Benefit Cap (Housing Benefit and Universal Credit) (Amendment) Regulations 2016

Debate between Lord Bishop of Leeds and Lord Shipley

Tuesday 8th November 2016 Lords Chamber

[The Lord Bishop of Leeds]

My Lords, we have heard a number of impressive figures and statistics this evening. It seems to me that the principle underlying all this is that you can save money with one hand but you will pay it out with another. According to End Child Poverty statistics released this month, we have 3.5 million children living in poverty in the United Kingdom in the 21st century. In some regions, up to 47% of children are living in poverty. In my own diocese, in the Bradford local authority area, 32.7% of children are living in poverty after housing costs. The national average is 29%. In Leeds Central, it is 41.8%. If children are living in housing and food poverty—as we know they are from food banks and all the other stuff we see on the ground in our cities, towns and rural areas—then we will end up paying out through the National Health Service and in other ways for the consequences of what children do not have at present.

Could the Government see their way to reducing the impact of this change on children by excluding children’s benefits from the cap, so that families always receive a basic income to spend on their children’s needs? Secondly, could the Government reverse the reductions to in-work allowances under universal credit in order to incentivise moving into work through the provision of better in-work financial support, recognising that much of the poverty we see around us involves those who are in work? I support the Motion to Regret.

[Lord Shipley (LD)]

My Lords, I thank my noble friend Lord Kirkwood of Kirkhope for moving this regret Motion. He has raised a very specific issue about the need for additional support to be made available to help those affected by the cap to find work. But, as we have heard, the issue is broader than this. The Government need to get to the heart of the problem, which previous speakers have identified, which is that they have not been building enough new homes, and as a consequence prices have been rising steeply, whether for owner occupation or for rent.

Crucially, the Government’s emphasis on subsidising owner occupation has left the social rented sector seriously short of funding and therefore of supply. Those who cannot afford to buy are increasingly forced into the private rented sector, with its high rents in most parts of the country. We heard from the noble Lord, Lord Best, about the implications for the private rented sector and the likelihood that the availability of homes in the private rented sector will decline for those who are on housing benefit.

Building more homes will help to hold down rents, which in return can reduce the Government’s revenue costs in terms of housing benefit. I understand that there is to be a White Paper on housing supply shortly. That is welcome, but can the Minister confirm whether the purpose of that White Paper is to address the lack of social rented accommodation? Might it also address the absurdity of calling a home “affordable” when for many people such homes are nothing of the kind?

Meanwhile, the impact on homelessness of lowering the cap could be severe. The Government are already committed, as we have heard, to supporting the Homelessness Reduction Bill, but their support for the Bill seems to sit oddly with this cap, which will actually increase homelessness. We have heard a whole set of disturbing figures, from the right reverend Prelate the Bishop of Leeds and others. I understand that Shelter has estimated that there will be more than 120,000 children in temporary accommodation at Christmas. I find that disturbing. Also disturbing is the fact that since the original cap was introduced, around 70% of those affected have not found work. So doubling the number subject to the cap and worsening it for those already subject to it means that many more people who are already poor are going to be made poorer.

When the Prime Minister took office, she declared that his was a Government for all the people. But this is a dubious claim when poor people are being made poorer. The Government must show that they are prepared to invest further in helping people back into work, at decent rates of pay, thus overcoming the barriers so many can face daily in their attempts to do so. If the Government do not do that, they are simply widening social and financial inequalities in our country, which is unacceptable.