Housing Benefit (Wales)

Glyn Davies Excerpts

Thursday 1st May 2014 Westminster Hall

[Glyn Davies (Montgomeryshire) (Con)]

I intend to make a fairly short contribution. I want to speak not only from the perspective of the Committee’s report and work, but about the impact of the housing benefit changes on my constituency and how things have worked out in practice. I congratulate the Chair of the Committee, my hon. Friend the Member for Monmouth (David T. C. Davies). The Committee was dealing with an issue of some controversy and disagreement between the various political parties, and consummate skill was required on his part to prevent us from coming to blows and to produce an agreed report.

I think it is generally accepted that the cost of housing benefit had reached an unsustainable level, and the worrying trajectory of increase in that cost meant that we simply had to do something about it. Those who challenge what the coalition Government have done to try to restrain that increase should come up with alternative ways of limiting housing benefit increases and keeping the cost within affordable limits. If our debates are to be credible, we must consider such challenges.

Inevitably, when we face a change such as the under-occupancy policy, we will all have worries. I have worries about my constituency and the impact on my constituents. I had views on the matter as soon as I heard about the proposal. I thought that it should apply only to new tenants going into properties, and I thought it should apply to people of all ages rather than stopping at 65. I must admit—I am sure that the Minister will be quite amused by this—that my concerns were such that I felt I needed to attend at least two or three Westminster Hall debates in which he was responding, in order fully to understand the arguments. The Minister is a persuasive individual, as is the Chairman of the Select Committee, because I ended up convinced that the policy was right, and I have since been supportive of it.

It struck me that the voice that is not heard on this issue is that of those people who do not have a home at all and are on waiting lists. We talk about the impact on people currently in social housing, but a huge number of people do not have a property at all and are living in very cramped conditions. That is the other side of the debate.

[Jonathan Edwards (Carmarthen East and Dinefwr) (PC)]

Is that not the crux of the matter? There is a huge contradiction: on the one hand, the policy is designed to free up supply, but on the other it is designed to reduce the housing benefit bill. It cannot achieve both, because the only way that the policy makes money and therefore savings is if people stay and pay.

--- Later in debate ---

[Glyn Davies]

The hon. Gentleman makes a perfectly fair point, and I do not think that the policy can be freestanding. I wanted to discuss this later, but there must be a responsibility for extra provision, and we must also have policies that deliver that. It seems logical to the people who have raised the issue with me that the problem is that there are not sufficient properties for people to move into.

When my hon. Friend the Member for Aberconwy (Guto Bebb) spoke earlier, I was struck by the fact that it is important for us all to see how the policy works out in practice in our constituencies, because it is now in practice. I decided to write to the county council—the housing authority in my area—and the local housing association to ask how it had worked out. The senior officer in this policy area at Powys county council came to my office and we spent an hour going through it, and I must pay huge tribute to the council for the way in which it managed a difficult situation. But the reality is that it did manage the system. No one has been evicted and the arrears have not gone up. Nearly all the people affected have access to the discretionary fund.

I think that about 600 tenants in the Montgomeryshire local authority were affected, and about 570 or 580 of them had access to a discretionary grant payment. I must say that when I started asking questions about whether the discretionary payment was enough, I was anticipating having to write to the Minister to say, “It is not enough—we want some more.” However, I found that the local authority was advertising, putting out press releases begging people to put in applications because the money was not going to be spent. The discretionary budget dealt with almost all the issues that mattered in the constituency.

Inevitably, a certain proportion of households—I think about 40 or 50—have moved, and because of the housing availability in the authority, quite a number of them have moved to the private sector. That is another issue. The differentiation between the private sector on one side and Government social housing provision on the other is one that we need to soften a little. We need to see people moving to make the best use of the available housing.

[Guto Bebb]

I agree with my hon. Friend that the difference between the private and social sectors should be reduced. Nevertheless, my experience is that housing associations in the social sector seem to have been more willing to work together as a result of the policy than they were previously. Is that the experience in Powys?

[Glyn Davies]

I think that it is. It might not be the same in all local authorities—I can speak only for my own—but I must say that, on this issue, Powys county council has been brilliant. It knew that things would be difficult for some tenants—it is not an easy situation—but it employed three specialist officers to help everyone affected to deal with their situation by giving them the best advice, and they have done that. I pay continuous tribute to the work that Powys county council has done with a policy that it may well not have agreed with. It has delivered coalition Government policy and done a magnificent job.

[Paul Murphy (Torfaen) (Lab)]

Does the hon. Gentleman accept that there is a world of difference between local authorities in Wales, particularly between a large rural area such as the one he represents and a constituency such as mine that has a vast amount of former social housing? For example, there were 3,500 applications for discretionary payments in Torfaen in 2013-14, compared with only 700 the previous year.

[Glyn Davies]

The right hon. Gentleman makes a good point in that there are great differences between constituencies. He may well speak later in the debate and describe what has happened in his constituency, but when the policy was debated early on, a number of people said that it was going to hit rural areas harder—that was going to be the real problem. No area is more rural than my constituency, and the reality is that the commitment of the local authority and Mid-Wales Housing Association has made the policy work. I am not pretending that it has been easy, but they have made it work as well as possible.

The final issue I want to discuss is new housing, which is clearly needed for the policy to work well in the longer term. Housing deliverers did not respond to what they could have anticipated, perfectly reasonably, to be Government policy. To say that the policy was suddenly dropped on them, out of the blue, and that they need two years to deliver is, I think, a bit of an excuse. They could have anticipated that the policy would be introduced, but we are where we are.

We need the Welsh Government, as well as housing and planning authorities in Wales, to recognise that we need new properties. They should not be piling on extra costs. The Welsh Government have not delivered on new housing. We only need look at the figures to see that they have gone down. They have put on new costs. The planning authorities demand planning gain for this, that and the other, and make it almost impossible to build housing. The Welsh Government have put on the extra cost of sprinklers, which in themselves are fine—

[Nia Griffith]

Will the hon. Gentleman give way?

[Glyn Davies]

I will in a second—let me just finish the point, because I am getting warmed up. They put on all these extra costs, the consequence of which is that housing is not built. People might have some idealistic objective to deliver something of which they can stand up and say, “Isn’t it grand? We must do this,” but the reality is that builders moved out of Wales because they could not accommodate the extra costs. We need a positive attitude in Government and local authorities. In order to house the people of Wales affordably, both national and local government must ensure that housing is delivered and not start from a position of trying to stop people building.

I do not have much else to say, but I would like to allow the hon. Lady to intervene.

[Nia Griffith]

Will the hon. Gentleman explain how, with his Government cutting capital expenditure funding to the Welsh Government by half, he expects them to be able to build more houses? What progress is Montgomeryshire making on taking similar steps to Carmarthenshire county council, which has been able to borrow funds to build houses?

[Glyn Davies]

Again, we have a complete separation, as if the private sector is over here and the public sector is over there. The issue is not the funding of the public sector; we must allow the private sector to deliver the housing we want. The private sector will deliver what we want if we create a situation in which it can. For the past few years, all I have seen is local and national Government making it more difficult for people to deliver what the people of Wales want.

[Guto Bebb]

On that point, it is important to state that the provision of social housing in Wales fell dramatically throughout the early part of the noughties—2000 to 2007—under successive Labour Administrations in the Assembly. The problem is not recent; social housing provision in Wales has been an issue of concern over the past decade.

[Glyn Davies]

I have nothing more to do, Sir Roger, other than to thank you.

--- Later in debate ---

[Jonathan Edwards]

The hon. Gentleman and I are singing from the same hymn sheet. We were promised a rebalancing of the economy and a move towards business investment and exports, but we are seeing the same old boom and bust policies that have been the hallmark of the UK economy for many decades. The danger is that the boom and bust on this occasion might be even more serious than that built up in 2008.

[Glyn Davies]

I hesitate to intervene, and I ask this question with some degree of uncertainty, but I am pretty sure that yesterday I read a report saying that house prices have actually fallen in Wales in the last 12 months. They have gone up substantially across Britain, particularly in London, but across Wales I do not think they have risen in the last 12 months.

[Jonathan Edwards]

I did not read that report, but it makes a point about the unbalanced nature of economic growth across Britain. I am referring to the rising housing benefit bill in the UK context. The statistics I have cited do not refer to Welsh house prices in particular.

The Committee’s report found that Wales is being hit hardest by the lack of single social properties in the social rented sector. Wales is therefore being hit by a policy designed to address the public expenditure implications of the dysfunctional London economy. As I have consistently argued, we need a range of reforms. Before becoming an MP, I was heavily influenced by the reforms in the Republic of Ireland. I used to be a policy officer for the citizens advice movement in Wales, and some of these issues were prevalent then. The 2004 reforms in the Republic of Ireland were welcome. The Residential Tenancies Act 2004 achieved a number of objectives. First, it set up a private residential tenancies board. Secondly, it regulated the private rented sector, with an extension of tenancies to a more European model of longer-term tenancies. Defined rights and obligations were provided for both tenants and landlords, and access was provided to an inexpensive dispute resolution system. The bonds that individuals who rent often have to pay were safeguarded—unfortunately, on too many occasions people lose those bonds—and rents were capped, which is a policy that exists across the world. There are rent caps in New York, the home of global capitalism, so it is difficult to define them as some sort of socialist trap.