Housing Benefit and Disabled People

Wednesday 23rd January 2013 Westminster Hall

11:00

[Jeremy Lefroy (Stafford) (Con)]

It is a pleasure to serve under your chairmanship, Mr Caton. I welcome the Minister to her place and offer belated congratulations on her appointment. I wish to raise with her the effect of the changes to housing benefit on people in the social rented sector who are deemed to be under-occupying a property. I thank my constituents John Turner and Matthew Hancock, Karen Armitage of Stafford and Rural Homes, and my colleague Pauline Ingall for bringing this matter to my attention.

From April 2013, size criteria for new and existing working-age housing benefit claimants will be introduced; they will replicate the size criteria that apply to housing benefit claimants in the private rented sector. The Department for Work and Pensions’ impact assessment estimates that out of 660,000 claimants affected by the new rules, some 420,000 are disabled. The impact assessment offers the explanation that

“Disabled claimants are, on average, older than non-disabled claimants. One consequence of this is that disabled claimants are also less likely to live in households with children… Fewer people living in a household means that large accommodation cannot be justified under the size criteria, and Housing Benefit entitlement is reduced.”

In the debate on the Welfare Reform Bill last year, I raised the matter of disabled people sometimes needing more rooms than provided for by the rules. One family in my constituency with disabled adults and children needed separate rooms for the couple and a separate room for one of the children under the age of 10. The then Minister for disabled people, my right hon. Friend the Member for Basingstoke (Maria Miller), gave a clear answer. She said that

“if a disabled person has the need for an overnight carer, additional rooms can be allocated. Indeed, if there are disabled people in the house who require rooms, there will be clear support there for them to be able to have those rooms.”—[Official Report, 1 February 2012; Vol. 539, c. 937.]

I also raised the question of adaptations, which have sometimes had many thousands of pounds spent on them to enable a disabled person to live in the property. It does not make sense for people to move from such properties to others that will themselves require costly adaptations. I therefore welcomed the fact that of the additional £30 million per annum being added to the discretionary housing payment scheme by the Government from April this year, £25 million is intended to be used

“specifically to assist those disabled claimants who are in properties where a significant adaptation has been made to cater for their individual needs.”

I have contacted the two councils in my constituency to ask them how they intend to allocate the additional funding. Stafford borough council has been working with housing associations to identify tenants affected by the new legislation. It will be concentrating its extra funding, which I estimate to be some £75,000, on disabled people whose property has been adapted and on foster carers; the support will be for 12 months. South Staffordshire district council, which has an additional £64,000 funding, will give short-term support, one to three months, to disabled people with property adaptations. The support is short term, because the council wishes to assess the situation before it commits to the longer term.

Both councils have been proactive in arranging mutual exchanges of properties between those who have spare rooms and those who are overcrowded—they have been doing exactly what the Government wish to encourage. However, both councils face serious shortages of one-bedroom properties for couples or singles, as much of the housing in the area has two bedrooms. That raises two questions for the Minister. First, can councils be sure that they will continue to receive at least the level of additional funding each year for discretionary housing payments that has been granted in 2013-14? Given that much of the funding will be for disabled claimants in adapted properties in which they are likely to live for many years, the need for DHPs will continue. Secondly, is the guidance for the assessment of the number of rooms required by disabled people being set out in the terms that the Minister used to me in the House last year? In addition to the case I mentioned, there are instances where disabled people live on their own or as a couple in a two-bedroom property with little or no storage space, and they tend to use the second room, which is often small, to store equipment that they need—perhaps a wheelchair or a mobility scooter. My understanding of the Minister’s comments in the House last year is that the second room should not be counted as a bedroom.

[Ian Lucas (Wrexham) (Lab)]

The hon. Gentleman is making a compelling case. Some of the individuals affected are severely disabled and the uncertainty that he has outlined is creating great worry, and not just for them; some parents of disabled people are also concerned about the situation. Is it not imperative that an element of certainty is introduced to the system?

[Jeremy Lefroy]

I thank the hon. Gentleman for that intervention and I agree with him. Certainty is vital, which is why I am asking for clarification, and hopefully clarification in the terms used by the then Minister for disabled people in the House of Commons last year.

[John McDonnell (Hayes and Harlington) (Lab)]

I thank the hon. Gentleman on behalf of the whole House for pursuing this matter so consistently, and I congratulate him on having the benefit of having as a constituent John Turner, who I know is an assiduous campaigner on this matter.

Consistency across the country is also necessary. There needs to be monitoring by central Government of how the policy is being applied, because I think we will discover, as we are already discovering in some areas, inconsistency of approach by individual councils.

[Jeremy Lefroy]

I thank the hon. Gentleman for his intervention. He is right: in the two cases that I have outlined of Stafford borough council and South Staffordshire district council, we can already see some differences. Those differences have arisen not for ideological reasons, but because each council takes a slightly different approach. I am all in favour of local councils making their own decisions, but if we end up with a situation wherein some councils’ conditions for DHPs are drastically different from those of other councils, there will be serious problems. Of course, there is also the question of the different profile of housing stocks in different parts of the country, which has an impact on what the hon. Gentleman has said.

To continue discussing space, the size of the rooms also needs to be considered, but the rules specifically rule that out. A typical tenancy agreement may describe the bedrooms as “two plus one plus one”—in other words, one double bedroom and two single bedrooms. The single bedrooms are described as single for a reason—they are often very, very small, as I have seen for myself. Yet a family comprising, for example, a couple and two boys under 16 would be considered as under-occupying that type of property. The rules encourage that family to move to a two-bedroom property, which may itself be described as “two plus one” and where they would effectively be in breach of the tenancy. Surely, size of rooms needs to be taken into account when determining whether there is under-occupancy. I ask the Minister to reconsider the rules.

Of course, the family that I have just spoken about might not be able to find a such a property. In many areas, there is a shortage of suitable housing into which tenants can downsize, which is a serious problem, and it is probably the most significant reason why disabled people are by far the most likely to be affected by the changes to the housing benefit rules, given that, as the impact assessment stated, disabled people will tend to be in smaller households. There is nothing that disabled people, or indeed anyone else who is affected, can do about that situation. They cannot move into properties that do not exist.

[Anas Sarwar (Glasgow Central) (Lab)]

I congratulate the hon. Gentleman on securing this important debate. Obviously, this is a massive issue for disabled families, but more widely there are 660,000 people on housing benefit who are likely to be affected by the changes, mostly those who are living in two or three-bedroom properties who will need to move to a one-bedroom property; they will be penalised, by an average of £728. Does he think it is fair that those people will be penalised in such a way when there is such a shortage of one-bedroom properties?

[Jeremy Lefroy]

It is a very difficult situation. I fully understand the Government’s need to get to grips with the housing benefit bill, and I will come on to that issue in a moment. I know that my right hon. Friend the Secretary of State for Work and Pensions considers these matters extremely carefully, and I have had personal discussions with him about them. I agree that there is a need to try to free up the larger housing stock for those people who are over-occupying properties—people who are overcrowded; I also have constituents coming to me with that problem. However, I agree with the hon. Gentleman that there is a problem of the kind he describes.

Will the Minister say whether, in allocating DHPs between councils, any allowance has been made for those areas in which there is short supply of the one-bedroom housing that is most suited to disabled people who are living on their own or as couples without the need for a carer? If no such allowance has been made, that needs to be taken into consideration, at least for a while, until councils or housing associations have been able to provide such one-bedroom properties.

Two of the reasons for introducing the rules are to encourage greater mobility within the social rented sector and to make better use of the housing sector stock. Those are important reasons at a time when families are struggling in overcrowded accommodation—a situation I am sure that all Members know of from their surgeries. The problem is in the application for existing tenants who are affected by the changes, two thirds of whom, as we have seen, are disabled. It is difficult to see the purpose in encouraging a family with, say, two girls, one of whom will be 16 in a year or two, to move away—even if they can find a smaller property—only for them to need to move back into a larger property when the under-occupancy deduction no longer applies.

If family incomes were such that an additional £12 or so a week was affordable, there would be no cause for concern, but for families in which one person is disabled, income is more than likely to be limited, and the need for a discretionary housing payment therefore grows. It is to deal with such cases that I encourage the Minister to increase the additional funding for discretionary housing payments. If £25 million is set aside to offset the reduction in housing benefit for disabled people whose homes have been adapted—that sum may in itself be insufficient—there will be little left for other difficult situations.

On another matter, a constituent visited me two weekends ago to put the case of fathers who live apart from the mother of their children but look after the children for, say, three nights a week. The bedroom they have kept for their children is considered spare, and hence subject to the reduction in housing benefit. I do not believe that a bedroom that is occupied by one’s children for almost half the week can be described as spare. The fathers therefore face a choice between paying the weekly amount while trying to live on jobseeker’s allowance or employment and support allowance, and going into debt—those are their own words—or not having their children to stay. They all say they will do the former—go into debt—rather than not have the children to stay. I do not believe it was the original intention of the changes to force them into such a choice. We must not put obstacles in the way of fathers remaining in touch with their children. I ask the Minister to look again at the rule that does not count a bedroom used by children for two or three nights a week as part of the occupancy of the home.

The housing benefit bill rose from £11 billion in 2000-01 to £21 billion in 2010-11. Even in real terms, that is an increase of £6 billion a year. I fully appreciate the need to get a grip on this, but ultimately it is growth in the economy, improving incomes and a massive programme of building social and affordable homes, which I hope all Members will support, that will bring that bill down. In the meantime, I ask the Minister seriously to consider changing the rules as I have proposed in respect of children of parents living apart, and the minimum size of rooms that are expected to accommodate more than one child. I also ask that the Government ensure that the statement by my right hon. Friend the Member for Basingstoke when she was Minister for disabled people about there being “clear support” for disabled people to have the rooms they require is properly implemented.

At the same time, I ask the Minister to consider making an additional amount available to local councils’ DHP funds. That will give councils the opportunity to assist those whom the additional £12 or so a week, which they cannot avoid because of the lack of suitable properties to move into, takes over a tipping point at which their finances become unmanageable, potentially leading them toward eviction and homelessness.

11:13

[The Parliamentary Under-Secretary of State for Work and Pensions (Esther McVey)]

It is a pleasure to take part in a debate on such an important issue, and I congratulate my hon. Friend the Member for Stafford (Jeremy Lefroy) on securing it. It is also a pleasure to serve under your chairmanship, Mr Caton. I believe that it is the first time that I have done so.

As we have heard, there is considerable interest among hon. Members in all parts of the House in housing benefit and how the benefits system supports disabled people, and it is important that we make time to discuss those issues in detail. Before I address some of the specific issues that have been raised, I will set out the Government’s approach to housing provision for disabled people.

As hon. Members will be aware, the Government are in the process of reforming the welfare system that will result in housing benefit for working-age people being replaced by universal credit. Current housing benefit arrangements include specific provisions for disabled people that mirror those for other means-tested benefits. They include, for example, a range of disability premiums, earnings disregards and permitted-work rules. With universal credit, we are simplifying the current arrangements to ensure that disabled people benefit from improved work incentives and a smoother transition into work.

My hon. Friend is right to point out that the cost of housing benefit has increased by about 50% in real terms over the past decade, with expenditure totalling £23 billion in 2011-12. That is simply unaffordable in the current economic climate. To begin to address it, the emergency Budget in June 2010 introduced a series of reforms to housing benefit paid to claimants in both the private and social rented sectors. Starting in April 2011, and finishing last month, we set up a series of reforms to local housing allowance, which is the basis for housing benefit awards made to people renting in the private sector. Those changes are intended to exert downward pressure on rents and introduce fairness into the system—for example, by setting caps on the benefit that is paid to ensure that the benefit system is not funding accommodation that many hard-working families could not afford.

Disabled people are not exempt from the reforms, but steps have been taken to provide some additional support to minimise potential adverse impacts on them. My hon. Friend mentioned the number of people affected by the social sector size criteria who are disabled. It is important to stress, however, that that reflects the general proportion of disabled people living in social sector housing overall. In answer to his question, I can confirm to my hon. Friend that the criteria allow for an extra room where a household has an overnight carer.

I am pleased to hear that Stafford borough council and South Staffordshire district council have been working proactively with tenants to identify, for example, where there may be scope for a mutual exchange. I have had other reports in the Department for Work and Pensions of such direct engagement with tenants. I must stress that many other options may be open to people, including those that they arrive at privately to deal with their own circumstances. Things that people can do—and are already doing—include moving somewhere smaller, finding the extra money required, or taking in a lodger. We are now waiving the income tax on that up to £4,250 a year. No tax would be payable on that sum. It is important to note that the private sector may have a supply of different sized properties and that people could move out of the social and into the private sector. When properties without the right number of bedrooms are not available in the social sector, they might be available in the private sector.

[Anas Sarwar]

Is the Minister seriously suggesting that people who are among the poorest and most vulnerable in our communities will be able to find £728, on average, from their annual income, to make up for the deficit in the housing benefit that they will get?

[Esther McVey]

I am not being specific about what people should or should not do. I am saying that there is an array of options, from which someone will find their best solution. The hon. Gentleman will, like me, have met people at surgeries who have said that they have come together as a family to work on the best solution for everyone. It is not a question of one person in isolation but the whole family. Many options are available. As we have said, we are living in tough financial times. What I am talking about is not something that we can take on board easily. We must just consider the fact that there are 1 million spare bedrooms in the current housing situation, but that 250,000 families live in overcrowded houses. We must ask what we can do to support those people.

[Anas Sarwar]

Will the Minister give way?

[Esther McVey]

I will proceed a bit further, and then if the hon. Gentleman wants to ask a further question he can.

There are always specific cases where the options in question may not be sensible or appropriate, and that is why we have trebled funding—a considerable amount—for discretionary housing payments, to give local authorities more flexibility to help people affected by the changes. Overall discretionary housing payment funding in 2013-14 will total £155 million. The funding has been allocated to support the bedding in of specific reforms, but we have listened to feedback from local authorities and as a result have built in flexibility that will allow authorities to allocate funding based on local needs. That flexibility includes, for example, helping disabled people who have made adaptations to their homes to remain in them, as was mentioned by my hon. Friend.

As I have said, there will be provision for those disabled people who need overnight, non-residential carers to receive additional payments for an extra bedroom. The hon. Gentleman pointed out that we are giving many types of support. The trebling of the discretionary benefit really does go to support the people most in need.

[Anas Sarwar]

On flexibility, is the Minister open to the idea of introducing a safeguard for people who cannot reasonably move to another local property because of the lack of availability and of sanctioning them only if they refuse a reasonable request? Is she open to that safeguard?

[Esther McVey]

The hon. Gentleman is speaking hypothetically. We have put in extra discretionary funds, because local councils will know exactly who those individuals are. We have put in extra money, and we have said that it is possible to move between the social and private sectors. With all the options that we have put in place, we believe that we will find solutions for all cases.

[Jeremy Lefroy]

I am grateful to the Minister for her answers. Will she give us some assurance that the additional discretionary funding, which we need to look at again to see whether it is adequate, will be continued through 2014-15 and 2015-16? Often the adaptations are such that it is not possible for a disabled person to move property in the next year or two. One of my constituents has adaptations worth some £30,000. It does not make any sense for them to move from their property.

[Esther McVey]

My hon. Friend makes a good point, and I will come on to that a little bit later and explain in detail what we are doing. He will also appreciate that I cannot make spending commitments into the next Parliament. None the less, with regard to the discretionary housing payment, the Government are committed to ensuring that the reforms are well implemented. We are working closely with local authorities and the Local Government Association regarding this payment usage. As part of the review of these reforms, we are taking ongoing feedback, and I will be pleased to pass on the points raised here today and any further evidence that emerges as the reforms are rolled out. We will continue to monitor and evaluate the impact of the changes.

I should like to put it on the record that a lot of the negative impacts that people talked about last year, such as an explosion of homelessness and mass migration, have simply not emerged. We all want to ensure that there is a smooth transition and that the change is affordable. Of course we are using common sense. My hon. Friend talks about expensive modifications. We know that we have to take that into account, which is precisely why we have trebled the discretionary fund.

We have also made arguments for exempting certain categories from the social sector size criteria measure. However, we do not believe that blanket exemptions are the most effective and affordable approach to targeting resources, because they do not take into account local knowledge. We have therefore avoided exemptions where possible and favoured the discretionary housing payment, because local decision makers are best placed to make decisions based on individual circumstances.

[Ian Lucas]

The Minister is being generous in giving way. Can she foresee circumstances in which someone who requires an overnight carer is not allowed an extra room within the housing benefit provisions?

[Esther McVey]

That is precisely why we are monitoring and evaluating the scheme, and we will continue to do so for two years to see what extra support might be needed. Of course we are watching and observing what is going on. [Interruption.] I will complete my comments here. However, we are committed to undertaking the independent evaluation of all housing reforms. The first report on the private sector is due to be published later this year, and work on evaluating the social sector changes will be implemented in April, with initial findings being available next year.

I trust that I have answered many of the questions that have been raised today. On other specific matters, I will get back to my hon. Friend. As I have already said, this is an important debate, and it is crucial that we closely monitor the situation. We are considering the most vulnerable people in society, and we have a commitment to them.

[John McDonnell]

I do not want the Minister to sit down thinking that there is no housing crisis out there. She referred to the predictions on housing benefit not coming true, but they have in my constituency. I have the worst housing crisis since the second world war. Nevertheless, she has mentioned monitoring, which is critical. Will she give an assurance that that monitoring will be published regularly, so that the House can receive and debate it? The points raised by the hon. Member for Stafford (Jeremy Lefroy) are critical. We must see what is happening on the ground, because a number of local authorities might want to work with Government to plan a transition over time. There will be a number of families for whom alternative private accommodation or social housing is not available and might not be available for years. An assurance that the monitoring will be published and that we will be able to debate it in the House would be helpful.

[Esther McVey]

The hon. Gentleman makes a good point. Of course, we have to monitor the situation, and I have confirmation from colleagues that the monitoring and evaluation will be made public. At the moment, there is much speculation about what might happen, but that is hypothetical. We do not know about that, but by monitoring closely, by introducing a discretionary fund and by working in a common-sense way with people on the ground who know best about local needs, we can get this right.

[Jeremy Lefroy]

I welcome the Minister’s commitment to monitoring, which is important. Will she say a few words about fathers who, unfortunately, are separated from the mothers of their children and who are not allowed to count the presence of their children in their home for up to three nights a week as part of the occupancy of that home? That is an important point. She and I, and I think all hon. Members present, feel that it is important for children to have regular access to both their parents—in this case, to their fathers.

[Esther McVey]

Again, my hon. Friend asks a key question. The heart of the matter is that we do not want children to suffer. Children must have what is right for them, but where a tenant has non-residential children, housing benefit may already pay for a room for the child or children in the place where they usually reside. Funding an additional room in both parents’ properties could be a double provision, but discretionary payments are the best way to address specific complex cases, which we are talking about here.

I am glad that all those points have been highlighted, and they will all be closely monitored. I thank my hon. Friend for bringing such an important debate to the House.

11:28

Sitting suspended.