Prevention of Social Housing Fraud Bill

Chris Williamson Excerpts

Friday 13th July 2012 Commons Chamber

[Chris Williamson (Derby North) (Lab)]

I congratulate the hon. Member for Watford (Richard Harrington) on introducing this Bill, which is very timely given the current housing crisis facing the nation. Sub-letting for financial gain prevents people from obtaining a home, and we support the Bill. Its proposals build on the work done by the previous Labour Government, as the hon. Gentleman said, and I pay tribute to my right hon. Friend the Member for Wentworth and Dearne (John Healey), who launched the first ever national crackdown on the fraudulent sub-letting of social housing. Almost 150 councils signed up to that concerted effort, including every London council and every top-tier Labour council that was responsible for its own housing stock. Under that initiative, councils got a share of a Government grant of £4 million, which was established to assist local authorities in developing their own anti-fraud initiatives. Councils and housing associations were also given practical advice on how best to tackle this problem. The initiative made a considerable impact.

Before the last general election, Labour committed to making the unlawful sub-letting of social homes a criminal offence. There have, however, been a number of successful prosecutions in cases where tenancies have been unlawfully sub-let. The Fraud Act 2006 has been used by both Camden and Westminster councils, and the hon. Member for Enfield North (Nick de Bois) said his council had taken action using current legislation as well, but I think explicitly making unlawful sub-letting a criminal offence will assist local authorities to deal with the problem. This Bill will make that a reality. It will assist local authorities to extend the work they are already doing. It will provide them with an additional tool to address the problem, and thereby to make the best use of their existing housing stock.

Notwithstanding the horrendous examples of abuse that Members have outlined in this debate, it is important to put on the record a point that the hon. Member for Watford made in his contribution: the overwhelming majority of council and social housing tenants pay their taxes and play by the rules. It would be very wrong if we were in any way to stigmatise people living in council homes by giving the impression that large numbers of them are abusing the system. There is no evidence that that is the case.

[Richard Harrington]

May I confirm that I fully support the hon. Gentleman’s point? The fraudulent ones are, in effect, an insult to the vast majority of genuine tenants who pay their rents, pay their taxes and are in social housing by right.

[Chris Williamson]

I thank the hon. Gentleman for those comments, and I think we both agree that it is important that we stress the fact that we are talking here about only a small minority of tenants. We must tackle their behaviour, in the interests of fairness and what is right.

The Bill has received cross-party support, and support from housing professional organisations and pressure groups, including the Chartered Institute of Housing, the National Housing Federation and the Local Government Association. The LGA posed a number of questions in a briefing note, to which I am sure all hon. Members will have had access, that could be addressed in Committee. For example, the briefing suggests that restitutionary payments should be made to social landlords where it has been found that a tenancy has been unlawfully sub-let. The LGA also perceives as narrow the definition of who would fall within the terms of the Bill and it seeks a wider one. Perhaps that could be taken into account as the Bill is scrutinised further in Committee.

I do not wish to strike a discordant note, because, as I have said, there is cross-party support for and cross-party sponsorship of the Bill. However, it is important to state that the Bill will not make up for the failure of the Government’s housing record. As the hon. Member for Romsey and Southampton North (Caroline Nokes) rightly said, there is clearly a desperate need for social housing in this country. We need to step up to the plate, but the Government are not doing so at the moment. They will need to do that to address the housing crisis gripping the nation.

There is broad agreement on the fact that we are gripped by the worst housing crisis in a generation. Waiting lists are increasing all the time; I believe the hon. Member for Watford said that there are 4,000 people on the list in his local authority area. We therefore need to do more than is contained in the Bill, although it will make a helpful contribution to tackling the inadequate supply of affordable housing. A renaissance in house building would also have huge benefits for the wider economy in jobs and growth, which are vital to get the economy moving again. We need to get people back into work, and if the Government would only take the measures necessary to increase the supply of new housing, that would provide a benefit by addressing some social needs and helping economically; it would help to generate growth and jobs, which are desperately needed at the moment.

What was extremely unhelpful in dealing with the housing crisis was the fact that the Government decided to make a £4 billion reduction in the funding available for affordable housing, which led to a disastrous collapse of 97% in new social housing starts and a 68% collapse in affordable house building over the past year. Labour Members have warned the Government time and again that their policies would make the housing crisis worse. This Bill will go some way to dealing with the problem, but we need to go much further. Young people, families and elderly people have all been affected by the Government’s disastrous housing policies—that is the only way they can be described. Regrettably, the Minister for Housing and Local Government has refused to listen and has insisted that things are getting better when the evidence demonstrates that they are clearly getting worse—

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. I think that even the shadow Minister may sense that he is going a little wider than what is contained in the Bill, so perhaps he could focus on its contents.

[Chris Williamson]

I am grateful for that, Mr Deputy Speaker, and I will endeavour to abide by your guidance.

The Bill is helpful in dealing with a problem, particularly given that people are often being forced into private sector accommodation because of the inability to find suitable social housing. The hon. Member for Watford and others made the point that forcing people into more expensive and often less suitable accommodation is unhelpful and unfair to individuals in such circumstances. We must therefore take measures such as those contained in the Bill to protect people from rogue landlords and being trapped paying high rents, which make things difficult for them. Even if they aspire to move into an occupation, they cannot do so because the rents are so high that they cannot set aside the money necessary to build up the deposit. It is clear that the Bill will ease the pressure on the housing list if we can release more accommodation through it, but unless more social housing is provided, councils will have to place more people in the private rented sector, including in expensive bed and breakfasts, and that will lead to an increase in the cost to the taxpayer.

Of course, the impact of the Bill will be further undermined by the Government’s decision to reduce the rights of tenants by creating insecure tenancies. As Members will be aware, the Government plan to link rents to market prices, which undermines the very basis of social housing. Although if the Bill finds its way on to the statute book that will be good news, as it will increase the supply of social housing, we must consider the consequences if the rents charged in the social housing sector are so high that it becomes difficult for people to access it at entry level.

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

I am surprised that the hon. Gentleman is going off at that angle. The point is that a small number of people are deliberately playing the system, either making money out of it or trying to hold on to properties. That is what the Bill is trying to deal with, not some of the more general challenges he is talking about in the context of social housing, which we all support. I am quite surprised by his speech.

[Chris Williamson]

The hon. Lady will concede that the hon. Members who have spoken so far have made the point that there is a desperate shortage in social housing and we therefore need to find ways to increase that supply. The need for the Bill is brought into sharp relief by the fact that there is such a dearth of social housing, particularly in certain parts of the country, where the waiting list runs into the thousands. For many people, the prospect of ever obtaining a social housing dwelling is virtually zero. It is therefore important that we set the proposal in its wider context. Members alluded to the suggestion that the Bill would go a long way towards eliminating and eradicating the problem of the insufficient supply of social housing. Clearly, it will not go anywhere near that so we need to take further measures to address the problem faced by millions of people in the country today.

[Sarah Newton]

I do not think that anybody on the Government Benches suggested that at all. The whole purpose of the Bill is to ensure that we make better use of the social housing that already exists. We are all absolutely aware that other measures need to be taken to address the wider issues that the hon. Gentleman is raising, and the Government are taking many of them, but today is not about a general debate on housing. The hon. Gentleman can raise that question in an Opposition day debate during their parliamentary time and it is very disappointing that he is bringing partisan points into something that is, generally speaking, a widely accepted and positive step forward.

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. Before the shadow Minister responds, I should tell him that although he is being masterful in doing so, he is straying into a wider debate on housing. I ask him to focus his attention on the contents of the Bill.

[Chris Williamson]

Thank you, Mr Deputy Speaker. I am bringing my remarks to a conclusion in any event. I am grateful to the hon. Member for Truro and Falmouth (Sarah Newton) for her intervention. I am sorry that she feels that I am striking a partisan note; all of us acknowledge, as she did in her intervention, that there is a much wider issue that needs to be addressed. I hope that we can get cross-party consensus on the importance of housing, and of ensuring that the Bill is just one of a number of measures that helps us to deal with the problems that confront far too many people in society.

We certainly welcome the Bill, but the Government must do better. Ministers should take steps to boost the number of new social homes, and abandon their proposals to abolish secure tenancies and to kick tenants out of their homes when they get a promotion or pay rise. They should make affordable housing genuinely affordable again, rather than proposing to link social housing rents to 80% of market rents. The problem with that proposal is that it will undermine the basis of the Bill; if rents are 80% of market rents, it will be a pyrrhic victory in some ways, because people moving into the dwellings will not be able to afford to go to work. We need to make work pay; that is an important goal, as all of us on both sides of the Chamber would agree.

We certainly welcome the general thrust of the Bill. I hope that the Government will support it, but go a lot further, and listen not just to Opposition Members but people right across the housing world. Our country faces a massive housing crisis. The Bill will act as a mere sticking plaster on the problem unless the Government step up to the plate, do better, ensure that we build the houses that people need, and ensure that the Bill has a much more meaningful impact on the availability of social housing in our society.