviction warning notices. What happens then? Do we evict tenants into the private sector—private landlords do not want them and it costs more—or into bed-and-breakfast accommodation which costs even more, or what? Should they be rough sleeping? What about children and disabled people? Through no fault of their own, there are people who cannot pay their rent because the Government have cut their benefit.

Instead, do we allow rent arrears to grow and in the process threaten the very viability of housing associations, as the noble Lord, Lord Taylor, said? We have offered the Minister three possible strategies to help because every defence of the bedroom tax is false. The first option is that the bedroom tax should not apply to disabled people, as the Work and Pensions Committee said only yesterday. Two-thirds of affected tenants are disabled. One may ask why. Adaptions, at a cost of £6,500 a property, become wasted. As regards space, the CAB has said that for disabled people that extra room for carers or equipment is,

“a lifeline as vital as a guide dog or a wheelchair”.

Finally, disabled people need the support of neighbours, as my noble friend Lady Lister said. We talk about social or community care and at the same time the Government seek to pluck disabled people out of the very communities that provide that social care.

The second option is that it should apply only to those who refuse an acceptable alternative offer. Following the remarks made by the noble Lord, Lord Taylor, I should like to know what the position of the Lib Dems is. Will they continue to support the bedroom tax in Parliament while campaigning on the doorstep simultaneously for its repeal? The third option is that the Government could treat social tenants like private tenants and apply the bedroom tax only to new tenancies. Any of those options would help.

We will go further. The Labour Party is pledged to repeal the legislation. It is the most wretched piece of social security legislation that I have known in 25 years in this House. But by then, in the summer of 2015 after the election, we will have seen hundreds of thousands of social tenants—our fellow citizens, most of them disabled and many with children—punished for occupying a house that was allocated to them. They would have been doing no wrong but are unable to pay or to move. They may be deep in debt and fearing, or perhaps experiencing, the loss of their home. How can we do this to them? It is grotesque.

Lord German (LD): My Lords, I am the first to recognise a political device when it comes my way. Indeed, this is a political device to secure a wider debate on the spare room subsidy on the back of regulations which have already been made and have

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come into effect. I do not dispute the need for political devices or regret the use of political devices but it is clear that that is what is being used. I think I should start by clearly laying on the line our policy as Liberal Democrats. What was said at our conference and what we have heard today from noble Lords is the preamble. But two things are being called for: the first is a review and the second is to do with housebuilding.

More crucially than anything else, we want to see the effect that this policy is having in this country. As I understand it—my noble friend can tell me—the review of the policy is due to publish its initial findings soon. I always hesitate when the word “soon” is used but I know that my noble friend loves the word, so perhaps he will indicate whether it will be before the end of this Session, before the Summer Recess or whatever. It would be useful to know when we can have that information.

One would expect that a Labour Party that has designed its policy to abolish the whole thing—we could have a debate about that—will want to assert that a huge amount needs to be put right. But we need facts that stand up to such an assertion and to know exactly where we are. We need to know whether things need to be changed as a result of that independent review, which was put in place by the Welfare Reform Act. That is the position of my party.

Perhaps I may dwell on the issue of correcting secondary legislation, which is what the Motion is about. The unexpected consequences of legislation of the past must have affected all Governments. I could assert that an opposition party present today will at some time have had to use corrective secondary legislation for something which has appeared after primary legislation has been put in place. Perhaps my noble friend can tell me whether I am right or wrong.

There are problems with the 1996 legislation. Perhaps my noble friend can tell us whether it was designed for social sector tenants. The impact that we are talking about is with regard to social sector tenants but my understanding is that that original legislation was put in place particularly for private sector housing and as a protection for private sector tenants. Perhaps my noble friend can advise us whether something that was designed for a different purpose is producing unexpected and unintended consequences.

My second point concerns what is happening in local authorities. Although I do not have as many years of experience in local government as the noble Lord, Lord Beecham, I did spend quite a considerable amount of time in local government. I cannot recall whether I spent more or less time than my noble friend Lord Tope. I certainly remember that we had the use of electronic equipment in the mid-1990s when I was a city councillor. How many local authorities are having to resort to paper trails in order to find out the number of people affected by the 1996 legislation? Do some local authorities have up-to-date information? When there are assertions that between 3,000 and 40,000 people are affected, somewhere there must be reasoning behind those assertions. Do we expect to find the correct solutions and answers soon? Will we be able to find out very soon how many people are affected?

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Will my noble friend reassure the House that local authorities are being reimbursed for the extra work that they are having to do to trawl through the paper trails where those records have not been kept electronically or have been lost? Now that the loophole is closed, I understand that there is now an issue relating to discretionary housing payments paid to people who were subjected to the extra charge between March 2013 and March 2014. People who were awarded DHP were awarded it on the basis that they needed it at that time. Can my noble friend reassure me that there will be no question of people having to repay it and that that discretionary housing payment remains in place?

Today, the noble Lord, Lord Touhig, gave an example of a case, which has been publicised, in Torfaen, the borough in which I live. I note that the Government made additional money available for discretionary housing payments to all 386 local authorities in this land and that only about 80 applied for money. In Wales, only Cardiff, Caerphilly and Conwy—it is very easy to remember them as the three “C”s—applied for discretionary housing payments and Torfaen did not. One can only assume therefore that local authorities which say that they do not need any more discretionary housing payment have enough to make available to people who have a need. I have a number of questions to ask those who support the case, which I read about in my local newspaper. Did those involved go to the local authority? Did the local authority turn them down for extra support, given that local authorities have enough money as they did not need to apply to the Government for additional money?

The second issue my party is concerned about is that of new homes. One of the problems that might come about as a result of this policy is the distortion as local authorities and housing associations decide to build more single-bedroom units. Can my noble friend give me any indication of what is happening in the housebuilding sector, not just in England but also in Wales? We could have a direct comparison with the record on housebuilding of the Conservative and Liberal Democrat coalition and a Labour Government. On that matter, can my noble friend tell me whether the Government’s target for building 170,000 new homes in England by the end of this Parliament in 2015 is still on track? Is it being matched in Wales by the Labour Government on the number of houses that they will be building as well?

Finally, I would like to ask my noble friend a question about the overall budget for housing benefit. The Labour Party, the Liberal Democrats and the Conservatives have all said that we have to try to contain the overall budget. In fact, in the other place all three parties voted in favour of the retention of that hold on the overall budget. Will the changes that have come about as a result of amendments to the secondary legislation affect the original estimates of expenditure on housing benefit, and how much, if at all, will this put up the bill for housing benefit in this coming year?

I have asked my noble friend a variety of questions. I would be grateful if he could tell us when “soon” means in terms of the first stage of the review of this policy.

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