Welfare Reform and Work Bill (Second sitting)

Amanda Milling Excerpts

Thursday 10th September 2015 Public Bill Committees

[Hannah Bardell]

Q 9 Do you think it is therefore very important that, if we end up with this in legislation, there are guarantees and stipulations on Government that people do not end up in that position? So many people’s circumstances change and fluctuate.

Paul Broadhead: In the way that mortgage lenders have requirements to assess the affordability of a mortgage loan when someone takes it out, that same mechanism ought to read across to their ability to repay the loan once they are back on their feet. If they can afford it, clearly they ought to be repaying it.

[Amanda Milling (Cannock Chase) (Con)]

Q 10 Welcome. Paul, I want to pick up on a point you raised about advice. Mortgages are complex, as are the legalities around housing. You talked about accessibility and ensuring that we give people channel preferences so that they can get advice. From an industry perspective and knowing this whole area, do you have any other advice in terms of things we need to consider? That question is for either of you.

Paul Smee: When we talk about channels of advice, it will be important that face to face is an option. I think a lot of people would want to receive this in a personal situation, and it will be important to have probably a single body as the focal point for providing that advice, which can then ensure that it is of the required standard and that those giving the advice have been trained appropriately.

Paul Broadhead: The other thing to consider when giving people this advice is whether it is in their best interests to remain in home ownership and wait for the 39 weeks, if that is right. It may well be that if they are in a situation where they cannot get back on their feet, and if they are in an environment where house prices are not rising and their debt is rising, nine months later they may be in a worse situation, having waited for that benefit, than they would be if they faced facts and took active steps to market the property and seek another form of residency. I do not think we should automatically favour remaining in homeownership as absolutely right for that person. They need to know the pros and cons to make an informed choice, because repossession or selling the property is not always the wrong thing for a borrower and their family.

[Jess Phillips]

Q 11 Apologies for being a bit late; I was stuck in the Chamber.

My questions have been largely answered, but I have some real concerns about the advice sections you are talking about. In my experiences of women and domestic violence, their husbands leave and they are left with the mortgage of a property. They have never worked and would find it difficult to get into work.

I am concerned about the advice, but I am also concerned about what detail is not in the Bill. I am confused. It is confusing enough, let alone if you are a vulnerable person in a difficult situation. I wonder if you have some concerns about the detail and whether you will need more detail before you can give firm conclusions about whether this is going to be terrible for the claimants.

Paul Broadhead: Yes, the detail will tell us the exact process—how this will work, who will provide information and all that final detail. That is not here at the moment. We are talking at a bit of a conceptual level, but I think we are generally supportive. Both parties are supportive of moving this to a loan in most cases, but we have concerns about the mechanism for delivering that advice and ensuring that there are not unintended consequences. There is a lot still to be worked out in the secondary legislation.

Paul Smee: We have offered to get down and work closely with DWP Ministers on the detail. We have a lot of experience within the lending community of how to deal with people who are in arrears and how to handle them sympathetically. We will be very keen to work with officials to come up with detailed proposals that work for the industry and for the claimants.