Children and Families Bill

Baroness Jones of Whitchurch Excerpts

Wednesday 29th January 2014 Lords Chamber

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[Baroness Jones of Whitchurch]

57BC: Before Clause 80, insert the following new Clause—
“Welfare of children: housing benefit
(1) The Housing Benefit (Amendment) Regulations 2006 are amended as follows.
(2) In regulation B13 (determination of maximum rent (social sector)), inserted by regulation 5 of the Housing Benefit (Amendment) Regulations 2012—
(a) in paragraph (5), at beginning insert “Subject to paragraph (5A)”; and(b) after paragraph (5) insert—“(5A) The relevant authority shall make a determination that the restriction to one bedroom under paragraph (5) does not apply if it is in the interests of the welfare of a child or the children living in the dwelling to make such a determination.””

[Baroness Jones of Whitchurch (Lab)]

My Lords, the amendment is about the impact of the bedroom tax on children. I refer noble Lords to my housing association interests recorded in the register.

This simple amendment would allow local authorities to put the welfare of the child first when assessing the appropriate occupancy level in a home. Many aspects of the bedroom tax are unfair and unjust, and we have raised them repeatedly in this House. This amendment picks on one simple theme which has quite rightly dominated our consideration of the Bill so far: that the interests and the welfare of the child should always come first. This issue has united us around the Chamber, and I hope that noble Lords will support the continuation of this principle, reflected in this amendment.

We already know that the bedroom tax hits families hard. The chief executive of the National Housing Federation has described the policy as,

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

It has resulted in an estimated 150,000 families with children being hit so far, forced out of their homes or pushed deeper into poverty and debt. We know from consistent research that children who are forced to move home, away from settled communities and their schooling, suffer health problems and have poorer educational outcomes. Meanwhile, families who stay put suffer an average loss of income of £14 a week, with much higher losses for many, impacting on their ability to feed and clothe their children.

The bedroom tax also has a disproportionate impact on disabled adults and children. Housing association studies have shown that a significant proportion of those affected are either disabled themselves or care for someone who is disabled. Many of them live in homes with adaptations, making it difficult and expensive to move. Others use their spare room for bulky medical equipment or facilities for visiting carers.

There are other adverse welfare implications of the bedroom tax. Recently, there was publicity for the very sad case of the Hollow family, whose 11 year-old son, Caleb, died in a car crash. After a year, the family were told that they had to move to a smaller property, causing added distress to Caleb’s siblings, who were still grieving for their lost brother and who now face the further disruption of a house move or a slide into poverty.

There is also the ongoing issue of the impact on foster carers. When we debated it in Committee, we welcomed the Government’s concession to allow one additional room in their home as long as they had registered as a foster carer or fostered a child within the previous 12 months. However, the reforms still apply to foster carers who have two or three bedrooms for fostered children. Foster carers could be deterred from providing foster care for more than one child at a time, so that more children would be more likely to be separated from their siblings. Given that there is already a shortage of foster carers in the UK, these reforms are likely to mean fewer new recruits coming forward and children’s well-being suffering as a result.

The application of these policies has seen local authorities and housing associations being put in an impossible position, trying to minimise the impact of badly designed policies on local people. As we know, there is often a mismatch in accommodation so that there are simply not enough smaller units even if tenants wish to move.

Meanwhile, under this Government, housing completions are at their lowest peacetime level since the 1920s. Local authorities find themselves trapped trying to implement an unworkable policy with little flexibility. Quite often, their only solution for tenants who are unable to downsize is to move them into the private rented sector, with all the additional housing benefit costs and the poorer standards that this entails.

The Government’s main response so far to the increasing number of tales of poverty and distress has been to set up the discretionary fund to support the most vulnerable families. However, alarmingly, the Local Government Association has reported a dramatic increase in the number of people requesting emergency financial help, with 81% of councils experiencing a sharp increase in the number of applications to the discretionary housing payments scheme, most of which are being made to stop people losing their homes. This demand is so great that councils report it is outstripping the money made available by the DWP, forcing them to make cuts to services in other areas. Anyway, these funds are, by their very nature, temporary, require regular reapplications and provide no ongoing stability for the families concerned. The Government have also issued guidance to local authorities on the application of the rules concerning children’s disability but again they have no obligation in law and the Minister will know that children’s charities remain concerned about the provisions and continue to challenge them.

We believe that our amendment gives local authorities the flexibility they need, based on their local knowledge and their local circumstances, to operate the bedroom tax rules to put the welfare and the interests of the child first. We believe that this would be welcomed by all those trying to implement this unwieldy and unjust policy. It would allow them to make an informed judgment of the options available to individual families in their local area to avoid some of the perverse outcomes that arise from the rules and to guarantee that the interests of the child are safeguarded. We believe that this is a simple but important amendment, in keeping with the spirit of the remainder of the Bill, and I urge noble Lords to support it.

[Baroness Meacher (CB)]

My Lords I support Amendment 57BC, tabled by the noble Baroness, Lady Jones of Whitchurch, to which I have added my name. She eloquently set out the case for the amendment and I will not repeat her comprehensive and cogent arguments. I have no doubt that the Government will regard the amendment as too wide-ranging. It provides for a determination setting aside the bedroom tax, potentially for a very large number of families. For a considerable number of families a move into new and smaller accommodation will be contrary to the interests and the welfare of the child. At the lower level of harms—if one can call them lower level—a house move may involve the children having to change school at the same time as they move home. Other children will move away from a grandparent or somebody else who looks after them when their parents are working. These sorts of changes could have very serious consequences for very sensitive children—not necessarily just disabled ones. At its most serious, a move may deprive a family of the basic space they need in order to continue managing a severely disabled child, or indeed an adult, in the family and therefore keeping the family intact. I want to focus on this to avoid duplication.

We know that families with a disabled child have been disproportionately disadvantaged by the bedroom tax, although the Government accept and have made changes to ensure that a disabled child should at least have a room of their own. That was certainly progress. The Minister always tells us that the discretionary housing payment is the answer to all possible problems. It will no doubt help many families with a short-term problem, if they are able to move into smaller accommodation—that is a big if—without serious consequences for a child or for the family as a whole, but where there is a short delay before the move can take place. I guess that would work pretty well. I accept that discretionary housing payments can be a helpful safety net for some people in the short term. That is how I think I see it working.

--- Later in debate ---

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud) (Con)]

My Lords, as one would expect, this has been an interesting debate with some impassioned and important contributions, which I welcome. Let me start by reminding the House of the fiscal environment that led to this measure’s introduction. In the final year of the previous Government, borrowing had risen to £150 billion. In cash terms, over the previous 10 years, expenditure on housing benefit had nearly doubled to £24 billion. Left unreformed, annual expenditure on housing benefit would have exceeded £26 billion per year by the end of this Parliament. Nearly four years on, the range of economic indicators are showing that our policies are working and have led to the number of workless households, the number of lone-parent workless households and the number of children in workless households all being the lowest since comparable records began in 1996.

I will not spend a huge amount of time responding to the policy issues raised because we have already spent a lot of time in this House dealing with the policy as a whole. I want to deal with the issues raised by the nature and form of this particular amendment.

The Housing Benefit (Amendment) Regulations 2006 are secondary legislation, which contain detailed provisions that set out how local authorities should administer housing benefit. It is very unusual to seek to amend secondary legislation through primary legislation in this way. The amendment itself is imprecise and ambiguous, unlike the rest of Regulation B13. For example, under proposed new paragraph (5A) it is unclear what “restriction to one bedroom” or the concept of,

“in the interests of the welfare of a child”,

means in this context. Because of this, the amendment may have unintended consequences that go far beyond those desired by the noble Baroness.

The effect of the amendment is potentially to allow local authorities to determine that the removal of the spare room subsidy does not apply where the household contains children, as it is not in the interests of their welfare. So this amendment is likely to add around £160 million a year to the housing benefit bill, reducing the savings from the policy to around £330 million a year. It would extend only to the social sector and so reintroduce the inequity in treatment between housing benefit claimants that we have sought to remove with the implementation of this change. Applying the spirit of the amendment to the local housing allowance to re-establish fairness is likely to more than double the cost of making this amendment to around £460 million a year. This amendment does not deliver the intended outcome. If accepted, we do not intend to amend it and it will be sent to the other place in its current defective state.

It may be helpful if I remind noble Lords that we have already taken account of the interests and welfare of children in developing this policy. In March, we amended the regulations to allow an additional bedroom for foster and kinship carers. We have also made £5 million of discretionary housing payment funding available specifically for foster carers who require further additional rooms to allow them to foster two or more children, including groups of siblings. The discretionary housing payment data for the first six months indicate that foster carers are applying for and receiving payments, as intended. In March, we also issued guidance to local authorities indicating that they should allow an additional bedroom for disabled children who would ordinarily be expected to share a room but are unable to do so because of their disability. This was put into a regulatory framework in October. We have provided £180 million of discretionary housing payment funding for this year, and £165 million for next year, to enable local authorities to support the most vulnerable families affected by the reforms. This funding is already meeting the need that the noble Baroness seeks to address through this amendment.

Perhaps I might pick up on two of the vital points raised by the noble Baroness, Lady Meacher, on the costs and benefits for children who go into residential care as a result of the removal of the spare room subsidy. We have not looked at this specifically. The independent evaluation of the policy will look at the effects on families. We are not currently aware of any evidence to support the assumption that this would be an outcome of the policy.

Picking up the example that the noble Baroness raised about Mary Jane and focusing on the uncertainty that that family had with that poor girl, I am aware that some local authorities, following the introduction of the policy, have understandably taken a very cautious approach to awarding discretionary housing payments, as they assess the level of need in their area. I have instructed my officials to amend the guidance to local authorities to encourage them to make longer-term awards where the circumstances are unlikely to change. The revised guidance is being prepared and will be shared with the local authority associations in draft before being issued for the start of the financial year.

At this stage, we have not seen anything to suggest that this policy is having a detrimental impact on the welfare of children living in affected households. We are closely monitoring the effects of the policy and have commissioned an independent two-year evaluation which—among other things—will look at the effects on families. The interim findings are due to be published in spring this year.

I hope I have been clear. I have already reflected on the noble Baronesses’ amendment. I cannot undertake to reflect further between now and Third Reading. If the noble Baroness wishes to test the opinion of the House, she should do so now.

[Baroness Jones of Whitchurch]

My Lords, I very much thank all noble Lords who have spoken. I also thank the Minister. I welcome him to this Bill for, I think, the first time. Some of us are long veterans of this Bill. We have been debating it since last June. Our focus has, perhaps, been very different from the values and priorities that the Minister has been enunciating this evening. We have been very much focused on the child welfare issues and have seen those as a priority in the progress of the Bill. We have reached quite a lot of cross-party and cross-Chamber consensus on all of that.

Once again the Minister put great emphasis on the discretionary housing payment scheme. The fact is, in ways that were never foreseen when the original bedroom tax was introduced, it has already had to be increased and increased. This very much demonstrates that the policy, as originally planned and thought out, was not working and is still not working. It is making the evaluation of the costs very difficult. Indeed, the savings that were originally envisaged are now not being met. The whole policy is being turned on its head.

In all the calculations that I have heard the Minister cite, he does not take into account some of the extra costs. Noble Lords around the Chamber have given us examples, including the whole issue of managing evictions, debt, arrears, the extra costs to local authorities of going back to people to try to collect those debts and arrears, and the more ill defined, but nevertheless very much present, extra social problems that arise from some of these issues.

I am very pleased to hear that there will be an evaluation but, in the mean time, we are trying to deal with some of the problems that exist now. I say to the noble Lord, Lord Storey, who said that some of the discretionary fund was not always being used, that, for that very reason, the discretionary fund is not always the answer to those families. It is quite traumatic to go through that means-testing process. There is also an administrative on-cost for the local authorities that are trying to administer it. This is a murky area. It is not surprising that money in and money out are not always working effectively with the administration of that scheme.

Meanwhile, we have to respect the fact that the Tory-led Local Government Association is saying that there is a problem here and that other budgets are having to be raided to cope with the surge of applications. It is not me who is saying that; it is the Local Government Association. The chair of the Local Government Association’s finance panel says:

“This will have a significant impact on local government budgets, which are already stretched to breaking point by the deepest cuts in the public sector”.

Again, those are not my words; they come from the chair of the LGA finance committee.