Housing Benefit (Abolition of Social Sector Size Criteria)

Lilian Greenwood Excerpts

Wednesday 17th December 2014 Commons Chamber

[Mr Slaughter]

rose—

[Lilian Greenwood (Nottingham South) (Lab)]

rose—

[Mr Harper]

Let me make a little more progress and then I will give way again.

Labour’s motion says nothing about the costs of its proposal. That is not really a surprise. It is, of course, a fact that the removal of the spare room subsidy is saving money: £490 million in 2013-14; £525 million in 2014-15; and £830 million to date, with savings increasing in future years. Abolishing this reform would cost over £500 million a year. The shadow Work and Pensions Secretary has made an “absolute pledge” to do so, but she has no idea of how she is going to fund it.

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[Yvonne Fovargue]

Absolutely, and that is the problem with a discretionary payment. Do we really want people to move every time their circumstances change? Let us look at it logically. A young couple move into a one-bedroom flat. They have a child so they move to a two-bedroom flat. Then they have another child. The children start school and can share a bedroom for a certain time, but when the first child is older the family move again to a three-bedroom property. Then, when the eldest child is 18, they move back to the two-bedroom flat. Then they go to a one-bedroom flat. Is that not a sure way to break down communities, take away social cohesion and spoil children’s education just when they need it? However, that point is academic, because, as I said, there just are not the properties available for people to move around like that. People are not chess pieces.

Perhaps the Government know that. This is not really about overcrowding, but saving money. Even by that yardstick, however, it still does not work. The Department for Work and Pensions assessment has been downgraded a number of times. It now appears that the cost of dealing with the debt, eviction, abandonment of properties and widespread misery and mental health problems caused by this pernicious tax might mean that cash savings are minimal or non-existent.

[Lilian Greenwood]

Will my hon. Friend give way?

[Yvonne Fovargue]

Not at the moment.

Debt, eviction and widespread misery are what we are talking about. They are the result of the Government’s reform. People have not been given a choice. If they cannot move to a property with fewer bedrooms, they have to make up the rent difference themselves. For tenants in Wigan, the financial impact ranges from nearly £10 a week to nearly £25 a week, or £1,273 a year. That is a lot of money to find on a low income. As I said, they cannot move because there is a shortage of housing, so they have nowhere to go, are staying put and building up debts. One clear consequence of the policy is the build-up of rent arrears. Figures from my constituency demonstrate that 44% of under-occupation households were in arrears in March 2014. The amount of arrears from the 3,319 households was £381,000, with £225,000 solely attributable to the under-occupation charge. That is not a good outcome for a local authority trying to balance its budget, and it is not good for the people themselves, who are at risk of being evicted because they simply cannot find the extra money to pay their rent. It is bad for tenants and it is bad for the councils that are trying to balance compassion with getting the money in. The only alternative to building up debts is to cut down on essentials, such as heating and food. I think we can certainly conclude that the bedroom tax has played its part in pushing people towards food banks, which have surely become the defining image of the Government in their dying days.

It is not too late for the Government to do the right thing and scrap this cruel and unfair tax. It has not given them what they wanted—budget savings—and has not helped to end overcrowding or make our housing system fairer. All it has done is to make poor people more stressed and desperate, living with the constant uncertainty of discretionary housing payments. I stress the word “discretionary”, because there is nothing certain about them at all. The human cost of the policy does not justify any savings that may have been made. I urge Government Members to look at that at Christmas and vote with the Labour party.

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[Lilian Greenwood (Nottingham South) (Lab)]

In March 2013, two weeks before the bedroom tax came into force, I secured an Adjournment debate to highlight the problems that this cruel and unworkable policy would create for some of the people in my city—those who were least able to afford it. I highlighted which households would be affected, with two thirds including someone with a disability, one third being families with children, more than a fifth being working households on low wages, and many having no spare room at all. They were families where older children needed their own room and a quiet place to do their homework, couples who needed to sleep separately because they were caring for a disabled partner, or separated parents who wanted to have their children to stay at weekends. For people in Nottingham, the bedroom tax would mean having to find, on average, an extra £11 a week if they had one more room than they were allowed, or £22 a week if they had two. Perhaps that is not much to a Government Minister, but for someone on low pay or out of work it is the difference between eating or going hungry, turning on the fire or sitting in the cold, borrowing money to pay the rent or going into arrears.

Back in March 2013, I was conjecturing about what would happen to those affected by the bedroom tax—but now we know. My local Labour council and its arm’s length management organisation, Nottingham City Homes, have worked hard to try to support those hit by the bedroom tax. However, by June 2014, 2,046 of the 3,445 Nottingham households hit were in arrears, owing an average of £218.71. This year, 1,393 tenants have been awarded discretionary housing payments, but they live in anxiety, worried that it could be withdrawn. The council is drawing on its own financial resources to support those affected because the allocation of £965,000 is not enough to meet the level of need.

The Government argue, as did the Lib Dem Minister who replied to my debate 21 months ago, that these people should simply move into smaller properties, but his own impact assessment said that tenant mobility was limited—as was the Government’s intention. His plan—their plan—to cut housing benefit relied specifically on the inability of tenants to move, balancing the books on the backs of poor and vulnerable people.

Nottingham City Homes has worked with tenants affected by the bedroom tax, but only 97 tenants—2.9%—were able to downsize in the year to April 2014. That compares with 81 homes freed up for families in the previous year under the Right Size project. So this flagship policy has made no difference to tackling under-occupation. The truth, as we know, is that it was never about that. It is about cuts and taking money from the households least able to afford it, at the same time as handing out tax cuts to millionaires.

People in Nottingham—people across this country—know that we cannot trust the Lib Dems, who are now wringing their hands having supported the Tories’ legislation every step of the way. Only a Labour Government will scrap this wretched tax. Next May cannot come soon enough.

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[Steve Webb]

Case studies were mentioned, including one from the shadow Secretary of State who then forgot to tell the House that discretionary housing payments were covering the shortfall. Let me share an example of a previously overcrowded family. Suzanna lived in a four-bedroom home in south Yorkshire when this measure was introduced, and decided to downsize. She joined the HomeSwapper scheme to find a more appropriate property and said:

“I was impressed with the quantity of matches that HomeSwapper provided…the lady I swapped with…had needed to move for a long time but her landlord had been unable to move her. She desperately needed the space for her overcrowded family.”

That is the sort of thing this policy is helping to achieve, but the voice of overcrowded tenants is not being heard in this debate.

[Lilian Greenwood]

rose—

[Steve Webb]

I will give way to the hon. Lady because she mentioned the situation in her constituency. Perhaps she will explain why Nottingham applied for extra cash from the Government, was given an extra £0.5 million, and did not spend it.

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[Lilian Greenwood]

The Minister is wrong. Nottingham city has spent the whole allocation that it was given by the Government, and is having to find extra resources to help people. The Minister mentioned HomeSwapper, but that existed before the bedroom tax was introduced. His Government cut money and funding for local authorities that were pursuing projects to encourage people to downsize, including £75,000 that supported Nottingham’s projects.

[Steve Webb]

Nottingham was allocated discretionary housing payment and was given an additional £0.5 million, and of that combined amount it spent 78%. On the question of HomeSwapper, this policy has prompted more people to look to downsize and swap. That is an entirely good thing, as it makes better use of the housing stock.

I want to respond briefly to some of the contributions to the debate. The Chair of the Select Committee, the hon. Member for Aberdeen South (Dame Anne Begg), initially made the claim that the spare room subsidy measure was forcing people into the private rented sector. When my hon. Friend the Minister for Disabled People pointed out that the rate of moves into the private rented sector had fallen, she then said in response that people are not moving to the private rented sector because rents are unaffordable. Well, it cannot be both. It has to be one or the other.

The hon. Member for Makerfield (Yvonne Fovargue) referred to the position of foster carers, but we have recognised this particular need and provided an exemption for foster carers. The hon. Member for Glasgow North West (John Robertson) referred to his constituents as the most affected by the policy, whereas the policy—