Under-occupancy Penalty (Wales)

Ian C. Lucas Excerpts

Tuesday 22nd January 2013 Westminster Hall

[Jessica Morden]

I thank my hon. Friend for that point. It is true that housing associations, local authorities and the Welsh Assembly will be under stress because they will not be able to mitigate the effects of this policy.

With a chronic shortage of available housing, many tenants appear to feel that there is no alternative but to be forced into arrears or to resort to desperate measures such as payday loans or loan sharks. Families will be forced into financial difficulty and rent arrears. Steve Clarke, chief executive of the Welsh Tenants Federation, estimates that 10% of tenants who will be affected are already indebted to their landlords who are seeking repossession orders. The double whammy of rent arrears and the increases could mean that 4,000 present themselves as homeless. This is against a backdrop of food banks in Newport giving out hundreds more parcels a month and food crime up 26% over the past two years. We are talking about people stealing washing powder.

The Government appear to think that people will find it easy to get extra hours of work or to find an elusive job. They think that lone parents with small children should go out and seek lodgers. In fact, the findings of the hotline of Community Housing Cymru— “Your benefits are changing”—found that 13% of people who rang would consider downsizing and 8% might consider a lodger. However, 79% said that taking on a lodger or moving were not suitable options and that they would apply for discretionary housing payments.

I believe that £7 million has been allocated to Wales, which faces a potential loss of £25 million. That is the Government’s answer to those who cannot move. There is a limited amount of money from the Government towards those payments, but once it has been used, no other payments can be made. I take the point that was made earlier about the fact that there has been no clarification of how the money will be spent. The deserving might miss out if they happen to be in need when the fund has been exhausted. There has been no compelling analysis of the impact that the changes will have on individuals, and the Government’s response of setting a finite budget without knowing whether it will be sufficient is as callous as the bedroom tax itself.

[Ian Lucas (Wrexham) (Lab)]

Does my hon. Friend agree that one of the most telling aspects of the legislation is the fact that there are no exemptions for severely disabled people? The fund that is available will be quickly used up by, for example, adults with severe learning disabilities who, in all genuineness, cannot take lodgers, because their needs and circumstances are not conducive to sharing accommodation.

[Jessica Morden]

I agree with my hon. Friend’s important point, which we have to bear in mind. Those who have had disabled adaptations to their property would, if forced to move, need another set of disabled adaptations, and it is not clear what will happen with discretionary payments in such circumstances.

--- Later in debate ---

[Steve Webb]

The right hon. Gentleman says that it is about saving money. I do not apologise for the fact that we have had to save money, because otherwise we would just pile up debts for our children, and that is not progressive, wherever someone is on the political spectrum.

On the hon. Lady’s specific point, yes of course, in theory, successive Governments have tried to work with housing associations and social landlords, and it has not worked, because we have the best part of 1 million empty bedrooms paid for by housing benefit at the same time as we have thousands of people in overcrowded accommodation. The challenge is therefore to use the need to save money to create fairness between private and social tenants and to create fairness between people who are living in overcrowded accommodation and those who have spare bedrooms.

[Ian Lucas]

Will the Minister give way?

[Steve Webb]

No, I want to respond to the hon. Lady. She said that these are the lifetime homes of some people, and I entirely accept that. That is why we have exempted pensioners as a group. A set of pensioners have spare rooms, living in the home that they have occupied all their lives, and we are not touching them for the reasons she gave.

Those who are below pension age can clearly respond in a range of ways. It will be different for every person. For example, we are often told that some people in social housing or on housing benefit are in work, and the average £12 shortfall in Wales is the equivalent of two hours at the minimum wage, so for some people, as the hon. Lady said, it will be a matter of working a few extra hours. I accept that that is not an option for everyone, but it is for some. Others might have the opportunity to do a part-time job, if they are not currently. She said that some would not be able to take in a lodger or tenant, but some can. I had a constituent ring me up to say, “I am in a three-bedroom house, I live on my own and I have just had one of these letters. What shall I do?” We started talking and she said, “To be honest, my brother and sister-in-law would quite like to move in. Can we do that?” Yes, they can, and that would be using the house to much better effect. That will not be right for everyone, but there will be a range of responses. The system is geared so that if people have a boarder or sub-tenant—most social landlords should allow a sub-tenant, in an organised way—they get to keep at least the first £20 a week of the income. Those are all options, which will not work for everyone, but there is a range of them.

The hon. Lady mentioned Bron Afon and Duncan Forbes. I have looked at some of the case studies. One of them is just wrong. In the case she mentioned of the ex-serviceman with a teenager who might go off to university, provided she is not away for more than 13 weeks at a time, she can have the bedroom. That means that social landlords have to be good at communicating with their tenants. I have seen good examples, although I have also seen some bad ones. The other examples may well be true but I saw that case and it jumped out at me, and I thought, “That is not right”, although there is a description of how distressed the man was. Someone has a duty to know the rules—we have to communicate them effectively, but so do the social landlords. I have seen letters sent out by social landlords that are excellent, that explain the rules and what discretionary housing payments are, but I have seen others that do not even mention discretionary housing payments. We have to ensure that social landlords up their game.

I must respond to several points on discretionary housing payments, which are crucial. The right hon. Member for Torfaen (Paul Murphy) cited a figure of £50,000, £54,000 or something. The figure for that local authority for the year we are talking about, when the policy comes in, is not £50,000 but £193,000. That is when the policy comes in. Clearly, the point of discretionary housing payments is not to make up everyone’s shortfall, or we would not make any money out of the policy—we would not be saving any money—but it is for the hardest cases.

There is an issue to do with whether we try to prescribe in primary or secondary legislation the exact categories of people whom we want to help, of which one is people with major disabled adaptations. We could have done that, but the second that is done and we try to define a substantial adaptation, we get someone whom we did not think of just the wrong side of the line and someone whom we did not need to include on the right side of the line. For example, if someone has had stairlifts, extra rooms, widened doors and all the rest, it is pretty obvious, or if someone has had a handgrip, it is pretty obvious, but what about all those in the middle? Rather than us in Whitehall trying to define for every local authority, for every sort of adaptation, that this is in or this is out, we have trusted local authorities.

We have given the money specifically for people who have had disabled adaptations or, to give another example, for foster carers; for some of the other housing benefit changes as well, we have given the councils a pot of money and said, “You know your local people. You can meet people case by case.” Thus, a lone or separated parent who has the kids regularly and needs that room, and nothing else can be done, could go to the local authority for DHP. We were not going to try to prescribe for DHP, however; we were not going to legislate for such things as whether so many nights qualify or whether there are certain arrangements for the kids. The idea is that the local authority treats people as individual human beings and meets their individual needs. The pot is not unlimited—

[Ian Lucas]

Will the Minister give way?

[Steve Webb]

I really want to respond to the hon. Member for Newport East, because I have other things to say about the points she made.

We tried not to prescribe in a rigid, central, one-size-fits-all way, but to make substantial extra money available so that people could respond individually.