Fit for Work Scheme
Lord Young of Cookham Excerpts(8 years, 1 month ago)
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Lord Young of Cookham (Con)
My Lords, as this is now last business, the time limit has been extended to 90 minutes and the limit on individual speeches to 10 minutes.
Lord Luce (CB)
My Lords, I am most grateful to the Minister for replying to this debate and to all noble Lords who will be offering their distinctive contributions. In July 2010 I led a short debate asking the Government what was being done to provide access to multidisciplinary pain management services in the NHS for those suffering chronic pain. Since then, the work of the Chronic Pain Policy Coalition and other specialist bodies has ensured progress, but it has been too slow.
I have suffered from chronic pain, caused by musculoskeletal problems, for more than 45 years. Thanks to prompt and effective support from private sector specialists in partnership with NHS doctors, I have been fortunate enough to be able to perform a wide variety of public responsibilities. Many people with chronic pain do not have the same opportunity to find effective support to keep them in work. I want all who suffer to have sufficient support to enable them to stay in or return to work after absence through sickness.
The latest available research, published by the British Medical Journal, estimates that 8 million adults are living with chronic pain serious enough to prevent them from working or participating in normal everyday life. Moreover, the research estimated that over 40% of the population suffer chronic pain at some stage in their working lives which will affect their ability to work. This evidence makes it clear that it is not only the individual who suffers but society as a whole.
Society needs the maximum number of productive years from as many people as possible. The ratio of earners and wealth generators to dependants—children, pensioners, the unemployed—should be as high as possible, because those not working depend on those who are. Fortunately, people are living longer and retirement age is becoming more elastic. Individuals can contribute to the labour force for longer, so long as they are sufficiently well, mentally and physically, to work. I therefore welcome the Secretary of State’s recent letter to me confirming that a Green Paper will be published before Christmas to consult on ways to ensure that government support meets the needs of people with health conditions in the workplace, and their employers.
It is shocking that the employment rate for adults with long-term conditions that affect their daily lives is only 46%, compared with 73% for the whole working-age population. The major long-term conditions include pain, musculoskeletal problems, stress and anxiety. Two major policy initiatives since 2008 have been the fit note and the Fit for Work service. Both are intended to enable sick individuals to return to work as soon as possible, with appropriate support. Early intervention is crucial to prevent a slide towards the benefits system. I know that the Minister is strongly committed to the Fit for Work service. I am giving him an opportunity to explain how it is developing and can be helped to succeed. Its effectiveness is something noble Lords will wish to probe.
Let me look briefly at the evolving history of sickness absence and its effect on society. In 2010, after 50 years of the sickness absence system, the Government replaced the sick note with a fit note. This was based on Dame Carol Black’s report, Working for a Healthier Tomorrow. This note enabled GPs to focus for the first time on a patient’s capacity to return to work, rather than their incapacity and the frequently repeated description “sick”.
In 2011 came the publication of another report, Health at Work—An Independent Review of Sickness Absence, by Dame Carol Black and Mr David Frost. In 2013, the Government accepted their main recommendations: to establish a health and work advisory assessment unit and to introduce a Fit for Work service—government funded and designed to help workers with ill health. It includes an occupational health work-focused assessment for employees who are off sick, or likely to be so, for four weeks or more and an advice service for employees, employers and GPs. It is now fully rolled out so that GPs and employers throughout Britain can refer patients or employees to it. This service has the potential to fill a massive gap in current provision.
I want to take this opportunity to highlight my belief that this early intervention scheme is needed. Its success could bring enormous benefit to society, and some statistics will illustrate the point. Overall, working-age ill health costs the economy more than £100 billion, including lost productivity, sickness absence and other costs. The latest figure available on chronic back pain, from 2000, shows that it cost the economy £10 billion; it will therefore be far higher now. We also know that 900,000 people are absent through sickness for four weeks or more each year and that more than 25% of the working population have a long-term condition or impairment, particularly in the 40 to 55 age group. We know that more people want to work past pension age, which will inevitably mean many more with long-term health conditions at work. Chairing recently two Westminster Employment Forum seminars on this subject, my attention has also been drawn to something called presenteeism, where a large number of employees are not working to full capacity due to their lack of health and well-being.
All this means that society suffers. Employers face a loss of productivity; the nation spends considerable sums of taxpayers’ money; and last but most important, the quality of life of many individuals is seriously undermined. Being out of work jeopardises any individual’s self-esteem and morale. So I ask the Minister: what is working well, and how can the service made more effective?
A number of questions arise. GPs and other health professionals seem to lack awareness of this service, so is it publicised enough? Do GPs realise that their workload will be reduced by referring more patients to the occupational health service? Is there enough face-to-face contact for employees, in addition to the initial telephone advisory service? Do employees know that they can get help after four weeks off work by asking their GP or employer for a referral?
There are some successful examples of large companies helping affected employees. BT has helped some 30,000 people in the last eight years. I have heard that Anglian Water has achieved a return of £3 for every £1 spent in helping an employee and the Royal Mail a return of £5 for every £1, cutting absence by 25% over three years. But the Fit for Work service was intended to make occupational health advice available nationwide. This is difficult when, as I am told, there are only some 4,000 occupational health professionals, compared to more than 45,000 GPs and physiotherapists. What number of specialists are needed to provide a nationwide Fit for Work service? It would be helpful if the Minister could say something about progress on these matters, especially how the service is currently supporting small and medium-sized enterprises, which are less likely to be able to employ their own health specialists.
A major question arises: how well equipped is the NHS to give adequate professional support for those with long-term illnesses? I can speak only about chronic pain and musculoskeletal issues, while other noble Lords can no doubt speak of other areas. Patients with chronic pain need to learn how to manage their pain and to know to what medical support they can turn—which may include physiotherapists, osteopaths, acupuncturists, psychologists and so on. A wide range of things can be done to keep us active and positive but many areas have inadequate or no multidisciplinary support for chronic pain. There is still a long way to go.
However, given an effective Fit for Work scheme, most suffering employees can be helped to stay in or return to work. Everyone stands to benefit: the individual, the employer and the nation. I congratulate the Minister on introducing this scheme. Would he be prepared for me to bring a small team from the Chronic Pain Policy Coalition and other interested Peers to discuss this scheme in more detail with him and, if possible, with Department of Health officials? I look forward to the Minister’s response.
Life Chances Strategy
Lord Young of Cookham Excerpts(8 years, 6 months ago)
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Lord Young of Cookham (Con)
My Lords, I join others in commending my noble friend Lord Farmer on the introductory speech he made at the beginning of the debate and for drawing attention to the Prime Minister’s 11 January speech on life chances. The speech would have got more attention at the time had it not coincided with the sad death of David Bowie. Re-reading it last night, it struck me as a significant speech, rich in content—and it reminded me of the David Cameron who campaigned more than 10 years ago to become the leader of my party and then to reposition it in its one nation tradition and champion social reform.
The speech showed that he wants to be remembered not as the Prime Minister who kept Scotland in the UK or indeed keeps the UK in the European Union, but as a Conservative Prime Minister as committed to lasting social reform as the Thatcher Government were committed to lasting economic reform. As my noble friend Lady Jenkin said, in summary the speech was about ensuring that children who are born into poorer and sometimes chaotic households have the same life chances as those who are born to more able and better-educated parents. They should be able to advance themselves despite the start they got in life. Parts of the speech echo some of the other speeches the Prime Minister made at the time about general well-being being more important than GDP.
I have no idea what is in the Queen’s Speech next week or what is in the Government’s future programme, but I suspect that the Prime Minister will want to follow up on that speech with measures to take forward the agenda it contains, including measures on prison reform and mental health care reform as well as some of the other subjects mentioned by noble Lords in this debate, including apprenticeships, which were mentioned by my noble friend Lord Hodgson. We also need measures to promote the soft skills that accelerate social mobility. Privately educated children do well not just because of better exam results or social connections but because they have the confidence and social skills that enable them to succeed at a top university or in a professional environment. Part of the agenda also needs to be a new mentoring scheme, better careers advice and a much more accessible programme of work experience.
I want to focus briefly on the housing section of the Prime Minister’s speech. The social divisions that are sometimes caused by tenants on local authority estates being in one part of a town and owner-occupiers on private estates in another part have been eroded to some extent by the right to buy and by Section 106 pepper-potting social housing in newly developed housing estates—but much more needs to be done. The speech refers to how housing estates, especially those built after the war, entrench poverty because they isolate and entrap so many families and communities. The speech says that they design crime in rather than out, leading to ghettos, gangs and anti-social behaviour, and thus to social segregation. The plan goes on to state that it wants to transform 100 housing estates across the country. It is a great idea, but a word of caution: we need to get the Treasury on side because transforming those estates is not cheap.
Some noble Lords may remember the housing action trusts of the 1990s, which provide a template for this transformation. There was a particularly successful one in Birmingham. So supportive of that trust was the local Labour MP that when he joined your Lordships’ House he gave himself the title of Lord Corbett of Castle Vale, which was the name of the housing action trust in his constituency. There were similar trusts in Liverpool, Hull, Waltham Forest, Brent and Tower Hamlets. They were preceded by a ballot of tenants to secure their assent to the transfer to a trust run by the local authority, the tenants association and the private sector. The tenants were key partners in the redesign of the estate, and training and employment were built into the transformation. At the end the estate could either go back to the local authority or it could set up a housing association to run itself. Guarantees were given on rents and obviously on rehousing, and there was mixed tenure.
Those trusts were a great success. Some of the people who ran them are still around and I hope they might be engaged. As I said, the only people who did not like it were in the Treasury. I hope that when my noble friend replies to the debate she can give us an assurance that the housing section of that speech will be taken forward by the Government with energy and with vision.
Welfare Reform and Work Bill
Lord Young of Cookham Excerpts(8 years, 9 months ago)
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Baroness Manzoor (LD)
I start by thanking the noble Lord, Lord Low, for his leadership and commitment to this issue, and other noble Lords who have also given their wholehearted commitment. This is a fundamental and important issue, not only to Members of this House, but to the most vulnerable in our society. I thank the Minister for the three concessions he has offered. These are real, substantive changes to the operation of ESA, and the wider system of support for disabled people, which will have a positive impact on the lives of some sick or disabled people. I am particularly pleased by the decision to end the 52-week rule, allowing those who are able to do so to stay close to the job market by working part-time. This is really important. This is a positive change to bring things in line with the system that will be in place under universal credit, and it is to be strongly welcomed.
I am also pleased by the decision to increase funding for the flexible support fund by £15 million to help those who are struggling to stay in work while managing a sickness or disability with whatever will make that task a little easier for them. However, I hope the Minister can look at ensuring that those who may benefit from the fund are aware of it. As we all know, with many of these kinds of funds the difference between availability and awareness can be significant in their success.
Finally, the commitment to ensure that those with degenerative conditions are able to move quickly into the support group if and when their condition worsens is important, although I hope the Minister will be able to give the House some details now of how this may operate. I also hope that he will commit to providing further updates to the House as details of this mechanism become clearer so that we may help to ensure that it operates in a way that is most beneficial to those who may need to call upon it.
It is to his credit that the Minister, despite not needing to do so, has fought for further concessions and I applaud him for it. These concessions will and could benefit many sick and disabled people, regardless of the cut to ESA being imposed by the Bill. But, as he well knows, no matter how hard fought, the concessions he has secured are merely tinkering around the edges. I do not believe for a minute that the Minister really thinks that the cut to ESA WRAG is a sensible measure or that it will somehow, as the Government have claimed, incentivise people to get better and into work more quickly. Some 50% of those likely to be affected by this cut suffer from mental health conditions. These are people living with depression and other conditions that make it hard for them to get through the day. The idea that pushing them closer to financial hardship, making it harder for them to afford their rent or feed their children, is going to help them in any way is, frankly, ridiculous. The fact is that for some, the risks of this added pressure could be severe.
If I could, I would seek to strike these measures out of the Bill again but, as we know, the Commons has spoken and the constraints of financial privilege have been put upon us. So we are left with the amendment to the Motion in the name of the noble Lord, Lord Low. This is a good amendment. It is not aiming to wreck the Bill, it is simply asking the Government to do one simple thing: to prove their case. The Government have said that this cut will help incentivise people to return to work. If that is the case, they should prove it. The Government say that this will have a limited impact on people’s physical and mental health. If they truly believe that, the noble Lord’s amendment gives them the chance to prove it. The Government say that sick and disabled people do not need that £30 extra a week. If that is the case, they should prove it.
When experts and NGOs from across the spectrum are saying the case is flawed, the least the Government can do is to present their evidence to prove their case before they implement the changes. That is what the noble Lord’s amendment does and that is why I and my Lib Dem colleagues strongly support it. Surely that is the bare minimum needed in the interests of good lawmaking.
The reason this cut has to happen is because of the need to meet an arbitrary spending target to completely abolish public sector borrowing set down by the Chancellor. The job of balancing the books can be done without this or other welfare cuts. These cuts are a choice, not an obligation. People deserve to know that they are happening because the Chancellor has made the calculation that it is better to look tough on spending and welfare by hitting those who are the most vulnerable than to accept, perhaps, that he has made a misjudgement about the economy.
I support the amendment of the noble Lord, Lord Low, not just because I believe that it is vital in ensuring that these cuts to ESA will proceed only if the claims by the Government about their impact can be proven but because those affected deserve some transparency—some honesty—from the Government. The Treasury must not hide behind good and honourable Ministers such as the noble Lord, Lord Freud, while doing immeasurable damage to some of the most vulnerable in our society.
Lord Young of Cookham (Con)
My Lords, perhaps I may respond briefly to the points that we have heard in the last three speeches, which I listened to with great interest and respect. The points fall into two categories: one is on the substantive issues about the benefit changes; the other is the argument about the procedural changes mentioned in the amendment.
On the substantive changes about whether ESA claimants in the WRAG should have their benefits realigned with those on JSA, with comparable changes to those on universal credit, the reality is that these changes have been debated extensively by both Houses. They were debated most recently last Tuesday in the other place, where after a three-hour debate the House of Commons insisted with a majority of 27—above the Government’s national majority—that the changes which we made should be resisted. The time has come to recognise, as I think the noble Baroness has just indicated, that we should respect the view of the Commons on this.
The noble Lord, Lord Low, said that the Government lost the argument but won the vote. Whether one has won the argument is a subjective decision and I happen to take a different view. Whether one won the vote is not a subjective decision, and that is the basis on which we should proceed. I hope that those who have expressed anxieties have been reassured by what my noble friend Lord Freud said in introducing this debate. There is the increase of £15 million for the flexible support fund, aimed at those with limited capabilities for work and enabling them to attend job interviews and training courses. I hope that that reassurance and the extra resources will allay some of the concerns that have been expressed.
Amendments 8B and 9B seem, briefly, to be going in exactly the opposite direction to that in which the House wanted to go in the context of the debate on my noble friend Lord Strathclyde’s report where, by and large, we wanted more done in primary legislation and less in statutory instruments. In that debate, I urged the Government to set the tone for constructive discussion by not using SIs where primary legislation is more appropriate. These amendments go in precisely the opposite direction to what I think the majority of the House wanted by putting the substantive change not in the primary legislation but in the statutory instrument. That would deny the opportunity for a conversation, which the House has always preferred, because the SI would not allow that. In effect, the amendment would give the House of Lords a veto over this part of the legislation, which the House of Commons has approved, and we would be back in the same territory as we were last October. I, for one, do not want to be back in that debate again and I hope, for those reasons, that the amendment will be resisted.
Baroness Lister of Burtersett (Lab)
My Lords, I strongly support the amendment in the name of the noble Lord, Lord Low of Dalston. He has made a strong case today, as he and other colleagues have made consistently, yet the Government continue simply to repeat that the original clauses will improve work incentives and somehow provide more support for disabled people moving into work, without any convincing evidence. Indeed, in the Commons the Minister fell back on the assertion that the Government strongly believe that this is the right thing to do. However, she did not even convince all her own Back-Benchers. As the noble Lord, Lord Low, said, a number of them had grave reservations about steaming ahead without the kind of evidence that is being sought, never mind the reservations and concerns of the wider constituency of disabled people and disability organisations.
However, the main point I want to make is the one that I and the noble Baronesses, Lady Grey-Thompson and Lady Thomas of Winchester, made on Report, which was brought to our attention by Sue Royston. Because the limited capacity for work element acts, in effect, as a gateway to the extra £30 in universal credit to cover the additional cost for disabled people in work, abolition means significant future losses for the very group the Government say they want to support. When the three of us made the point on Report, the Minister did not provide any substantive response. I did not receive the letter until just now, so it is possible that I have not read it properly. I have a horrible feeling that it might be languishing in my junk email folder, because a number of previous letters from the Minister finally turned up in that folder—I do not know what my email knows.
Welfare Reform and Work Bill
Lord Young of Cookham Excerpts(8 years, 10 months ago)
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Baroness Sherlock (Lab)
My Lords, I rise to move Amendments 46E and 46F in my name and that of my noble friend Lord McKenzie of Luton. In doing so, I remind the House of my declared interest as a senior independent director of the Financial Ombudsman Service in case it should prove relevant to the debate.
I will not go back over the substance of the matter, as we discussed it in some detail in Committee. However, I want to push two points that I did not feel, in the end, were satisfactorily addressed by the government response. Amendment 46F seeks to retain the SMI grant scheme for claimants who are in receipt of pension credit; in other words, our poorest pensioners. In Committee, I dubbed this the reverse Salisbury-Addison amendment, reminding the House that we were helping the Government to maintain their manifesto commitment to protect all pensioner benefits, since that is, in fact, who this is mainly aimed at. My concern is that the effect of this policy is essentially to wipe out what is usually the only asset of poor pensioners, and currently their safety net in case they need equity released for care or other emergencies. As I reported last time, Age UK expressed a concern that older people would be reluctant to take on extra debt, so whereas they might have taken a grant, they will not take out loans. They may indeed compromise their own well-being by limiting essential spending instead. I do not think the Minister addressed that, so I would be grateful if he would.
I also asked a number of other specific questions. I had answers to some at the time, and answers to others in writing later. Sometimes the answers in writing were not the same as those given in Committee, but we will come on to that in a moment. I just want to deal with a couple that are left.
I raised the issue of people who die without enough equity in the house to meet the debt and who might worry that it would not leave them with enough money to pay for their funeral. I had hoped to persuade the Minister to leave a cushion untouched, but he was not having it. His response was that the family could apply for a grant, a funeral payment, from the Social Fund. So will all SMI loan recipients be automatically entitled to access a funeral payment from the Social Fund? If so, how much is it? Will it be enough to cover the fast-rising costs of a funeral all around the country?
I also asked if the loss of SMI would result in someone no longer being entitled to pension credit and thereby losing access to passported benefits such as cold weather payments, help with health costs or access to funeral payments. After a series of questions, supported by the right reverend Prelate of Durham, about the advice that would be offered to people, and having reread the record and read the letter that was given, I wish to tell the Minister what I think has been said and he can correct me if I am wrong. I understood him to say that people will get generalised guidance rather than advice about their own particular circumstances and what they should do. Is that right? I gather that the claimant may have to pay for the advice. Is that right?
During the debate the Minister assured me that the provision of advice would be independent of the party recovering the debt. He assured me that that was the case but then wrote to me afterwards and said that in fact it was not the case. I assume that he did not change his mind but that he misread his brief. Either way, can he reassure the House about that because it seems to be a potential conflict of interest? If someone who is advising a pensioner to take out a loan is also making money out of the recovery of that debt, is that not a conflict of interest? If not, how not? I asked him whether a face-to-face option would be available, at least for vulnerable clients. Can he tell me that?
Amendment 46E would require regulations for the scheme to be introduced by the affirmative procedure. The House will recall that the Delegated Powers and Regulatory Reform Committee expressed significant concern about the fact that the draft regulations for the SMI loan scheme had not been made available to the House for debate, given the plan that the scheme be set up by negative regulation. Effectively, the Bill abolishes the grant scheme and empowers Ministers to create a loan scheme but there are no draft regulations before us. Under the proposals they would be introduced under the negative procedure. The committee therefore recommended that regulations under this clause should be subject to the affirmative procedure. It is usual practice that such a recommendation would be followed. Can the Minister confirm that this will happen? If for some reason he cannot, can he tell the House when the Government last refused such a recommendation from the DPRRC? I beg to move
Lord Young of Cookham (Con)
My Lords, we briefly went round this course in Committee. The noble Baroness has raised a number of points to which the Minister will want to respond. However, I am not sure that she made a forceful argument for her Amendment 46F, which seeks to exempt a group of people from this new provision.
Looking at the Bill as a whole, this seems the least painful way of reducing public expenditure, and the argument for looking to this clause for savings is not as strong as the case that could be made in other parts of the Bill. The Opposition recognised this because, in their amendment to the Bill on Second Reading in another place, they specifically said that loans for mortgage interest were a necessary change to the welfare system. So the principle of switching from grants to loans was conceded by the opposition party in another place.
The operation of what is proposed makes no difference to the pensioner at all—the money will simply be paid from the department to the lender—and the impact on the standard of living and the income of the pensioner is wholly unaffected; their day-to-day income is unchanged. The Government’s proposal is that they will continue to get exactly the same level of support as they do at the moment. The fact that the loan may eventually be recovered from their estate has minimal bearing on their financial position, although of course their heirs may take a slightly different view. One has to balance the expectations of the heirs against the taxpayer, who at the moment is footing the bill. Given the imperative to reduce welfare expenditure, it seems to me that this is one of the least objectionable ways of doing it, and I very much hope that the amendment will not be pressed to a Division.
Lord Ramsbotham (CB)
My Lords, in speaking to my Amendment 52, I do so very much in context rather than proposing it. I thank the Minister, first, for seeing me before Christmas on this and other issues and, secondly, for his very welcome letter this morning. At the same time, I salute my noble friend Lord Best for his mastery and tireless pursuit of social housing issues.
I am very glad that this moratorium has been imposed and I sincerely hope that the Minister will encourage urgent consultation with organisations such as the almshouses and the YMCA, which he mentioned in his letter, and which I would have mentioned if the amendment had been going forward as normal. What was unfortunate about the way that the Bill was proposed was that it led to unintended consequences, which I think officials would do very well to consider in the consultation, in which they will hear from the YMCA, the almshouses and others about what would have been the effect if these proposals had been allowed to go forward.
Lord Young of Cookham
My Lords, from these Benches I join other noble Lords in commending the negotiating skills of the noble Lord, Lord Best. As a former Housing Minister, I know what a plausible advocate he can be on behalf of those in social housing. I also commend my noble friend the Minister for listening to the case made by both sides in this House a few weeks ago.
The only clarification I seek from my noble friend is in relation to Amendment 51, which says:
“Section 21 does not apply to social housing which meets the definition of supported housing”.
I wonder if my noble friend can confirm that it will be absolutely clear, if we go ahead with this amendment or something similar to it, exactly which housing schemes will benefit from the exemption and which will fall outside, and, related to that, how the good news he is about to announce will be communicated to those associations or organisations which run operations that will qualify under Amendment 51 and indeed some of the other related amendments.
Baroness Warwick of Undercliffe (Lab)
My Lords, I declare an interest as the chair of the National Housing Federation. I speak in favour of Amendment 51, which seeks to protect schemes that house some of the most vulnerable people in the country from a damaging cut to their rents.
In answer to a question from me on Monday on the associated issue of the local housing allowance cap, the noble Lord, Lord Freud, referred to a review of the supported housing sector. That review was referred to again today in another place. Indeed, much has been said today in another place on both rent cuts and the LHA cap. It is only right that we fairly consider what has been said in another place and factor that into our discussions here. Referring to the review, the Government said that it would report urgently by the end of March. In addition, we have heard of a one-year delay in the implementation of the 1% rent cut for supported housing. This extra year’s delay is welcome, since it means that incomes will not be reduced as much as feared. Unfortunately, that is only at the margins when measured against the impact of the LHA cap on supported housing as announced in the spending review. This will have a much more significant and lasting impact, and is a threat to the very existence of much supported housing.
The National Housing Federation has been pressing the Government to urgently clarify that the LHA will apply only to working-age tenants in general needs accommodation. The Government have not done so. A survey of NHF members showed that this lack of certainty will result in 156,000 homes becoming unviable and being forced to close—41% of the sector—while 2,400 homes planned for development will now not be built. I find it hard to believe that it can be even remotely possible that it is the Government’s intention to put all this supported housing at risk. The impact on vulnerable people will be acute: on the elderly, people with disabilities, those fleeing domestic violence and those who served our country in the Armed Forces. The knock-on impact on public services in trying to pick up the pieces will be immense. These services desperately need a long-term commitment to safeguard their future.
The Government had the opportunity today in another place to set this right and clarify their intentions. They did not do it. The Government will carry out a review of how supported housing is funded—excellent. But surely the purpose of a review is to think first and only then act. Why create this level of uncertainty leaving housing association boards, which have to take decisions about future provision now, completely blind-sided about whether or when the cap may now be introduced? A one-year delay on the rent cut, welcome though it is, may not make much difference at all on this issue. The uncertainty is having a damaging and dangerous effect now. Tough decisions are being taken already: to close supported housing schemes; not to renew contracts; and to halt development of new schemes because there is not the certainty that they will be affordable in the near future, whether that be in two years or three. Protective redundancy notices are being prepared now. No provider can risk the cost of new building unless they are confident that the rent will cover that cost.
The announcement made by the Government today will do nothing to allay the fears on this issue of housing associations or the people living in these homes. I urge the Minister to think again and announce now that the LHA cap does not apply to supported and sheltered housing. I also urge the Government, through him, to work with the sector to develop a long-term sustainable funding model for supported housing.
Welfare Reform and Work Bill
Lord Young of Cookham Excerpts(8 years, 10 months ago)
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Lord Shipley
My Lords, I hope that the Minister understands the seriousness of this matter. I do not want to repeat what other speakers have said. Suffice it to say that there used to be three sources of funding for supported housing: the Supporting People programme, specific grants, and the income from rent and service charges eligible for housing benefit. Given the deep budget reductions to the first two, it has left income from rent as critical to the financial viability of schemes. That is an important issue to be made clear, because if rents go down, the income inevitably goes down and cannot be replaced from other sources. As we have heard, that 1% annual rent reduction policy will have two consequences for supported housing: a reduction in new building and lower staffing support for schemes, and, indeed, the potential collapse of schemes, given that the management and maintenance costs of supported housing can often be a third higher than the general housing stock.
When I spoke on this matter at Second Reading, I said that there was a danger that if the preventive role of supported housing were reduced, it would push up costs in other parts of the public sector. As the noble Baroness, Lady Blackstone, has pointed out, there is evidence that the rest of the public sector has to pay out more if supported housing is not there to help people. A few years ago, the Homes and Communities Agency reported that there was a substantial net saving for the public sector from investing in specialist housing.
A further consideration is the evidence of the National Housing Federation, which has identified a shortfall of more than 15,000 units in the number of supported housing lettings available each year to people of working age. Furthermore, there is some evidence that the recent rise in rough sleeping is related to the lack of supported housing lettings. So the conclusion is pretty clear. I understand that the cost to the Government in agreeing Amendments 107 and 109 is around £75 million per year—I would be grateful if the Minister could confirm that number. If it is, then surely it is at a level low enough for the Government to accept the cost, because the advantages to the public service outweigh the cost of the £75 million loss.
Lord Young of Cookham (Con)
My Lords, I intervene briefly from these Benches to add my support to Amendment 109 in the name of the noble Lord, Lord Best. When I intervened at Second Reading, I mentioned that I wanted to return to this issue in Committee. Subsequent to that, the noble Lord, Lord Kirkwood, chaired a meeting on the Committee Corridor of a number of organisations which would be directly affected, and they made some very moving presentations about the implications for them if the Bill went through without further amendment. Subsequently, I added my name to the letter referred to by the noble Lord, Lord Best, to the Times, expressing the hope that the Government would smile on this amendment or give the necessary comfort in some other way.
As others have said, the last thing my noble friend wants to do is to precipitate the closure of valuable schemes run by voluntary organisations providing support to vulnerable groups. Indeed, that is why there is a whole clause in the Bill entitled “Exceptions”, and subsection (5) gives powers to the Secretary of State to do basically what he wants to. The exemptions that have been trailed so far by the Government are welcome, but I agree with others that they may not go quite far enough, and I wonder if we can just nudge the Government a little further to give a greater degree of comfort to those running these projects.
Housing: Spare Room Subsidy
Lord Young of Cookham Excerpts(8 years, 11 months ago)
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Lord Freud
This policy is about making sure that people who are living in oversized accommodation take the decision either to downsize or find the funds to run the extra rooms. That is how this policy works, and we can see in this study that people are now making adjustments. There are substantial moves in various areas in terms of downsizing and finding work between the interim report and this final report.
Lord Young of Cookham (Con)
My Lords, is it not in everyone’s interests that there should be a better match between household size on the one hand and the size of houses and flats on the other, to avoid overcrowding and underoccupation? Does the survey not show a fivefold increase in the number of working-age tenants seeking to downsize? Does this not show that the policy is working?
Lord Freud
Yes, we have seen a substantial number of people downsizing—45,000 people have downsized within the social rented sector and another 12,000 have moved into the private rented sector. The number of people who have registered for downsizing is now running at 16%. Noble Lords may remember that when this policy started it was estimated from the surveys that about 20% of people would want to do so. We are well on the way to people making this adjustment. Other people, however, are looking to earn more money and to work. That is one of the factors, but not a major one, in some of the record employment levels we are now seeing.
Welfare Reform and Work Bill
Lord Young of Cookham Excerpts(8 years, 11 months ago)
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Lord Curry of Kirkharle (CB)
My Lords, I shall speak to Amendment 104A. I very much support the intentions of this Bill, but, of course, there are inevitably special cases that would be adversely affected by a change of this magnitude. The Government have been very clear in their intentions for this change, and I commend them for that. What I seek to amend, however, is not the principle of the clause, but its application. More specifically, I seek to amend this clause so that those who are in receipt of disability living allowance, or carer’s allowance and income support, are exempt from this change so that they can continue to receive support for mortgage interest as a benefit, not as a loan.
This clause was initially brought to my attention by a friend who attends my church. This man purchased a house in 2006 and was financially stable and secure. However, two years into his mortgage, he was diagnosed with a detached retina, which rendered him blind. As a consequence, he has had to cease working. He has been entitled to support for mortgage interest, due to being in receipt of disability living allowance, and carer’s allowance, as his wife is now his carer. With the help of SMI, his mortgage would have reached completion in 2030. At this point, he planned to downsize, using the extra equity to pay off other loans accrued since he was diagnosed as blind to equip his house as a result of his disability. However, the implications of the proposed change from interest support to a loan mean that 12 years’ worth of interest and a small capital contribution will need to be repaid. If interest rates stay as they are for the whole period, my friend, on top of his mortgage, will have to pay the Government back £63,000, the sum contributed by SMI as a loan, and £15,000 for the 5% interest on the interest owed each year. As I said earlier, I am in support of the clause in principle, but strongly urge the Government to reassess and reconsider applying the changes to those who are on disability living allowance.
My friend will be for ever incapable of working, and so would never be able to repay the loan. It is not right that such a burden should be placed on him and others like him—he is not unique—who receive disability living allowance. This change could potentially result in my friend losing his house and being forced to move into government housing, which would ultimately cost the taxpayer much more. Have the Government fully assessed the long-term implications of this? Surely, a successful policy is not one that saves money in one area, only for more to be spent elsewhere.
In conclusion, I repeat that I support the aims of Clause 16, but feel that it is entirely inappropriate for those on disability allowance to be treated in the same way as those on jobseeker’s allowance. The assumption is that those on jobseeker’s allowance will eventually get a job and be able to pay their mortgage in full themselves and also to pay back the loan. Those on disability allowance, however, might never be able to pay it back if they are for ever prevented from working. On these grounds, I urge the Government to reconsider the wording of Clause 16 and allow those on disability allowance or carer’s allowance to be exempt from the changes.
Lord Young of Cookham (Con)
My Lords, I listened to most of the debate this evening and have heard the arguments on most of the amendments. Without any discourtesy to those who have proposed these amendments, it seems to me that the case for these are less compelling than the case for some of the amendments that were discussed earlier. There is one fundamental reason for this: what this clause does is basically to convert what is at the moment a grant into a loan. Of itself, it does not affect the quantum of support from taxpayer to recipient: it simply converts the terms. Therefore, to my mind, this is a much less painful way of reducing public expenditure than some of the other measures of the Bill that directly affect the quantum of support from taxpayer to beneficiary. Perhaps it is for that reason that the Opposition’s reasoned amendment to the Bill in the other place said:
“That this House, whilst affirming its belief that … a benefits cap and loans for mortgage interest support are necessary changes to the welfare system”.—[Official Report, Commons, 20/07/15; col. 1264.],
specifically excluding this bit of the Bill from their general reservations. Any measure that reduces the quantum of saving from this particular clause just puts more pressure on some of the other measures in the Bill which directly affect the support that a beneficiary might get.
Turning to the point made by the noble Baroness, Lady Sherlock, in a sense she gave the case away by conceding that 39 weeks was the period for which people had to wait for roughly 10 years under the last Labour Government. If 39 weeks was appropriate when there was not the pressure that we have on public expenditure today, then it is certainly appropriate when we are trying to make necessary savings.
Welfare Reform and Work Bill
Lord Young of Cookham Excerpts(9 years ago)
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Lord Young of Cookham (Con)
My Lords, I have listened for the past six hours to this excellent debate with its high-quality maiden speeches with a growing sense of relief that I am no longer the Government’s Chief Whip, as some serious issues have been raised that will need addressing in Committee. As someone who was a Housing Minister, on and off, for 10 years and who chaired a housing association for seven years, I want to focus my remarks on the two clauses in the Bill that deal with housing, which were welcomed in another place by the Opposition Front Bench.
Looking at the clauses on support for mortgage interest, the Opposition spokesman said:
“We support reforms to mortgage interest support that will strengthen work incentives and deliver savings”.—[Official Report, Commons, 20/7/15; col. 1265.]
Of the rent reductions, which have been controversial in today’s debate, the Opposition spokesman said:
“We want…reductions in social rents that will deliver savings to the taxpayer”.—[Official Report, Commons, 20/7/15; col. 1273.]
So the housing element of the Bill ought to be less controversial than the rest of it.
Dealing first with support for mortgage interest, which was touched on by the noble Baroness, Lady Sherlock, and the noble Lord, Lord MacKenzie, turning a grant into a loan is a sensible way of cutting public expenditure without reducing support to the homeowner who faces difficulties. I will come to the extra waiting period in a moment, but it is difficult to justify the fact that a householder sitting on a substantial chunk of equity gets a grant from the taxpayer, leaving when he dies his estate to his beneficiaries, unencumbered by the help he has had from the taxpayer. It seems sensible to convert that from a grant to a loan, and I think that would be justifiable whether or not one was looking for savings in public expenditure.
There are extra weeks before the entitlement kicks in, but that simply restores the waiting period to what it was before the financial crash in 2009. I understand the concern that this might push up repossessions, which are at an all-time low, but I wonder whether a bank or building society would go through the aggravation of repossession if it knew that in a few weeks’ time it would get, direct from the Government, monthly interest in full on the sum in question. In view of the concern, I wonder if it would make sense for Housing Ministers to have a dialogue with the CML, perhaps to get a memorandum of understanding that repossession would not normally be activated if SMI was about to kick in. Ministers made it clear in another place that:
“We remain committed to helping owner-occupiers in times of need to avoid the risk of repossession”.—[Official Report, Commons, Welfare Reform and Work Bill Committee, 13/10/15; col. 356.]
I think that dialogue might help.
The reduction in social rents is of course welcome news to tenants, and not just those who pay the rent in full. Of course, some of those currently on housing benefit hopefully will float off it in the next four years and therefore benefit from the measure. Those who currently pay their rent will be able to plan, knowing that for the next four years one of the largest items in their budget will go down in cash terms. This is good news for tenants and good news for the DWP, in that it reduces its outgoings not just on housing benefit but presumably on other index-linked benefits as well, as the downward pressure on rents will influence the CPI.
However, as my noble friend will know, this saving is subject to the ONS changing its mind on housing association debt. It decided just a few days ago that, as from next March, housing association debt will score as public expenditure. This means that, far from this measure reducing public expenditure, it will push it up unless between now and next March the Government can make sufficient changes to the housing association regime to convince the ONS that it can be reclassified. Can my noble friend indicate how they are going to ensure that the ONS ruling is reversed? Of course, that was based on measures taken before the rent reduction and the voluntary right to buy was introduced. It is important that any deregulation does not undermine the creditworthiness of the movement.
What is good news for tenants and the DWP is less good news for investment in housing, as many noble Lords have said in this debate. Ever since housing associations were able to borrow from the capital markets, there has been a link between housing associations’ rents and the size of their investment programme. I confess that when I was Housing Minister, much of my capital programme was funded by the DWP through housing benefit, so any reduction in rent affects cash flow and the ability to sustain borrowing, and therefore affects the investment programme.
It is therefore important that any measures in the Bill that reduce the investment programme of housing associations be replaced by other measures in the Housing and Planning Bill, because there are two sides to this coin. If one side of the coin is reduction in rents in this Bill, the other side has to be measures to increase supply to counteract that in the Housing and Planning Bill currently in another place. I understand the points that were made about supported housing and the excellent work done by those who help the homeless, such as St Mungo’s Broadway and other movements. Clause 22(7) enables the Minister to make exceptions, and I am sure we will want to look at this in Committee to see whether we can safeguard the valuable work housing associations do to support vulnerable people.
My final point concerns an issue that has not been raised in this debate. Reducing social rents at a time when market rents continue to rise brings into sharp focus the question of who gets lifetime tenancies at a lower rent from a social landlord, as opposed to the other half of the market, which has to accept short-term tenancies at market rents from landlords who, in some cases, are not as good as local authorities or registered social landlords. Noble Lords with very long memories may recall the Local Government and Housing Act 1989, one of the objectives of which was to influence the level of social rents to market level, with housing benefit taking the strain. The golden age of Nicholas Ridley never actually arrived, for good reasons, but this measure makes a sharp step in the opposite direction, widening the gap between the two sectors. That means that we need to ensure that the stock of social housing is more accurately targeted at those who need it most. That means another look at lifetime tenancies and at measures to encourage mobility through the social housing sector, as families now decently housed find their circumstances have improved and they can make their way into market housing, freeing social housing for those who, like they were, are in desperate housing need at the inception of their tenancies.
This Bill is an important building block in getting public finances under control, but it raises serious issues for those who want to see an increase in housing supply. Those issues need to be developed when the Housing and Planning Bill reaches this House, and I hope to take a part in those proceedings.
Oral Answers to Questions
Lord Young of Cookham Excerpts(9 years, 11 months ago)
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Mr Duncan Smith
The same old rubbish from the Opposition! May I just remind the hon. Lady that this Government have done a huge amount for the poorest? The tax allowance is up to £10,000 by April, saving £825 per year. Under this Government, the national minimum wage has gone up by 3%, more than earnings and more than inflation. There are free school meals for primary school pupils—1.5 million children will be getting them. The cost of living is coming down, too. Food prices are falling, and motor fuel prices are down. The hon. Lady wanted to make this a political issue, but I remind her of what the Archbishop of Canterbury said today: it would be wrong to play political games with such an important issue. Perhaps she should listen more and speak less.
Sir George Young (North West Hampshire) (Con)
T4. Does my right hon. Friend agree that as unemployment continues to fall, we have a golden opportunity to offer work to those with a learning or physical disability? Will he confirm that programmes such as Work Choice and Access to Work and the work of his Department’s disability employment advisers will continue to have top priority, so that we can make yet further progress?
The Minister for Disabled People (Mr Mark Harper)
I completely agree with my right hon. Friend. In fact, the latest labour market statistics show that disabled people are sharing in the jobs that are being created, with more than 258,000 more disabled people in work over the last year, including 75,000 in the south-east, which will cover his constituency, and there are particularly sharp rises in the number of those with learning disabilities getting jobs, which he specifically asked about.
Parliamentary Under-Secretary of State for Welfare Reform (Disabled People)
Lord Young of Cookham Excerpts(10 years ago)
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Sir George Young (North West Hampshire) (Con)
I begin by warmly congratulating the hon. Member for Heywood and Middleton (Liz McInnes) on her maiden speech. We all welcome her first contribution to debates in this Chamber. She spoke with warmth about Jim Dobbin, whom we remember with affection, and she obviously knew him well. She took us on a guided tour of her constituency. She spoke with confidence, humour and insight, and she clearly has a contribution to make, specifically on health matters. I would have visited her constituency during the by-election, but I was otherwise detained in Clacton. We look forward to hearing many future contributions from the hon. Lady.
I believe that this motion is opportunistic and misguided. I do not think that it furthers the interests of those with a disability or the organisations that care for them. The reaction of the audience at “Question Time” the week before last showed a distaste for the political opportunism that we have seen this afternoon. I am genuinely surprised that the Opposition did not learn the lesson from that reaction before they chose the subject of this debate and launched their highly personalised attack on a man who, as we have just heard, has done so much to advance the cause of those who have a disability. If I were charitable, I would say on listening to the mover of the motion, that I do not believe her heart was in it.
Andy McDonald (Middlesbrough) (Lab)
As the father of two disabled children, I found the remarks grossly offensive, as did every member of my family and my community.
Sir George Young
I do not doubt for one moment what the hon. Gentleman has just said, but I have not received one e-mail, one letter or one comment from one of my constituents about those remarks.
Of course there are times when there are policy disagreements on how best to enfranchise those with disabilities, be they physical or learning disabilities, and of course we should always be careful about the language that we use—as the former Prime Minister discovered when he referred to someone as a bigot. However, during the 40 years I have been in the House, I have been struck by the degree of consensus on how best to proceed with policy on disability, and I honestly do not believe that the exchange at the party conference justified the outbreak of partisanship that we have witnessed this afternoon.
Let me pick out two pieces of legislation relating to disabled people. The ground-breaking Chronically Sick and Disabled Persons Act 1970 started as a Private Member’s Bill, promoted by Alf Morris, and reached the statute book with Conservative support just before the 1970 election. Later in the 1970s, one of the first Bills whose Committee stages I attended introduced a non-contributory invalidity pension, which was the first of a new generation of benefits that replaced earnings for those unable to work.The other piece of legislation, which was mentioned earlier by my hon. Friend the Minister of State, is the Disability Discrimination Act 1995, which introduced a new right to non-discrimination in employment and which had all-party support. By and large, the House has made progress, driving forward the agenda, when we have been able to reach a consensus.
The objective that I hope we all share this afternoon was put well by Nicholas Scott in 1992, when he was Minister for Social Security and Disabled People. He said then:
“There is no difference of opinion in the House about the ends that we seek: the integration of disabled people, their independence and their participation in a range of activities, including employment, the securing of proper housing, recreation and sport. Above all, we want them to have control over their own lives.”—[Official Report, 31 January 1992; Vol. 202, c. 1251.]
I think that that is as valid today as it was then.
The thrust of policy under all parties has been to remove the obstacles that prevent someone with a disability from enjoying the same quality of life as someone without that disability. That has involved Government action, including action by my party.
Stephen Lloyd (Eastbourne) (LD)
I strongly support what my right hon. Friend is saying, and the tenor of it. As one who was involved in lobbying for the Disability Discrimination Act outside the House all those years ago, may I ask whether he agrees that a key part of disability empowerment is the Government’s Access to Work scheme? I should add, to be fair, that it was introduced by the then Government. It is very important for every penny that can possibly be invested in access to work to be invested, because it is a route that enables many people with disabilities to be helped into work.
Sir George Young
I agree with my hon. Friend, and in a moment I shall say a little about how more disabled people can be helped into work.
Over the past 40 years, there has been Government intervention to achieve the objectives that I have identified. We have the mobility allowance, which can sometimes be converted into the Motability scheme, and we have the disabled facilities grant. Both parties have used building regulations to make public buildings, in particular, more accessible to people with disabilities.
Let me now deal with the specifics. I shall try to adhere to the six-minute time limit, although it does not apply to me. We all want disabled people to have the sense of fulfilment, independence and comradeship that goes with having a job. My noble Friend Lord Freud was asking a genuine question, namely “How can we intervene in the market to enable everyone to work if some people work at a slower rate than others or need more supervision?” It was a genuine question, and we have not heard an answer to it from the Opposition today.
The debate then moved on to the minimum wage, in respect of which there are a number of exemptions, including one for company directors. During the meeting that took place at the conference, one delegate said that he had got round the minimum wage provision for his daughter by making her a company director, but that is a rather protracted and complex solution, which not everyone can adopt. What my noble Friend was trying to do was establish whether there were other solutions that would enable the same objective to be reached.
There is no dispute about the direction of social policy on those with disabilities, and I am not aware that the Opposition plan to repeal the measures that we have had to introduce in order to contain public expenditure. The speed with which we move in the direction in which we all want to move depends on getting the economy right. As with the national health service, so with support for disability: we need a strong economy if we are to take the agenda forward. No one has a greater interest in the success of the Government’s economic policy than those with a disability.
I think that the motion should be withdrawn, but if it is not withdrawn, it should be defeated, because it is an unwarranted personal attack. No alternative approach to disability has been advocated, and it risks breaking a bipartisan approach to disability that has served those with a disability well for the last 40 years.