Housing Benefit (Abolition of Social Sector Size Criteria)

Geraint Davies Excerpts

Wednesday 17th December 2014 Commons Chamber

[Geraint Davies (Swansea West) (Lab/Co-op)]

Given the predictability of this and the absence of small houses to move to, is it not obvious that the objective was simply to tax the poor for being poor? It has nothing to do with moving to smaller houses; it is about punishing people who are poor because of the bankers’ errors. There is no other rationale.

[Rachel Reeves]

I thank my hon. Friend for that intervention.

This afternoon the amendment signed by the Deputy Prime Minister aims to remove our call on the Government to abolish the bedroom tax immediately, and instead merely “notes” that the Liberal Democrats have come up with some “proposals” to change the way the bedroom tax is implemented. We would not be supporting the amendment, because “noting” the latest Liberal Democrat “proposals” is not going to pay anyone’s rent or keep anyone in their home. What matters in this House is how Members vote, how they use the power entrusted to them by their constituents. What we on the Opposition side and people watching the debate will “note” is where Members took their stand when they had an opportunity to make a difference.

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[Mr Harper]

My right hon. Friend, who is very familiar with this policy area, is absolutely right. We have put in place clear policies for disabled children. As in the case highlighted by the shadow Secretary of State, discretionary housing payments have been put in place specifically for cases that are complex and cannot be dealt with under the rules. Ample protection is in place for the families who need it.

There is no clearer illustration of Labour’s reckless lack of control than housing benefit. Under the previous Government, housing benefit spending increased by nearly 50% in real terms, from £16 billion to £23 billion. If we had not reformed it, spending would have risen to more than £26 billion this year. We have brought that figure down by £2 billion, and last year saw the first real-terms fall in housing benefit for a decade.

[Geraint Davies]

rose—

[Mr Harper]

That is something to welcome, and I am sure the hon. Gentleman will do so.

[Geraint Davies]

I will respond to that point. Does the Minister accept that 70% of the doubling of housing benefit in the past 10 years has been due to rent rises? The strategic solution should not be to inflate rents and housing costs, but to build more houses, which is the opposite of what he is doing. He will end up with housing benefit costs that are higher, not lower, because of his incompetence.

[Mr Harper]

With the greatest respect, the period during which the housing benefit bill rose so fast, as the hon. Gentleman has just said, was of course when his party was in government. He is quite right about the need to build more houses, but housing starts fell to a historical low under Labour. We have actually increased the building of new homes. Nearly 500,000 homes have been built since 2010, and a further 275,000 affordable homes will be built from 2015 to 2020. More affordable homes are planned over the next Parliament than in any equivalent period in the past 20 years. The point he makes is right, but this Government have absolutely dealt with it. Overall, the changes we have made to housing benefit will save £6 billion during this Parliament.

The removal of the spare room subsidy is a key part of the reforms. Despite some outlandish claims about its effect, it is working. In the interim evaluation, half of those affected and unemployed had looked for a job, and one in five of them intended to plan to earn more. It was alleged that the change would move people into poverty. In fact, the figures show that thousands of those affected have moved into work.

Despite the Opposition’s scaremongering about evictions and arrears, the evidence has been to the contrary. The latest statistics show—[Interruption.] If we are to have a sensible debate about such matters, it would help if people did not make outlandish claims. I listened very carefully to the intervention by the hon. Member for Westminster North (Ms Buck). It is worth remembering that, when we discussed the benefit cap, she said that huge damage would be done to the 400,000-plus working households in private rented accommodation. However, we know from work that we published this week that 41% of people affected by the benefit cap are more likely to go into work. People are doing more to find work, and the policy has actually been very successful. In London, where the highest number of people are subject to the benefit cap, very few people have actually moved, and those who have moved have not moved great distances.

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[Geraint Davies (Swansea West) (Lab/Co-op)]

It is a great pleasure to follow my hon. Friend the Member for Blaydon (Mr Anderson). He is completely right: our party stands for a strong economy and a fair society, while the Conservatives have overseen a complete economic catastrophe, with the amount of debt escalating to 80% of the economy now.

[David Morris (Morecambe and Lunesdale) (Con)]

Does the hon. Gentleman agree that he and his colleagues have collective amnesia about what happened during 13 years of Labour Governments?

[Geraint Davies]

Share of debt has gone to 80% from 55%, the Conservative-led Government have now borrowed more in four years than we did in 13 years, and the economy is flatlining when it had grown by 40%. Their economic incompetence and the bankers’ errors are being borne on the shoulders of the most vulnerable, the most needy and, in the views of the Tories, the people least likely to vote. This is completely cynical and disastrous, in particular in poorer areas such as Wales.

In Wales, 46% of tenants are affected, versus 31% in the rest of the UK. Some 60% of people who have been inspected since a year last April are now driven into arrears, so the council has got less money still for repair and renewal. We have a situation where money has been spent on disability changes for flats and houses and those need to be decommissioned. The whole thing is horrendous.

The reason, allegedly, is twofold. One reason is housing benefit escalation, which has doubled in 10 years, but 70% of that is because of private rents going up. We need more homes. We do not need the Government, as they are doing, to use the funding for lending scheme through the Bank of England to spend more and more money on mortgages, to inflate the price of existing houses rather than building new ones. The money to small business is cut by 40% so wages, productivity and innovation do not grow. This is an horrendous, cynical and incompetent business and social experiment that is going disastrously wrong.

According to the House of Commons Library, the level of under-occupancy in the social sector is 10.2% versus 15.7% in the private rented sector and 49% in the owner-occupied sector. It is being said that people in social housing should not have homes. The reason why that rate is so low, of course, is that we build two-bedroom or three-bedroom houses and then the kids grow up and there is a part-empty home for them to be able to come back and see mum and dad or whoever. Then people die and those houses are recirculated. That is why that housing is efficiently used. In the owner-occupied sector that does not happen, of course, but the Conservatives do not care about these people on estates who need stable communities to build stable futures and jobs, and security for all of us. The whole thing is a complete disgrace.

We know that two thirds of the people affected are disabled. The Government are pretending that everything they are doing is right, but in fact they are hitting people in many different ways. For example, a couple with two children in which the woman is earning £10,000 and the man is earning £25,000 will now be losing £9,417 unless they separate. The Government have set in train incentives for families to break up as well as stripping them bare of their money.

The bedroom tax is one of the most horrendous examples of the Tories ripping the food out of the mouths of the poorest to the extent that, at Christmas time, they have to go to food banks. In Swansea, we are really being hit. The amount of money going to public servants has been frozen and the amount going into the public sector is going down. The amount of money in the local economy has been massively reduced. On the benefits side, tax credits for people on low wages are being cut, as is housing benefit. We are seeing desperate people being driven into the hands of loan sharks and having to use food banks.

This new Dickensian society that the Tories have created must be ended, and I hope that we will soon see the advent of a new, stronger Labour Government who will deliver a strong, united Britain in place of the weak, divided future that the Tories are heralding.