Social Security

Kate Green Excerpts

Monday 10th February 2020 Commons Chamber

[Mike Amesbury (Weaver Vale) (Lab)]

This uprating order will increase a range of social security entitlements and pensions. As a result of the Government’s Welfare Reform and Work Act 2016, most working-age benefits and tax credit elements have been subject to a four-year freeze, covering the period 2016-17 to 2019-20. It is a basic human right to have security and stability in our lives, secure housing, reliable income, and support when things get difficult. Society’s choices about benefit levels help to determine the levels of inequality and living standards, sometimes for the most vulnerable in our society.

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

I am grateful to my hon. Friend for giving way, especially as I did not have the opportunity to intervene on the Minister. Does my hon. Friend agree that one of the fairnesses that we have to consider is intergenerational fairness? We are seeing a widening discrepancy between the protection for pensioners—rightly—through the rise in the basic state pension, and what is provided for those on working-age benefits. If people on working age benefits are kept in very difficult financial circumstances, they cannot save for their old age. Is not this really politically motivated, rather than a genuine policy to achieve better equality and protect the most vulnerable?

[Mike Amesbury]

My hon. Friend makes a very valid and powerful point.

For too many of our citizens, there is no such security. The responsibility for this situation lies firmly at the door of the Government, whose lack of compassion and cruel social security policies have afflicted those who are most in need.

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[Mike Amesbury]

I do agree with my hon. Friend. Social security has become a vehicle for cuts and children have borne the brunt, with over 4 million now in poverty.

The 75p per week for the first child will not even buy a loaf of bread in many shops. As a result of the four-year freeze, families living in poverty are now a total of £560 worse off a year on average, equivalent to three months of food shopping for low-income families. Harsh and punitive Conservative policies such as the benefits freeze, the two-child limit and the five-week wait have created a society in which people are forced to turn to food banks in ever-increasing numbers just to get by.

The flagship social security reform of universal credit is not working. The full roll-out will now be delayed yet again until 2024, seven years behind the original plan. It is driving far too many people into poverty, debt and rent arrears. One of its key defects is the in-built and unrealistic five-week wait. At what stage will the Minister apply common sense and change that to fortnightly payments?

According to latest figures available, in 2018-19 the Trussell Trust distributed just short of 1.6 million emergency food parcels, of which 578,000 went to children—the highest level since the charity opened and up nearly 20% on the previous year. In some parts of the UK—Scotland and London and the north-east—the percentage increase year on year was even higher. That represents a depressing 73% increase in food bank use over the past five years, and the Trussell Trust identifies the failing benefits system as one of the main reasons behind that. Behind these devastating statistics are real people, families and children up and down the country, many of them in the constituencies that the new Tory MPs in the north represent.

I turn to the freeze in the local housing allowance. Evidence suggests that it has been a particular source of hardship because of the increasing number of people forced into private rented accommodation by the shortage of social housing. The charity Shelter has calculated that as a result of the benefit freeze, 94% of areas in the UK are unaffordable for people claiming LHA. Recent research by the charity Crisis and the Chartered Institute of Housing found that almost 93% of areas were still unaffordable. There are huge discrepancies throughout the country. For example, an average of £87 a month would be needed to make the bottom 30% of the rental market available in the UK. However, in London a claimant would need an extra £1,398, so the uprate of £10 per month is totally unrealistic.

[Kate Green]

As my hon. Friend knows, Trafford in Greater Manchester, where I am a Member of Parliament, has relatively high housing costs. I frequently see people who are driven into rent arrears because of the lack of generosity in local housing allowance. That means that they have to seek advice to avoid penalties or eviction, but that advice is not available. Eventually, the cost piles up and they arrive at the door of the local authority saying that they are now in housing need because they have been evicted from their private rented accommodation. How can that be sensible?

[Mike Amesbury]

My hon. Friend is totally correct. It is not sensible at all.

The devastating repercussions of 10 years of Tory austerity and the impacts of the benefit freeze will remain for a long time to come. The 1.7% uprate is a token mild thaw at the tip of the iceberg of systematic and pernicious cuts to the benefit system. It is too little, too late, and it does nothing to repair the damage done to people’s lives by this Government’s failed social security policies. It has served to further entrench poverty in society. For those reasons, it is Labour’s intention to abstain from voting on this statutory instrument.

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[Stephen Timms]

I am very concerned. My hon. Friend is absolutely right. I think that the Government are making sure that the situation is not going to get worse, or at least not much worse, but they are certainly in no way putting right the damage that has been done over the last few years—indeed, over the past 10 years.

[Kate Green]

Does my right hon. Friend agree that there is a cruel lack of logic in the household benefit cap because it is a blunt instrument that takes no account of different family structures and different forms of need in different households?

[Stephen Timms]

My hon. Friend is quite right. We were given a rationale when the cap was introduced—it was an extremely blunt one, but it was a rationale—but the benefit was reduced arbitrarily after that.

I have several questions for the Minister. Does he recognise that the freeze has made life much harder for those who depend on benefits, and that they are due a better offer than simply maintaining the current diminished level of income in line with inflation in the years ahead? Does he recognise the force of the case made by the Select Committee under its previous Chair and by Citizens Advice, which is of course drawing in part on its observations from the work it does for the Department, running the help to claim service for universal credit? Does he recognise that benefits need to catch up on ground lost over the past 10 years?

I have one specific technical question. The definition of RPI is to be revised. The Treasury is going to consult on the future definition, which will replace the current definition in a few years’ time. Is it the Government’s intention to make the new RPI the default uprating amount for each year, rather than the CPI figure that is being used this year? I would be grateful if the Minister said a little about the Government’s intentions in that regard.

As has been mentioned already in this debate, there is one part of the system where inflation uprating makes no sense at all, and that is local housing allowance—determining how much housing support claimants in the private rented sector in each locality can receive. Local housing allowance was introduced in 2008 to limit the amount of housing benefit that could be paid. It was set initially at the 50th percentile of rents in a locality, so the effect was to cap housing support at the median rent locally. In 2011, it was then reduced to the 30th percentile, so housing support would cover only the cheapest 30% of accommodation in the area. Since 2016, local housing allowance has been frozen completely in cash terms, while rents have increase by leaps and bounds. That is why, as the shadow Minister, the hon. Member for Glasgow South West (Chris Stephens) and others have pointed out, Shelter and others have drawn attention to the fact that there is now hardly anywhere in the country where people can rent accommodation for the amount set by the local housing allowance. The shortfall therefore has to be made up from people’s other income, and if that is benefit income that has been has been frozen since 2015-16, so people have to pay their increasing rent by somehow reducing what they spend on everything else.

What does that mean in practice? Well, it is a very big part of the reason why so many people are sleeping rough in London this winter. I can remember—I imagine that many of us can—when nobody slept in Westminster tube station overnight. We have all seen the large numbers who seem at times to be camping out there at the moment. That is the consequence, to quite a large extent, of the extraordinary unwillingness to allow the local housing allowance to reflect what is actually going on in housing costs in London.

Last summer, I hosted a visit to my constituency by members of the Archbishop of Canterbury’s Commission on Housing. We called on one of my constituents who lived with his wife and child in a single small, squalid room above a shop on East Ham High Street. Both those parents work in the NHS part-time, but this room was all they could afford. Their four-year-old son was running around when we visited—a very lively youngster. His mother had given birth to a younger sister, but she had died. It was clear that the housing conditions in that room had contributed in no small part to her death.

That is the impact of the grinding down of housing support since 2010. Surely we can do better than that. In its report last July, the Select Committee recommended

“that the Department unfreeze Local Housing Allowance as planned in 2020/21, and restore rates to at least the 30th percentile of local market rates. Thereafter, the Department should commit to uprating Local Housing Allowance in line with rental prices.”

I want to urge that view from the all-party Select Committee on the Minister this evening.