Welfare Reform Bill

Lord Foulkes of Cumnock Excerpts

Tuesday 18th October 2011 Grand Committee

[Lord Foulkes of Cumnock]

Can I ask the noble Lord a number of questions since he is asking the Minister a lot of questions? He seems to accept the policy in the Bill but only wants it postponed, so what is his attitude to the amendment proposed by the noble Baroness, Lady Hollis? What is his response, particularly to the point made by my noble friend Lady Turner that this should be done by agreement and not be forced on people?

[Lord German]

I think if the noble Lord would wait a few moments, he will see what I am proposing. It is on this piece of card, which I can pass to him, but if he just bears with me, I will give him three things which I think are essential in order to make this section of the Bill work. That is why I am posing the questions, because it seems to me that the solutions are not given in any of the documents.

The document from the DWP about what these choices will be and the three questions that people will have to answer says:

“it is unclear how this”—

the policy—

“will affect the choices of claimants that are likely to be affected by the measure”.

In other words, the Government do not know; or do they? If they do know, we need to ensure that we have those figures in front of us. If we are to avoid unintended consequences, we are going to have to look at the levers that ensure that the housing stock is accurate, and if the housing stock can, over time, match the needs of this particular policy.

As we know, there are 670,000 claimants, presumably of working age, which means that a third of a million non-working age claimants are underoccupying—the noble Lords, Lord Stoneham and Lord Wigley, have talked about elderly people underoccupying. Maybe there is an answer to that which the Minister and the Government have already thought about. There are no figures that I have seen in any of the documentation that indicate how we are going to manage to create a housing stock to match the changes. First, we need to know how many of the 670,000 are going to move and the modelling figure behind it. Until we have the answer to that, we cannot answer the question about how many houses we are going to need.

[Lord German]

I am grateful for that quotation, which of course goes against the other one that I gave from further on in the document, which says that we do not know what claimants’ choices are likely to be. The noble Baroness’s quotation has the word “little” in it. We have often reached the point where we have quoted from different sections of the same document, and that is why we need answers. We need to know which of the three choices people are going to make so that we can determine whether the homes are available for them. There are three solutions, which I put to the Minister and which we need answers about, at the very least after his answer to the fundamental question of whether we have the housing stock.

I ask the Minister, when replying, to talk not about the DCLG but about the three government departments that are responsible for these matters in this country, because three levers have to be pulled for the DWP to be able to answer that single question. What is the solution? I would like to know what the three government departments feel about how they can match housing demand. I must say that I am not particularly encouraged because, for many of us, moving house is probably the worst thing in the world that you could probably do. In fact, my noble friend Lord Kirkwood told me this morning that we ought to exchange our rubbish with our neighbour’s because our neighbour’s rubbish is much more interesting than our own. I have found moving house to be a very uncomfortable exercise, and I am sure we have to be careful of this. The Government say that they are working in England to develop a team of advisers who will work to help people to make better use of our housing stock, which is a laudable aim, but they also say that they will work with the devolved Administrations to see what can be done in Scotland and Wales. What can be done about the housing stock across the whole of the country where this policy impacts?

It seems to me that there are three potential solutions when we have the answers to the figures, one of which is that we must have housing money—discretionary housing money, or whatever—to ensure that the money reaches the particular groups that will need it in order to be able to make the adjustment. The second is about exceptions. We will come to that in the next set of amendments, but where the cost to the public purse can be demonstrated to be larger—and many of the amendments coming up now will demonstrate that—we must ensure that we have exceptions. The final point that has been made by many noble Lords here today is that we must have transition time for the social housing sector in all three parts of the country where this Bill applies to make the changes in order that this policy works. We cannot achieve the original purposes of these measures, all of which I think are right, without achieving those three things and without ensuring that we have a sector that can—

[Lord Foulkes of Cumnock]

I have listened very carefully, and the noble Lord’s Welsh eloquence—what do you call it, hwyl?—is impressive, but he has still not made it clear to me whether his speech is in support of the amendment by my noble friend Baroness Hollis.

[Lord German]

My speech, my Lords, is in favour of the policy proposals that are behind this measure, but in order to achieve that this amendment has given us an opportunity to explore the issues that need to be satisfied in order that we can proceed. And hwyl, by the way, is spelt H-W-Y-L, for the record.

--- Later in debate ---

[Lord German]

I will repeat the answer that I gave the noble Baroness just now.

[Lord Foulkes of Cumnock]

I have still not had the answer to my question. I do not want him to repeat it, just to clarify it. It was the pronunciation of hwyl I had problems with, not the spelling.

For all his bluster and eloquence, I think the noble Lord has confirmed that he still supports the coalition Government’s dreadful proposals in the Bill. All his questions to the Minister are really just to cover up that fact.

[Baroness Thomas of Winchester]

The noble Lord, Lord Foulkes, is bullying my noble friend, which is outrageous. My noble friend is exploring the issues around this question, which is perfectly valid in Committee.

--- Later in debate ---

[Lord Foulkes of Cumnock]

Could the Minister describe what he means by a bedroom?

[Lord Freud]

My Lords, I am tempted to ask the noble Baroness, Lady Thomas, to come and save me from bullying by the noble Lord, Lord Foulkes.

[Lord Foulkes of Cumnock]

I will make it easier for the Minister then, since he is finding it difficult. In my city of Edinburgh, there are a lot of houses with rooms that do not have external windows—they are box rooms. Some occasionally have a small skylight. Is that within the definition of a bedroom? Another example might be studio flats, or studio flats that may then have an extra bedroom attached to them. Is that a two-bedroom or a one-bedroom flat? Another might be my study. Is my study a bedroom or is it a study? It was used as a bedroom by the previous occupier, but now it is a study. These are just three examples of difficulties from the very start and the most simple part of the Bill: that is, the description of a bedroom.

[Lord Freud]

Certainly, the study of the noble Lord, Lord Foulkes, would seem to me to be a bedroom. However, box rooms without opening windows normally would not count as bedrooms. There is a series of rules that we will go through as we work through the implementation planning with stakeholders.

[Lord Foulkes of Cumnock]

Then you tempt tenants to board up their windows, as some owners used to do when there were window taxes.

[Lord Freud]

The coalition Government, my Lords, are not Queen Anne and we will resist any of those blocked up windows, which still blight many villages and which I know the noble Lord is very concerned about.

This is more than just a savings exercise. Housing benefit payments in both sectors will become more balanced in a way that will restore fairness, encourage better use of our existing social housing stock and encourage more people into employment.

The noble Baroness, Lady Sherlock, asked about the impact on children in particular. The impact assessment shows that claimants with children are less likely to be affected by the measure than those without children. Only around a third of the claimants potentially affected have children living with them. DWP officials have been working very closely in this area with officials from DCLG, the Department for Education and HMT.

It is reasonable to expect people living in the social rented sector to make choices about the affordability and the size of their accommodation, just as those in the private sector, and those who are not on benefit, have to.

My noble friend Lord Kirkwood spoke about transition and phasing. I should remind the Committee that these measures were announced in the summer of 2010 with a view to their taking effect, as has been observed, in April 2013. We think that this provides adequate lead-in time and we aim to have regulations in place by April 2012 to allow for a full year of implementation. If you like, you can look at that period as the transition phase, as people make appropriate arrangements.

Let me move on to Amendment 48, which comes in two parts. The first part would place a duty on social landlords to find suitable alternative accommodation for claimants who are underoccupying their property. If a smaller property cannot be offered to the claimant’s household, the size criteria measure would not apply. The second part relates to those who live in significantly adapted accommodation, and I will come on to that shortly. We are working closely with the Department for Communities and Local Government, and others, as we explore ways to best support landlords, local authorities and tenants, leading up to the implementation of this measure. That work is ongoing, and we will look at how we can work to ensure that claimants’ options are clearly set out, well in advance of the measure coming into force in April 2013.

It is important that local authorities and other providers of social housing make more effective use of their stock, and this measure, alongside the Localism Bill, will provide not only a greater incentive but a means for achieving that. This measure is about asking people on benefit to make realistic choices about the affordability of their accommodation when it is larger than they need. It is in the interests of social landlords to make the best use of their stock in order to make sure that tenants are able to pay their rent. For this reason most landlords would try to offer alternative housing options whenever they could. The specific duty on social landlords in Amendment 48 is therefore unnecessary and would raise important concerns around control, classification and enforceability. We do not want to impose regulations on to social landlords just for the sake of it.

The Government are providing funding to councils—£13 million over four years until 2015-16—to assist them in supporting underoccupying tenants who wish to move, as well as funding an action team within the Chartered Institute of Housing to work with all social landlords to help them to promote moves. The Government are investing £4.5 billion to help to deliver up to 170,000 new, affordable homes over the next four years.

This amendment would also exempt claimants from the measures where no suitable alternative accommodation is available. However, we expect that many people will decide to remain in their existing property, and make up the shortfall, even if an alternative offer of smaller accommodation is available, so it is likely that such an exemption would be an expensive waste of money in many cases. Of course, without a definition of suitable alternative accommodation, it is not easy to estimate how much this exemption would cost, but let us be clear that it would be extremely complex to deliver, and undoubtedly place a significant dent in the expected savings that would need to be found from elsewhere. I do not think this is a sensible way forward.

I understand that there are concerns about the supply of smaller properties. Claimants affected by this measure will have to decide whether to meet any shortfall themselves—from their earnings for example, or they could take in a lodger, or someone they know, to fill the extra bedrooms. If they do decide that moving to a smaller property is the only option to avoid getting into arrears, the social rented sector should not be seen as the only option. Private renting may be an appropriate alternative for some of those affected.

Changes being taken forward by the Department for Communities and Local Government through the Localism Bill will make it easier for councils and housing associations to move underoccupying tenants. However, this is not just about landlords. Some tenants can, and perhaps should, take more responsibility for arranging a move themselves. The new national homeswap scheme, Home Exchange Direct, will increase opportunities for social tenants looking to move through mutual exchange. Home Exchange Direct brings together the four internet providers of mutual exchange services to offer tenants more choice over where they live. Ultimately, landlords in Northern Ireland, Scotland and Wales will also be able to join the new scheme.

Amendment 34A also probes the availability of suitably sized accommodation. The provisions in subsection (3) will restrict how the other powers relating to the provision of housing costs may be used. Adding a line in subsection (3) to take into account the availability of suitable accommodation will not limit the way in which those other powers can be used. I take it that this amendment is really intended to ensure that claimants are unaffected by the size criteria in circumstances where no suitable alternative accommodation is available, and I have already made my thoughts clear on that. I recognise that, for some households in certain circumstances, moving may not be appropriate or should be delayed. Local housing authorities are best placed to take into account individual households’ circumstances. Where it is appropriate, they may offer help to meet a rent shortfall through the discretionary housing payment scheme.

The question of how people might respond was raised by my noble friend Lord German and the noble Baroness, Lady Hollis, who I congratulate on her speech. She has made a series of excellent speeches. The most up-to-date evidence is the survey by the Housing Futures Network on claimants’ behaviour, which came out recently. It showed a variety of initial reactions. Twenty-five per cent of respondents said that they were quite or very likely to downsize; 50 per cent said that they were unlikely to consider moving; 29 per cent said they would be quite or very likely to move into work or increase their hours; and around 15 per cent said that they were quite or very likely to take in a lodger or offer a spare room to a family member. Therefore, around 65 per cent of the survey’s respondent group are looking to change their behaviour. In the interests of full reporting of that survey, I should add that 35 per cent said that they were quite or very likely to run into arrears. Clearly, over the next couple of years we will look at putting strategies in place to make sure that that does not happen.

The second part of the amendment would provide an exemption from the size criterion measure for those living in significantly adapted accommodation. I appreciate that within this amendment there is acknowledgment of the need to draw a line somewhere and not just exempt all claimants in any form of adapted accommodation. I have noted the different views put forward in this Committee on how we might begin to do that.

The noble Baroness, Lady Lister, raised the question of disabled children. We are looking at ways to limit the impact on disabled children effectively and in an affordable way. I am sure she will understand that I do not want to comment today on the specifics of that, but I can assure her that very active consideration is going on. I should add the reminder that over this SR period we are already spending a lot of money—a total of £190 million, of which £130 million is for discretionary housing payments.

Since the measure was debated in the other House in May—I think the noble Baroness, Lady Hayter, was right about that—we have looked in detail at the possibility of an exemption for a tightly drawn group living in adapted accommodation. The work that we have undertaken to look at this in detail, in conjunction with various stakeholders, has revealed that such an approach is complex and has drawbacks. The issues that have been highlighted are finely balanced, so I should like to take a little more time to deal with them. My department is working closely with officials from the DCLG. We are continuing to talk to stakeholders as we do so. I hope to return to this matter when we debate Clause 68, and certainly by the time we get to Report if that is too tight.

My response to the question of my noble friend Lord German on the evaluation of the reforms is that we intend to undertake independent monitoring and evaluation to assess the impact of this set of measures and the changes in the social rented sector, and we expect the research to be undertaken over a two-year period, 2013-14, with preparatory work starting in 2012-30.

With that in mind and the assurances I have given more generally, I ask the noble Baroness to withdraw her amendment.