Under-Occupancy Penalty

Kate Green Excerpts

Tuesday 5th November 2013 Westminster Hall

[Mrs Lewell-Buck]

I was not aware of that response. I thank my hon. Friend for letting me know that information. I am very surprised by that.

The National Housing Federation estimates that a family under-occupying a two-bedroom home who move into a one-bedroom flat in the private rented sector will claim an average of £1,500 in housing benefit, despite living in a smaller property. Just last month, the Deputy Prime Minister acknowledged that the bedroom tax is leaving some families facing

“dilemmas which need to be addressed”.

This is not a dilemma—it is a crisis happening on his Government’s watch.

I visited Ms Ashley Pollard, one of my constituents, at home. She faces one of the Deputy Prime Minister’s so-called dilemmas. She lives alone in a two-bedroom flat. She has mobility difficulties and, as a result, needs to be in a wheelchair almost every moment of the day. Her mother is her carer and stays in her extra bedroom most week nights. Her mother is also in employment, so she is not entitled to carer’s allowance.

Ashley is unable to avoid paying the bedroom tax and has requested a move to a one-bedroom ground-floor property, but there is none for her to go to. She wants to move but cannot; wants to pay her bills but is struggling to do so; and needs to have the continued care from her mother. Sadly, Ashley is not alone. It is estimated that more than 400,000 disabled people are expected to suffer what the Deputy Prime Minister calls a dilemma. Can the Minister, in his response, suggest what Ms Pollard should do?

At a time when the disabled are already being hit hard by cuts to public services and reduced benefits, they now have to worry about losing their homes as well—homes that, once they have been forced out, will lie empty. Those homes have been adapted to fit tenants’ needs in line with their disability. If they move, their new home will need to be adapted, while their own home will remain empty.

Another disabled constituent of mine lives in an adapted property that cost the local authority in excess of £10,000 to adapt. The property has two bedrooms, so she is subject to the bedroom tax. Unsurprisingly, there are no alternative, one-bedroom properties in our area to meet her needs. She is therefore stuck paying the tax, unable to obtain discretionary housing payment, and she is struggling.

What do the Government suggest is an efficient use of housing in that situation? Should my local authority adapt a new property for my constituent at the cost of a further £10,000 and leave her current home empty? Far from encouraging the better use of social housing, in that case, the bedroom tax leads to a nonsensical outcome.

[Kate Green (Stretford and Urmston) (Lab)]

My hon. Friend will be interested to hear about a constituent of mine, whose home also has had adaptations to account for the equipment needed for their disability. That accommodation can be offered only to older people over the age of 40. If my constituent is to vacate the accommodation, there is no way that a family with young children can move into it. It is a further waste of public money.

[Mrs Lewell-Buck]

My hon. Friend is of course correct. It will be far easier to leave people in the homes that have been adapted to meet their needs.

In a survey of the 51 largest of its associations, the National Housing Federation, which represents housing associations, found that more than half of those who were affected by the tax could not pay their rent in April or June. For many of those people, that was the first time that they had ever fallen behind with their rent.

--- Later in debate ---

[Sheila Gilmore]

That is helpful. It reminds us of the many ways in which we are going backwards.

In an intervention on my hon. Friend the Member for South Shields, I mentioned a DWP Minister’s suggestion that if councils were struggling with three-bedroom houses that they could not let, they should have anticipated the problem and taken steps to divide those houses. I was fantasising slightly about how that would work. Let us take a typical three up, two down property in England; in Scotland, we are more likely to be talking about a tenement flat. What exactly would be involved in dividing it? First, either the tenants would somehow have to use the same door and stairs, or the council would have to create a separate entrance, which would cost money. One of the upstairs rooms would have to be converted into some form of kitchen, which would cost money. That leaves the downstairs, which would have a kitchen, but not a bathroom. Where would the bathroom go, or at least a toilet? A bathroom extension? Remember there are only two rooms and a kitchen downstairs, so building a bathroom would not be easy, unless it were built outside, and an extension costs money. Then I thought, “I know what the Minister must have had in mind: a portaloo in the back garden.” That would take us right back to the days when people had outside toilets, but it might help get the house divided up. It would involve not only huge additional cost but a style of living that I hope most of us would think inappropriate. That shows how little thought was given in practical reality.

It is the same with the idea that everybody could take in lodgers. That does not take into consideration the nature of many of the properties in which people live, and the difficulties involved.

[Kate Green]

Does my hon. Friend not also accept that that would be a particularly unwelcome suggestion to women fleeing domestic abuse and violence, for example? The idea that they might have to take in a stranger as a lodger after experiences that may have absolutely traumatised them is particularly inimical. That is exactly the situation faced by one of my constituents.

[Sheila Gilmore]

I thank my hon. Friend for that intervention. Many people would find the concept of taking in a lodger extremely difficult, particularly given the nature of many properties. I visited a constituent whose kitchen was off the living room, and whose bedrooms were not particularly big. When someone has a lodger, they are sharing a house. They are not taking in a lodger who has a self-contained annexe of the house; they are taking someone into the bosom of their household. The 60-year-old woman in question felt that that was not somewhere she needed to be in her life.

--- Later in debate ---

[Mr McKenzie]

Absolutely. I fully accept that. I noted earlier in my speech that the changes are pushing people to find accommodation in the private sector, with all the additional costs involved.

Research by the National Housing Federation found that if the additional funding were to be distributed equally among every affected claimant of disability living allowance, they would each receive just £2.51 per week, compared with the average £11-a-week loss in housing benefit in Scotland. The pressure to find smaller homes and flats has become immense. In Inverclyde, there is a huge lack of one-bedroom accommodation. I ask the Minister: what are my constituents to do? Many will fall into arrears. Housing associations warned the Government from the start that the under-occupancy penalty would not work, and that families would face financial hardship and struggle to make ends meet.

[Kate Green]

On the point about arrears, does my hon. Friend agree that it is nonsensical that many housing associations will not move people who are in arrears into new accommodation? They will not give them new tenancy agreements until their arrears are cleared. That is one more perverse—indeed, Kafkaesque—consequence of the policy.

[Mr McKenzie]

My hon. Friend makes a good point. Housing associations need flexibility to ensure that no one falls into arrears, or into the eviction bracket.

Housing associations warned also that there would not be the house building that would be required for people to avoid the penalty. That is certainly true not only in Scotland but across the country. People cannot move to smaller homes to avoid the bedroom tax because there are not enough smaller properties. In Inverclyde, I could count on one hand the streets, outwith the private sector, that offer single-bedroom accommodation.

I ask again what my constituents are to do about the policy. There are now rent arrears, evictions, financial distress, and difficulty in finding alternative or adapted accommodation. That all shows that there is a lack of appropriate housing and house building throughout the country while we have the dreadful bedroom tax.

--- Later in debate ---

[Kris Hopkins]

No, I will carry on, because I want to make some progress.

I will just pick up on a point made by the hon. Member for Wolverhampton North East, who said that I had said that there was no crisis. Just to provide some clarification and so that this myth does not continue, I will say that I was asked about a housing bubble in London and whether or not there was a crisis, and there is not. I actually used the backing of the Governor of the Bank of England, who says there is no housing bubble, and that was what I was specifically referring to. Also, the Chancellor has put in place the means to intervene on any of the measures that we have in place, through the Financial Policy Committee; if a bubble was emerging, he could intervene at that point.

An issue that has come out in the debate is the comparison between, “We’ve said it’s about saving money,” and, “You’re saying now it’s about supply.” There is a need to save money. We inherited a bill that had doubled to some £24 billion by the time we came to power, and it was important that we addressed it because we ended up with a deficit where we were spending—in fact, despite a reduction of a third, we are still paying £120 million a day in interest and we have a responsibility to address that.

[Kate Green]

Will the Minister give way?

[Kris Hopkins]

I am sorry, but I will not give way.

Despite the fact that we have this huge deficit, we wanted to ensure that the burden that was placed on this sector was as small as possible. In fact, it is 0.3% of the deficit reduction strategy that was put in place.

Answering the question about supply, the Government have already delivered 334,000 houses; we have made a commitment of £20 billion to deliver 170,000 houses before the end of this financial spending period; and we have made further commitments of £23 billion to deliver another 165,000 affordable houses. So I am afraid that the idea that money is not being raised or that councils or housing associations do not have the ability to deliver affordable housing is false. Despite the limited resources that are available, the Government have been absolutely committed to delivering affordable housing, and we will continue to deliver it.

Rather than talking about imaginary numbers of a billion houses over the next period, let me say that Labour clearly failed to deliver in a time of boom. For a period of 13 years—it was 11 years of boom— Labour failed to hit the target that it was talking about. And it has not said how it would fund its plan to address this issue.

On the ground out there at the moment, there is real growth in supply. The construction industry is running at a six-year high; the construction sector has said that it has had a higher expansion in the past six months than it has had for some time; and most of that construction growth is from housing. So the supply issue is being addressed by Britain getting out and building, and we have resourced that.

The Chartered Institute of Purchasing and Supply has said that we are experiencing the highest rate of building for a decade and that housing supply is now at its highest since the end of the unsustainable housing boom of 2008. As I said, some 334,000 houses have been built.