Housing Benefit Entitlement

Lord Austin of Dudley Excerpts

Wednesday 23rd January 2013 Westminster Hall

[Ian Austin (Dudley North) (Lab)]

I not only congratulate but thank my hon. Friend the Member for Sedgefield (Phil Wilson) for calling this debate. The number of my hon. Friends who have taken part and the brilliant, passionate and well informed speeches that they have made show how important this issue is for so many of their constituents.

We agree with the Government in wanting less overcrowded and less under-occupied social housing. We want to see sensible, practical welfare reform. We also agree that the housing benefit bill needs to be reduced. The problem with the Government’s plan is that it is unlikely to ease housing supply or to save money. In fact, it could end up costing more. It could also mean, as so many of my hon. Friends have said, that disabled people, war widows, foster carers and the families of members of the armed forces all lose out. As we have heard, some could even be made homeless.

However, despite all the criticisms, defeats in the House of Lords and warnings from housing associations, local authorities and experts at charities such as Shelter and Crisis and organisations such as the National Housing Federation, Ministers are determined to press ahead. As a result, in a few months, about 660,000 tenants will be charged up to £20 a week for bedrooms that Ministers say they should not have or they will be forced to move. Ministers claim that living in a council flat with a spare bedroom is

“a luxury the country can no longer afford”.

I will set aside the nauseating spectacle of a millionaire Minister telling poor people that they are living in luxury and will instead consider whether the policy will work. It is supposed to make under-occupiers move into smaller accommodation, but the Government’s own impact assessment makes it clear that all the savings that it is estimated the policy could make are based on the assumption that no one will actually move at all. Instead, all the savings come from reductions in people’s benefits. This policy is literally based on making some of the poorest people in Britain poorer, and it is being implemented, as we have heard, at precisely the moment when millionaires and the super-rich are getting a tax cut.

Let us consider a practical example. Someone with terminal cancer who is receiving employment and support allowance and is in the support group, which is for people who are not expected to work again, has a spare bedroom in a two-bedroom council house because their child moved out recently. They would be happy to move into a smaller home, but the council does not have one available. According to the National Housing Federation, although 180,000 social tenants in England are under-occupying two-bedroom homes, only 68,000 one-bedroom social homes became available for letting in 2009-10.

Usually, there simply will not be a one-bedroom social home for the cancer patient to move into, and more one-bedroom homes will not become available as a result of the policy because, after all, it is not possible to under-occupy a one-bedroom flat. Therefore, they would lose £14 a week, on average, which they would need to make up to their landlord from their benefit income. That is £60 a month straight out of the pocket of someone with terminal cancer. How are they supposed to cope with that loss of income? The Government suggest that they work to make up the difference, or take in a lodger. For people with terminal cancer or the most genuinely disabled people, work is often not much of an option, and it certainly should not be forced on them. Taking in a lodger simply is not an option for many vulnerable households either.

Therefore, one of three things could happen, not just to the family I am talking about, but to hundreds of thousands of others, too. First, they could lose income and be pushed into poverty. Secondly, they could move out to a smaller home in the private sector, but that means higher rent and higher housing benefit bills, and a policy that is supposed to be saving money will end up costing much more. Thirdly, they could end up in rent arrears, be evicted and even end up homeless.

Let us be honest: homelessness is a real possibility. Even the office of the Secretary of State for Communities and Local Government—a man not known as a bleeding-heart liberal—warned that the Government’s housing benefit reforms could make 40,000 people homeless and that the policy could cost more than it saves. The Government claim that discretionary housing payments will help to make up the shortfall between housing benefit and rent, but both the National Audit Office and the Child Poverty Action Group find that the funding available is likely to be woefully inadequate.

I would therefore like to ask the Minister a few questions—first, about the cost of this policy. We have heard already that the policy will make savings only if it does not work, and it is set to push people into private rented accommodation, making supporting them all the more expensive. Will he tell us why the Government have estimated the costs of the policy on the basis that no one moves, but loses benefit instead? Will he tell us what estimates they have made of the number of people likely to move into expensive private rented accommodation? Given the serious concerns about the cost of the policy, can he give us an assurance that under-occupancy deductions will not be increased if the Government do not make the expected savings?

The Government seem to have casually accepted that as many as 40,000 people could be made homeless by the policy. What does the Minister say to the housing association that has told us that it expects to have to evict one third of its tenants? How many children does the Minister think will have to move school as a result of the policy? Have the Government put any measures in place to ensure that local authorities can cope with the increase in the number of homeless people? What estimate has been made of the cost of supporting homeless people and getting them back into housing?

I would also like to ask some questions about the people who will be forced to rely on discretionary housing payments after the changes. The Government have indicated that they expect disabled people with adapted housing and foster carers to apply for the funding. Why should they face the prospect of being moved out of adapted homes on the basis of whether their local authority has enough money left in the DHP pot? Surely, that is a monumental waste when significant time and money has already been invested in their homes. Discretionary housing payments are short term, and new applications must be made every few months, so how are disabled people and foster carers supposed to plan their lives when they cannot be sure that they will be able to afford their house in a few months’ time? Local authorities desperately need to know how much funding they will have, to plan their responses to the changes, so why did the Minister tell the House at the end of October that the Government still have no idea how much money will be allocated to local authorities for the next two years?

It has also emerged that not just disabled people and carers might be forced to rely on short-term discretionary housing payments, but soldiers. The Daily Telegraph recently reported, as we heard earlier, that the families of service personnel will face deductions if they keep a room for a family member away on duty. Why should brave men and women serving their country in the armed forces have no room to come home to, because under-occupancy deductions have caused their family to move? What assessment have the Government made of whether the policy contravenes section C.4 of the armed forces covenant, which states:

“Members of the Armed Forces Community should have the same access to social housing and other housing schemes as any other citizen, and not be disadvantaged in that respect by the requirement for mobility whilst in Service.”

Can the Minister tell us what discussions he has had with the Ministry of Defence on this issue?

As I said, there is no dispute about wanting to tackle overcrowding and under-occupancy or the need to get the housing benefit bill under control, but as Labour Members have shown, the current plans are unlikely to ease housing supply or to save money and could end up costing more. Worse still, they will put people in debt and risk making them homeless. Labour’s alternative where under-occupiers would face deductions if they had been offered a smaller property and refused it would have worked and would have saved money. The fundamental truth is that the best way to get the benefits bill down is not to attack the families of disabled people, soldiers or poor tenants, but to get everyone back to work. That is what Labour’s jobs guarantee would do. Britain needs reform that is tough, fair and, most of all, works.

Welfare Benefits Up-rating Bill

Lord Austin of Dudley Excerpts

Tuesday 8th January 2013 Commons Chamber

[Alun Cairns]

I am grateful to my hon. Friend for that useful reminder that the Labour party did nothing on the issue. Few individuals—if any—would reject a benefit payment, even if in their hearts they were confused about why they were receiving it or uncomfortable with that. The then Chancellor knew well what he was doing and that withdrawing a payment after issuing it in the first place would create a difficult and almost impossible situation—the situation we are in now. Dependency on the state became more widespread, and with that came a significant political shift to the left. The centre ground of politics moved at that moment. It is, therefore, little wonder that £90 billion is now spent on welfare for people of working age.

During the seven years before the last general election, tax credit spend increased by a staggering 258%—that is the context I wished to create in response to the hon. Member for Edinburgh East (Sheila Gilmore). Adding insult to taxpayers’ injury, the tax credit regime was one of the most inefficient benefit systems ever devised, leading to £2 billion of fraud each and every year. Today’s Bill will lead to savings of £1.9 billion over two years, with the pain shared by those recipients whose increases in benefits will be limited. Although £1.9 billion is a significant sum, it does not go anywhere near the increases in spending introduced by the previous Government, particularly leading up to the 2010 general election.

[Ian Austin (Dudley North) (Lab)]

Will the hon. Gentleman give way?

[Alun Cairns]

I will in a moment but I want to develop my argument a little further. Presumably in an effort to drive the landscape even further to the left, tax credits increased dramatically—strangely—in the run-up to the 2005 general election, and, by coincidence, in the run-up to the 2010 general election.

[Alun Cairns]

My hon. Friend makes an excellent point. The previous Prime Minister knew exactly what he was doing and he did it for party political ends rather than to support and help families who needed tax credits.

[Ian Austin]

If the hon. Gentleman is so worried about helping people further down the income scale, why does he support a tax cut for people who earn more than £150,000 and a reduction in the living standards of the poorest people in Britain?

[Alun Cairns]

That is right on cue because I remember the 50% tax rate as being temporary. Is the hon. Gentleman saying that he is committed to that rate leading up to and beyond the next general election?

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[Ian Austin]

I would rather see people who earn more than £150,000 make a contribution than take money off the poorest people in Britain, which is what the hon. Gentleman is arguing for today.

[Alun Cairns]

I would have much more respect for the hon. Gentleman if he told the House that that will be his commitment at the next general election.

[Ian Austin]

We will announce our policies for the next election but they will not be to give tax cuts to the wealthiest people in Britain while hammering the poorest. That is what the hon. Gentleman and his colleagues are supporting today.

[Alun Cairns]

It is obvious that there are two options. Either that will not be a commitment going into the next general election, or the Labour Government introduced the only temporary tax rate that would last almost 10 years. I hope the hon. Gentleman will allow me, in the minute I have left, to develop my second point.

On benefits and incomes, it is difficult to believe that out-of-work benefits have increased by 20% since 2007 and that earnings have increased by half that amount. What is the incentive to work? The Labour Government left a marginal rate of tax of 80% for some of the lowest earners and those on benefits. What sort of incentive was that to get people into work? They continue with the same principle in this debate. That inequality must be resolved, particularly given the nation’s debt, the need to encourage people into work and the demand for structural changes in the economy to deliver growth. It is Labour’s policy to increase spending, taxes and benefits and to take us into a further spiral of increased borrowing, spending and taxes. The people will not stand for it.

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[Greg Mulholland]

It is indeed about choices, and two parties are having to make those choices while the Labour party refuses to make any choices. Labour Members are saying nothing about what they would do or even telling us a single cut that they would reverse.

Ministers from the two parties have sat down and developed a reasonable strategy for reducing the welfare budget. I remind the House that it costs us more than £220 billion a year—more than we spend on health, education and defence combined. Labour Members conveniently forget that they went into the last election with a commitment to reduce that.

At the same time, the Liberal Democrats were clear that there were red lines that we would not cross. We clearly said that we would not accept getting rid of housing benefit for the under-25s; penalising people who have more children; a freeze on benefits; a reduction in benefits; or £10 billion in cuts. What we have now is a much smaller reduction in the budget, but one that is still significant and necessary. The solution is that everybody on benefits, apart, crucially, from those most vulnerable groups, as it is welcome that DLA, attendance allowance, disability carer and pension premiums in the ESA support group have been excluded and will continue to get benefits uprated by CPI—

[Ian Austin]

Will the hon. Gentleman give way?

[Greg Mulholland]

No. The hon. Gentleman has been extremely rude in this debate, and I have taken two interventions, so I am certainly not going to let him intervene. If he gets some manners, I might think about it on a future occasion.

It was a tough choice, but Ministers, to their credit, worked together in the interests of the country and came up with something that was as fair and reasonable as possible. I do not want to have to do this. I do not want to see any reduction in benefits unless absolutely necessary, but we need to remember that this is temporary. This is a temporary measure which can and will be reversed as and when the economy improves.

The one thing I would say to my right hon. Friend the Secretary of State is that we must get the language right. Talk of trying to divide those who work from those who do not has been unhelpful. On worklessness, as a former member of the Work and Pensions Committee in the last Parliament, I can tell the House that there was an appalling benefits trap under that Government, but they did not have the courage to address it. All members of the Committee said that again and again, and this Government are doing something about it. It is not easy and will not be done overnight, but the universal credit will ensure that people have a safety net and that work pays. That is why it is being introduced, and today’s changes also need to be seen in that context.

It was a Liberal who brought in the welfare state, and that is one of our proudest achievements. The principles in the Beveridge report were for a safety net to assist those who cannot work for whatever reason. If those principles were being breached today, I would not support the Bill, but they are not. Indeed, the level of benefits that we have will increase—admittedly not as much as we would like—and I hope that in the future we will review the situation. This is a tough choice, but it is one that I am prepared to make.

Oral Answers to Questions

Lord Austin of Dudley Excerpts

Monday 10th December 2012 Commons Chamber

[Mr Duncan Smith]

Up until now, many people have been trapped on benefits, as they will continue to be without change. The point has been made in this discussion and debate that many who are not on housing benefit but on low incomes find that they must make difficult decisions on where to live—on whether to stay at home or share. My point is simply that we are looking at how we bring those who fall under the benefit bill into line with others, thus giving them a greater opportunity to take work and profit by doing well from an early age. That is all the debate is about. It should surely be welcomed as a right debate to hold.

[Ian Austin (Dudley North) (Lab)]

It is interesting that, despite the Liberal Democrat campaign, the Secretary of State is not ruling the proposal out. Young people have been coming to London to get on in life since Dick Whittington. What does the Secretary of State say to the youngster who took the advice of his predecessor, Lord Tebbit, and got on his bike, moved to London, worked hard and paid taxes, but was made redundant? Should he lose his home and have to move hundreds of miles to live with his parents, where there might not be any jobs? All hon. Members want housing benefit to come down, but how would that promote aspiration?

[Mr Duncan Smith]

This Government are doing more to help unemployed young people back to work than was ever done by the previous one. I remind him that his Government left us with rising youth unemployment. They took all those who were unemployed for over 10 months and put them on a course. When those who were unemployed came off the course, they went back to zero, and therefore were never registered. We have a better record than they had.

Oral Answers to Questions

Lord Austin of Dudley Excerpts

Monday 25th June 2012 Commons Chamber

[Mr Duncan Smith]

We believe that the programmes brought forward to us, and which these young people are volunteering for, constitute genuine experience that they will gain and that the companies were not necessarily providing before. Of course, I fully accept that we want to ensure that those are high quality, and I congratulate the hon. Lady, not for the first time, on genuinely looking at this issue from the point of view of the problem and how we solve it. I wish there were more people doing that, but the trouble is that Opposition Front Benchers absolutely do not attack those who spend their time trying to destroy the work experience programme.

[Ian Austin (Dudley North) (Lab)]

We introduced mandatory work experience under the flexible new deal and we support, as we have heard from a number of my hon. Friends, proper work experience that leads to jobs. However, why did the Secretary of State scrap our scheme and instead pour millions into a mandatory work activity scheme that his own Department says has no impact? Should he not sort out this shambles before announcing his next set of half-baked changes?

[Mr Duncan Smith]

I see that the Opposition have discovered one word that they can now all say because it is not too long for them: shambles. The only shambles that we see is what is going on on their Front Bench. The reality is that we did not persist with the two-week work experience programme because all the young people told us that it did not work—they needed more time. That is what you do: when you hear the truth from people who need your support, you act on it, like we did, and give them that extra time.

Oral Answers to Questions

Lord Austin of Dudley Excerpts

Monday 5th March 2012 Commons Chamber

[Maria Miller]

My hon. Friend is right: we should applaud the work of those councils, including Kettering, that ensure that such skills fairs take place. Through them, unemployed people can learn not only where the jobs are but where the training can be found. There are currently more women starting apprenticeships than men, which shows that great changes can be made.

[Ian Austin (Dudley North) (Lab)]

Despite promising policies to cut unemployment and make work pay, the Government are supporting measures that will leave many mums better off out of work. Is it not clear that these out-of-touch Ministers have not got a clue what life is like for mums struggling with food and fuel bills, given that their benefit and tax changes will cost the average family £580 this year, with thousands being hit by up to £4,000 as a result of the tax credit cuts alone?

[Maria Miller]

I am sorry, but rather than leaving the country with the massive deficit that the hon. Gentleman’s party left us, the Government are putting practical programmes in place—if these had been done when his party was in government, the country would perhaps not be facing the current fiscal deficit.

Unemployment

Lord Austin of Dudley Excerpts

Wednesday 14th December 2011 Commons Chamber

[Chris Grayling]

I absolutely agree, and that is central to what we are trying to achieve. The measures that we are putting in place, which I will set out for the House in a moment, are designed to ensure that we help young people, indeed people of all ages, to move into roles in the private sector, where there is a long-term, sustained opportunity for them to build careers.

[Ian Austin (Dudley North) (Lab)]

Is it or is it not the case that Jaguar-Land Rover in the west midlands provided placements for young people through the future jobs fund?

[Chris Grayling]

The hon. Gentleman will know that in order for a private sector organisation to participate in the future jobs fund, it had to set up a special purpose vehicle to work around European Union state aid rules. The result was that virtually all placements under the future jobs fund were in the public and community sector. In putting in place additional programmes, providing apprenticeships and providing a subsidy through the youth contract, we are focusing support on roles in the private sector.

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[Chris Grayling]

I will explain what we are planning to do, but we should remember that youth unemployment was at almost 950,000 when Labour left office, which was higher than when it took office. We are not going take lessons from Labour and its record on youth unemployment.

I wish to set out the approach that we have put in place to try to support the unemployed.

[Ian Austin]

Will the Minister give way?

[Chris Grayling]

No, I am going to make some progress now.

The first priority has to be to help get business moving and growing again. That involves having a stable financial environment in which businesses are confident that this country is not going to find itself in the economic predicament that some other nations are facing. We therefore remain determined to address the deficit challenge, bring our public finances under control and send a message to the world that Britain understands the challenges that we face and is trying to do something about them. That is why we saw such a good response in the bond markets this morning to this country’s attempts to sell its bonds, and why other countries are facing difficulties. I believe that if we had not taken those measures, businesses would not be investing in this country or considering employing people here. I believe that unemployment would be higher than it is today.

We also have to take measures that, within the confines of the financial constraints upon us, do everything possible to encourage and support business. That is why my right hon. Friend the Chancellor set out in his autumn statement two weeks ago a variety of measures designed to do just that. They include investment in infrastructure; an expansion of the regional growth fund; increased capital allowances in enterprise zones; and measures to underpin bank lending to small businesses, so that they can access the finance that they need to grow. Those are essential parts of ensuring that in exceptionally difficult times, businesses at least have the best foundations that we can possibly give them to enable them to grow.

Oral Answers to Questions

Lord Austin of Dudley Excerpts

Monday 28th November 2011 Commons Chamber

[Chris Grayling]

I have talked to Jobcentre Plus about the availability of placements, and I am confident that, together with the changes that we announced last Friday, which will double the size of the work experience scheme, we will be able to offer every single young person who needs such a placement the opportunity to embark on one.

[Ian Austin (Dudley North) (Lab)]

Youth unemployment has now hit 1 million, and the OECD has forecast today that unemployment is set to climb to 9%, as thousands and thousands more people lose their jobs. The Government scrapped the future jobs fund in their very first month, but the new measures that they have announced do not start until April—two years later. Will this morning’s shocking projections finally wake up the complacent and out-of-touch Ministers before us and persuade them to implement our plan for 100,000 jobs, paid for by a tax on bankers’ bonuses?

[Chris Grayling]

The trouble is that we just cannot take the Opposition seriously when we know that they have already announced 10 different ways of spending that money. We as a Government are delivering real action through real schemes that work and are affordable, and that is something that they failed to do. It is worth saying also that Labour is the party under which, back in 2009, more than 1 million young people were not in education, employment or training—despite the fact that Labour Members tell us otherwise.

Youth Unemployment

Lord Austin of Dudley Excerpts

Wednesday 9th November 2011 Commons Chamber

[Chris Grayling]

Local partnerships are immensely important, and now the Work programme providers have complete freedom to forge partnerships that will make a genuine difference.

The third element of our strategy is apprenticeships. Over the past 12 months, we have launched 100,000 new apprenticeships. I believe that more apprenticeships are now available in this country than ever before. We have many apprenticeships that are targeted at young people. The previous Government’s track record on apprenticeships was, as usual, full of rhetoric but lacking in delivery. They repeatedly made promises for an overall number of apprenticeships, and they repeatedly failed to deliver what they promised. We are hitting targets for apprenticeships. That is the first time in a long time that that has happened, and I pay tribute to my hon. Friend the Minister for Further Education, Skills and Lifelong Learning for that.

[Ian Austin (Dudley North) (Lab)]

How many of these apprenticeships are reserved for 18 to 24-year-olds?

[Chris Grayling]

In the Budget, we announced an additional 40,000 apprenticeships targeted at the young unemployed, and the overall number of young people under the age of 24 on apprenticeships is greater than the total number of apprenticeships that were available under the previous Government. My hon. Friend will walk us through the details of that when he concludes the debate; this is very much his baby, and he should take credit for what he has achieved.

I might also mention the support we are providing for the short-term young unemployed through the work experience scheme, our sector-based work academies and the work being done through Jobcentre Plus. The Work programme is the biggest ever welfare-to-work programme of its kind in the country. We have the biggest payment-by-results scheme in the world, offering tailored, personalised support to help young people actually get into work right now. There is the opportunity to move through into an apprenticeship, which is an appropriate path into work for many young people. Never before has this scale of apprenticeships been provided in this country.

I believe these measures represent a coherent strategy to deal with a problem that was left behind by the previous Government, and that has been made more challenging by a difficult set of international circumstances. Unlike the previous Government with their failures, we are determined to tackle this problem, and to succeed.

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[The Minister for Further Education, Skills and Lifelong Learning (Mr John Hayes)]

How could we not be moved by what the hon. Member for Hartlepool (Mr Wright), my hon. Friends the Members for Blackpool North and Cleveleys (Paul Maynard) and for Aberconwy (Guto Bebb), and the hon. Members for North West Durham (Pat Glass) and for Wansbeck (Ian Lavery) said about the plight of young people in their constituencies? Let there be no dispute about this: there is no denial and there is no complacency. [Interruption.] Of course this matters to all hon. Members in this House, and it ill befits Opposition Members to suggest that they have a monopoly on care.

[Ian Austin]

Will the Minister give way?

[Mr Hayes]

I will not give way.

Hearing Labour Members talk about generational joblessness reminded me of the plight that my father and my grandfather suffered in the ’30s when they were jobless. The story now, as we have heard from Members across the House, is no less tragic than it was then. That is why the Government are doing something about it.

All hon. Members who have spoken in the debate must be disappointed by the motion. Like worn-out conjuror’s paraphernalia, it is all smoke and mirrors. It resembles the economic policy that the last Government practised when the shadow Chancellor was their senior economic adviser, and we all know where that led. It led to the point at which the shadow Secretary of State, who introduced this debate, left his famous letter saying “There’s no money left”. We can see the shadow Chancellor’s footprints and fingerprints all over the motion.

Oral Answers to Questions

Lord Austin of Dudley Excerpts

Monday 24th October 2011 Commons Chamber

[The Minister of State, Department for Work and Pensions (Chris Grayling)]

My hon. Friend needs to understand that Atos is simply a subcontractor to the Department for Work and Pensions. It does not take decisions about individuals. It simply operates to a template, which was mostly established under the previous Government. Of course we must be sensitive, but Atos and our other subcontractors are as careful as possible about the job that they do. Ultimately however, it is the Department itself that sets the policy and implements the processes, and that must take responsibility for the outcomes.

[Ian Austin (Dudley North) (Lab)]

Given the Secretary of State’s complaints about the free movement of European labour and his leadership of the Maastricht rebels in the ’90s, may I ask why he will not be demonstrating some conviction and consistency this evening? Why is he putting his position and his party before his principles, and his career before his country, in the debate on Europe this evening?

[Mr Speaker]

Order. It is always a pleasure to listen to the hon. Gentleman, and that is, indeed, a topical question, but it suffers from the notable disadvantage of bearing absolutely no relation whatsoever to the responsibilities of the Secretary of State for Work and Pensions. I will give a seminar to the hon. Gentleman later, further and better to explain the point, but there is no requirement on the Secretary of State to respond to that question.