Welfare Reform and Work Bill (Second sitting)

Jess Phillips Excerpts

Thursday 10th September 2015 Public Bill Committees

[The Chair]

Just before you answer that, one or two of us older folk are having a bit of trouble hearing, and we are told that they cannot turn the sound up. Could you speak directly into the microphone and be as clear as you can? It is not your fault at all; it is the age of some of us at this end.

[Jess Phillips (Birmingham, Yardley) (Lab)]

I’m 33 and I can’t hear it.

[The Chair]

My apologies.

Paul Smee: And the age of some of us at this end, too. Sorry, I lost the thread after that intervention. Would you mind repeating the question?

--- Later in debate ---

[Amanda Milling (Cannock Chase) (Con)]

Q 10 Welcome. Paul, I want to pick up on a point you raised about advice. Mortgages are complex, as are the legalities around housing. You talked about accessibility and ensuring that we give people channel preferences so that they can get advice. From an industry perspective and knowing this whole area, do you have any other advice in terms of things we need to consider? That question is for either of you.

Paul Smee: When we talk about channels of advice, it will be important that face to face is an option. I think a lot of people would want to receive this in a personal situation, and it will be important to have probably a single body as the focal point for providing that advice, which can then ensure that it is of the required standard and that those giving the advice have been trained appropriately.

Paul Broadhead: The other thing to consider when giving people this advice is whether it is in their best interests to remain in home ownership and wait for the 39 weeks, if that is right. It may well be that if they are in a situation where they cannot get back on their feet, and if they are in an environment where house prices are not rising and their debt is rising, nine months later they may be in a worse situation, having waited for that benefit, than they would be if they faced facts and took active steps to market the property and seek another form of residency. I do not think we should automatically favour remaining in homeownership as absolutely right for that person. They need to know the pros and cons to make an informed choice, because repossession or selling the property is not always the wrong thing for a borrower and their family.

[Jess Phillips]

Q 11 Apologies for being a bit late; I was stuck in the Chamber.

My questions have been largely answered, but I have some real concerns about the advice sections you are talking about. In my experiences of women and domestic violence, their husbands leave and they are left with the mortgage of a property. They have never worked and would find it difficult to get into work.

I am concerned about the advice, but I am also concerned about what detail is not in the Bill. I am confused. It is confusing enough, let alone if you are a vulnerable person in a difficult situation. I wonder if you have some concerns about the detail and whether you will need more detail before you can give firm conclusions about whether this is going to be terrible for the claimants.

Paul Broadhead: Yes, the detail will tell us the exact process—how this will work, who will provide information and all that final detail. That is not here at the moment. We are talking at a bit of a conceptual level, but I think we are generally supportive. Both parties are supportive of moving this to a loan in most cases, but we have concerns about the mechanism for delivering that advice and ensuring that there are not unintended consequences. There is a lot still to be worked out in the secondary legislation.

Paul Smee: We have offered to get down and work closely with DWP Ministers on the detail. We have a lot of experience within the lending community of how to deal with people who are in arrears and how to handle them sympathetically. We will be very keen to work with officials to come up with detailed proposals that work for the industry and for the claimants.

[Anna Turley (Redcar) (Lab/Co-op)]

Q 12 Building on that point about the lack of detail in the Bill, one of the biggest concerns you have raised is the huge number of existing claimants, but there is no detail on how they will be dealt with. What are your thoughts on how they should be dealt with? How serious is it that the detail is not there?

Paul Broadhead: Many, in fact more than half, of the existing claimants are in receipt of pension credit, so we are talking about a certain type of individual and we need to ensure that the advice is right. Many of these people have been long-term claimants, so we need fully to understand that change. The timetable for delivery is challenging. There could be an argument—I am not saying there is, because it depends on the Government’s delivery plans—for saying, “Okay, on 1 April 2018, this applies to new claimants,” and we then make sure that we take our time to ensure that everyone understands the effect of the change on their circumstances. Perhaps we could put that back 12 months or so for existing claimants, but it needs to be considered very carefully so that we do not end up with unintended consequences. We have talked about debt—whether it is debt or not and whether it is going to be repaid—and many of these people will not like the thought of debt and might put themselves in a more difficult position than is needed.

Paul Smee: I hope that the Government can come to an early conclusion about the channel through which the advice will be given, because we would want to work with those who are giving the advice in order to understand their position.

--- Later in debate ---

[Jo Churchill (Bury St Edmunds) (Con)]

Q 41 I will try to be succinct, because you have covered a lot of this. My major interest is in how we help occupational health outcomes that would aid employees, particularly those who, for example, suffer from cancer and, through no fault of their own, end up in a situation where they are claiming. Many of them, after Question Time yesterday, asked me why we could not do something like invoke a conversation between a doctor and the employer to avoid them falling between the cracks. They are okay to work and they want to work, but it is an all-or-nothing scenario. Is there any mileage in a better dialogue or a service where doctors can help to inform—this leads into long-term conditions, an ageing population and so on—so that we have a better conduit of information between different services?

Kirsty McHugh: Short answer—yes. We know that the NHS is not brought into the conversation as much as it should be. Again, a positive: employment is now one of the NHS framework outcomes in a way that it was not before. That should be a big step forward for us. Where things work well, the GP is part of the conversation. We often find people who have been on ESA for a long time and whose medicine has not been reassessed. The prescription keeps on running, which cannot be good for them and does not help that idea of work being good for people.

[Jess Phillips]

Q 42 I am just going to go back to some of the discussion about the benefits cap. My colleague, Emily, pointed out the effect on the cost of housing and on those people living in the private rented sector. Do any of you perceive that the changes in the rates that will be offered will have an effect on the market, thus pushing down the costs of rents for those landlords? If not, will it potentially just affect—

Tony Wilson: Categorically no; it will not have any impact on rents. I can say that fairly categorically because the Department produced a really good evaluation of the local housing allowance reforms in the previous Parliament, which, I think, found that 92% of the impact was borne by the tenant and 8% by the landlord. Essentially, landlords did not have to adjust their prices; tenants just had to pay.

[Jess Phillips]

Q 43 Thinking about the local housing allowances rates, now that those allowances have been localised and councils can put rules in place to decide them—for example, you have to have lived in Birmingham for one year or Sandwell for five years before you can qualify to go on housing lists and access those services—I have a concern. Octavia, I wonder if you could comment on it. The idea of people moving to places with cheaper rents will be immediately stopped by that. Emily’s lovely residents in Islington could move to Birmingham and, let me tell you, there are lots of London boroughs trying to do that. Of course, what they will find when they get there is that they are not able to come in. Might that be a problem for some families?

Octavia Holland: Yes, I think it could well be but, as I said before, it is difficult to be very precise about exactly how the outcomes of the benefit cap will play out over the next few years.

The other point I want to make in relation to the benefit cap is that all the evidence we have had, and some evidence released by the Joseph Rowntree Foundation yesterday, shows that single parents who are working are by far the worst-hit group among all types of families and individuals. I am sure members of the Committee know that there are 2 million single-parent families—that is one in four families. I think the support given to those parents to get into work and stay in work needs to be looked at. There is a severe shortage of part-time work, for example, and I do not know what plans there are to make sure there is enough suitable work for single parents.

[The Chair]

Well, Ministers are here and are listening. A point well made.