Baroness Meacher
Main Page: Baroness Meacher (Crossbench - Life peer)Local Government Finance Bill
Baroness Meacher Excerpts
Baroness Hanham
My Lords, I acknowledge immediately that carers play a vital role in society. We all know of people who have provided enormous support and care to their families and others, and I accept exactly what the noble Baroness says in that some of them must feel very isolated and find things very difficult.
The Government expect local authorities to consider what provision to make for carers as part of their broader responsibilities to those with protected characteristics under the public sector equality duty. In exercising that duty under the Equality Act with regard to the design of their council tax reduction schemes, local authorities should have regard to the treatment of carers associated with those who are, for example, disabled or older people, given their general duty to eliminate discrimination. I am happy to clarify this point for the record and to bring it to the attention of local authorities that they have that responsibility.
County council tax benefit makes provision for people who are carers through a specific income disregard and a premium towards their applicable amount. Local authorities will be free to do the same under localised council tax support. To facilitate this further, the Department for Communities and Local Government, as I said last time, is working with the Department for Work and Pensions to ensure that local authorities will continue to receive data on current benefits and the universal credit. I cannot give the noble Baroness the news that I think she is asking for, but as soon as those consultations are in position I will make sure that she is made aware of them.
As I have said, local authorities already have an existing framework of statutory responsibilities in relation to individuals who are vulnerable, and I do not think it necessary to create new guidance or highlight specific groups, which would risk cutting across this. I reiterate that the introduction of the transitional grant will give those authorities that undertake to avoid significant cuts to awards in the first year time to find other, more helpful ways of managing the reduction.
Amendment 107ZD would remove the powers to make regulations creating criminal offences in new Section 14B of the Local Government Finance Act. The noble Baroness is looking slightly puzzled. Have we not got to Amendment 107ZD?
Baroness Hanham
I apologise; I noticed the noble Baroness’s face and was getting a bit alarmed.
We have been asked about how we are talking to local authorities about this and other recent legislation. We are regularly communicating with them and will use this regular communication to bring to their attention recent legislation relating to carers. I think that we had some guidance, which I am also happy to discuss with the noble Baroness and, if necessary, reissue.
I apologise to the House for not realising that Amendment 107ZD had not been moved. I hope that the noble Baroness will feel satisfied with my response and will withdraw her amendment.
Baroness Meacher
“(2A) Schemes under subsection (2) shall include 100% council tax rebate fully and additionally funded by central government for persons in receipt of—
(a) less than the income support applicable amount;(b) the universal credit maximum award under section 1(3) of the Welfare Reform Act 2012.”
Baroness Meacher
My Lords, I shall speak briefly in view of the hour; I am sure that the Minister and everyone else would like to get away shortly. The amendment provides for a 100% council tax rebate, fully funded by central government, for people with out-of-work incomes at the income support or JSA level, or when the universal credit is implemented, at the maximum award level under Section 3 of the Welfare Reform Act 2012. I should say that the noble and right reverend Lord, Lord Harries of Pentregarth, had planned to speak to this amendment but at this time he has had to go to an appointment.
The Government may argue that this is a “money” amendment that would increase government spending, but I would refute that suggestion. The basic income of people depending on JSA, for example, as your Lordships will know, is £71 per week for a single person and £111.45 per week for a couple. This is some £20 per week below the Joseph Rowntree assessment of income required to cover the basic costs of food, heating and travel, and one has only to think that there will be a few more costs than that to realise that these people are in dire trouble and need. Such households cannot and will not pay a tax on their home out of that tiny income. I understand that already 2 million households are failing to pay their council tax, a number which will put 2010-11 in the record books for the level of council tax default—that is £1 billion lost to taxpayers, a very large sum—while 3 million liability orders are being sought annually by local authorities through the courts, a 37% increase between 2000 and 2007. The poorest citizens will simply swell these numbers. The amendment would therefore not increase public spending, and that is before we consider the subsequent costs that the Government would have to pick up when these poor households failed.
The Government’s statement refers to transitional council tax benefits between 0% and 8.5%, which to me suggests a positive number. Whatever the number, though, it will be only for a limited period and therefore, as I hope the Minister will appreciate, does not in any way address the concerns that I and others have. I know that she does not really like to be reminded that this is the poll tax mark two, but that is what it will be unless this amendment is accepted by the Government, who could then bring forward their own amendment. I suppose you could say that we are trying to rescue the Government from themselves.
The New Policy Institute refers in its recent report to the return of one of the principles of the poll tax: that every household will pay. It was surely that principle that lay at the heart of the revulsion of the country against the poll tax and which brought down the Prime Minister of the day—Mrs Thatcher, as she was then. It is not surprising, then, that John Major promised Parliament that the council tax would provide up to 100% benefit for the unemployed and those on low incomes. Council tax benefit was expected to protect the poorest in the community, particularly from enforcement action in the courts. I cannot imagine anything more distressing, when you have no money and cannot buy any food, than spending your time going to court to defend yourself.
Now, however, the principle of the DCLG seems to be that instead of a 100% council tax benefit for the poorest, all shall pay something, and the favoured minimum has been 20%. My feeling is that once the transitional plans and arrangements are over, that is the sort of figure that we will probably return to, which means something like £5 per week for these very poor households to find out of income that I believe none of us in this House could survive on. Why issue demands if it is any less than that? Why issue a demand for £1 or £2 a week when even those sums cannot and will not be paid by these people on the lowest of incomes? Already these households will be losing benefit as a result of the move from RPI to CPI as the index used to upgrade benefits. Also many will lose from the housing benefit cap, as my noble friend Lord Best always argues so eloquently. There are disability benefit cuts and lots of other cuts. It is difficult to imagine how they are going to cope.
When these poorest households default, as they will, a liability order will be issued adding £120 to the liability. Then the unregulated bailiffs will turn up with a further cost to the household of £75 or £210 depending on whether they have to make a visit. These costs are piled upon council debt of, let us say, £1 to £2 a week or perhaps £4 to £5 a week. I am sure the Minister can see the nonsense of all this. We can call it nonsense, but for the family or household at the other end, it is not nonsense. It must be absolutely terrifying. People who owe small amounts of money at the beginning can find themselves owing thousands of pounds in a relatively short period. I welcome the Government’s statement, but I ask the Minister to assure the House today that she does not want to introduce poll tax mark two and that the Government will provide a 100% council tax benefit for those at the very bottom of the heap. That is what we are asking today. As other noble Lords have said, these very poorest people are not the right target for the cuts that, as we all know, were made necessary by the banks of this country.
Lord Cormack
My Lords, coming in to listen is fatal. I was very taken by what the noble Baroness, Lady Meacher, said. As somebody who did not support the introduction of the poll tax in Scotland and voted against it on every conceivable occasion thereafter, I would hate to think that we are in any sense moving in that direction. I say briefly, but with great feeling, that I hope the Minister, for whom I have genuinely high regard, will be able to give us some comfort in her response, either now or on Third Reading, because the problems that the noble Baroness sketched are for us theoretical, but for those who suffer, they can make the difference between a life and an existence.
Baroness Hanham
I could do that, but I notice the words of the noble Lord and for the moment I will leave out the transitional arrangements because what the noble Baroness is asking for is not transitional but permanent. I am afraid that again I am not going to be able to accept the amendment.
The noble Baroness will be aware that we have consistently made clear that local authorities must take into account the needs of vulnerable groups in designing their schemes. Our draft regulations set out how the default scheme will take universal credit into account. Local authorities may wish to take this into account as they finalise their schemes in relation to people of working age. Under our proposals for the default scheme, universal credit income will be assessed as part of the means test for council tax support. Therefore the level of income, whether from universal credit or earnings, will be calculated in the means test determining the level of award. It is open to local authorities to take a similar approach in their own schemes.
The amendment would require that central government provides sufficient additional funding for councils to cover them to provide 100% support for the groups the noble Baroness was speaking about. As I explained earlier in relation to the set of amendments on funding, the saving from localisation is an essential contribution to tackling the deficit. The amendment also completely undermines the strengthened incentive for local growth. Making councils financially responsible for providing support brings incentives to get back to work.
I note what the noble Baroness said about the small amounts that potentially have to be collected from vulnerable people. I reiterate that we have drawn vulnerable people to local authorities’ attention and indicated that we think they must be taken very much into account. These proposals leave this in the hands of local authorities, and we are not prepared to change that for this group. Therefore, I hope the noble Baroness will withdraw her amendment.
Baroness Meacher
I thank the Minister for her response. The difficulty we have is that local authorities are squeezed to pieces. I have been very close to local authorities until very recently. They are cutting CAMHS services. They are cutting all sorts of things such as care homes and support for elderly people in their homes. They are desperate. Therefore, they are not going to be able to be generous to people in the situation we are talking about today. It is only at central government level that one can make rational decisions about where the pain should strike. The argument of this amendment is that it should not strike the very poorest people any more. They have already been pinched a very great deal. On that basis, I want to test the opinion of the House.