Welfare Reform Bill

Debate between Liam Byrne and Ian Paisley

Wednesday 1st February 2012 Commons Chamber

[Mr Byrne]

In a moment.

We are grateful to the Children’s Society for telling us that about half the families who will be affected by the current “one cap fits all” proposal will be families with five children, and on the basis of the first impact assessment—I think—the Children’s Society calculated that about 21,000 families would be affected.

[Ian Paisley]

Will the right hon. Gentleman give way?

[Mr Byrne]

I will give way in a moment.

Let us just see what that scenario looks like in London. The House of Commons Library tells us that a family in that situation will be taking a hundred quid in jobseeker’s allowance, £74 in child benefit, £255 in child tax credit, £32 in council tax benefit and—because of the high levels of rents in London—£350 in housing benefit. Under the cap, a family in that position will lose about £243. There is no way on earth that their rent will fall by that amount. Even out of London, a family in that situation will face losing £87 a week, and there is no way that their rent will fall by that amount either. Those families—some 21,000 of them—will be made homeless. Coincidentally, that is exactly the figure in the analysis produced by the Secretary of State for Communities and Local Government. I am afraid that it is therefore rather ludicrous to suggest that there will not be widespread homelessness as a result of the “one cap fits all” approach, and if anyone wanted any proof of that, the Minister has just given it by telling us that he has had to burn a third of the savings that he proposes to make in sorting the problem out.

[Mr Byrne]

My hon. Friend has highlighted a problem with which we are confronted in London and elsewhere. It was remarkable that the Minister managed to get through his speech this afternoon without making any reference to the latest DCLG estimates for how much rents in London and elsewhere are going to rise. According to some analyses that I have seen, they could rise by something like 41% over the next few years. Nowhere is that corrected or remedied in the Government’s proposals. One Department is simply not talking to the other.

[Ian Paisley]

Has the shadow Minister not just illustrated that this is a Greater London-centric issue, given that 60% of the high claims and high benefit payments are in the Greater London area? Across Northern Ireland, only one claimant is in receipt of an amount that would reflect a higher benefit. Yes, something needs to be said about London, but this issue does not affect the whole of the UK in the same way.

[Mr Byrne]

The hon. Gentleman is making the point that we tried to make in our amendment—namely, that a “one cap fits all” proposal does not look as though it is going to work. We have heard the Minister’s reassurances this afternoon that certain families will be referred into the Work programme, but I am afraid that the Work programme is failing. The off-flow rate—the rate at which people flow off benefits and into work—in the last quarter of last year was the lowest since 1998. People are not getting back into work, because the Government’s back-to-work programmes are failing. Perhaps the Minister will tell us what he is going to do about that problem.