Housing Benefit

Karen Buck Excerpts

Wednesday 13th October 2010 Westminster Hall

[Ms Karen Buck (Westminster North) (Lab)]

I congratulate my right hon. Friend the Member for Barking (Margaret Hodge) on securing the debate. She has done us a great service by setting out to the House the implications for those local authorities that are likely to receive people who move from higher-cost areas. Many of us, including me as a constituency MP, have focused on issues that will impact on the areas from which people will be moving, but we must understand the sheer scale and extent of the proposals.

Almost 1 million households will lose out as a consequence of the combined measures introduced in the June Budget. As was rightly pointed out by my hon. Friend the Member for Edinburgh East (Sheila Gilmore), that will have implications for the entire country. The measures will have the most extensive impact in London, but that will ripple through all local authority areas in the country, including a particularly sharp effect in the south-west, Bristol, Brighton, Cambridge, Oxford, Edinburgh and parts of the north-west. Although London is at the sharp end of the proposals, it is not exclusively affected.

We heard powerful and well informed speeches from across the Chamber, and particularly from those hon. Members who will see the impact of the proposals. My expert and right hon. Friend the Member for Greenwich and Woolwich (Mr Raynsford) spoke about the potential damage to the private rented sector, which is a valid point. My hon. Friend the Member for Lewisham East (Heidi Alexander) spoke correctly about how the image of work-shy households in Mayfair mansions is completely contradicted by the lived experience of the overwhelming majority of people who claim local housing allowance. She and others mentioned the fact that in east or south-east London, and many other parts of the country, there are no rooms or houses to spare to absorb that movement.

My hon. Friend the Member for Islington North (Jeremy Corbyn) talked about the sometimes perverse consequences of the right to buy, a popular policy that delivered much to those who benefited from it, but which down the line has contributed to some of the problems. In yet another extraordinarily powerful speech, my hon. Friend the Member for Hampstead and Kilburn (Glenda Jackson) talked about the impact of dislocation on households and children. The hon. Members for Bermondsey and Old Southwark (Simon Hughes) and for Colchester (Bob Russell) talked about the impact on children, and they were right to do so.

Before I address one or two of the substantive points and ask the Minister some questions, it is important to place on the record a correct understanding of what housing benefit and the local housing allowance for private tenants actually do, and why they have risen so much. We have heard a great deal—including this week from the Secretary of State—about the explosion in the cost of the local housing allowance. Almost half, 48%, of the entire increase in housing benefit over the past five years has been a result of the growth in the private rented sector. It has been driven by cases and not by rents. Of that, 28% is accounted for by an increase in social rents, while a mere 20% is accounted for by rises in rents themselves at a time when house prices have doubled.

That does not mean that we do not have problems in some areas. We know that there are hard cases and that some people will always swing the lead; that is the case everywhere and in every system. However, such people are outweighed by thousands to one by those who rely on housing benefit and the local housing allowance to keep a roof over their heads. There are ways of dealing with hard cases by allowing local authorities discretion, and some such measures were set out by the last Government in the March Budget. We must not let hard cases dictate a national policy that impacts on 1 million people. That is the catastrophe.

Ministers seem to fail to understand the number of households on local housing allowance who are in work—again, the Secretary of State failed to refer to that. Over the past two years, there have been a quarter of a million new cases of people in work claiming local housing allowance. During the recession, as wages and the hours that people worked fell, people turned to housing benefit and the local housing allowance to stop themselves from being made homeless. The coalition Government have completely ignored that. Research commissioned by my party when considering housing benefit reform last year laid to rest the myth that, taken as a whole, the local housing allowance discriminates against working households.

Research published three weeks ago stated that

“housing benefits arrangements do not seem to unduly favour local housing allowance recipients compared to most low-income working households”.

One clear message is that it would be a mistake to see housing benefit claimants and low-income working families as totally distinct categories. Most interviewees in the research study moved between those categories, sometimes several times, so that the same household could be a low-income working household one week, and find itself on housing allowance in another.

Despite all the evidence and research, in something like 20 weeks, a policy will come into effect that could impact on 114,000 households, mostly in London, who live in properties too expensive for them. The Mayor of London’s own submission contains an expectation that 20,000 children will be moved. In my local authority, 5,500 households will be way above the cap. If we consider that half of those households are larger households with children, that is 5,000 children in one borough. Where are the school places going to come from? Where will those children be educated? Where will health services be found for them? Where will they be found homes? The sheer lack of planning for the scale of population movement, and the debt, homelessness and distress to be caused is overwhelming. That is in 20 weeks. In a year’s time there will be a much bigger and deeper cut with the move to the 30th percentile, which is far wider.

The Minister says that rents will fall. Where is the evidence for that? Will all rents fall? Of course they will not. Some rents will fall, but where are the calculations about the numbers affected in areas where rents do not fall? Does the Minister think that the market does not exist, despite everything that we hear about it? When tens of thousands of people leave their homes in high-cost areas and move to Croydon, Barking, Southend, Hastings or Luton, surely the market will respond and rents will go up. Where will the savings be made? That is before households turn—as they will—to local authorities for rehousing.

Over the past two years, 120,000 households have been placed in the private rented sector by local authorities to prevent people from becoming homeless. What are those households going to do? Has the Minister considered how many of those households will apply to local authorities as homeless? It will be the overwhelming majority. Will local authorities have to pick up those duties and house those households in temporary accommodation, and at what cost? Do we not see the rankest hypocrisy from my own local authority of Westminster, which has been the cheerleader for some of these reforms for what I must say are highly political reasons? In response to a question that I asked the Minister, Westminster was the first council to write to the Government to ask for assistance in dealing with temporary accommodation costs. What extraordinary hypocrisy for it to be holding its hand out for financial assistance while lobbying for the changes that will see the majority of households, particularly those with children, moved out of the borough.

We are talking about a staggering movement of people, an increase in homelessness and an increase in the number of children—many of them vulnerable—throwing themselves on the mercy of ill-prepared local authorities in other parts of the country, including London, which are themselves expected to make a huge cut in their own expenditure at the same time. Many of the households involved are working households.

Has the Minister reflected on the effect of the policies on his own constituency and, indeed, that of the Secretary of State? It is worth remembering how they are affected. In the Secretary of State’s constituency, 13,990 households are losers in the two broad rental market areas affected, and of those, just under 5,000 are in work. In the Minister’s area, a shade under 1,000 working households lose, with families in two-bedroom properties losing nearly £1,000 a year. The policies are impacting in the Government’s own backyard. I hope that that will give them some pause for thought.

Many measures are being proposed to ameliorate some of the most catastrophic impacts of the decisions. The Minister should allow time for impact assessment before local authorities are placed in the position that has been described, because I predict that even with the most minimal impact of the policies, we will see the most distressing scenes that we have seen in many years, as families are forced from their homes, are forced into debt and have to queue at local authority housing departments to make a claim for homelessness. There will also be an impact on the demand for services from local authorities throughout the country, which will have to deal with people’s needs. Please will the Minister tell us what measures are being put in place to allow local authorities to cope with that?

[The Minister of State, Department for Work and Pensions (Steve Webb)]

I have already congratulated the right hon. Member for Barking (Margaret Hodge) on securing this important debate. I also congratulate the hon. Member for Westminster North (Ms Buck); the Select Committee’s loss is the Labour Front Bench’s gain. She and many other hon. Members who have spoken bring to the debate a great deal of expert knowledge on housing. In the eight minutes remaining, I shall do my best to respond to some of the key points that were made.

My hon. Friend the Member for Colchester (Bob Russell) is a doughty campaigner on housing issues and I hope that he always will be. He raised very important questions. Are the measures not bad for child poverty? What about disabled people? A number of hon. Members mentioned the position of vulnerable groups. My response to my hon. Friend is twofold, but principally it is that if we examine what we are spending on housing benefit, we see clear evidence that a significant part of our spending is not subsidising people in need to have decent housing, but subsidising landlords. In each of the past five years, we spent an additional £1 billion in real terms; each year it was another billion, then another and then another.

I want to put a hypothetical scenario to my hon. Friend. The Department for Communities and Local Government says to the Chancellor of the Exchequer, “We want to spend £1 billion next year building affordable homes.” The Chancellor says, “Yes, I’d like to do that.” Then he goes to the Department for Work and Pensions and we have just put in a bid for another £1 billion and another £1 billion for housing benefit, and he has to go back to the DCLG and say, “I’m sorry. The DWP has claimed that £1 billion. It’s not available for affordable housing. It’s not available for tackling child poverty.” The crucial point is that we have a housing benefit system that protects the vulnerable but does not pre-empt resources that could be spent on the very things on which we in this Chamber want to spend money.

[Ms Buck]

rose—

[Steve Webb]

I wonder whether the hon. Lady will forgive me—

Low-income Households

Karen Buck Excerpts

Tuesday 14th September 2010 Westminster Hall

[Ms Karen Buck (Westminster North) (Lab)]

I am grateful for the opportunity to hold this debate because, over the recess, a number of studies and reports have emerged that have analysed and cast doubt on some of the central claims of the coalition Government in respect of the impact of the Budget and the differential impact that the comprehensive spending review will have on the lowest-income households. All claims about the June Budget being progressive are now being dismantled, and the theme that the pain will be shared is proving to be clearly inaccurate. The refrain has been “We’re all in this together,” and that has been explicitly stated by the Chancellor of the Exchequer. The claim that the measures in the June Budget are progressive has been widely echoed by Government Members, yet that is clearly not the case. In challenging that assertion and asking further questions of the Minister, I am hoping that the Government will, even at this late stage, see sense and acknowledge the dangers that are implicit in a number of their proposals.

I will draw heavily on the analysis carried out by Institute of Fiscal Studies, which has been challenged by defensive Ministers, and I look forward to hearing what the Minister has to say this morning. It would be wise for Ministers not to rubbish the IFS conclusions too rapidly, not least because they extensively used such research when they were in opposition. When the Chancellor was in opposition, he did not hesitate to summon IFS statistics to his aid when he was participating in pre-election economy debates, and the Conservative party policy document, “Labour’s Two Nations”, published in 2010, favourably quoted IFS research in its attack on Labour’s record on poverty, so what is sauce for the goose must surely be sauce for the gander.

Before talking a little about the content of the IFS critique of Government policy, I want to spend a moment or two challenging the two myths that are repeated so frequently: that Labour’s record on inequality was a failure and demonstrated the inability of the Labour Government to put forward progressive measures; and that the Labour Government failed to tackle the reform agenda, and particularly welfare reform.

[Mr Mark Field (Cities of London and Westminster) (Con)]

On that latter assertion, I am sure that the hon. Lady has avidly read the books of Lord Mandelson and the erstwhile Prime Minister, Tony Blair; it is fair to point out that both would stand up and say that the reform agenda did not go through in the way in which they envisaged, and that there was insufficient planning in the run-up to May 1997 to enable them to succeed in making the reforms to the welfare system that were required. I am not suggesting for one minute that such decisions are easy. I am sure that the coalition Government will face some significant problems in the years to come, despite the quite significant long-term planning that took place in the run-up to 201. That planning is in great contrast to what happened when there was an incoming Labour Government 13 years ago.

[Ms Buck]

I am grateful to the hon. Gentleman for his comments. I will not shy away from it: there was internal debate within the Labour party, both in the run-up to 1997 and subsequently, on what reform agenda was needed and how it would be carried forward. As can be traced through numerous speeches in Parliament and elsewhere, I was not always in agreement with the priorities of either Tony Blair or Peter Mandelson. It is historically inaccurate to claim that the welfare state was not subject to significant reform throughout the 13-year period. One of the earliest, and fairly controversial, proposals was on incapacity benefits; it was voted on in 1998. The first clash that took place after the 1997 Government were elected was over lone-parent benefits. Housing benefit was subject to a number of changes. My hon. Friend the Member for Bishop Auckland (Helen Goodman), who was a Minister at the time, will confirm that I beat a path to her door to exercise my concerns about what the Labour Government were proposing on housing benefit reforms, which I felt then and feel now were wrong, but which have been picked up on and exaggerated by the Government.

On the more positive side, the whole tax credits agenda was clearly designed and had an impact on work incentives. The idea that there was no reform agenda is complete nonsense. The reason why welfare reform, particularly in relation to work incentives, has not satisfied the incoming Government is that it is extremely difficult to achieve reform that both makes it easier to work and does not increase poverty. Clearly the new Government have come down on one side of that equation. The simple facts are that inequality soared under previous Conservative Governments. As measured by the Gini coefficient—I do not think that we can argue against this—there was a very sharp upward curve on inequality throughout the mid to late 1980s; it levelled off a little during the 1990s. During the first two terms of the Labour Government, real progress was made on turning the curve down again. Levels of inequality flattened out and then turned up again in the last term of the Labour Government, not least—but not solely—because of the impact of the financial crisis.

In its pre-election briefing, the IFS said:

“The tax and benefit measures implemented by Labour since 1997 have increased the incomes of poorer households and reduced those of richer ones, largely halting the rapid rise in income inequality we saw under the Conservatives.”

[Bob Russell (Colchester) (LD)]

Will the hon. Lady confirm that the gap between rich and poor is greater in 2010 than it was in 1997?

[Ms Buck]

I will not make a similar error to that being made by the Conservatives. I will not say that absolutely everything that the Labour Government did was perfect, and that they achieved every single goal and target that they set for themselves, whether on child poverty or on reducing income inequality; they did not. However, it is also nonsense to use the hon. Gentleman’s line to make the case that the Labour Government’s investments, whether in employment growth or in tax and benefit changes, did not slow down and flatten out the rapid rise in inequality that took place throughout the 1980s and into the 1990s. That would be to claim that all the investment in tax credits, increased child benefit and the national child care strategy failed, and it absolutely, clearly and demonstrably did not.

[Mr Mark Field]

Does this exchange not sum up the big problem in trying to assess equality or inequality? The question is whether we consider the matter in an absolute or in a relative sense. As we represent neighbouring constituencies, the hon. Lady will know that one of the effects of globalisation and the huge wealth that has come from the financial services industry in Britain over the past 20 years is that relative inequality has increased. The huge wealth of certain people in our constituencies—whether in St John’s Wood, Mayfair or Belgravia—is clear. That is not to get away from the idea that some progress was made under her Government, and I am sure that the same will be true under the coalition Government. The most vulnerable will be looked after and we will ensure that absolute levels of inequality are at the forefront of our minds.

[Katy Clark (in the Chair)]

Order. I remind hon. Members that interventions must be short.

[Ms Buck]

I am not sure whether it is possible to have an absolute measure of inequality. Inequality is, almost by definition, a relative indicator. I am glad that the hon. Gentleman accepts the fact that we made progress in levelling out soaring inequality. Interestingly—he makes this point—we are talking about a global context of widening inequalities.

We are in a highly globalised economy, with fabulous increases in wealth and income at the top levels; that is very well demonstrated in the City of London in the hon. Gentleman’s constituency. The fact that, even against that backdrop, the Labour Government were able to level out inequality, broadly, after the soaring increase in inequality that we saw in the 1980s, was an extraordinary achievement. Then, on top of that achievement—as he rightly says, there is a difference between relative inequality and poverty—the Labour Government were also able to make real progress, particularly in their first two and a half terms in office, in tackling child poverty, and even more progress in tackling pensioner poverty.

However, the Labour Government’s record is not faultless, by any stretch of the imagination, and I am not here to claim that it is. Nevertheless, that does not make it any better for the coalition Government falsely to claim that there was no reform agenda, falsely to exaggerate the impact on levels of inequality between 1997 and 2010, or inaccurately to compare Labour’s record with that of previous Governments before coming out with a set of proposals that are absolutely guaranteed to make the situation dramatically worse.

Clearly, that set of proposals by the Government is the central point of this debate, because the claims that the Budget of June 2010 was progressive have been completely demolished by the IFS, and that was even before last week’s announcement that an additional £4 billion will be cut from the welfare budget. As the IFS states:

“researchers have previously cast doubt on this claim”—

the claim that the June Budget was progressive—

“noting that the main measures which will lead to losses amongst better-off households were announced by the previous government”.

They were announced by Labour, but they have subsequently been rolled into the coalition Government’s claims. The IFS says that new research that it published two weeks ago shows that the changes

are clearly regressive as, on average, they hit the poorest households more…in cash, let alone percentage, terms”.

Those who lose the least are households of working age without children in the upper half of income distribution; those who lose most are low-income households, usually with children.

I will quickly outline the key measures that will have that impact: the move to update benefits and tax credits by the consumer prices index instead of basing inflation rates on the retail prices index; a reduction in Government spending of £5.8 billion a year by 2014; cuts in the value of housing benefit for some, which will amount to a reduction of £1.8 billion a year; cuts to tax credits for low-income families—something that was flatly and explicitly denied by the Chancellor when he was the shadow Chancellor and other coalition politicians before June, and certainly before the election—and the rise in the tax threshold, which will be of little benefit to low-income families in rented accommodation, as the extra net income will result in reduced housing benefit. Those are just some of the cuts; there are many more specific cuts that will apply particularly to the poorest.

Given the criticism that was aimed at the Labour Government’s policies as they affected work incentives, it is worth reminding ourselves that, extraordinarily, the June Budget increased rather than decreased the proportion of earners facing high marginal levels of deduction. That is one of the most extraordinary and hypocritical things that has emerged from the coalition Government since May. The more aggressive mean-testing of tax credits will raise the marginal rates of deduction for all recipients with incomes above £6,420. The number of people affected by MRDs above 70% will increase from 700,000 to 2.2 million. How on earth can Ministers look themselves in the face, having said so much about the Labour Government’s failure to improve work incentives for two-income households—if not for single-parent households—and then having allowed this change to happen?

Furthermore, despite the massive investment in tax credits and other in-work benefits that the Labour Government made, we should reflect on the fact that yesterday’s report by the Institute for Public Policy Research is just the latest to confirm a large and growing problem of in-work poverty. Wage levels, sometimes—but not always—in conjunction with a sufficiency of working hours, are simply not able to carry the burden of the idea that work is always the best route out of poverty. Without improvements in pay—such improvements are my preferred strategy—and without extra work potential and even better in-work benefits, this situation will not improve and indeed may worsen.

Worryingly, that was also confirmed by an Office for Budget Responsibility document that looked at the prospects for economic recovery. That document stated that, in the view of the OBR, one of the ways that business will reduce its costs as it enters recovery will be not by shedding more jobs—in itself, that is good news—but by maintaining a downward pressure on hourly rates of pay. So, unless we do something about the way that work incentives are supported through tax credits and benefits, we are likely to see even more in-work poverty. Of course, that not only is bad in itself, because it traps people in poverty, but sends out a message that is precisely the opposite of what everybody from all parts of the House claims to support—a message that we in Labour genuinely believe in. That is the message that we do not want worklessness and that we want people to enter employment. However, that work must be made to pay.

I am sure that others will want to talk about the specific tax and benefit changes announced by the Government, and I will not go into great detail about all of those changes. However, I want to say a little more about the issues of employment support allowance and incapacity benefit. After the June Budget, cuts of £4 billion, including the £2.5 billion cuts from ESA, were bounced on to the Department for Work and Pensions last week; that was something of a surprise, not least to the Department. Yesterday, following the statement made by the hon. Member for Colchester (Bob Russell), my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper), the shadow Secretary of State for Work and Pensions, sought clarification on whether the savings will affect only those people whom the Government have already assessed through the work capability assessment and found not fit for work. She was unable to get an answer from Ministers yesterday, and I wonder if the Minister who is here today can confirm where those proposed savings of £2.5 billion are coming from.

Will there be a reduction in benefit for people who have already been assessed and who have failed the work capability assessment? Can the Minister also confirm that the £2.5 billion of savings come on top of savings already built into Treasury plans, based on the anticipated results of work capability assessments? About two thirds of people who have already been tested have been found fit to work. In addition, can she confirm that, if these cuts are made uniformly, each claimant will lose an average of about £1,000 a year?

Furthermore, has the Minister had a chance to reflect on the report by the Public Accounts Committee yesterday that showed that private providers of the work directions programme have managed to reach only about a third of their targets in placing people in work? That casts real doubt on the validity of a further aggressive reduction in the provision made for people who are classified as long-term sick or disabled and their ability to enter employment.

The Minister will also not be surprised to know that one of my deepest concerns has been about housing benefit. Since the recess, new research from Shelter, for example, shows that the cuts in local housing allowance will cause a huge surge in homelessness. It is estimated that well in excess of 100,000 people are unable to negotiate cheaper rents, and they will either be evicted or forced to move. Providing temporary accommodation for all of those people is likely to cost the Government up to £120 million, cancelling out—as a minimum—a fifth of the savings that the Government are hoping to achieve. Has the Department for Work and Pensions, in partnership with the Department for Communities and Local Government, been able so far to carry out a proper analysis of what the impact on homelessness will be of the cuts in the LHA?

In relation to housing benefit cuts and non-dependant deductions, can the Minister confirm that the unfreezing of non-dependant deductions also applies to council tax benefit? That would affect many low-income home owners and many pensioners. Has her Department carried out an analysis of the breakdown by age group and tenure of the number of people who will be affected by the unfreezing of non-dependant deductions and, if so, what is the average saving per household of that measure?

I could spend a great deal more time working through a number of these specific proposals and setting out the harshness of their impact on low-income groups, but I will let others speak. I will just finish with a couple of sentences on the issue of public services and how they represent benefits in kind. Although I have been focusing primarily on the June Budget, the CSR is likely to have exactly the same differential impact on low-income groups, particularly with its focus on reductions in public services.

The annual analysis by the Office for National Statistics, entitled “The effects of taxes and benefits on household incomes”, provides a vitally important piece of analysis, looking at the value of different services by quintile groups. The value of spending on health, education, transport, housing and school meals is not evenly distributed across income groups but, with the exception of transport expenditure, disproportionately benefits poorer households. Again, housing investment is especially pro-poor, benefiting the bottom quintile 15 times more than the top. A 25% reduction in the housing budget will add 300,000 people to housing waiting lists; a 40% reduction will add 500,000.

I am sure that the Minister will know from her constituency work—although the problem is not, I suspect, on the scale of that in my constituency and that of the hon. Member for Cities of London and Westminster (Mr Field)—what it is like to have constituents who are trapped in grossly overcrowded, substandard or temporary accommodation and who are unable to work due to high rents. They may be trapped at home in extremely difficult circumstances. The average age at which a young person in London will be able to afford their first home is now estimated to be 52. If we deliberately cut investment in housing, not only will it make the situation worse; as the Office for National Statistics clearly confirms, it will affect the poorest disproportionately. According to the ONS analysis of benefits in kind, when all services are taken together, the bottom quintile receives 13 times more benefit than the top. An across-the-board reduction in service expenditure of 25% will therefore, by definition, disproportionately affect poorer households. That fact has not been teased out at all in discussions of the coalition’s Budget.

The analysis by the Institute for Fiscal Studies, increasingly supplemented by work by Shelter, Citizens Advice, the TUC and many others, has driven a stake through the heart of Government claims that the coalition’s tax and spending plans are fair or progressive. In fact, they will sharply increase inequality, weaken incentives to work, cause widespread misery and hardship and almost certainly increase pressure on non-discretionary expenditure such as that on homelessness. On 17 June, the Deputy Prime Minister said:

“it makes no moral sense to abandon poorer children along the way”,

yet that is exactly what has happened. Unless the Government change course between now and the comprehensive spending review, both poverty and inequality in this country are likely to escalate.

[Mr Mark Field (Cities of London and Westminster) (Con)]

I congratulate my constituency neighbour, the hon. Member for Westminster North (Ms Buck), on obtaining this important debate. I hope hon. Members will forgive me if I discuss issues affecting central London specifically and some of the alleviation that will take place in our local authority area. The hon. Lady is absolutely right to identify the key problem of in-work poverty. We often think of low-income households as consisting of people who are simply out of work, but in-work poverty is an important issue.

There are a range of issues that have not been dealt with over the past 20 years. Perhaps we can achieve little on some of them, such as the impact of unregulated immigration, over which we, as members of the European Union, have no control. I am not making an anti-European statement; that is simply a fact. There is no doubt that with the growth of the EU, immigration levels over the past six years have played an important part in driving down wages. Employers have perhaps been somewhat irresponsible in taking advantage of that, but it has and will continue to have a significant impact on welfare.

Understandably, the hon. Lady prayed in aid the high-profile report by the Institute for Fiscal Studies on the Budget, and its concerns about what will happen on 20 October. It is fair at least to argue that the outgoing Labour Government made it clear that they too would have had to do a lot to sort out the deficit. The erstwhile Chancellor of the Exchequer stated that their own Budget would have included £40 billion in cuts. None of those was specified, so it is slightly unfair for the hon. Lady to be accusatory, as she has not analysed where Labour’s cuts would have come into play and what impact they would have had on the lowest-income households.

[Ms Buck]

I remind the hon. Gentleman of what I said in my comments. The IFS analysis says that the more progressive elements of the changes to tax and benefits, which the coalition Government now claim will balance out their other changes, were in fact among those proposed by the previous Chancellor of the Exchequer. The less progressive changes, which will hit lower-income groups disproportionately, are the ones introduced in the June Budget.

[Mr Field]

That is a fair point. To be absolutely honest, the core problem that we all face is a lack of any explicit mandate for anything that is being done on the issue. For we Conservative Members who have been warning about the deficit and levels of public debt for many years, at a time when conventional wisdom was that we would stick to the outgoing Government’s spending plans, that is obviously a matter of some concern.

During the run-up to the general election, a spurious debate took place in which all parties danced on the head of a pin. Apparently, the necessity for £6 billion in cuts was a matter of Armageddon on one hand or sunlit uplands on the other. As the political class, we all took a decision to keep the electorate away from some of the harsh choices that would have been inevitable whoever won the election. That lack of an explicit mandate will cause difficulties in making the necessary case for deficit reduction, a case that I have discussed many times in the House. It is of great importance that we reduce the deficit as responsibly and as early as possible, not just to impress the money markets.

I feel strongly that we will now face intergenerational conflict. Almost uniquely outside wartime, the children of the present middle-aged generation—I see several 40 and 50-somethings here—will have a less good financial situation than the one that we have taken for granted. In many ways, that is a terrible indictment of the debts that we are building up, and it is one reason why we need to reduce those debts. It will make this country a more acceptable place for our children to live in.

The hon. Lady and I both have sons. I worry for my son when he comes to adulthood at 20. I hope he will have the education and skills to make him a globally mobile citizen. He and many of the brightest and best of our young men and women may choose to vote with their feet. I fear that we are already seeing an element of that, given the huge levels of unemployment among our graduate population, many of whom have globally mobile skills that they may well use to go elsewhere. I took for granted the opportunities that were available to me when I left university in the 1980s. We need to bring back those opportunities as quickly as possible. Reducing the deficit and ensuring that debt is kept to a minimum will provide a level playing field for future generations.

I appreciate that others want to speak. I will say a bit about some things that are happening in central London specifically. Due to the grave financial situation inherited by the coalition Government, all of us, whether in business, in households or in local and national Government are, understandably, being forced to tighten our purse strings. My local authority, Westminster city council, is no exception. One clear priority in Westminster is the most vulnerable in our community. Hopefully, that is a benefit of having two Members of Parliament for Westminster, one on each side of the political divide, to make the case.

It is easy to characterise my constituency in particular as extremely wealthy. The hon. Member for Stretford and Urmston (Kate Green), whom I have not had a chance to meet, is an erstwhile constituent of mine, and indeed a former candidate for the Barbican in 1997. She will recognise that although the Cities of London and Westminster contain pockets of incredible wealth, there is a lot of poverty not far from the surface. An important part of my job has always been to provide a voice for the most vulnerable in my community.

--- Later in debate ---

[Lorely Burt (Solihull) (LD)]

Welcome to the Chair, Ms Clark, for your first chairmanship of a Westminster Hall debate. I am sure that you will always guide us wisely and fairly.

I congratulate the hon. Member for Westminster North (Ms Buck), who spoke with great passion. Her presentation was extremely well researched, but the facts that she presented support her case, which is exactly what one would expect. Liberal Democrats certainly do not take these issues lightly, and we heard in the passionate words of my hon. Friend the Member for Colchester (Bob Russell) that no ideological pleasure is taken from any cut made by the Government.

Liberal Democrats are in coalition because the country is in a financial pickle. We are borrowing £1 of every £4 that we spend, and if we do not do something about it, two main things would happen. First, we would lose our AAA borrowing status, which would mean that we would have to pay more to borrow, which would mean that our economic standing in the world would go down and we would go into economic meltdown, similar to Greece.

[Ms Buck]

I am listening carefully to the hon. Lady, who is making important points. However, the purpose of my debate was to query the Government’s claims, and their practice of requiring a deficit reduction programme to fall disproportionately on the poorest people. I am not sure that what she is saying, important and valid though it is, actually addresses that point.

[Lorely Burt]

I am not sure that what I am saying is not relevant. I shall discuss the effects of the reductions that we will make, but I contest the hon. Lady’s claim that many of them are not fair. Well researched though her presentation was, there are things that she cannot know—a great deal is still to come from the Government.

Much of what has been presented has been based on speculation, and there is a great deal of scaremongering at present. Clearly, as the hon. Member for Cities of London and Westminster (Mr Field) said, people are afraid. The time to become afraid is when we see what the Government are proposing. They are trying hard to make their proposals as fair as possible.

I want to make a second point about why we are doing this—it is the legacy. The hon. Member for Cities of London and Westminster said that we must take a grip of the existing situation. That would apply whatever party were in government. I am declining the invitation of the hon. Member for Westminster North because I want to talk about the issues that she wants to me to raise. She mentioned the report of the Institute for Fiscal Studies. I do not claim to be an expert, but it was selective in what it chose to raise, and it ignores some of the major parts of the Budget, including changes to tax credits, the increase in income tax personal allowance and freezes on council tax. It does not take account of the choices on which measures in previous Labour Budgets to continue and which to reverse, or the effect of future Budgets.

The debate on the effect of Government policy is legitimate, and all parties must be prepared to discuss that, but with respect, the debate is happening too soon. The way in which the vast majority of changes to Department for Work and Pensions policy and savings in the welfare budget will be implemented will not become clear until after the departmental spending review in October. Any debate before then is bound to be based on media speculation, of which we have had sufficient.

One reason for the consultation on departmental spending is to ensure that the difficult decisions are not made lightly, and that any cuts are made in a way that protects those on the lowest incomes. Alongside the cuts is a radical programme of core Liberal Democrat policies specifically targeted at people on low incomes—the income tax pledge, the pupil premium and the re-linking of the basic state pension to earnings. However, in the coming weeks and months, the Government must ensure that they focus on ensuring that those groups most likely to be on low incomes are protected, specifically disabled people, older people, young people and people who are long-term unemployed.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Work and Pensions (Maria Miller)]

It is a pleasure to serve under your chairmanship, Ms Clark. I understand this is the first time that you have chaired Westminster Hall. You have done us proud and done a great job. I congratulate the hon. Member for Westminster North (Ms Buck) on securing the debate. As the hon. Member for Colchester (Bob Russell) said, this is not the first time that we have debated these issues in this Parliament, and I am sure it will not be the last. However, it does give me an opportunity to set out, in a more measured manner perhaps, the impact of the policies that we are talking about as a coalition Government.

We have had a wide-ranging debate, and in the time left, I hope that I can cover as many as possible of the points that hon. Members raised. The hon. Member for Westminster North talked about challenges in relation to the perceptions of the Labour party’s record in government, but she must acknowledge that the facts speak for themselves when it comes to the impact, or lack of impact, of Labour policies on issues of poverty. As the hon. Member for Colchester said, there are still far too many children living in poverty in this country after more than a decade of Labour Government. Labour talked a great deal about trying to reverse the problems of inequality in this country, but it failed to tackle the root causes of poverty, leaving a catalogue of entrenched social problems that the coalition Government must now deal with.

[Ms Buck]

I hoped that I was being fair in stating that I did not think that the Labour Government got everything right and tackled every problem. In the interests of equivalent fairness, will the Minister accept that child poverty increased threefold during the time of the previous, Conservative Government and inequality soared?

[Maria Miller]

The hon. Lady is again being selective in her recollection of the facts. When we examine the level of child poverty now, we see that it has gone up since 2004 under Labour. She can throw her hands up in horror, but unfortunately the facts speak for themselves.

There are other facts that we need to acknowledge. Levels of household debt have gone up significantly. In 2009, there were almost 160,000 personal insolvencies in this country. Those were record levels; there were 30,000 more than in the previous year. The hon. Lady must look at the whole picture when giving the facts in the debate.

Further assertions have been made that progress was made under the previous Government because of the level of investment that they put in, but as we all know, investment alone is not the answer. We need structural changes in the way in which support systems work. In relation to welfare, spending on social security and tax credits has increased by about £60 billion in real terms over the past 10 years, yet as the hon. Member for Colchester said, there has been an inability to tackle the issues of poverty, and the performance on inequality has either stalled or deteriorated.

Now we face the biggest legacy from Labour of all, which is that we have the biggest deficit of any G20 country. It is incumbent on the present Government to get that deficit under control; otherwise, stability, either in interest rates or in our ability to provide employment for people or to encourage strong business, will be undermined. It is therefore absolutely right that the Government put first and foremost trying to get the deficit under control.

The Labour party now understands the failure of its policies in this area and that keeping on spending at unsustainable levels is not the way forward. The hon. Member for Bishop Auckland (Helen Goodman) was a Minister in the Department in which I am now a Minister when that spending spiralled out of control. She will know that the cuts would have had to come anyway and that her Department was already tabling 20% cuts. The problem is that the Opposition would not tell us where those cuts were to come from. Despite their being asked repeatedly, those details were not forthcoming.

Housing Benefit

Karen Buck Excerpts

Tuesday 13th July 2010 Westminster Hall

[Meg Hillier]

The hon. Gentleman brings me nicely to my next point, and I shall deal with his second point in a moment. Let me be clear that I am not saying that all is perfect with housing benefit, as the Minister, from his previous incarnation as an academic in this area, knows all too well. Although I have been unable to source the reference, I believe that the current Leader of House famously said, “Let housing benefit take the strain,” when a previous Government made changes following which social housing rents increased.

[Ms Karen Buck (Westminster North) (Lab)]

Does my hon. Friend agree that there are grave perils in establishing a policy that affects one million claimants on the basis of what we know for a fact are some 30 extreme cases of the kind quoted by the hon. Member for North East Hertfordshire (Mr Heald)?

--- Later in debate ---

[Mr Mark Field (Cities of London and Westminster) (Con)]

I congratulate the hon. Member for Hackney South and Shoreditch (Meg Hillier) on securing the debate. We have worked together on a problem in our communities concerning the Crown Estate, along with the right hon. Member for Holborn and St Pancras (Frank Dobson), and will continue to do so. I have significant sympathy with some of her concerns, particularly those that relate to London. I fear that elements of the proposals are similar to those adopted by previous Governments, of all colours, and that there is a lack of understanding on specific issues that affect the capital and that an entirely nationwide approach cannot necessarily focus on. Many people will argue that if we remove the opportunity of central London life for the unemployed or the poor, we risk losing the fundamental character of the inner city and perhaps ghettoising the outer capital where families would inevitably be placed.

A housing benefit cap is not about driving people out of London; it is about bringing rents back into the real world, and saying that a system that pays for accommodation that is well out of the reach of ordinary taxpayers is wrong. That system is largely absurd. It has been broken, and become more absurd as time goes by. I am not focusing on Daily Mail articles that appear day by day, because we all know that those exceptions do not prove the rule. None the less, they reflect some of the reality as well as the anger felt by many people who take responsibility for their lives and do not have a lot of children and then throw themselves on the mercy of the state through housing benefit or subsidised housing. There must be fairness.

London will continue to have vibrant estates, and its housing association properties and relatively cheap private sector offering will probably come within the reach of many ordinary workers when the artificially raised rents that have in part been caused by the housing benefit system fall. The issue is not just about the regulated rents of recent years, but goes back some years. There is no doubt that some rents have been artificially raised over the last few years because private landlords have known what they can get away with. That has led to some of the current absurdities.

[Ms Buck]

On that specific point, is the hon. Gentleman aware of the proportion of private sector tenancies in London where a claimant is on housing benefit? He is making the point that the market is distorted by housing benefit, yet housing benefit claimants make up only a small proportion of total private sector leasing, so why should that be the case?

[Mr Field]

It distorts the overall price level that landlords—often absentee landlords, of which there are far more—reckon they can get away with. That has a distorting effect on the rest of the free market in this area.

Westminster city council—my local authority and the hon. Lady’s—supports the cap even though the announced changes are estimated in the worst case scenario to cost local authorities some £8.1 million this year. That reflects another element of the absurdity: the expense of long-term temporary accommodation contracts that the council was encouraged to enter into under the previous cap regime.

[Ms Buck]

Does the hon. Gentleman agree that two years ago, when the Labour Government proposed changes to the broad market rental area that would have impacted on Westminster, the council not only opposed that and asked us to lobby against it, but said that it would seek judicial review?

[Mr Field]

I do. The hon. Lady and I have done work and spoken in debates here over many years, but it is absurd that there is a massive incentive for local authorities to work within that system, and that they will lose a significant amount because of the cap system.

The local connection guidelines must change because, again, there is a phenomenal incentive for people to come to London, particularly central London. It is understandable that people from established communities abroad would want to be in central London, and I share some of the concerns of Opposition Members about tampering with ideas about local connections. However, in relation to the requirement on a local authority to provide housing, it has been suggested that we consider a three-year period instead of the existing six months out of 12. There is no doubt that central London remains an extremely attractive place in which to live, and it is important to ensure that only families most in need of temporary accommodation are here.

I understand the knock-on effects—I see the hon. Member for West Ham (Lyn Brown) shaking her head. I understand that part of the difficulty is that wherever the boundary is drawn the knock-on effect will mean that in Barking, Dagenham, Newham and so on there will be many more people, and that is equally a wrong way forward to a large extent. I hope that we will implement the caps for new claimants with immediate effect, because nothing would be worse than having too long a gap, such that there would be an incentive for people to enter into long-term contracts before the cap comes into effect.

I appreciate that many hon. Members want to speak, but I want to provide a bit of balance. I am broadly supportive of what the Government are trying to do, but they must consider seriously the specific problems in London, which I am sure will be articulated elsewhere.

It is only right to put another side of the story. A housing provider in my constituency—St Mungo’s—is dedicated to providing a recovery solution for homeless people, and I have worked closely with it during my time as an MP. We know that finding employment must be part of homeless people’s recovery. St Mungo’s welcomes the Government’s promise of further support for those who live a long way from the labour market. The people it works with have many problems, which have contributed to their joblessness and homelessness. It is worried about the announcement that jobseeker’s allowance claimants will have their housing allowance cut by 10% if they have not found jobs within a year.

Many Conservative Members welcome the review of the housing benefit system, because its flaws have become glaringly obvious to those of us who frequently deal with housing cases. I probably speak for all London Members when I say that housing and immigration are the two biggest elements of our work load. Given the great financial straits facing our country, the case for reform is more compelling, but I share the concern of the hon. Member for Hackney South and Shoreditch, and I hope that the Minister will respond to it. Urgent as the need for reform is, there must be proper consultation and an emphasis on the issues particular to the capital. I fear that if we do not change the system, we risk undermining the most compelling aspect of the case for reform, which is that the measures must be primarily about fairness, with hard work rewarded and the truly vulnerable protected.

--- Later in debate ---

[Ms Karen Buck (Westminster North) (Lab)]

William Beveridge deferred any strategy for dealing with housing costs on the ground that that could not be done while there were still significant regional variations. To paraphrase Lloyd Bentsen’s famous comment to Dan Quayle when Dan Quayle compared himself to Kennedy, “George Osborne, you are no William Beveridge.”

Our problem is that we have had a 30-year policy of shifting expenditure from the construction of affordable housing to the housing benefit budget. That includes, I have to say, decisions made by the Labour Government, which I did not agree with at the time. We are dealing with that now in the worst possible way.

Four categories of people are involved. There is a very small number of very extreme cases, which the Labour Government were planning to deal with through taking out the most expensive properties at the top of the market in the local housing allowance calculation, which was a reasonable one. We will not support such cases, but we have to have a sensible strategy for dealing with those extremes. I do not think that any Labour Member would disagree that pumping billions of pounds of taxpayers’ money into the pockets of private landlords is an insane way to go about a housing policy, but what is proposed is more insane.

I say that because of the other three categories. One is pensioners who never expected to be on housing benefit but who, many years into their private tenancy, as the rents have gone up, have found themselves caught. The second is people in the private rented sector who were working but who have lost their jobs or whose incomes have gone down and who now find that they have to claim housing benefit, possibly for a transitional period. The third category is people—families in many cases—in priority need, who either could not access social housing or were deliberately placed in the accommodation that we are talking about by local authorities. All three categories but certainly categories one and three are made up of very vulnerable people.

I have a few questions for the Minister and I would be grateful if he confirmed that he will write to all hon. Members with replies to these questions and those asked in the excellent opening speech by my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier). Can he confirm that placing homeless households in private rented accommodation was a deliberate policy of local authorities and Government, and remains so? Is he aware of how many households have been either directed to or maintained in private lettings over the past five years as a deliberate housing policy?

What proportion of households making applications and accepted by local authorities as homeless had as the main reason for their homelessness acceptance the end of an assured shorthold tenancy? I believe that it is the majority of cases; it is the main driver of homelessness.

If a household is in priority need and faces a reduction in housing benefit below the rent payable, will the local authority continue to have a homelessness duty to it? How many private tenants on housing benefit currently face a shortfall between local housing allowance and the rent charged, and what is the average amount? Hon. Friends have cited some figures. Shelter has come up with the figure of 50% of all housing benefit claimants and cited the figure of £100.

What assessment has the Department made of the numbers overall and broken down by different categories—pensioners, families with children and those of working age—and by local authority area for additional homelessness applications that are expected as a result of the policy? What assessment is being undertaken of the implications for local authorities of the movement of substantial numbers of families with children, pensioner households and others, referred to by my right hon. Friend the Member for Barking (Margaret Hodge)? I am thinking in particular of the capacity to provide school places and the implications for children’s services and adult services of dealing with large numbers of people with additional needs in a very short time scale.

Is it the Government’s intention to introduce new legislation to change the homelessness duty? What discussions are being held with local authorities about changes to the homelessness duty and the local connection criterion? Is the Minister confident that local authorities that will be the recipients of large numbers of people moved as a consequence of housing benefit changes are content to receive additional large numbers of low-income and, often, vulnerable households? What discussions have been held between the Department for Work and Pensions and the Department for Communities and Local Government about the introduction of new homelessness legislation to accommodate that difference? Will the forthcoming impact assessment indicate the Government’s confidence as to the availability of additional private rented sector housing at the reduced local housing allowance levels in all areas? What assessment has been made of the market capacity and ability to reduce rent levels?

I have a number of other questions, but I shall write to the Minister because other hon. Members want to speak. I am absolutely confident that the Department does not realise the full gravity of what is proposed.

[Mr Mike Hancock (in the Chair)]

I call Caroline Lucas. Please remember the time.

--- Later in debate ---

[Steve Webb]

We are publishing on 23 July to give us time to prepare the detailed statistics that the House wants to see. We know the aggregate impact, but the House wants some fine detail. I can tell the Chamber that the impact assessment will include the impact on groups at a national level, broad rental market areas, bedroom category, the availability of accommodation by broad rental market area, the households affected by caps by local authority and by Government office region, the households affected by moving to the 30th percentile and the distribution of local housing allowance and housing benefit award by case load and by housing benefit award intervals. Rather than drip-feed incomplete information, we want to give the Chamber comprehensive detailed information before the House rises for the summer recess.

One thing that is usually said in such debates is that people on housing benefit will not be able to find anywhere to rent. We have all come across anecdotal examples of that. Occasionally, landlords will not rent to people on housing benefit. [Interruption.] I hate to bring the facts to bear in this debate, but since November 2008 the number of private sector tenants on housing benefit has not fallen. It has risen by 400,000. If private landlords are not willing to rent to people on housing benefit, how come there are 400,000 more of them doing it?

[Ms Buck]

I refer back to my first question, which the Minister has not had time to answer. The majority of increase, according to the Department for Communities and Local Government, is in households that are placed in private rented accommodation by local authorities. That is why they have been able to access it, and they will no longer be able to access it in whole swathes of the country including London.

[Steve Webb]

As the hon. Lady knows—she is exceptionally knowledgeable about such matters—what is important is how the market responds to these changed incentives. If everything carries on as it is now, the reforms will have failed. We want an impact on the rental market so that we can end the situation in which people have huge rents paid for by the taxpayer that they cannot afford from the jobs they get.

Tackling Poverty in the UK

Karen Buck Excerpts

Thursday 10th June 2010 Commons Chamber

[Chris Grayling]

The hon. Lady has extremely extensive experience of these matters and she is absolutely right. We remain firmly of the view that early intervention is important. I mentioned parenting skills earlier; when talking about these matters, I always pay tribute to the charity Home-Start. Enabling people who have good parenting experience to mentor those who do not makes a valuable contribution to helping young people who grow up in more challenging environments to do better than they might otherwise have done. That is hugely important because we have massive divides within communities, between people living side by side.

Here in Westminster, for example, we have the largest difference in life expectancy of any London local authority. In areas such as Knightsbridge and Belgravia, people can expect to live into their mid-80s, but just up the road in Queens Park life expectancy is just over 70—a gap of nearly 15 years. For every two minutes on the tube between Knightsbridge and Queens Park, the life expectancy of the communities through which one travels drops by a year.

[Ms Karen Buck (Westminster North) (Lab)]

As a resident of Queens Park, this is an opportune moment to seek to intervene.

On the issue of health inequalities, poverty has to be understood as a relative as well as an absolute issue. Before the right hon. Gentleman goes too far in dismissing everything that the Labour Government were doing, does he agree with the Institute for Fiscal Studies, which said:

“Tax and benefit measures implemented by Labour since 1997 have increased the incomes of poorer households and reduced those of richer ones, largely halting the rapid rise in income inequality that we saw under the Conservatives”?

What measures that the Conservatives took—or failed to take—in those years will he now say will not be reintroduced if we are to make further progress?

[Chris Grayling]

Of course, we have not been in office since 1997. One of the tragedies of the past 13 years is seeing the amount of money spent leading to so little in the way of results. The point made by the hon. Member for Alyn and Deeside about poverty of aspiration is a crucial one. I shall come on to discuss worklessness, but a lack of experience of work or educational achievement in a household, and other factors, can make such a difference. The divides are enormous. If one goes to a city such as Liverpool, one only has to walk for 20 minutes from one of the smartest, newest shopping centres in the country to streets where almost no one is working. Worklessness is central to the challenges faced by many of our communities.

[Chris Grayling]

We have to look at this in a far more three-dimensional way. It is about changing educational achievement, which is why we have said that it is important to focus on a pupil premium for the most deprived areas. It is also why we have said that it is important to ensure, as the economy recovers and as the employment market picks up, that we do not make the mistakes of the past 10 years. Too many of the jobs that were created went to people coming into the country from overseas, as the right hon. Member for Birkenhead has identified on more than one occasion. We have to make sure that we break down the culture of worklessness and educational failure, which is as essential to dealing with poverty as any other factor.

[Ms Buck]

I thank the right hon. Gentleman for giving way again. To approach the question that I asked earlier from a different angle, the IFS confirmed that Labour’s measures had largely halted the rise in income inequality, which increased dramatically under the Conservative Government. Does he accept that the measures that he has to put in place must not repeat the errors and mistakes, with deep roots in unemployment and social breakdown, that characterised the Conservative years and led to rising income inequality and poverty?

[Chris Grayling]

We should always seek to learn from the past. We will seek not to make the mistakes of the past 10 years, when billions of pounds were spend on employment programmes that failed to break down the culture of worklessness in many of our communities.

--- Later in debate ---

[Helen Goodman]

I think my right hon. Friend ignores the fact that it is less than three months since the Child Poverty Act 2010 received Royal Assent. It committed any Government to eradicating child poverty and set out the four measures that will be used to make that judgment, which are of absolute poverty, relative poverty—that is the one agreed in the EU and the OECD—persistent poverty and material deprivation. Everybody in the House supported that Act, and I hope that the Government will not renege on that support.

The main problem with the Government’s position is that it is incoherent. They are divided on family policy and welfare strategy. Everyone knows that worklessness is one of the key drivers of poverty, but the proposals that we have heard from the Government so far will increase unemployment and the north-south divide.

[Ms Buck]

Was my hon. Friend surprised that the Minister made no mention of child care, which is critical to employment levels, particularly of lone parents? Does she share my disappointment that just before the election, the Mayor of London chose that moment to abolish child care from the London Development Agency’s work and to start unpicking measures such as the child care affordability programme? Does she agree that affordable child care must be at the heart of the wide range of programmes and policies that we use to tackle poverty?

[Helen Goodman]

My hon. Friend is absolutely right, and I hope that what the Mayor of London has done is not a precursor of what the Government intend to do. The Labour Government increased resources for child care significantly. We provided for three and four-year-olds to have 12 and then 15 hours of free provision, and we provided an element in the tax credits for people to pay for the child care that they found convenient. Our manifesto set out a commitment to extend child care provision to two-year-olds as well, because of the importance of the developmental needs that the Minister talked about so eloquently little more than 15 minutes ago.

The proof of the pudding will be whether the Government commit the policies to match the rhetoric. We fear that that will not be the case, and that there is now a serious risk of a double-dip recession. I urge DWP Ministers to be very careful indeed, lest they frustrate their no doubt good intentions by agreeing to cuts in the coming Budget.