Universal Sustainable Development Goals

Baroness Grender Excerpts

Thursday 22nd November 2018 Lords Chamber

[Baroness Grender (LD)]

My Lords, I congratulate my noble friend Lady Suttie on securing this timely and important debate, if only because I get to follow the real insight and context of the noble Lord, Lord McConnell.

The SDGs are an important part of the toolkit for us to scrutinise the work of the Government. I will focus my comments on goal 11 on sustainable cities and communities and, within that, goal 11.1: to ensure by 2030,

“access for all to adequate, safe and affordable housing”.

I echo my noble friend Lady Suttie’s concerns about the danger of losing sight of the domestic issue, while wholeheartedly agreeing that it was a proud moment when we achieved 0.7% of GNI for developing nations under the coalition—guaranteed, by the way, through a Private Member’s Bill from Michael Moore because the Conservatives in government refused to deliver it through government time. I suspect that when David Cameron signed up to these aims in 2015 and called for all Governments to be held to account for the implementation of the global goals, he was looking beyond our borders and thinking that others needed to play catch-up rather than him. Now, in 2018, he has departed for his £25,000 Marie Antoinette-style shepherd’s hut.

What a contrast with the communities in the UK that will fall far short of the original objectives when this Government deliver the voluntary national review in July 2019. As my noble friend Lady Walmsley said, just last Friday a UN rapporteur ended a two-week mission and concluded that this Government have inflicted “great misery” on their people with,

“punitive, mean-spirited, and often callous”,

policies. The report, which will be presented to the UN Human Rights Council in Geneva next year, states that in the UK,

“poverty is a political choice”.

He said that about 14 million people, a fifth of the population, live in poverty and 1.5 million are destitute, being unable to afford basic essentials. These figures are taken from the Institute for Fiscal Studies and the Joseph Rowntree Foundation. The IFS also predicts a 7% rise in child poverty between 2015 and 2022. Philip Alston, the UN rapporteur and human rights lawyer, said that it was his belief that this Government are in denial.

I see that the Government pushed back hard on the UN report, but Philip Alston is not alone in his findings. The recent investigation by two highly respected journalists at the Times, Rachel Sylvester and Alice Thomson, uncovered a similar story. As they have written in their columns and comments since, they were shocked by what they found in some communities: children going without meals, schools having to find shoes for children and the scandal that continues because of the lack of decent social housing, leaving people on low or no incomes with little choice but to rent in the worst parts of the private sector. Their investigation highlighted the toxic combination of unscrupulous landlords and inadequate benefit for housing, which is pushing thousands of families into homelessness. They found that housing benefit does not cover rents in 95% of the country. Only yesterday, the Residential Landlords Association published a report citing the benefit system as the main cause of ending a tenancy and leading to homelessness. To be a low-income family in the UK—even in work—in the private rented sector is to constantly teeter on the brink of homelessness.

Last year, 123,130 children were in temporary accommodation, defined as statutorily homeless. Today, Shelter published its annual report on homelessness, revealing that 320,000 people are homeless in Britain, This amounts to a year-on-year increase of 13,000, as my noble friend Lady Suttie said. The estimate suggests that nationally one in 200 people is homeless. In London it is much worse: every night we see people sleeping out on the streets.

My noble friend Lady Suttie and I team up once a year to do an annual sleep-out for the charity Depaul, which helps young homeless people. It is only one night a year; she is a hardy Scot who can sleep while it is raining, while I am the soft southerner who always wakes up the minute it starts. For us it is a small reminder of what it is like to sleep out, but it is nothing like the danger, the insecurity, the toll on mental health, the substance abuse and the early death, which Dame Louise Casey and the noble Baroness, Lady Armstrong, worked so hard to eradicate and reduce in the late 1990s in the early days of the Blair Government. It is back, and it is like an epidemic.

This week the Huffington Post conducted an investigation which showed that the Government’s use of “snapshot” rough sleeper counts on just one night of the year in autumn were being used to provide data on the nationwide levels of homelessness. It did its own analysis, which showed that 33 of 326 local authorities in England recorded zero rough sleepers for 2017, including, for example, the London Borough of Barking and Dagenham, where street sleepers are visible throughout the year.

I appreciate that the Minister will be unable to answer on the 169 targets today, so if he is unable to answer my questions, in particular on goal 11.1, will he undertake to write and respond to the following questions? First, which stakeholders will be involved in drawing up the VNRs relating to poverty, statutory homelessness and rough sleeping? Secondly, given that a year ago my complaint about government use of statistics on homelessness was upheld by the UK Statistics Authority, what methodology will be used to report on homelessness as part of goal 11.1? Is the Minister satisfied that that will be an accurate reflection? Perhaps I am getting ahead of myself and making an assumption that that figure will even be used, so my third question is: will homelessness and rough sleeping figures be reported as part of the identified challenges when reporting this July? Fourthly, I was extremely concerned to learn in the WWF brief for this debate that as yet there appears to be no consultation plan in preparation for reporting in July. Given the significant need for partnership to deliver this, is the Minister concerned that the Government are leaving it a little late, and when will the consultation plan be made available?

The SDG global indicators are a noble intent, and the Government were right to sign up to them in 2015. But it is critical that partnerships are formed and challenging questions are asked here at home, particularly on a goal that promises housing for all when it is so obvious that right here, right now, we are falling far short of that objective.

Housing: Rent Payment History

Baroness Grender Excerpts

Wednesday 31st October 2018 Lords Chamber

[Lord Bates]

First, I pay tribute to the work that the noble Lord has consistently done in raising this issue up the agenda. It is indeed something that the Government are taking seriously and they are working with the Financial Conduct Authority and the regulators to see how this can be done. The noble Lord will have noticed the welcome announcement last week that Experian intends to take into account rental contributions as part of credit scoring. That will make a significant difference along the lines that we want—that is, getting the major credit reference agencies to use this data in ensuring that lenders have an accurate reflection of an applicant’s ability to service a loan.

[Baroness Grender (LD)]

My Lords, does the Minister agree that, if a quarter of all households will be renting as of 2021, there must be an end to the bias against people who pay rent rather than a mortgage? With that in mind, will he commit to ensuring that the larger retailers such as Dixons and Argos are included in any initiative that comes out of the Rent Recognition Challenge? Without their participation in addition to that of mortgage lender companies, the poorest renters will continue to be driven into the arms of some of the worst possible lenders just to buy, for instance, white goods.

[Lord Bates]

That is why the consultation is being extended, and it is open to all those parties to feed into it. I gave the example of Experian. By categorising the rental contributions of people in social housing, it was possible for 80% of the 1.2 million people included in the survey to increase their credit rating, meaning that they would have access to lower-cost credit. That is very much what we want, and we believe that, after a long time and a lot of pressure, we are beginning to head in the right direction.

Creditworthiness Assessment Bill [HL]

Baroness Grender Excerpts

Committee: 1st sitting (Hansard): House of Lords
Friday 11th May 2018 Lords Chamber

[Baroness Kramer (LD)]

My Lords, I am a real fan of the unamended version of the Bill. Some 40 years ago, when I was in my early 20s and trying to get credit for the first time, I remember the struggles—I think that most women will share them because of the era—of trying to establish any kind of credit history and demonstrate that I was reliable and could manage my finances and the stresses and strains of all of that. I had to go through the most convoluted routes to establish that history. In the Bill, the noble Lord, Lord Bird, has captured the opportunity for many people to use their reliability in making key payments—rent and council tax—to establish credit history. In some ways, the noble Lord, Lord Blencathra, gave the game away when he mentioned, very early, that part of the industry’s resistance is based simply on the cost of gathering this data. I really do not think that that should be an obstacle to so many people who demonstrate in their lives that they are capable of managing money being able to make the decision that they need to access credit and have a reasonable avenue to do so.

[Baroness Grender (LD)]

My Lords, we on these Benches fully support the Bill as originally drafted and therefore oppose the amendments in group 1 for all the reasons set out so far by other Members. Renters are such a large part of the population now. They have every right to be full participants as consumers. I will give a very specific example: if you are a renter in social housing—78% of renters in social housing pay their rent in full and on time—and you go to buy a washing machine, currently, because you are described as high risk, you will pay between £300 and £1,000 more. Could somebody please explain to me how it is possible that someone can steer clear of arrears when they are in a scenario where, if they are not an owner-occupier, they pay between £300 and £1,000 more for a washing machine? We need to stand firm on the current wording in the Bill and not allow this probing amendment to be aired. A small change in the renting threshold would mean that an additional 4.8 million consumers would be more attracted to mainstream and lower-cost renting.

On arrears, while I understand that this is a point of concern, the whole point of this is to bring people who are renters into the sunlight with information about them. The FCA has also said that it would be good to know who these people are. The alternative is unscrupulous lenders. That is where we drive people to if they are not in the full sunlight of creditworthiness and there is data about them. For those very brief reasons, we urge noble Lords to reject these amendments and to understand that renters are increasing in number. Just today the BBC announced that the proportion of 35 to 54 year-olds who live as private tenants has nearly doubled in 10 years since 2006. The real problem is that the number of people who are renting is doubling but government policy is not keeping pace with this scenario. This very fine Bill tries to do so.

[Lord Desai (Lab)]

My Lords, I did not speak in the Second Reading debate but I add my support to the Bill sponsored by the noble Lord, Lord Bird, and speak against the amendment. The Second Reading debate showed that several things were being put together and confused. The Bill’s purpose is simple. Obviously the problem is that the poor do not get access to credit, or they do at very high interest rates. That is not the problem that would be solved here. There is also the problem that lots of people are in arrears. If they are they will have a low credit rating. That is often as true for owners. That is not a problem.

The virtue of the Bill is to say that if people are behaving like regular, honest payers of their debt on time they ought to get some sort of compensation or reward for that. If people are paying rent regularly they should be treated on par with those who pay their mortgage regularly. It is such a simple idea that I do not know why people are upset about it. For one thing, the cost of recording payments is much lower than it used to be because they are completely automatic. If we can tell the FCA to persuade people to get into a blockchain system that would be a very efficient way of recording payments, both on the part of the landlord who receives it and the tenant who pays it. It would be very easy to build up a databank of regular payments. From there we could easily get on to some sort of financial app that will give them the credit they deserve.

If we keep the Bill to this particularly narrow but very useful aim we should be very happy to support it. It is required that we do not treat two groups of virtuous people unequally. Those who pay their mortgage on time and those who pay their rent on time should be treated equally because they are both behaving honestly.

--- Later in debate ---

Moved by

[Baroness Grender]

5: After Clause 1, in subsection (1) leave out from “whether” to end of subsection and insert “its rules, legal instruments, guidance, and policies, including those rules pursuant to section 1, have been effective in improving the creditworthiness of borrowers who rent and who pay council tax.”

[Baroness Grender]

My Lords, this is a probing of an airing, to give the technical term. The primary aim of this amendment is to counteract the other amendments tabled by the noble Lords, Lord Naseby and Lord Blencathra. Amendment 5 has been tabled to say, “This needs to happen now”. Its primary point is that the FCA needs to conduct a review and do it now.

I am fully aware that the FCA is at the moment conducting a high-cost credit review. However, its most recent conclusion is that it is,

“prepared to look at solutions designed to increase the choice”,

and encourage the,

“availability of alternatives to high-cost credit”—

in other words, more delay. The main point I want to make as a result of this amendment is that tenants cannot wait any longer. The number of tenants is doubling and government policies are not keeping pace. What we need is the immediate implementation of this, not to wait and have a two-year delay. That is the primary reason for this probing amendment. I thank the noble Lord, Lord Kennedy, the right reverend Prelate the Bishop of St Albans and the noble Baroness, Lady Jones, for supporting this amendment. It is an amendment to an amendment, so if the noble Lord, Lord Blencathra, withdraws his amendment, it falls by the wayside.

When I had my Private Member’s Bill banning tenants’ fees, the Government used the unintended consequences argument, asked whether the problem could be solved via the market and then rightly changed their mind, but it is taking a very long time for this to come through. I sometimes wish that the Prime Minister had put a date on this, rather than on one or two other items that have come before noble Lords this week.

I take the opportunity of this amendment to say to the Minister that I think he should support the Bill and give it a fair wind, and that the Government Benches should give a fair wind to more time for it so that it has its Report and Third Reading stages and is sent to the other place. The number of tenants is increasing enormously and legislation is not keeping pace. The FCA needs to conduct an urgent inquiry into the people who were described in the debate on the previous group of amendments, and for that reason I am attempting to amend the amendment.

[Lord Bates]

My Lords, I think I can be brief on this group. I thank my noble friend for moving the amendment. This group of amendments concerns the proposal for the Financial Conduct Authority to conduct a review into the experience of rental tenants, with particular regard to their ability to demonstrate their creditworthiness under the existing rules.

I remind the Committee that the FCA recently consulted on proposed changes to its rules and guidance on assessing creditworthiness in consumer credit and has undertaken research on this subject, which carefully considered the factors that firms take into account when making lending decisions. This consultation made direct reference to the current limitations on sharing rental data and the potential for new technology to alleviate them. That is the purpose behind the rent recognition challenge.

Furthermore, in April 2018 the FCA announced that it will conduct a market study on credit information. A consumer’s credit information affects how likely they are to be able to access a range of financial services, including mortgages, loans and credit cards. Consumers may experience harm, such as restricted access to credit, if this information, such as rental payment history, is not shared effectively. The FCA’s aim is to ensure the credit information market works as well as possible to maximise the benefits that it can deliver for consumers. The FCA will also collect evidence to gain a better understanding of the potential for harm in this market and, if necessary, identify remedies. This study will be launched in quarter four of 2018. Finally, the FCA conducts a review of all new interventions as a matter of course and continues to monitor the market for consumer detriment on an ongoing basis.

In conclusion, I put it to the Committee that the need for a further review by the Financial Conduct Authority into this issue is unclear, as the regulator is already carrying out extensive work in this field. The Government’s position on the Creditworthiness Assessment Bill therefore remains unchanged.

Creditworthiness Assessment Bill [HL]

Baroness Grender Excerpts

2nd reading (Hansard): House of Lords
Friday 24th November 2017 Lords Chamber

[Baroness Grender (LD)]

You have paid your rent all your life, in full, on time. You go online to buy a washing machine. You fill in your credit details. Because you are renting in social housing, that washing machine will cost you somewhere between £300 and almost £1,000 more than it would cost someone with a mortgage. How on earth can that be fair—the poorest paying the most?

That is why I am absolutely delighted, on behalf of the Liberal Democrats, to support the excellent Creditworthiness Assessment Bill of the noble Lord, Lord Bird. Social mobility and fairness were close to our hearts during the coalition Government. Some battles on that we clearly lost, but one of our biggest wins, in my view, was raising the tax threshold so that today those on the lowest incomes pay over £1,000 less tax—something that David Cameron clearly said in 2010 that he would not deliver.

Indeed, this Bill overlaps with some of the key themes in our recent manifesto, where we pledged to implement the recommendations of the Lords Committee on Financial Exclusion, which highlighted the need to address lack of access to bank accounts and low levels of savings, proposed making financial inclusion a statutory objective of the FCA and called for financial literacy to be incorporated into a curriculum for life in state-funded schools in England. Fairness for those who rent was the reason for my Renters’ Rights Bill last year, which focused in particular on banning tenancy fees. I am delighted that this is now a Government Bill and look forward to welcoming it in this place.

By 2021, nearly one in four people will be renters, a quarter of whom will be families with children. More than 4.3 million will be social tenants. The majority of those social housing tenants—78%—pay their rent on time, but an estimated 2 million of those mostly social tenants take out high-cost loans and are trapped in what is called the poverty premium, paying an additional £1,300 on average for the basics, such as energy, phones, white goods and furniture. Those same tenants who pay their rent—78%—are often managing bills, juggling finances and paying a far higher proportion on their housing than many who are owner-occupiers, especially in London. Imagine if all the rent that they had paid was looked on as an equity. It would be a different situation altogether when they applied for credit. As the report by the House of Lords Financial Exclusion Committee put it,

“a sizeable number of UK citizens lack access to even the most basic financial services, while still more are forced to rely on high-cost and sub-optimal products which can prove damaging to their long-term financial health. The ‘poverty premium’, whereby the poor pay more, serves to exacerbate the effects of financial exclusion, reinforcing a vicious circle”.

So how can we ensure greater fairness for these tenants? Big Issue Invest’s Rental Exchange is a good example of how the Bill can work. Since my days at the charity Shelter, the Big Issue, under the leadership of the noble Lord, Lord Bird, has been recognised as a great force for social change. Its Rental Exchange scheme with Experian is no exception. Since launching in 2010, more than 1.5 million tenants across the UK have been represented by the scheme, with an option to opt out so far taken up by only 1% of tenants. It has been a great success. By using rent data, this brilliant project has transformed credit freedoms. In more than 80% of cases, tenants gain an improved credit score when their rent data is shared, and the evidence also shows a jump from 39% to 84% in their digital identity where rent data is included in credit files.

Anyone who has worked with or met people who are homeless is familiar with the vicious circle. You do not have an address, so you cannot get work. Nowadays, as the noble Lord, Lord Bird, described, if you do not have a digital address or digital credit rating, the same issue and problem applies. But these tenants deserve to be part of the mainstream of consumers in the UK. As the Financial Inclusion Commission report published in September said,

“lower cost lenders could be willing to lower their income thresholds for loans if they had access to additional information on household income and earnings. Lowering the threshold from £15,000 to £12,000 per annum could make an additional 4.8m consumers more attractive to mainstream and lower cost lenders”.

That is the 4.8 million consumers who currently struggle to access normal levels of credit for no logical reason.

As the report of the House of Lords Committee on Financial Exclusion put it,

“We recommend that the Government provide all necessary assistance, including legislation where needed, to further combat financial exclusion caused or exacerbated by high-cost credit”.


The Bill does just that.

Finally, I have some words of comfort for the noble Lord, Lord Bird, whatever the Minister now says. A year ago, I stood on this very spot and asked that lettings agency fees be banned for tenants. The arguments by the Minister against were lengthy, but no great surprise—that it would impose significant operational costs. I am sure that we will hear that argument today. We might even indulge ourselves on this Friday afternoon in a bit of ministerial answer bingo. The Minister might suggest that “a market solution is best”, which is another one to expect or that “transparency already covers this area” and that “the empowered consumer is already there”. All those arguments were deployed against my Bill only a year ago, but they were all arguments that the Government sensibly changed their mind on. I hope, for the sake of those tenants whom we have talked about today, who deserve nothing short of fairness and a level playing field, that once again, the Government will see sense, change their mind and adopt this Bill in full.