Benefits Uprating (2013-14)

Glenda Jackson Excerpts

Thursday 6th December 2012 Commons Chamber

[Steve Webb]

My hon. Friend is right that the coalition is making it pay to work. We are paying an increase in the state pension that is above inflation and above earnings growth. The figure he gives is right: someone retiring this year on a full state pension will get around £15,000 more over their retirement than they would get under the policies adopted by the previous Government.

[Glenda Jackson (Hampstead and Kilburn) (Lab)]

To paraphrase Shakespeare, the Minister doth protest too much, methinks. He knows that the majority of our children who live in poverty do so in low-paid, working, not shirking, families. Those families are already experiencing serious difficulties in adequately feeding, clothing and, in some instances, even housing their children. In the light of the freeze on benefits, how many more families and children does he expect to be pushed into that—surely, in the 21st century—totally unacceptable situation?

[Steve Webb]

I hesitate to trade Shakespearian quotes with the hon. Lady, but to be clear, benefits are not being frozen, they are being increased. She is right on child poverty. The Government have not just stumbled across working poverty, because it was widespread under the previous Government, but it will be substantially improved by universal credit, which will make work pay in a way that it did not under the previous Government.

Working-Age Disabled People

Glenda Jackson Excerpts

Thursday 25th October 2012 Westminster Hall

[Stephen Lloyd]

I agree to a great extent. The way that some of the media, particularly some of the tabloids, have been reporting the issue has been disgraceful. I have said that more times than anyone can possibly imagine. However, the DWP and the Government have an enormous responsibility when they are introducing such a seismic change to a benefit. Some of the time, the Government and Ministers have been good and positive, pushing strongly and actively the social model and what they are trying to achieve; at other times, they have been guilty of pandering to people who are more focused on what I might term the tabloid agenda.

The Government have an enormous responsibility, and I would like them to be aggressive. If one of the papers—I do not even need to mention them; we all know the ones I am talking about—comes out with a particularly inaccurate story, I would like to see the Minister and the Secretary of State dealing with it aggressively on the airwaves.

[Glenda Jackson (Hampstead and Kilburn) (Lab)]

Bylines in newspapers may not be the responsibility of the Government, but it is certainly the responsibility of the Government and the DWP to point out the fact that DLA is an in-work as well as an out-of-work benefit, which they markedly fail to do. They should also highlight the fact that more than 35% of families who claim housing benefit are in work, and that the reason they qualify for housing benefit is because their pay is so very low.

[Stephen Lloyd]

I agree entirely. A lot of people do not understand that the DLA was introduced to help to support disabled people in leading independent lives. I do not know the exact figures, but I know that an enormous percentage of people on DLA are in work. That is a very important point.

I retain doubts about whether that Select Committee recommendation has been followed, either by Ministers in their speeches or by the DWP, and urge that it be made a priority for the Government. However, I strongly support the steps taken by the coalition Government to involve disabled people in the process for devising and implementing PIP, which have proved effective. The DWP has continued to engage extensively with organisations that represent disabled people since May 2011, through its implementation development group, which has more than 50 members and represents a broad range of national and local disability organisations. Engagement at such a level should ensure that the operational design, implementation and ongoing operation of PIPs considers the informed perspectives of disabled people and their representative organisations.

As a consequence of advice and lobbying from me and other Select Committee members, the Department dropped its original proposals to end payment of the DLA mobility component for care home residents, after the Low review, and to extend the three-month qualifying period under DLA to six months under PIP.

I urge the DWP to continue to listen, consult and take on board advice from disabled people and their representative organisations, particularly about the descriptors in PIPs, which I shall come to later. For the record, the disability pressure groups and charities also have a responsibility to be factual in their advice, lobbying and media coverage, as much as the Government do. The victims of misreporting on both sides are disabled people themselves. That simply is not right.

I welcome the Government’s decision to support a three-month qualifying period for PIP, rather than extend it to six months as they originally intended. However, I support the Select Committee’s view that there is evidence of significant financial hardship caused during the current three-month DLA qualifying period, particularly for those with sudden-onset conditions. I ask the coalition Government seriously to consider the Select Committee’s recommendation to implement a facility for early eligibility, which could operate in the same way as that for terminal illnesses.

I welcome the changes made to the first draft of the PIP assessment criteria, which demonstrate that the Government have listened to concerns expressed by disabled people and their representatives. I have had a number of discussions with Lord Freud and his office, drilling down on how some descriptors written into the initial draft were inadequate. I look forward to the final draft, as does the Select Committee.

The DWP deserves credit for the way it has involved disability groups and disabled people in the co-production approach it has adopted to the development of the PIP criteria. However, thus far, mobility descriptors still concentrate too heavily on the ability to move a fixed distance and do not include barriers to accessing public transport, or the difficulties of some locations for individuals where routes to shops, public transport and so on are particularly challenging.

The PIP assessment criteria also tend towards the medical model of disability. This is an incredibly important point. I value the fact that the DWP understands, or appears to understand, the social model of disability and that it is about providing support for disabled people so that they may lead independent lives. However, within the PIP criteria, we seem to be slipping back to the medical model. I urge the Minister to watch that closely. For instance, those criteria do not properly take on board the barriers to being independently mobile that a blind person may have face. Yes, they may be able get to the shops or their workplace via a route they know, but the descriptors do not take into account the challenges that a blind person might face if they were travelling to a destination they did not know, which is not uncommon for all of us on a weekly basis. If I had a visual impairment and was using a route that I do not know, I would face a series of different challenges. The descriptors need to show understanding of that and to take it into account.

I was encouraged by the language used by the Minister’s predecessor, who described the PIP assessment as a conversation between claimant and assessor. It is vital that the PIP assessment does not take the same mechanistic approach, based on an inflexible computer system, as originally adopted for the work capability assessment by the previous Government. In time, though, I would like there to be a checking system or review system—call it what we will—that allowed PIP recipients to be reviewed without having to go through the stresses of face-to-face assessment. I suggest that a letter of support from a consultant or other expert in the field—someone with knowledge of their disability—should suffice once the face-to-face assessments have been completed.

I understand why the coalition Government are going through the process of face-to-face assessment—some people have not been reviewed for many years—but it is important that the DWP take on board the profound worry and stress that many disabled people and their families are going through because of the proposed changes. If the Government do not take this on board, they will be perceived as uncaring and their stated desire—our stated desire—to support the social model of disability and to provide additional support for those who need it while being properly careful with the public purse will turn to nothing. I for one will become not a supporter of the Government’s objectives, but a highly vocal opponent. I really do not want this to happen.

My many years in the field of disability lead me to recognise that the system is not good enough. An annual overpayment of more than £600 million and an underpayment of almost £200 million show that it is heavily flawed, but I request that the Government do all they can to ensure that we replace DLA with something better and fairer, and that works. PIP could be that, but it is not yet. I believe it can be and profoundly hope that it will be, by the time it is rolled out in the pilot scheme in April 2013. The coalition Government must get this right, because people’s financial security, their level of comfort and their daily lives heavily depend on it.

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[Glenda Jackson (Hampstead and Kilburn) (Lab)]

It is a pleasure to follow the hon. Member for Eastbourne (Stephen Lloyd). I thank my hon. Friend the Member for Aberdeen South (Dame Anne Begg), as Chair of the Select Committee, for her prescient, direct analysis of what we have found in our deliberations to be the areas that the Government must address with no small haste, because if they mess this one up, hundreds and thousands of people will suffer grievously for the inadequacies.

Concerns have already been expressed, which all hon. Members must have heard from our constituents, about the whole assessment process. We all have horror stories to tell about the previous Atos regime. It does not seem to have got any better, because the number of appeals against existing assessments, although not necessarily with regard to DLA, are rising exponentially and being upheld almost exponentially.

One of the most glaring holes in the Government’s approach to the assessment process is in the area of illnesses and disabilities that fluctuate, the most obvious to me, having had representation from my constituents, being Parkinson’s disease. I have also had representations on multiple sclerosis and myalgic encephalomyelitis, and that is long before we get into the variabilities of people who are lifelong sufferers of mental health problems, not least those who are bipolar. My hon. Friend gave an example of someone who may be perfectly capable of getting out of bed one day, but the next day is completely incapable of moving, but under the present structure they would possibly be deemed to be perfectly capable of moving every day. That is simply not the case.

Aside from the Government’s black propaganda agenda for people who claim the whole range of benefits, which we touched on earlier, the great irony of what is being proposed is that no one in Parliament or in the country would argue with the concept of assisting disabled people into work. That seems to be fundamental—why else do we have Equality Acts or laws against discrimination? We want people to work, and people with disabilities are themselves desperate to work, but the great paradox of the Government proposals is that they are actively working against the possibility of people with disabilities being able to get into work because the process is so cloudy and unclear, as is the other issue of what passported benefits—to use that good old cliché—they will still be able to claim.

[Anne Marie Morris]

Throughout the House there is acceptance that we want to do everything we can to enable people with disabilities to take a full part in life, whether working or not. If I may correct or add to what the hon. Lady said, I think it is true that more appeals have been unsuccessful than successful. My second point is the result of an interesting conversation that I had with our new Minister, who is dedicated to helping disabled people get into work. My constituents have said, “Well, that’s a lovely idea, but how can we do that when many of the jobs are nine-to-five?” I am pleased that the Minister is now looking carefully at what is happening in other jurisdictions to ensure that flexibility is available in the work on offer, so that those who have good days and bad days may still participate in the world of work.

[Glenda Jackson]

On the hon. Lady’s point about appeals not being upheld, the length of time taken to hear an appeal is growing exponentially—my favourite word—so we do not know. People are having to wait months before their appeal is heard, because of the increase in the number presented.

On the changes with regard to nine-to-five, with all due respect that applies to every woman who works—that situation already exists for women. The only job that they might be able to obtain is nine-to-five, although they have children who go to school and the times are completely outside their range. That is not something new that the Government have to address in particular for people with disabilities. If we are looking at the accessibility of existing jobs for people with disabilities, I give the example of one of my constituents who is profoundly deaf. One of the Government’s arguments on accessing the work capability assessment for DLA is that if people do not get the letter they can phone, but that is of absolutely no use to anyone who is profoundly deaf. It certainly does not help my constituent: if he goes along to the jobcentre because he has read about a job he could do, there is no one there to translate for him, so there are holes in the existing system, and I am concerned that they will become crevasses if the Government do not get their timing right and their assessment of people with DLA done within a reasonable period.

The assessments also need to take on board what we were told when the Government initially introduced their changes to the whole of the benefits system: the assessment process, which they accepted in the past had not been up to snuff, would be infinitely more flexible and sensitive. I see absolutely no signs, given the time scale for assessment of people with DLA, of greater flexibility and more sensitivity, which are absolute givens when talking about people whose lives will be fundamentally overturned if they fail to meet the precepts set down by the Government. With all due respect to my hon. Friend the Member for Aberdeen South, who as I said gave a remarkable oversight of the evidence and the concerns expressed, the organisations that work in concert with and on behalf of people with disabilities remain seriously concerned because such questions are not being answered now. We had evidence before us in Committee last week of a coroner in Leicestershire, I think, who attributed a suicide to the individual’s concerns about having to go through the DLA assessment. From our constituents we all know of the anxiety already out there, which is actively having an effect on people now.

That was my introductory rant, but what I am most concerned about is the linkage between services for people with disabilities and local authorities providing such services. Owing to the massive cuts imposed on local authorities, we are already seeing a major downturn in, or removal of, services that many people with disabilities have been or still are dependent on, my favourite example being day centres. They can be a major part of enabling someone who, for example, cares for a person with disabilities to work and to maintain their families. Those day centres are being closed, without there being any idea how support will be provided in the area and made accessible to all those who need it. That is another major issue, as is the accessibility of affordable transport, which is seemingly being taken away every five minutes. The argument that has always been made is that the kinds of services required by people with disabilities should be in their local communities, where they can be reached. An example given to me was of a six-year-old boy who needs a hydrotherapy pool. There is such a pool at the end of his street, but although it is in a state school, he does not attend it, so he is precluded from using it and his family have to drive 23 miles there and back to take their child to a hydrotherapy pool.

The overarching argument that I am attempting to put forward is that local authorities have a vital part to play in ensuring that people with disabilities can work, and that they can make a contribution not only in the workplace but in their local communities so that their quality of life and that of their whole family is improved. As we all know, in many instances if one or possibly two people in a family are disabled, the entire family is focused on supporting those people. The needs of the family can often be as great, if not greater, than those of the one family member.

I have probably exhausted the points that I wished to make. I am grateful for everyone’s patience. I stress to the Minister, however, that this is a once-in-a-lifetime opportunity not only for her Government but for the people in this country who have disabilities and for the much wider community—namely, the whole country. In future, do we really wish to be presented as a people who rejected the most vulnerable in society and who believed the black propaganda and accepted that the vulnerable were all workshy, when we all know that that is the antithesis of the truth? We have a duty to ensure that our best might possibly be demonstrated by the care we take of our weakest.

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[Jane Ellison]

I could not agree more. It is central to these important reforms that we ask people what they can do, instead of what they cannot do.

[Glenda Jackson]

I take on board the hon. Lady’s point about overstatement of the most vulnerable, but some people who are asked that question are totally incapable of answering. A constituent who is 27 years old with a mental age of a six-year-old went to be reassessed. She is already in the system, and the assessor’s report was a million miles from the facts and the actuality. Without the new change that allowed her to take her mother with her, she would have been not only vulnerable but completely unsupported.

[Jane Ellison]

Absolutely. That intervention illustrates two points. First, there is an enormous range of disability; we are talking about huge diversity. We must be mindful of the fact that it is difficult to say anything that is true of all disabled people because of the extraordinary span of people covered, from the example just given to some of the people we saw winning gold medals for Britain during the summer. Secondly, the system has already been changed to respond to that concern, and that is exactly as it should be. I am sure that the Select Committee plays an important part in looking at evidence from life to see how a small tweak to the system can enable someone who is exceptionally vulnerable to be properly represented in the system.

[Glenda Jackson]

The hon. Lady is missing the essential point that I clearly failed to make. The decider in that instance is someone who has been appointed and financed by central Government. They make the decisions, and we have already spoken about the number of appeals arising. That individual should have said immediately, “This is absurd and no one should have sent you to see me”, but they went through the process. My only point is that the deciders of an individual’s life are sometimes a million miles from understanding. They are appointed by the Government, so it is the Government’s responsibility to ensure that assessors are up to the job.

[Jane Ellison]

I completely agree, but that is not a reason not to press ahead with important reforms.

To return to my previous point, it is sometime possible to give the impression that when a series of practical concerns amass to so great a number—many have been brought up today—that is a reason not to proceed. That is exactly why we have made the mistake of leaving things in the “too difficult” tray in the past.

Oral Answers to Questions

Glenda Jackson Excerpts

Monday 23rd January 2012 Commons Chamber

[Mr Duncan Smith]

I should tell my hon. Friend that I am not complacent about delivery. Hon. Members on both sides of the House know that IT developments can have difficulties and can go wrong at key points, even when we are not expecting them to do so. I am trying to ensure that Ministers are directly involved at every turn. We get weekly updates and have fortnightly meetings with those in charge. I set up a programme board, which I chair, and a senior sponsorship group, which includes Her Majesty’s Revenue and Customs, the programme board and the Department for Work and Pensions. The major projects review group has regular reviews. “Agile” principles make it easier for us to pinpoint where there might be failures.

[Glenda Jackson (Hampstead and Kilburn) (Lab)]

This morning on the “Today” programme, the Secretary of State declared that he knew where and who the families were who would be most adversely affected by the introduction of universal credit. They will lose their homes, their children will lose their schools and they will have to find new medical treatments. Why does he need that system, and has he begun the process of informing those families about the cataclysm that he will bring down on their heads?

[Mr Duncan Smith]

With respect to the hon. Lady, she is mixing up policies. This question is about universal credit, but she is referring to the cap. I am sorry that no Opposition Member tabled a question on the cap—there might be a reason for that, but I do not quite know what it is.

What I said this morning was quite clear. I said that when it comes to the cap and smaller numbers of people, we have worked very hard over the last nine months or so to ensure that we know who will be eligible to fall within the cap. We know exactly all their details, which will make it easier for us to help them through the process. She should have a word with Opposition Front Benchers, and ask them why they did not ask a question about the cap.

Living Standards

Glenda Jackson Excerpts

Wednesday 30th November 2011 Commons Chamber

[Mr Duncan Smith]

I wish that we saw a little more realism from Labour Members in accepting that they were, in many senses, partly the architects of the difficulty that we are in.

[Glenda Jackson (Hampstead and Kilburn) (Lab)]

I find it absolutely incomprehensible that the Secretary of State is able to discard the real pain that is now being suffered by children because of his Government’s bizarre choices based on the argument that they are going to become adults and will then have to pay further down the line. Is he really equating the possibility of a child losing its home, its school, its friends, its family, its support system, and watching its parents having to give up work because they cannot afford child care, with what is going to happen further down the road? That is bizarre.

[Mr Duncan Smith]

Of course, the hon. Lady would be right if that were what I was saying. What I am saying is quite simple: it is that our responsibility right now is to get the economy back in balance so that children do not have to pick up the debts. Let us remember that the deficit that we are dealing with is the pump that fuels the debt, and that debt is the legacy that we will leave them.

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[Jessica Lee]

I entirely agree. I know that my hon. Friend has spent some years examining the issue while running a charity. I think that all Members agree that early intervention will benefit young people, and that we must do all that we can to implement it.

[Glenda Jackson]

Will the hon. Lady give way?

[Jessica Lee]

I will give way once more.

[Glenda Jackson]

No one would disagree with the hon. Lady’s argument, but unfortunately the Government have made the provision of early intervention virtually impossible by removing the ring fence from Sure Start funds, and removing the other support systems that are necessary to produce the results that she and every other Member desires.

[Jessica Lee]

I disagree completely with the hon. Lady’s comments. That sort of scaremongering about local children’s services is not helpful. [Interruption.] This Government have gone out of their way—[Interruption.]

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[Glenda Jackson (Hampstead and Kilburn) (Lab)]

Yesterday, the Chancellor of the Exchequer, as for the last 18 months and assiduously supported by his Back-Bench colleagues, blamed our flatlining economy, constantly rising unemployment and failure of small businesses to obtain loans from banks on the enormous debts that this country was left by the previous Labour Government. His other argument was that the Labour Government had failed to mend the roof when the sun was shining. Those of us who had lived through 18 years of Conservative Government knew that it was not only the roof that needed mending, but also the foundations: our schools, our hospitals, our infrastructure, our social services.

The interesting point that the Chancellor of the Exchequer made yesterday was that our flatlining economy, constantly rising unemployment and consistent failure of small businesses to obtain loans was because, actually, the debt was even greater. What puzzles me is why the Chancellor of the Exchequer, after 18 months and with all the services that the Treasury provides to him, has clearly failed to make the numbers add up. Are we really left with the realisation that we have a Chancellor of the Exchequer who cannot count? I rather worry that we probably are.

The Chancellor then went on with the other canard that his Government have floated ever since they entered office—that this particular crisis is one in which we are all in it together, and that his economic polices will protect our state from the storm. His idea of protecting our state from the storm reminds me of the old Grecian city of Sparta, where the state was protected by exposing the most vulnerable on the harshest, coldest, stormiest mountain that could be found. That seems to be the example that his Government are following, because we simply are not all in this together.

The Secretary of State for Work and Pensions seemed today to state, with great sang froid, that the lowest three deciles in our society carry three times the burden of the top decile, and Government Members throughout the afternoon have stated that all our children must be protected from the terrible debt burden that they will have to face if we do not continue with an economy in which there is almost no growth—because we are all in this together.

It is highly unlikely that any child whose parent and/or parents sit on the Government Benches is in the situation facing many children in families in my constituency, where there is a strong possibility that, owing to the changes that the Government have introduced, most markedly to housing benefit, they will lose their homes. Indeed, they will lose not only their homes, but their schools—that is, those who are fortunate enough to have a place at a school in their area, because in my constituency, although apparently we are all in this together, there is a terrible dearth of school places. The dearth used to be in secondary schools; now it is in junior schools.

We hear from the Government all these wonderful stories about the free schools that will come in down the road, and about the academies that will be built, but they have not been built yet. It is simply not true, as we have heard. The Government’s changes—in relation to the abolition of the ring-fence around children’s centres and the supposed protection of Sure Start—are taking place throughout the country. I have mothers in my constituency who simply cannot find adequate child care—

[Madam Deputy Speaker (Dawn Primarolo)]

Order.

Pensions Bill [Lords]

Glenda Jackson Excerpts

Tuesday 18th October 2011 Commons Chamber

[Steve Webb]

I will come on to that, because Opposition amendments 19 and 20 relate to it. As I said in my introduction, I shall deal with all the amendments in this group, so if the hon. Gentleman will forgive me I will explain our thinking on that matter later.

[Glenda Jackson (Hampstead and Kilburn) (Lab)]

The Minister has referred to the transparency of the current charges in the pensions industry, yet in his evidence to the Work and Pensions Committee, the gentleman who advised the Government on the matter—I regret that I have forgotten his name—made the point, which I am sure everybody in the House would endorse, that existing pensions provision is extremely cloudy. It is extremely difficult to know what the charges are, because the wording is imponderable in many instances. Why is the Minister so sanguine about what will happen in future? It certainly has not happened in the past, and it certainly is not happening now.

[Steve Webb]

There are two significant differences between past and future provision. First, we have established NEST, which did not exist before. It has been set up as a low-cost provider, so we have guaranteed that there is such a provider out there, particularly for small firms, which are the least likely to shop around. Secondly, there is a saying that pensions are not bought, they are sold. In other words, individuals tend not to go out and look for a pension but instead have one sold to them. In a world of auto-enrolment, the opposite is the case. Employers have a legal duty to select a provider, and that makes providers’ costs much lower. Rather than having to bear the huge costs of individual salespeople going out and selling to individual policyholders, employers will instead seek out providers. The costs of the whole process will be much lower, so that will be a significant step in the right direction.

[Glenda Jackson]

Will the Minister give way?

[Steve Webb]

I will not, if the hon. Lady will forgive me, because I am going to try to cover about six topics in not very much time, so as to give everyone else a chance to respond.

Government new clause 2 has been tabled in response to our discussions in Committee, and will give the Government a power that I think previous Governments either thought they had or would have wanted to have. It is the power to cap charges for deferred members of qualifying auto-enrolment schemes. I think that is probably a relatively uncontentious power. Were we to bring it into force, that would clearly be the subject of separate debates and discussion in the House, but I hope the House will be happy that the Government should have that power.

Government amendments 15 and 16 are technical amendments to clause 14, dealing with what would otherwise have been a problem in section 30 of the Pensions Act 2008. Although that section currently allows employers to use a defined benefit, hybrid or money purchase scheme as an alternative scheme, it does not allow them to use a workplace personal pension scheme. Clause 14 corrects that omission, but there is a risk that an individual might be automatically enrolled into a personal pension scheme, and then required to pay contributions immediately for up to four previous years. The amendments protect individuals from that scenario. They correct what we believe to be an error in previous legislation. I hope that the House will find my explanation helpful, although I can go into far greater detail if threatened.

I welcome new clause 1, tabled by my hon. Friend the Member for West Worcestershire (Harriett Baldwin), who serves on the Work and Pensions Committee. I believe that, in a rather intimidating fashion, it has been signed by pretty much all the Committee’s members, so I think I have to give it a fair wind. It is about what is known in jargon as the “open market option”—in other words, the fact that people often forget that when they save for a pension, they are doing two things. First, they are building up a pot of money—the accumulation stage—and then they are turning it into a pension, which is the “decumulation” stage. Those are two entirely separate processes.

All too often, someone can save with provider A—I will not use the name of a company—and think that they have to take their pension from provider A, which they do not. Broadly speaking, as a rule of thumb, it is estimated that the market can be divided into thirds. Roughly a third of people shop around and go somewhere else, a third of people shop around and stay with their original provider, and a third of people do not shop around at all. There is clearly a danger that at the crucial point when somebody sets their income for the rest of their life, they may not be getting the best value. The open market option reminds people that they can shop around, and indeed prompts them to do so. However, as I have just indicated, take-up of that option is not as high as we would wish, or as I believe the insurance industry would increasingly wish, so we need to do more.

I take new clause 1 as a probing amendment, and it is important in getting the issue on the table. As drafted, it would have one or two problems. It would bring some schemes within its scope that should not be, such as final salary schemes. Those are qualifying schemes for auto-enrolment, but we do not want to give final salary scheme providers a duty to tell people about their right to buy an annuity. That would not be appropriate. The new clause also duplicates some existing duties. For example, the Occupational Pension Schemes (Disclosure of Information) Regulations 1996, as I am sure my hon. Friend is well aware, state that when members have the opportunity to select an annuity, they must be informed of their right to buy one on the open market. They must also be advised that there are different types of annuities available, which may have different features and different payment rates. There are also 1987 regulations that relate to contract-based business. So there are rules about the open market option, but I think we would all agree that they are not working as well as they should. I am sure that is the point of my hon. Friend’s new clause.

The Government welcome the opportunity to discuss the open market option. We believe that it is critical for consumers to think about the shape of annuity that is most appropriate to their circumstances and compare rates across providers. There are comparison websites available, which is a helpful development, but people have to know about them to look at them. They have to consider the option in order to know what questions to ask.

I am pleased to say that, in an example of joined-up government, we are working closely with our colleagues at the Treasury on the matter. I regularly meet my hon. Friend the Financial Secretary, who leads on it, to discuss the open market option, and we have a joint working group examining that very issue. My hon. Friend the Member for West Worcestershire will be pleased to know that earlier this year, we asked that working group to consider what is called a default open market option arrangement—in other words, whether we could make shopping around the default, so that people would have to make an active choice to stay with their current provider. There are practical issues to consider, such as what would happen to someone who failed to shop around, whether there should be a point at which their own provider paid them a pension, and what information people should have. However, the principle is attractive, and certainly my hon. Friend the Financial Secretary is keen to go as far as we can.

Progress has already been made. One might say that a working group is often the last refuge of a scoundrel—not the Financial Secretary, I should add; I meant myself. However, this is a working group with teeth. To give one example, the Association of British Insurers, which has engaged actively with us on the matter, has already said that its members will cease sending out to people, with the letter saying that they can get an annuity, the application form from their own provider. They will stop saying, “You can shop around, but here in the same envelope is a form to get an annuity from us.” Instead, a person will actively have to say, “I want my annuity from you; give me a form.” That is a small step in the right direction, but I believe we need to go further.

I will be pleased to hear the arguments and concerns of my hon. Friend the Member for West Worcestershire, but we are certainly seized of the importance of this issue. We do not believe the new clause is quite the way to deliver what is needed, but the Government very much welcome it, and the spirit of what she is trying to achieve.

[Glenda Jackson]

Will the Minister give way?

[Steve Webb]

On that point?

[Glenda Jackson]

Yes.

[Steve Webb]

Okay.

[Glenda Jackson]

I am extremely grateful that the Minister welcomes new clause 1, but with all due respect, he spoke earlier of pensions being not bought, but sold. He is now talking about the buyer being in the driving seat, but as we know full well, and as we see in the papers every day in relation to energy prices, people do not seem to have the capacity to shop around in their best interests. I do not think that the Government have had a great deal of success in encouraging companies to make the situation better. Will he learn from those mistakes, and will there be a better method?

[Steve Webb]

As I think I said a moment ago, we have asked the working group to look at making shopping around—[Interruption.] Before the hon. Lady heckles me, she might like to listen.

[Glenda Jackson]

I was muttering, not heckling.

[Steve Webb]

The working group will look at making shopping around the default situation. Somebody who does not actively choose to stay with their current provider will shop around by default. That is the difference between pensions and energy suppliers. Whereas people are stuck with their energy suppliers unless they choose to shop around, people will not get a pension unless they shop around. That is a pretty good incentive to shop around.

[Glenda Jackson]

Will the Minister give way?

[Steve Webb]

I hope that the hon. Lady will forgive me if I do not; I have given way to her twice already.

New clauses 9 and 10 relate to the role of NEST, which I mentioned a moment ago. New clause 9 suggests that in a couple of years’ time we should review transfers into NEST, and new clause 10 suggests that we review contribution limits at the same time. It is worth reminding the House why NEST was constrained when it was established. There was a recognition that there is a market for big firms and higher earners—pension providers are willing to provide at a reasonable cost and to go to such firms. However, for small firms and lower-paid workers, there was a market failure. NEST was designed to fill that gap in the market.

First, the Government created a legal duty for firms to enrol people, so we ensured that there was something to enrol people in. That is what NEST is for. Secondly, we could have created NEST and imposed no constraints, and it could have been just another provider, but because we constrained NEST to consider lower-paid workers and smaller firms, it has innovated in an impressive manner. The previous Government envisaged such constraints. The Work and Pensions Committee has visited NEST and was positive about what it found. Forcing NEST to focus on lower-paid workers, smaller firms, and people who do not speak “pensions” or who are uninterested in them, has created impressive product, investment strategy and technological innovation, which is entirely welcome. Creating NEST with constraints was the right thing to do, and it has been beneficial.

--- Later in debate ---

[Teresa Pearce (Erith and Thamesmead) (Lab)]

I strongly support the principle of auto-enrolment. As was pointed out by the hon. Member for West Worcestershire (Harriett Baldwin), it means that from 2012 onwards, millions of people will save for a pension for the first time. We need a low-cost, trustworthy system in the United Kingdom if we are to begin to lift future generations out of pensioner poverty.

I fully support the establishment of NEST, as currently only 50% of employees contribute to a private pension, and for many of those on lower incomes the current system is poor. Research has shown that if a typical British and a typical Dutch person save exactly the same amount for their retirement, the Dutch person will end up with a 50% larger pension under the current scheme. I believe that that is because in the UK it is often not clear how high pension charges can be. For instance, a person who is sold a pension and charged at 1.5% per annum may not realise that over the lifetime of the pension, 38% of their possible income could be lost to fees.

In the past, pension companies were unwilling to provide the low-cost pensions of the type needed under auto-enrolment, as they felt that the ordinary low-paid workers had what the industry deemed “unattractive lives”—a somewhat derogatory term which simply meant that it was not easy to make money out of those policies. Indeed, it was because of the failure of the current structure to provide such pensions that it was necessary to establish NEST.

I welcome auto-enrolment, I welcome NEST and I welcome new clause 2, but three points cause me concern. My concern about auto-enrolment was prompted by some of the evidence given to the Work and Pensions Committee relating to a lack of regulation. I was troubled to hear that there would be no restrictions on how workplace pension savings are invested, and no record-keeping requirements for providers. The meeting between the Select Committee and the Pensions Regulator gave me very little reassurance. It appears that during the drafting of the Bill, many interested parties gained concessions. Employers, whether large, small or micro—along with the pensions industry—have been pleased to note that restrictions will be placed on NEST, but not necessarily on other alternative providers.

I believe that the restrictions placed on contributions to NEST, a vehicle for workers whose employers have no pension provision, may push some employers who are new to the pensions arena towards less scrupulous pension providers, I realise that NEST is aimed at lower earners, but some of the restrictions placed on it may nudge employers who are baffled by the choices facing them towards a pension provider that does not have such restrictions, but may well provide an unattractive pension scheme for the employee. It appears that the industry and employers have been around the negotiating table, but that the employees’ voice has not yet been heard.

If employers reject NEST because of the contribution limit, or other limits, they may place employees in schemes with unfairly high charges. I am deeply concerned about the apparent lack of a quality test for schemes that would be deemed to be a qualifying alternative to NEST. We know from past mis-selling scandals that too few people understand how charges, and pensions, work, and that—as in the case of the mis-selling of endowment policies—it can take many years for such practices to come to light. I ask the Minister to consider, with the benefit of hindsight in regard to previous mis-selling problems, what measures he intends to take to ensure that we do not store up similar troubles with auto-enrolment outside NEST.

My second point, which the Minister has touched on, relates to the ban on transfers to NEST, which resulted from lobbying from the pensions industry and which will benefit that industry at the expense of employees in the scheme. Under the current rules, people who are auto-enrolled in a scheme and go into NEST will not be able to move existing pots into the scheme. Such a ban cannot benefit the very employees and future pensioners whom we are trying to assist; it can only support the industry. I believe that a modern pension in a modern age should be portable, and that provisions for transfers in and out of NEST should be included in the Bill even if they cannot be implemented immediately. I welcomed some of the reassurances given by the Minister in his opening remarks.

My third reason for concern is the three-month waiting period. Although I understand the need to balance the administrative burden for businesses, it means that half a million fewer people will be automatically enrolled. As has been pointed out twice already today, nowadays many people have 11 different employers over their lifetimes. I would support a reduction to one month. Nevertheless, employees are currently able to opt in to the system from the first day of their employment, but they need to know that they have that right. I urge the Minister to amend the measures to require employers to ensure that employees are aware from when they start their employment that they can opt in from day one and receive employer pensions contributions.

The pensions cap combined with the three-month opt-out and the inability to transfer into NEST will prevent casual workers and part-time workers—mainly women—from building a decent pot, even though that is our aim. I ask the Minister to consider these concerns and in his closing remarks to give the House further assurances as to how they can be addressed.

[Glenda Jackson]

I rise to speak in support of the new clause of the hon. Member for West Worcestershire (Harriett Baldwin). I also strongly endorse everything my hon. Friend the Member for Erith and Thamesmead (Teresa Pearce) has just said. I, too, strongly support auto-enrolment. It offers a genuine breakthrough in attracting those people who presume that saving has nothing to offer them, which is not infrequently because their wages have been extremely low.

This scheme requires greater Government support, however. I was concerned by the Minister’s somewhat sanguine attitude towards what the established pensions industry is going to do. As the hon. Member for West Worcestershire said, millions of people will for the first time feel encouraged to begin to save for their future.

Those people have always been out there, but the existing pensions industry has done absolutely nothing to attract them into savings. If it is suddenly interested in this new market, I wonder what it finds so attractive. The Minister referred to the CBI, which is a confederation of major employers. However, from my point of view the real silver lining of the scheme is that it will attract employers who employ only a few staff and their employees.

I am not making a party political point here, but we are currently in a period when people’s standards of living are falling. The most recent report from the Institute for Fiscal Studies found that most people’s standard of living has fallen by 7%. That will serve only to reinforce the existing reluctance of small business men and their employees on low incomes to see any benefits in saving for the future, and the pensions industry does not seem in any way geared up to make it attractive.

My hon. Friend spoke about the mis-selling scandals of the past. I need only refer to payment protection insurance. The mis-selling of that was conducted by bankers, and at that time they were considered to be rock-solid people, although that assessment has now changed dramatically in this country and the entire world. There have been far too many examples of excessive charges. I have also referred to the impenetrable documents issued to us by our pension providers. The problem is not simply their length or the smallness of the print; they are completely incomprehensible.

I understand that the Government cannot simply say to everybody, “Listen, the only scheme you should go into is this new scheme, NEST.” However, as that option is not available to them, they must work with the existing pensions industry to ensure that safeguards are in place.

The Government have attempted to make some changes in another supposedly competitive industry: the energy industry. They have markedly failed, however. There is no genuine competition in that industry. We, the people who have to pay the bills, know that, and Which? has said it, as have Ofgem and the Government.

This measure is a major step forward and, as I have said, I absolutely endorse it, because it genuinely seems to be a way of ensuring that people can have a more secure future for themselves. Not only that, but we also hope it will relieve the tax burden for generations to come and it should give people a greater sense of being in charge of their own destinies. However, that is not possible if they are not absolutely satisfied and guaranteed that the pensions being sold are actually transparent and honest, and that the detail is specific and clear to them—

--- Later in debate ---

[Mr Duncan Smith]

I think I have explained that. As I said earlier and as the right hon. Gentleman knows well, the acceleration is about reaching equalisation in time to move the age to 66. We can bandy this subject about, but the point remains that the Opposition must come to terms with something quite important. The hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East, who opened the debate on Report, suggested that £11 billion—he insisted on saying £10 billion, but I must tell him that the figure is £11 billion—was no great problem and not an issue in the great scheme of things. That is, in a sense, the problem. I remind him that to save £5 billion in real terms today straight off, we would have to cut the education budget by 10%. That is the nature of how we would have to find the money.

I simply say to the Opposition that I understand the rules of opposition—goodness gracious, we spent enough time in opposition ourselves—and the temptations that come with opposition, but realistically they should be saying to all those women that we have made a major move. We are prepared to spend an extra £1 billion to make sure that those who were excessively caught in that trap are not any more. I think that is fair and reasonable and that the Opposition need to explain to women up and down the land why they are making a big fuss about this when they know, cynically, that they would not overturn this if they came to government. That is a very cynical position to be in—to whip up this emotion outside and then calmly and quietly say, “Of course, we can’t change it.” I am afraid that is bad politics and bad decision making.

[Glenda Jackson]

Perhaps the Secretary of State would like to hear what some of the women in my constituency think about the Government’s changes regarding their pension age. Their view is that the Government have made this very small change—it is a very small movement—which has nothing whatever to do with a concern for those women in their old age, because they are losing the women’s vote––and my constituents are not by nature cynical.

[Mr Duncan Smith]

After listening to the Opposition tonight, they ought to be. One thing I will be certain to tell them whenever I encounter them is that at least I am being honest about what we are trying to do. We inherited a major economic problem, with a deficit that was out of control and burgeoning debt—the two are linked just in case the Opposition do not remember that. The reality is that, on both counts, we are charged with reducing the amounts. That is not something that is given to just a few Ministers—it is ultimately about taxpayers and about those who get pensions.

We have listened and we have done something quite significant—not small—to give way. To cap this at 18 months and spend £1 billion is, as my hon. Friends have recognised, a big step. Of course, in a perfect world, as the hon. Member for Cardiff Central (Jenny Willott) said, if all things were equal we would have loved to be able to do more, but the reality that we face is that this country has to get its debt under control. As I said earlier, the real burden is not going to fall on the shoulders of the hon. Member for Hampstead and Kilburn (Glenda Jackson) or on mine but on those of our children and grandchildren if we do not do something about that debt. I am not prepared to think to myself, “I must charge around and say that I am worried about this group or that group.” I have to say to them honestly, “All of us, together, recognise that we must do the best for the next generation coming through,” as well as doing our best, as the Pensions Minister said, for those who are due to retire.

With the amendments in place, I believe that the Bill has reached Third Reading with its fundamental principles firmly intact. I have repeatedly said that the Bill is, in large part, about the next generation—a generation who will have to pay for their parents’ retirement while footing the bill for their own savings and also for the debt.

I want to discuss auto-enrolment which, as the right hon. Member for East Ham rightly said, was started by his Government. We committed to continue it and I like to think that we have done that in the best spirit possible, taking into account the difficult financial considerations. The key will be getting many more people into saving. As he knows, some 9 million to 10 million people will be eligible under the new system. That is why we are taking forward plans for automatic enrolment into pension schemes—plans that were debated and widely supported across the House.

The Bill refines some of the parameters of automatic enrolment legislation and ensures that we take forward a model that will work for the individual, I hope, as well as for the employers who will be our key partners in delivering these reforms. There was a question about the three-month point and I wanted to make a point about those who are in work for three months in these firms and then move on—90% will move on, so the issue we are dealing with concerns a much smaller group than people have been leading us to believe. I do not agree with those who say categorically that this is a problem for growth. Auto-enrolment is good for the country, good for people who save and, ultimately, good for growth because it puts the economy on a firm footing, based on savings. I stand here today categorically prepared to take on anybody on that basis, and I will continue to do so, as will the Pensions Minister and, indeed, all of us. Others who support us on this include the TUC, the CBI and the National Association of Pension Funds. I hope that, as a consideration, we will move forward on this together.

Finally, I want to touch briefly on the consumer prices index uprating and judicial pensions. I know that everybody in the House is worried about the judicial pension scheme that is going through in the Bill, but none the less we will press on. As I made clear on Second Reading, the Bill makes a few relatively minor changes to the legislation governing the uprating of occupational pensions. It amends references to the retail prices index to read instead the “general level of prices” to ensure consistency with the rest of the legislation. It does not specify the measure for the general level of prices. I am pleased to see that the Opposition support us in all of this, although after talking to some Opposition Back Benchers, I do not think they were aware that the Government and the Opposition are apparently as one on CPI.

On judicial pensions, I will simply say that this is a key part of building a more responsible pension system, and I am pleased that the provisions have received the widespread support of the House.

I shall conclude, as others may want to speak. When we introduced the Bill, we were clear about the principle behind it: a desire to secure a better deal for our children through incentivising saving and sharing the costs of retirement more evenly between the generations. I hope there are more changes to come, with the other pension reforms that my hon. Friend the Minister spoke about, which will incentivise saving and give people a base income in retirement that they can understand and calculate. These changes should be seen in the light of all those wider reforms. We are currently working on that state pension design and consulting on the option of a single tier. All this will, I hope, provide a better deal for many women and self-employed people who have historically tended to suffer poorer pension outcomes. The changes that we are making to our retirement system are designed to put it back on firm foundations, establishing a new and fairer settlement between young and old.

I return to one point. It is a challenge to any Opposition, I guess, to have been in government and created something of which they are justifiably proud—auto-enrolment. We wanted to continue with it and we have done our level best to do that. That is the most important and powerful part of this Bill of reform. Given the importance of auto-enrolment, and notwithstanding all the heat and light generated by the Opposition’s arguments today about the level and the speed at which the state pension retirement age has moved, when they sit down and consider what is in the Bill that we are about to pass—automatic enrolment to improve the savings and outcomes for people in future years—I hope the Opposition will do the right thing and support the Bill. On that basis I commend the Bill to the House.

--- Later in debate ---

[Glenda Jackson]

Regrettably, I was not here for the opening remarks of my hon. Friend the Member for Edinburgh East (Sheila Gilmore), but we are clearly of one mind. I share with her the total refusal to accept the Government’s interpretation of the situation in which we find ourselves. The Secretary of State made a passionate plea that the debt should not lay a burden on our children and grandchildren, but that plea would have played rather more resonantly with me were it not for the fact that his Government are punishing our children and grandchildren even as we speak.

My parents and grandparents had absolutely no qualms whatever about laying on my generation the burden of debt incurred by fighting and winning a second world war, and I have to say that I am extremely grateful to them for that. I also point out to the Secretary of State that in the intervening decades, the opportunities that were presented to me and millions like me in this country by, as my hon. Friend said, the introduction of the welfare state, had been not only unheard of but undreamt of by people from the social and economic background from which I came. Therefore I, like her, simply refuse to accept that the choices the Government are making in every single area of our national economic life will promote growth, provide a way forward or benefit this country.

I would be more prepared to believe that the changes to the pension system that the Government have introduced—which, as my right hon. Friend the Member for East Ham (Stephen Timms) said, are grossly unfair to women—were driven by the harsh economic climate, which the Government constantly pray in aid, were it not for the fact that that measly six months will save only £1.1 billion. The Government borrow something like 10 times that amount every week. I simply cannot make the figures match—but then neither can they.

[Mrs Anne Main (St Albans) (Con)]

I struggle to see the hon. Lady’s logic in comparing a debt carried over on behalf of the nation for the second world war with a pension debt that results from the demographic fact of an ageing population for whom we must pay. Is she saying that £1.2 billion is a measly amount? If so, where would she find the other £10 billion that the Labour party are committed to spending by not voting for the Bill?

[Glenda Jackson]

I trust that the hon. Lady would allow me to use my own adjectives—“measly” is not a word that would immediately spring to my mind to describe £1.1 billion. The fact is that the six-month “pause”, which might be a better word to use as far as the hon. Lady’s view of the economy is concerned, will apparently save the nation £1.1 billion. That saving will not come in until next year, and it is doing nothing to fill the current hole. That sum is a fraction of what the Government are borrowing week in, week out, because they have markedly failed to do anything to create growth in this country. They have done little or nothing to stimulate our economy. The hon. Lady may smile and shake her head, but I was taught that the only way to get something is by earning it. That is the only way to settle debt.

[Mrs Main]

What does the hon. Lady think that the money we borrow every week pays for? I suggest that it pays for the debt that we are all committed to reducing.

[Glenda Jackson]

The hon. Lady is plucking fantasies out of the air—fantasies that the Government have been running for months. The money is certainly not paying to ensure that every child in my constituency has a school place, or that every elderly person in my constituency has secure meals on wheels, or that day centres for the elderly remain open. The Government have done nothing to encourage young people to believe that they have a future. Whatever they are doing with the money, they are certainly not stimulating growth in the country.

I must return to the issues that we are supposedly debating. The Government have imposed a gross unfairness on one half of our people: women. That unfairness is absolutely unacceptable. As I had occasion to say to the Secretary of State in an intervention, for many women in my constituency, the changes to the Bill are nothing more than a cynical attempt by the Government to re-attract the female vote, which, as they read every day in the papers, they are losing.

On the one hand, the Government have introduced this Bill, but on the other, they protest that one of their central planks is ensuring greater equality for women. They say that they want more women in the boardroom, and greater wage equality and equality of opportunity, but then they decide that when a woman has worked all her life—as has been said, she will probably have been in low-paid work, doing two or three jobs at the same time, not least looking after her family, including both children and parents—and when her employment potential is nil, she must struggle on until the state pension comes in.

I strongly and heartily endorse many aspects of auto-enrolment. I do have concerns that the Government will not introduce sufficient teeth to ensure that, if the existing pensions industry does regard auto-enrolment as a business that they would wish to enter, the proper safeguards would be in place to ensure that it remains genuinely competitive, open and transparent, so that people who have never before considered having a pension will not find—as most of us do at the moment—the pension papers to be totally obfuscating so that we are no wiser about where our money is going or what the charges are after reading them.

It will not be possible for me to vote for this Bill, but I strongly endorse auto-enrolment. I urge the Government to think again, even at this late stage, about trying to eradicate this gross unfairness from the Bill.

Welfare Reform Bill

Glenda Jackson Excerpts

Monday 13th June 2011 Commons Chamber

[Ms Buck]

I will be very interested to see the evidence for the hon. Lady’s assertion. Although I know that our two parties have differed in the past on their interpretation of “rough sleeping”—on street homelessness—and that there is a genuine debate to be had about how that is measured, I was not aware, and I stand to be corrected, that there has been a shift in the data set for the measurement of the number of people approaching local authorities as homeless and being accepted as such. Nothing on the DCLG website indicates that, so I dispute her definition and it seems to me that we are facing a genuine problem.

Even more worryingly, rent arrears and mortgage default were to blame for a growing share of the number of people who were approaching local authorities as homeless; although not the main cause, that is a growing cause of those applications. It gives me no satisfaction to see that; I do not want people to be made homeless. As we discussed in Committee, homelessness is one of the greatest traumas that any household can possibly face. The hon. Member for Truro and Falmouth (Sarah Newton) and other Government Members must face up to the fact that the statistics show a growing trend just as the cuts in housing benefit begin to be flagged up and as people react to the changes in the incoming benefits.

The second set of data to come out in the past week of which we need to be cognisant was a survey released on Friday by the National Landlords Association. It found that 58% of all private residential landlords plan to reduce the number of properties they let to tenants on local housing allowance. Some 80% of landlords expressed concern about the reduction in local housing allowance rates from the average market rents of the bottom 30% and the same number were worried, as I shall discuss in the context of the relevant amendment, about the future local housing allowance increases being linked to the consumer prices index rather than true market rents. The survey also found that 90% of landlords stated they cannot afford to reduce their rents to absorb changes to the local housing allowance as the large majority are faced with mortgage repayments and rising running costs.

The worrying picture is that our discussions are put in context by the cuts in housing benefit that have already been through the House and were opposed by the Opposition, which are feeding through into the concerns of landlords. One point of concern is that when the Government assert that 30% of properties will remain available to tenants on local housing allowance, they ignore the fact that not all the properties in that threshold will be available to tenants because it will not necessarily be the landlords within that cohort who are prepared to let in the first place.

We will have to wait and see, but it is entirely reasonable for alarm bells to ring on the impact on homelessness when we look at those two sets of statistics. If we find either that households are in an affordability crisis or that landlords simply pull out of the housing benefit sector, particularly in those areas where the demand for private rented accommodation is greatest—that is, London, the south-east and some of our cities—we will have a severe problem and many the assumptions being made by the Government about savings are unlikely to be realised. Homelessness is an expensive process and places considerable pressure on local government.

[Glenda Jackson (Hampstead and Kilburn) (Lab)]

Is there not a third warning bell, also, in the evidence that is being produced almost weekly that the inability of first-time buyers to obtain a reasonable mortgage means that they are forgoing the possibility of ever becoming homeowners and are renting? That is increasing not only in cities but across the country, apparently.

[Ms Buck]

My hon. Friend is absolutely right. Without any question, we are seeing a growth in the private rented sector for all those reasons, including the affordability crisis and the lending pressures in the home ownership sector. That means that the private rented sector, which we all applaud and support—we want a healthy private rented sector—can draw from an increased pool of potential tenants who are not on housing allowance. There will be competition for those properties between tenants who do not require housing allowance and those who do and are on the transitional protection path through the caps and reductions in the 30th percentile on which we have already agreed—I shall turn in a second to the further ratcheting down that is intrinsic to the future use of the consumer prices index rather than a local housing allowance determination—and that pressure will mean that a larger pool of people are frozen out of such accommodation.

--- Later in debate ---

[Ms Buck]

My hon. Friend is absolutely right. I have been drawn into arguing with the Government on their own terms, which is a clinical, cash-led way of debating such things: if it will cost £5, someone may have to lose their home; that is the only measure. However, my hon. Friend is right, and we expressed such anxieties about the whole under-occupation policy in Committee. We could be talking about somebody in an adapted property, somebody who has been in their family home for 30 years, or somebody who has been in their home for 30 years but has recently been widowed or lost a child and is suddenly deemed to be under-occupying.

[Glenda Jackson]

Is there not another bureaucratic hurdle for people who are in adapted homes or, as is often the case in my constituency, elderly people who have lived in a place for a long period whose families have moved? Both categories could be defined as vulnerable. I am not saying that all young people in this country are necessarily hell-raisers, but would there not be a justifiable cause for an additional tenant to go through a Criminal Records Bureau check?

[Ms Buck]

I am not going to be drawn into debating the advantages and disadvantages of an argument that has just been thrown into the air by the Minister. In some circumstances, the idea may work. Some individuals of working age will actively want to downsize and will say, “We are in a three-bedroom property and it is too big for us. We have been waiting for years to get into a one-bedroom property.” In the real world, we all deal as constituency MPs with people with a huge number of different needs. There are people in all different circumstances, and these different options will work for some people.

The point, surely, in discussing this amendment is that there are 101,000 to 108,000 households in properties that are specifically adapted for their needs who, despite the slightly more sympathetic noises coming from the Minister, in just over 18 months will lose up to 23% of their housing benefit. I am not sure that the vague and general ideas being thrown out by the ministerial team are doing anything to help us deal with that reality.

--- Later in debate ---

[Ms Buck]

The point that the hon. Lady misses is this: when people come to my advice surgery and say that they need an adapted property, they do not mean that they need one in Merseyside. That is the fundamental problem. Not only is there a regional imbalance in the supply of accommodation, but each individual has individual needs. If they do not, why does my local authority employ Dependability Ltd to send occupational therapists to assess individual needs? I am sure that my hon. Friend the Member for Aberdeen South (Dame Anne Begg) would support me on this, but every individual with a disability is likely to have personalised requirements. That is my central argument. Not everybody has wheelchair access adaptations or larger bathrooms or lower counters. Adaptations are highly tailored to the individual’s circumstances, as they should be.

In some cases, the Government’s proposals will work like a dream. Nobody is arguing that in no instance will a perfect match be found and people will be satisfied. My central point is that that will involve a minority of the 108,000 who will be affected. I cannot see—housing associations support my analysis—how the result could be anything different. The measure is likely to result in a phenomenal waste of money on adapted properties and/or to trap people with disabilities who are by definition on low and fixed incomes with a cut in their living standards, which is exactly what the Government told us they wish to avoid.

Last year, the Secretary of State claimed that disabled people had “nothing to fear” from his welfare plans, adding:

“It is a proud duty to provide financial security to the most vulnerable members of our society and this will not change.”

If disabled people are in an adapted property with an extra bedroom, they have every reason, as things stand, to worry.

To return to the intervention from the hon. Member for Cardiff Central (Jenny Willott), the discretionary housing payment, which the Government repeatedly say is a panacea, is the philosopher’s stone, as I described in Committee. Somehow, the £40 million a year fund will stretch to cover overall cuts in housing benefit of £1.5 billion. There is no earthly way in which it can stretch sufficiently to cover the protection of vulnerable younger people who are affected by the single-room cuts, of people in accommodation that has been adapted for disabled use, and of all those whom we want to keep in their homes because we want them to keep their jobs when their property becomes unaffordable owing to overall housing benefit cuts and the downrating from CPI.

[Glenda Jackson]

As my hon. Friend the Member for Hayes and Harlington (John McDonnell) mutters from a sedentary position, the scheme is not voluntary. That is surely the antithesis of what Government Members have argued—they say that their plans treat everybody as individuals. The scheme is an imposition.

[Ms Buck]

My hon. Friend is absolutely right. The scheme is not voluntary. Voluntary downsizing has a proud history. Good local authorities and housing associations provide voluntary downsizing, which is sensible. The Government’s measure requires 108,000 households whose properties have been adapted for disabled purposes to take, within the next 18 months, a significant cut in their housing benefit, or to move, regardless of the value of that adaptation. The Minister implies a mammoth bureaucratic exercise to evaluate every one of those adaptations, and to establish individual cost-benefit analyses in every case, in the hope, which I suspect will be a forlorn one, that an appropriate property will be available for people to move into when they fall foul of such analyses. That appropriate property does not have to be within the local authority area or even the region where those people have family, friends, support and, in some cases, employment.

Those two concerns, of the many that the Opposition have on housing costs, are the subject of the amendments that we have tabled. I hope that the Minister, who has made sympathetic noises on both issues in Committee, goes a little further tonight, and gives us solid and binding reassurances that there is a way of resolving the benefit trap that will catch so many people, in order, as Ministers have frequently stated in the media, to deal with a very small number of high-value claimants who dominate the media agenda. It is not fair to capture 108,000 disabled people and 750,000 claimants of local housing allowance, all of whom will be affected by the housing benefit cuts, in order to deal with a small number of extreme cases, on which we could otherwise have had a sensible debate about attempting to resolve.

State Pension Reform

Glenda Jackson Excerpts

Monday 4th April 2011 Commons Chamber

[Steve Webb]

My hon. Friend is absolutely right. There is a clear link between the major reforms that the Department is introducing for people of working age and those that it is introducing for those who will reach pension age in the future. “It pays to work” and “it pays to save” must be the right combination.

My hon. Friend asked about pensioners’ savings. In a world in which we will enrol people in workplace savings, we need them to be confident that they will be better off when they save, and that is one of the specific purposes of the reforms. If my hon. Friend wishes to raise any further points, I will certainly respond to them.

[Glenda Jackson (Hampstead and Kilburn) (Lab)]

Given that the introduction of a single-tier pension will be available only to new pensioners, will the safety nets to which the Minister referred in his answer to my hon. Friend the Member for Aberdeen South (Dame Anne Begg) include all the existing passported benefits, and will claimants still have to go through a means-tested system in order to obtain them?

[Steve Webb]

We are not changing the system for current pensioners at all. It will continue as previously budgeted. As for new pensioners, we need to think what paying a pension above the guarantee credit implies for passported benefits, and what sort of system we need. I should be interested to hear people’s ideas, because the issue is important. Hitherto, we have simply assumed that pension credit means poverty and that we must therefore make all the extra payments. We may need a more sophisticated system now, but the role of passported benefits is important, and I am grateful to the hon. Lady for raising it.

Amendment of the Law

Glenda Jackson Excerpts

Tuesday 29th March 2011 Commons Chamber

[Mr Duncan Smith]

I am interested that the hon. Gentleman raises the matter, because it was originally mentioned in the comprehensive spending review. We have stuck to the last Government’s plans on the winter fuel payment. In fact, I was intrigued by the issue so I looked up what the right hon. Member for Edinburgh South West (Mr Darling), who is in his place, said when he was Chancellor. He said a lot of straightforward things, and I congratulate him on that. He said about the winter fuel payments that they

“were temporarily increased to £250, and £400 for the over-80s…I will guarantee this higher winter fuel payment for another year.”—[Official Report, 24 March 2010; Vol. 508, c. 263.]

When we look at the Red Book produced at the time, we find that there was no allocation for any more winter fuel payments. We stuck to the last Government’s plans. Perhaps the hon. Member for Ynys Môn (Albert Owen) should ask his right hon. Friend why he did not plan for more. We did exactly what we said we would do.

The real problem is that 7 million people are not saving enough for the retirement that they want, and few will be able to rely on a guaranteed income in retirement, because the numbers saving in defined benefit schemes in the private sector have more than halved in the last 20 years. In fact, less than half of the entire working-age population is currently saving in a pension at all.

Our plans automatically to enrol all workers in a pension scheme will make a real difference—we have continued the work started by the previous Government—but my hon. Friend the Minister and I do not think that auto-enrolment will work unless it pays people to save, which is why we have determined finally to get to grips with the state pension. As all hon. Members know, not only is the state pension extremely complex, leaving millions of people unsure as to what they will receive in retirement, but it completely fails to reward those who make the effort to save but who do not quite get there.

Too many people reach state pension age having scrimped and saved all their life to find that others, who have not saved or who have made no effort to save, get the same income as them through pension credit. The Budget is about rewarding those who do the right thing, which is why we will shortly publish a Green Paper on state pension reform, with an option for a single-tier state pension, which will provide a clear foundation for saving. We currently estimate that it will be set at around £140 a week, which is above the level of the means-tested guarantee credit, but we must send out the clear message across the welfare and the pension systems that people will be better off in work than on benefits, and better off in retirement if they save.

[Glenda Jackson (Hampstead and Kilburn) (Lab)]

If the change in the pension system is to benefit the whole country and all pensioners—current and future—why have the Secretary of State’s policies targeted specifically women born between ’53 and ’54? They expected to retire, but now discover that they must work at least four years longer. That does not strike me as a policy that benefits the entire population.

[Mr Duncan Smith]

The hon. Lady’s comment on working four years longer is simply incorrect, but I take what she says. The reality is that the Government are doing what we were asked to do—equalise the ages—and increasing the age to 66. I recognise the group she mentions, but they will be covered and supported in other ways anyway, so this is not a loss—

[Glenda Jackson]

It is a specific, targeted group.

[Mr Duncan Smith]

It is not a specific group in the sense that they were targeted. That policy is part of trying to get the pensionable age up first to 65, and then to 66.

--- Later in debate ---

[Glenda Jackson (Hampstead and Kilburn) (Lab)]

I must tell the hon. Member for Witham (Priti Patel) that her speech was a bit like “all our yesterdays”. The one thing that she did not seem to think would create jobs in this country was slashing the national minimum wage, and I was surprised that she did not suggest that.

Today’s debate opened with one of the most lamentable speeches that I have ever heard the Secretary of State for Work and Pensions deliver, in which he presented—as have other Government Members—the rosy view that the Government’s proposals will automatically create jobs, that there will be people who will be qualified to fill them, and that the future will be golden. If we look at the Red Book, which Government Members have waved in our faces on many occasions, we see that what the Government are setting in train is a Budget that will create a vast increase in unemployment. Unless they intend to abolish the whole benefits system at a stroke, an astronomical amount will have to be spent on unemployment benefit and passported benefits—although, of course, they may wipe all those out as well.

Government Members have the audacity to accuse us of frightening some of the most vulnerable people in our society, but it is not us who are frightening them. In my constituency and in those of Government Members, it is the Government who seem to look at nothing but the bottom line. It is they who introduce swingeing policies which, nine times out of 10, do not mesh, and the Secretary of State responsible for delivering those policies does not know what impact they will have on the ground.

A precise example from today’s debate was what I understand to have been the initial proposal from the Department for Work and Pensions in regard to jobseeker’s allowance and housing benefit. It was proposed that 10% should automatically be slashed from the housing benefit of anyone who had failed to find a job after 12 months on jobseeker’s allowance despite doing everything demanded by the Government—and that is housing benefit which is being capped.

It is to his shame that, in his opening speech, the Secretary of State ran again with a canard that he is on record as saying he hoped would not be fulfilled: that the majority—he did not use the word “majority”, but it was implied—of people on housing benefit are living in properties where the rent is £100,000 a week. Everyone in the House, and certainly the Secretary of State, ought to know that the majority of people claiming housing benefit are pensioners, people with disabilities, or people on very low pay.

Many hard-working families in this country are entirely dependent on housing benefit. Nowhere is that more marked than in constituencies such as mine in central London, where housing, travel and training costs are vastly above the national average. However, nothing in the Budget appears to acknowledge regional variations, which will of course affect the potential for people to find jobs even if the private sector is capable of providing them.

Another remarkable feature of many speeches from Government Members was their contempt for public sector workers. It seemed that none of them wanted additional nurses in their hospitals, additional doctors in their surgeries, or additional teachers in their schools. Certainly we know that they do not want more policemen, because their numbers are being slashed all over the country, as will be the very people on whom the most vulnerable in our society depend.

That, of course, is the other great canard. This Government came into office saying that they would take tough decisions. They said the road was bumpy, but that they would protect the most vulnerable. They have betrayed the most vulnerable, however—the very young, the very old, people with disabilities. Women are a marked target for this Government. We women are clearly expected to have the broadest shoulders in the country because the cuts will fall on us. The Government are expecting women to go back to work—if there is a job to go to, of course—while at the same time taking away child care support, which is the absolute bedrock that enables a woman with children to go back to work.

The Government have markedly failed to think through their grievous policies. This is not a Budget for investment or growth. Rather, this is the Budget of a group of people who have markedly failed to understand the realities of the situation facing millions of people in this country who do want to work, who wish to take this country forward, and who have optimism and believe in all of us. The people who do not believe in the people of this country, or indeed in this country itself, are the Conservatives.

[Stephen Lloyd]

rose—

Oral Answers to Questions

Glenda Jackson Excerpts

Monday 28th March 2011 Commons Chamber

[Steve Webb]

My hon. Friend has raised an important point, but of course as soon as we do something for that particular cohort, another of people born a month earlier or later will say “That’s not fair”, and before we know it we will have delayed the change until 2020 at a cost of £10 billion. Although my hon. Friend asked his question in a characteristically beguiling way, I must tell him that there is no simple way of dealing with that one group.

[Glenda Jackson (Hampstead and Kilburn) (Lab)]

The Minister will be aware that it is increasingly difficult for women over the age of 50 to obtain employment. Given the later pension age that the Government are introducing and the changes in employment and support allowance, women who find it impossible to obtain jobs may find themselves with no financial support at all.

[Steve Webb]

The hon. Lady has raised an important point about the financial support available to the group concerned. In fact, about 70% of them are in paid employment, and that section of the labour market is doing better than other sections. We reckon that three in five of these women have built up occupational pension rights on which they will be able to draw before they reach the age of 66, and both ESA and JSA will be available in certain circumstances. A combination of sources of income will be available to them.

Housing Benefit

Glenda Jackson Excerpts

Thursday 10th March 2011 Westminster Hall

[Dame Anne Begg (Aberdeen South) (Lab)]

On behalf of the Work and Pensions Committee, it is a pleasure to open the first debate that we have held in Westminster Hall. We have published two full reports up to this point in time. One is “Youth Unemployment and the Future Jobs Fund” and the other is the report that we are discussing today, “Changes to Housing Benefit announced in the June 2010 Budget”.

We had hoped that the Government response would have been with us a bit earlier, but it arrived a bit close to the wire. We were able to agree it in our Committee meeting yesterday morning, just after we had grilled the Minister, who is here today, on his pensions policy and thrown him out. The members of the Committee now have copies of the Government response. Obviously, part of the reason for the debate today is to discuss the report in general and the Government response.

I will give a bit of history about the genesis of the report that we are debating today. We decided that it was important to produce the report after the announcement about housing benefit in the Budget last June. However, as soon as we announced the inquiry and published our terms of reference, the debate about housing benefit and local housing allowance moved on. So this report is quite narrow, in that it looks almost exclusively at the LHA and the situation in the private rented sector. That is because at the time that the report was produced, it had not been recognised that there might be implications for the public rented sector, and particularly for local councils, due to the changes to housing benefit. That became clearer as we carried out our inquiry, but by that time we were already tied in to the terms of reference that we had sought evidence on, and we were not in a position to change those terms of reference. However, I am fairly sure that the debate about housing benefit and the LHA will continue, and hopefully this afternoon we can tease out some of the additional issues that we were unable to cover in the report.

We need to begin with the items in the Government response that we welcome. We made a number of recommendations in our report about the need for robust data and robust independent research. That was because when we took evidence, we found that charities working in the homeless sector often said that the changes to housing benefit would lead to mass homelessness and were unlikely to lead to private landlords reducing their rent, whereas the Government said, “No, they won’t. There might be a bit of homelessness, but not really that much, and yes, the whole point of this policy is to force private landlords to reduce their rent.” Until the policy is in place and has been working, it is impossible to test which of those two diametrically opposed views is the right one. That is why we are pleased that the Government have recognised the need for good, solid, independent research, because that will be the only way in which we can tell whether the policy has had the intended consequences and ensure that it does what it says on the tin.

I do not know whether this was a success for our Select Committee, but many people were delighted that the Government decided to drop the 10% sanction on housing benefit for people who have been on jobseeker’s allowance for more than a year. That proposal caused a huge amount of angst among a large number of the people from whom we took evidence, and the issue was raised on the Floor of the House and in debates in Westminster Hall. It seemed grossly unfair, and it certainly would not have done what the Government alleged it would do, which was to act as a work incentive—if anything, it would have acted as a work disincentive.

That proposal woke up the public rented sector—particularly the housing associations—to the full implications of some of the proposals that the Government were coming up with, because a large number of housing association residents are on JSA. The housing associations faced the prospect of losing 10% of their income at a stroke as their residents were sanctioned. The residents might have done everything that the Government asked them but have been unable to get a job, because the labour market in their area was such that they could not find one, yet they would still lose 10% of their housing benefit. It seemed strange to us that housing benefit would be sanctioned for actions in relation to a completely different benefit. I am pleased that the Government have seen fit to drop that proposal, which is incredibly important.

Much of the debate about housing benefit has focused on the caps or on the situation in London, which has helped to obscure what could happen elsewhere in the country, and some of the knock-on effects for the public rented sector. That was because it was much easier for the tabloid newspapers to latch on to stories about “£1,000-a-week housing benefit claims”, when in fact such claims were a small minority of all claims. It is often the case that it is not good practice to introduce policy based on the few rogue examples rather than on the position that most people find themselves in.

Despite that, and despite the fact that the LHA was increasing and in general covered rents, there were already shortfalls for some residents. Many claimants were already making up the shortfall between what they qualified for with regard to what they could get in the broad rental market area and what their actual rent was. As part of our inquiry, we visited a citizens advice bureau where we met an elderly gentleman who was already having to supplement his housing benefit to the tune of about 10% of his very limited pension. He was a prime example of someone who had found it very difficult to get a tenancy in the private rented sector, because as soon as landlords heard that he was on housing benefit they turned him away. “Lying” might not be quite the right word to use, but he “failed to inform” his landlord that he was actually an LHA recipient when he signed the lease on the accommodation that he was in at that time. He knows that he probably would not have been able to get that lease if he had told his landlord that he was an LHA recipient.

That is one likely problem with the Government’s approach. The assumption is that people will be able to move and that they will be able to find accommodation within the bands that they can claim for, but that is not necessarily the case. Although the Government response says that landlords will reduce rents in many areas, it is definitely the case that in large numbers of areas—my area, for example—demand already outstrips supply, and landlords will quite easily be able to get tenants who are not dependent on housing benefit to live in their properties. Therefore, the choices of those who are dependent on housing benefit will be squeezed and become ever narrower. They do not have the choice to go into the public rented sector, because there is already a shortage of supply there.

The Government’s response is a bit complacent in saying that landlords will reduce their rents. Even if they do so in one or two areas, I suspect that in the majority of the UK they will not, and it will be very difficult for people to find anything to rent. In places where there is very little choice anyway, such as rural areas, choice will be further narrowed, and it might be impossible for people who are on housing benefit or local housing allowance to get anything with a rental price anywhere near what they can claim in benefit.

[Glenda Jackson (Hampstead and Kilburn) (Lab)]

I have received a briefing from the Residential Landlords Association on that precise point. It says that in relation to a survey it conducted:

“71% of respondents said that they would not decrease their rents. A recent study for the British Property Federation put this figure at 88%. Although the Government’s whole case is based on the assumption that this will happen our survey evidence (along with that carried out by the Local Government Association in London) contradicts this.”

[Dame Anne Begg]

That is why it is important that the research is carried out. In his evidence to the Committee, the Minister, the noble Lord Freud, said:

“They would say that, wouldn’t they?”

It is not until the proposal is market-tested that we will know whether what we are talking about will be the case.

--- Later in debate ---

[Dame Anne Begg]

That is the problem. As well as the discretionary element, council tax benefit will be devolved to local authorities, although only 90% of it, and that as well will be discretionary to the local authority. The discretionary element must cover not only older people but disabled people, young people, large families and multi-generational families, perhaps from ethnic minorities, yet it will be up to the local authority to decide who receives it. I suspect that most local authorities will have a pecking order of groups that they think are worthy of support, leaving the groups that they do not think are worthy of support at the bottom of the heap.

[Glenda Jackson]

There is another dimension to the problem that my local authority has raised with me. This is a period in which local authorities are strapped for cash and reducing staff, yet the changes will place greater burdens on them, which might extend the length of time required to make the discretionary decisions, making the people waiting for those decisions even more anxious and concerned.

[Dame Anne Begg]

Governments and local authorities are often accused of making people suffer a postcode lottery. The fact that yet another matter will be open to the discretion of local authorities with tight budgets could create a strong postcode lottery dependent on area, not just in different parts of the country but in neighbouring areas. That will lead to uncertainty among claimants, who will not know when they sign a lease whether they will receive discretionary housing payment or not. There will be new claimants, and those sitting in houses in the hope of receiving discretionary housing benefit might have months of worry—perhaps will have even started to look for other housing—before knowing whether they will be covered by their council’s discretion and receive the money.

I suspect that in many areas, because the money will not go far enough, the discretionary housing payment might cover some but not all of the gap between people’s rent and their housing benefit and local housing allowance, so the anxiety about whether they will have to move will continue even after they are awarded the discretionary housing payment.

The other panaceas that the Government seem to think will solve a lot are the nine months’ transitional protection, which was mentioned only four times in their response rather than 20, and the independent review, which is mentioned throughout the document, although I did not count how many times. Phrases such as “the independent review will be comprehensive” and “it will cover” crop up throughout the report, as though we will have to wait for the review before some of the questions are answered. That is particularly worrying.

Another issue that we considered was the shared room rate, which the Government say in their response will be renamed the shared accommodation rate. It is meant for younger people, who are expected not necessarily to have single tenancy of a complete property but to share with others. It is proposed to raise the age limit for the shared accommodation rate from 25 to 35.

I am not sure that the Government have thought through the implications. I held a housing summit in Aberdeen to which a lot of people from the public rented sector came along, particularly from housing associations, and they were greatly exercised. Do the Government know how many houses in multiple occupation exist? Is there enough accommodation for that group of people? In my area, there are virtually no HMOs, because it is quite complicated and bureaucratic to register as one. A number of people who fall into the category will not be able to access a room in shared accommodation. Have the Government considered changing the rules to make it easier to share? It is illegal for tenants on housing benefit to sub-let, and there are all sorts of other barriers in the rules that make it difficult for people on housing benefit to share housing.

Have the Government considered the divorced or separated dad who is 34 years old and has access to his children at the weekend? What will it mean to bring children into a house in which other people live? Have the Government considered the child protection issues involved? Will the single room rate apply to the divorced father under 35 who looks after his children one or two nights a week?

What research have the Government done to ensure that accommodation for that group exists at all? In some rural areas, there are no HMOs. Will young people all be expected to flock into cities and more populated areas if the accommodation for which they qualify does not exist in their area?

--- Later in debate ---

[Dame Anne Begg]

Indeed. I know from the homelessness legislation that that problem already exists. Lots of young pregnant women come to my constituency surgery who are living in mum’s spare bedroom or on her couch, but the homeless section will not see or deal with them until the day the baby is born. Usually the homeless section is sympathetic and will try to find them somewhere, but I suspect that that might happen only in Aberdeen, where there is not as much pressure on the social rented sector as in London. Such young women are often in a state of anxiety because they do not know what they will be taking their baby home to. They worry that it might be a damp room in a shared house somewhere.

[Glenda Jackson]

My hon. Friend lays her finger precisely on a constituency case that I had. The mother involved gave birth to her baby in the local hospital, the baby was ill and my constituent’s medical team would not allow her to take the baby back to where she had come from, as it was overcrowded, seriously damp and totally unsuited to a sick child. As a result, additional costs were laid on the national health service due to the complete unacceptability of her living arrangements at the time.

[Dame Anne Begg]

I suspect that most hon. Members will have similar examples in their constituency.

The Government’s response lists the various groups to which the shared accommodation rate—I have got so used to calling it the single room rate that I am finding it difficult to change—will not apply, but it is not clear how all the housing benefit changes will affect those living in supported accommodation, especially those who receive a mixture of Supporting People money and housing benefits, which is often a complex package of benefits, to allow them to live with support in their own home or shared accommodation. Will the Minister say a bit more about that?

Our report also considered work incentives, which were the main rationale for the Government’s changes—well, I suppose that the main rationale was to save on the housing benefit budget, but the second was to improve work incentives to ensure that work always pays.

--- Later in debate ---

[Glenda Jackson]

On that very point, I have a briefing from the National Housing Federation, which states:

“There is a very limited supply of one bed properties into which people will be able to move. In 2009, just 38,700 one bed housing association properties were let to people of all ages in England. By contrast, the DWP’s impact assessment identifies 240,000 households who fit the size criteria…Most of these people will see a cut in their benefit with no prospect of being able to move to a smaller social home.”

[Dame Anne Begg]

That gives some of the figures. The problem is the mismatch between what people will now get housing benefit for and the actual housing supply. We also have to remember that housing associations and councils are no longer building houses. In fact, the housing summit that I hosted made it clear that housing associations, in particular, are afraid that they might not be in a position to build any more new houses. At the moment, banks regard them as a fairly low investment risk, because they know that housing associations will be paid housing benefit directly for residents who are on it. Under the move to universal credit, housing benefit will no longer be paid directly to the landlord, which will undermine housing associations’ ability to borrow, because they will no longer be seen as low risk.

Alternatively, housing associations might have a large number of tenants in properties that are over-occupied, so they will see a shortfall in housing benefit. On a number of different fronts, therefore, housing associations could see arrears build up, because people can no longer afford rents as a result of the changes to housing benefit. If housing associations are then seen as no longer being a safe investment bet, they will not be in a position to build the new houses that are required. Some housing associations have gone down the route of shared equity and all sorts of other things, but all that is under threat because of the housing benefit changes. That was outwith the scope of the Committee’s report, but it certainly needs to be considered, and I hope that we will return to it at some time in the future.

I know that I have not covered everything and that I have covered only bits and pieces, but I have talked for a long time, so I hope that hon. Members will have a flavour of some of the issues. Yes, we welcome some of the things the Government have said, but we are generally quite disappointed by their response and by their view that £190 million of discretionary housing benefit will somehow magic away a lot of the problems resulting from the changes. I hope that the Government are listening and that the Minister can answer at least some of our questions—if he cannot do so, I am sure that he can write to us.

--- Later in debate ---

[Caroline Lucas]

A tiny number of high-profile cases have completely distorted the whole debate. Yes, there will be a few cases that cannot be justified, but I do not think that they should be allowed to dictate a policy that will be so punitive towards the poorest and most vulnerable.

[Glenda Jackson]

On precisely that point, I, too, was somewhat disturbed by the Prime Minister’s absolute adumbration that such cases were the norm for people who claim housing benefit, so I tabled questions. We are talking about precisely 90 families, who are all in central London. They are all large families, usually from ethnic minority communities, who have come to this country because we offered them asylum.

[Caroline Lucas]

I am enormously grateful for that information, which clearly sets out what we are dealing with. We are not dealing with the manufactured scenario in which hard-working families support the housing costs of huge numbers of workshy people who are wasting taxpayers’ money, which is the story being put about. The evidence given to the Committee shows plainly that that approach is inaccurate and irresponsible.

Let us remember that only one in eight of all housing benefit claimants is formally classified as unemployed. The rest include people on low incomes, pensioners, carers, and people with disabilities who are unable to work. We must challenge the myth of the workshy.

--- Later in debate ---

[Glenda Jackson (Hampstead and Kilburn) (Lab)]

I congratulate my hon. Friend the Member for Aberdeen South (Dame Anne Begg), who chairs the Select Committee on Work and Pensions, and other hon. Members who have contributed to the debate this afternoon.

I must say to the Minister that the Government response to the Select Committee report adds insult to injury. The insult was the Government’s failure to give the House their response to the report earlier than this morning. Committee members were in a privileged position: we got our less-than-glossy copies yesterday morning, I believe at about 9.25. What was injurious was that the Government seemed not to have read the report.

I freely expect the Government not to listen to anything that the Opposition have to say about proposals, but I am stunned that they ignore what a Select Committee puts before them, given that the Committee’s findings are based not on our own experience as constituency MPs, but on a great deal of informed experience and evidence given to us by organisations whose only reason for being is attempting to prevent people becoming homeless or dependent on housing benefit. I have with me about a third of the briefings that I—in common with every other Member of the House, presumably—have received from such organisations. Almost without exception, the recurring theme coming through from such reports is the failure of the Government to listen to what they are being told or to take on board the dangers inherent in their housing benefit policy for the most vulnerable in our society.

We can all quote chapter and verse from our own constituencies about what the danger and damage will be. The hon. Member for Cardiff Central (Jenny Willott) spoke of the Government’s policies being London-centric. Would that they were, because it seems to me that the Government totally ignore any of the individual situations that can be found up and down the country, that people are in and will remain in, even though they are in work. Many of the most low-paid in this country are utterly dependent on housing benefit, and they are certainly not pulling in rents that would keep in fine fettle a house worth more than £1 million.

The contribution of London Councils stated:

“Housing costs are over 50% higher than the national average…child care costs are around 25% higher than the national average…Transport in London costs on average £10 per week more…than…in other metropolitan areas.”

We are told that the whole thrust behind the Government’s policy is not simply to cut money out of housing benefit or to fill up that big black hole of national debt, but to encourage people to get back into work. However, according to London Councils:

“Added to this, Londoners face extra difficulties in moving into employment, with greater competition for entry level jobs. Many of these entry level jobs do not include a London weighting to reflect the higher in-work costs in the capital…The impact on jobseekers in London has been highlighted in research carried out by Reed in Partnership”—

presumably more evidence the Government know nothing about—

“where the move into work costs on average £639.40 over the first month (including childcare), over £150.00 more than for the rest of the UK.”

Other briefings also pointed out a genuine and well-based fear that the Government’s proposals will inevitably lead to greater levels of homelessness, which would mean a greater need for local authorities to house, unless the Government propose removing the statutory obligation on them to put a roof over a child’s head. Anything is possible with this Government—they might be intending that, but they have not said it yet. However, if the statutory requirement remains, local authorities will have to house children.

Without any question, every single piece of evidence presented to us shows that the people who will be most affected by the Government’s proposals are the most vulnerable. Such people tend to be single parents with children, or families on very low pay with children. We are looking at a situation in which we might go back to the dreadful days, which I remember well, when families were existing—certainly not living—in ghastly bed-and-breakfast hostels.

Crisis, in its briefing to the Select Committee, said that at the moment the cost of a room in a bed-and-breakfast hostel could be £60 a day. How will the Government save money if that is indeed the future for many families, not only in London but throughout the country, if the proposals go through without any consideration?

As my hon. Friend commented on the Government response to the arguments put forward, not exclusively by the Select Committee, we are not inventing these things, which come not only from direct constituency experience, but from organisations that are expert in the field. They say, for example, that if people with a disabled child need an extra room, or space for a wheelchair or a dialysis machine, the Government’s response is, “Oh well, we can’t be expected to meet the requirements of every single individual in this country.” Why? I thought that one of the first responsibilities of Government is to protect the citizens of this country. Surely protecting children, the disabled and the elderly is a vital part of any Government’s job.

In their response to the Select Committee’s report, the Government have failed markedly. There is lack of attention to detail. As most hon. Members who have spoken have said, the Government apparently believe that the additional £190 million that they have managed to find will cover all the additional costs on local authorities, for people who cannot meet their rents, and that that will be the panacea and remove everyone’s problems. We all know that that is ridiculous, because it will not. There will be a nine-month transition. Really! Nine months’ transition will do nothing except exacerbate the justifiable anxieties of people who know that they are being threatened and may have to move home.

When the noble Lord Freud gave evidence to the Select Committee, he was very sanguine about people who may have to move from central London boroughs to outer London boroughs. He could not give any fine detail of what properties could be affordable and available in outer London boroughs. He rested his contribution on the statement that there is a 40% churn annually of people moving house. He could not tell us what sort of families that 40% churn represented, and I think it highly unlikely that it included people with disabilities. I am pretty sure that it did not include families with children, because the monstrous aspect of the Government’s proposals is not only that people will lose their homes—they will—but that children will lose their place in school. They will then have to try to find another place in another school. The evidence from Lord Freud’s officials on school place vacancies bore no relationship to any figures that I have heard. There are two London boroughs in my constituency, and a desperate shortage of school places not only in junior schools, but in secondary schools. Yet according to the Government, the rest of London is awash with empty school places. I would be interested to know where they are, as would many of my constituents.

Another issue that Lord Freud completely discounted in his evidence about people having to be moved from central London boroughs to outer London boroughs was of people having to look for work. Again, he was remarkably sanguine about the cost of travelling. I had three constituency cases only this morning. In one of those, parents with three children aged nine to three are forced to live with their in-laws: six adults and three children are living in a four-bedroom house. The house is owned by the in-laws, but it is extremely difficult for the local authority to find anywhere for that unit with three children to live other than in the private sector.

Despite the Government’s pronouncement that landlords will be only too happy to lower their rents when housing benefit goes down, there is a marked reluctance on the part of private landlords to accept tenants who receive housing benefit. In my constituency, almost without exception, there is a gap between what landlords charge and what housing benefit pays. That gap will only increase because of the Government’s proposals.

Another issue that I find bemusing is the Government’s argument that the proposal is not just about saving money, but is a real plus and an incentive for people to find work. The majority of people I know who are on housing benefit in my constituency, setting aside the fact that they may be disabled, work. They are in low- paid work, but they are expected to move somewhere else to find jobs, so central London will be bereft of all those jobs on which higher earners are dependent to be able to do their jobs. Quite how that will be a big plus in revitalising our economy is beyond my comprehension.

I have always had a rule, Mr Sheridan, that if one cannot say what one needs to say in 10 minutes or less, one should not rise to one’s feet. As I am in grave danger of breaking my own rule, I had better draw my comments to a conclusion.

When the evidence in a Select Committee report is so irrefutable and it is of such importance to so many individuals and families that the Government get it right, it is absolutely scandalous that the Government response should be so flabby and patronising. The Government patted the Select Committee on the head, but they examined none of the real issues. Given the huge wider changes that they are introducing throughout the welfare benefits system, it is to be hoped that they will begin to do a little more research and take seriously the evidence that is out there.

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[Ms Buck]

rose—

[Glenda Jackson]

rose—

[Steve Webb]

I will give way to the hon. Member for Westminster North in a second. One of the reasons why deficit reduction is so vital is that so many items of spending have become too large. Some of the concessions that we have talked about would be £100 million here or £500 million there. Very soon they add up to serious money.

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[Dame Anne Begg]

rose—

[Glenda Jackson]

rose—

[Steve Webb]

I will give way in a moment. Landlords are quite clear that that is hugely attractive to them. It is worth shaving the rent for, and that is often all that it would take.

--- Later in debate ---

[Steve Webb]

I am grateful to my hon. Friend for setting that context. During the course of this debate, one or two hon. Members have said that this is all about chasing the headlines in the red tops—the tabloids—and it is that that is shaping policy. Clearly, this is not a policy about a small number of extreme cases. The hon. Member for Hampstead and Kilburn says there are about 90 cases, but let me give one example. The top 5,000 cases of people to whom we pay housing benefit cost us £100 million a year. For 5,000 people to live in properties—

[Glenda Jackson]

It is not 5,000 people; it is 5,000 families.

[Steve Webb]

The hon. Lady can have 5,000 families, but she is, I think, losing sight of zeros. For someone in the Department for Work and Pensions, £100 million does not seem such a big figure, but it is a colossal amount of money that is not providing value for the hard-pressed, low-paid taxpayer, who often does not live in brilliant accommodation. It is not a good use of £100 million.

[Steve Webb]

As the hon. Lady knows, a lot depends on who takes those tenancies. If they are people who would have been in lower-rent social tenancies, the housing benefit costs will be higher, but if they are people who would have been renting in the free-market private sector, the costs could end up being lower. The numbers that she quotes are spurious.

[Glenda Jackson]

I want to know the Minister’s evidence for believing that landlords in the private rented sector will lower their rents. That certainly was not the finding of the National Landlords Association, which I mentioned earlier in the debate. Surely it is dependent on whether there is an excessive amount of empty properties, which, in a constituency such as mine, or any in central London, is an absurd premise. For all the properties concerned, there are many more people who are willing to take them on.

[Steve Webb]

I have a number of observations to make. First, the hon. Lady cited “evidence” that was not evidence at all, of course. It was a survey of the people who stand to lose from the policy, who mysteriously wanted to undermine the policy. When we talk to landlords’ groups—as we do—it is absolutely clear that direct payment is a prize for them. I hope that she does not argue with that statement. It is self-evident, blindingly obvious and common sense.

[Glenda Jackson]

Will the Minister give way?

[Steve Webb]

Can I just respond to the hon. Lady’s points before giving way to her again? [Interruption.]

[Steve Webb]

I hope that I can just respond to the points that the hon. Lady has made.

[Glenda Jackson]

I did not make that point.

[Steve Webb]

Landlords clearly value direct payment. There is no doubt about that. It is common sense and stands to reason. I do not know if the hon. Lady accepts things that stand to reason, but it is patently obvious that landlords value direct payment. There is an economic value to direct payment. It offers certainty as opposed to uncertainty. That can translate into lower rent. If landlords have a choice between the rent that they previously charged with uncertainty about whether they get the money, and a slightly lower rent with certainty of getting the money, landlords will go for certainty every time. That is common sense.

[Glenda Jackson]

Will the Minister give way?

[Steve Webb]

In a moment. The hon. Lady also said, “Where are all these properties? There is this massive, pent-up demand and these landlords will just go somewhere else.” If there is that massive, pent-up demand, why have landlords not already gone somewhere else? Why have they not already increased their rents beyond what housing benefit covers today? Why are they not already renting to non-housing benefit tenants? There is a reason why they rent to housing benefit tenants: they get the money, particularly with direct payments.

[Glenda Jackson]

Oh, I am most grateful to the Minister for giving way. The words “direct payment” never passed my lips and as I said in an earlier intervention, I would be grateful if the Minister could try to answer the questions that I put to him. Then there is the issue of why landlords are not renting to others outside the housing benefit sector. As I have pointed out, there is a growing trend that private landlords will not accept tenants whose rent is paid by housing benefit. In my constituency and contiguous constituencies, I do not see a massive increase in signs showing places to let.

[Steve Webb]

I hesitate to bring facts into the debate, but the number of properties in the private rented sector with tenants on housing benefit, which the hon. Lady says is falling and indeed she also says that such properties are hard to find, has risen since November 2008—

[Glenda Jackson]

Where?

[Steve Webb]

Across the country. It has risen since November 2008 by 440,000. To listen to the hon. Lady talk, one would imagine that tenants on housing benefit cannot find anywhere to live. There are 1 million tenants on housing benefit in the private rented sector. To listen to her, one would think that those people do not exist. Unfortunately for her, I am afraid that what she describes is at variance with the facts.

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[Steve Webb]

Okay, I shall give way to the other hon. Lady.

[Glenda Jackson]

I just wondered whether the Minister had the shared accommodation figures, and why hard-working taxpayers are not offended by HMRC allowing people to have tax breaks when they let a room.