Housing Benefit Entitlement

Lisa Nandy Excerpts

Wednesday 23rd January 2013 Westminster Hall

[Lisa Nandy (Wigan) (Lab)]

I am losing my voice, as you can probably tell, Mr Bayley, but I was so upset and incensed by the proposals that I am doing my best to speak on behalf of the 4,000 Wigan households that will be affected from April. Collectively, those households will have to find nearly £55,000 a week in extra rent. I am clear that the vast majority will not be able to manage, so they will have to downsize. As we have just heard, however, we have a problem: we do not have one and two-bedroom properties available. The demand for them already far outstrips demand for other properties; for example, 62 households are waiting for four-bedroom homes and 2,000 for one-bedroom flats.

Put simply, downsizing is not an option, so tenants will be forced into the private sector, where rents are between £20 and £40 a month higher. If only half of tenants make that move and claim the local housing allowance, the Department for Work and Pensions will not save a single penny, but those families will have had their lives disrupted, leaving the homes that they have grown up in and with children forced to move schools and childhoods destroyed.

I have little doubt that Ministers are aware of such implications of the policy. Last year, I wrote to the then Minister to ask whether a constituent would be expected to move in April—his mother had recently died from cancer, leaving him under-occupying, and he is now suffering from terminal cancer himself. The Minister did not give me a commitment that my constituent, a man with only up to two years to live, would not have to move. The policy, to use the words of my hon. Friend the Member for Sedgefield (Phil Wilson), is one of the most spiteful and callous that I have ever seen enacted by a Government.

In Wigan, it is not clear whether people will be able to find homes in the private sector, because larger properties make up 75% of the stock. It will take 33 years, at current building rates, for private and social housing collectively to meet needs. The situation is unclear, but if those people simply cannot afford to live in their properties, they may well have grounds for being re-housed as unintentionally homeless. Can the Minister tell me where he expects a housing authority such as mine, without access to smaller properties, to put those people? How on earth can creating this unnecessary, callous revolving door of homelessness, destroying people’s lives in the process, possibly be a moral policy to pursue?

Finally, I want to make a specific point about foster children, to which my hon. Friend alluded. It is absolutely scandalous and a damning indictment of the Government’s lack of commitment to the most vulnerable children that, apparently, no thought at all was given to foster children when the policy was devised. Foster children simply do not count—they are invisible—for the purposes of the policy and the purposes of a spare room. The money that has since been made available through a discretionary fund, as my hon. Friend said, is not widely known about among foster carers or local authorities. Furthermore, that pot amounts to only £100 per child, which is woefully inadequate for the foster children already in the system, let alone for the many more whom the Minister’s colleagues in the Department for Education are rightly seeking to place.

We have a huge shortage of foster carers in this country, and the situation for children waiting in the care system must be urgently rectified. Where is the thought given to those children, or the commitment from their Government? Why did the Government overlook those children in the first place? Why do those children simply not count? Why has so little money been made available? Despite concerns expressed by the Under-Secretary of State for Education, the hon. Member for Crewe and Nantwich (Mr Timpson), why has the policy not been reversed? Why was the money for such children not ring-fenced? It might not even be used to help their situation. Can the Minister, if he will not reverse such appalling regulations, at least commit to amending them, so that they do not make the situation worse for some of the most disadvantaged children in this country?

--- Later in debate ---

[Steve Webb]

I have said that I am not giving way. This is an area of the housing benefit budget where we can better manage the housing stock. Let me give a specific example. It has been said in this debate that for housing benefit not to cover a spare room is immoral; that is the tenor of what has been said. When Labour introduced the local housing allowance, private sector tenants did not get housing benefit for a spare bedroom. Where is the morality in saying to private tenants that they cannot have a spare room, when social tenants, who are paying a subsidised rent, can? They could be living next door to each other, and we are favouring the social tenant over the private tenant. Why should housing benefit not cover spare rooms for private tenants when it does for social tenants? It is simply not fair.

The second unfairness that we have to tackle is overcrowding. A quarter of a million households in England are overcrowded, and they have had no voice in this debate. They are trying to get family homes, and homes that they need. They are living in overcrowded accommodation—

[Lisa Nandy]

Build some houses.

[Steve Webb]

I should like to point out that the shortage of affordable social housing did not start in 2010. Somebody had 13 years to sort that out, and it needs to be tackled now.

--- Later in debate ---

[Steve Webb]

Thank you, Mr Bayley. The second unfairness that we must tackle is the needs of people who live in overcrowded accommodation. A quarter of a million of them need to have a voice in this debate, because all too often they do not, and we must tackle that.

People have rightly said that these are family homes. They are not just houses; people have lived their lives in them. I accept that, which is why we have exempted people over state pension credit age. Essentially, someone who is a pensioner is not affected by these changes; we are talking about people of working age.

How will people respond to the change? There are a range of responses. It has been mentioned that housing benefit is an in-work benefit in some cases. Nationally, the average loss from this policy is £14 a week. For someone who is in work on a minimum wage, that is the equivalent of about two and half hours of additional work; it is not quite that because of tapers and so on, but we are talking about a few hours of extra work as one option—

[Lisa Nandy]

Where is the work?

[Steve Webb]

Again, the hon. Lady is talking from a sedentary position. She cannot control herself. On the day that we have published yet another set of figures showing another fall in unemployment and record growth in employment, she asks, “Where is the work?” The myth that there are no jobs available when we have more people in employment than ever before needs to be countered.

For some people, taking a job or working extra hours is an important part of the solution. It has been mentioned that taking in a lodger or a sub-tenant is not an option for some people, but for many it will be. The hon. Member for Banff and Buchan (Dr Whiteford) said that that might be an issue. In general, housing associations and social landlords should allow orderly sub-tenancies—a person cannot just take someone in and tell the landlord after the event. There has to be a strong reason to refuse such an option. The presumption is that it can be done, so it is part of the mix.

I had a constituent who was a single person living in a three-bedroom social housing accommodation. She had a letter about under-occupation, so she phoned me up. She said that she had a brother and sister-in-law who could live with her. That is a better use of the housing stock; it meets their housing need and covers the shortfall. Such improved use of the housing stock benefits us all.

I want to address discretionary housing payments, which were raised by the hon. Member for Stockport (Ann Coffey) in her thoughtful contribution. The hon. Member for Wrexham (Ian Lucas) also mentioned discretion. We are being asked to do contradictory things here. Where people have identified groups such as foster carers or people with major disability adaptations to their property, rather than central Government defining exactly what that means in every case, we have allocated the money that we think is needed to deal with the problem and given it to local authorities to respond on a case-by-case basis.

We think that such local discretion is right, but we have been asked to give local discretion, except in every such case also to have an absolute right to make a discretionary housing payment or to exempt people. That is the tension. There are all sorts of individuals whom we might think should be exempt. Trying to sit down and write a regulation or a statutory instrument to define exactly who all those people are does not work, which is why we have allocated discretionary housing payments—this year of £60 million and next year of £155 million—to local authorities. Let me take as an example Durham’s local authority. Last year, it had £177,000 of DHPs. Next year, it will be £880,000 of DHPs to respond to the sorts of people whom hon. Members have mentioned.

I want to respond to the issue about service personnel. I assume that the things that have been said are based on ignorance, rather than on an intent to mislead. Let us take the example of a married serviceman or woman. If one goes away, it does not matter, because there is still a one-bedroom need, so married service personnel are not an issue. Service personnel who live in service accommodation are also not an issue, because they are not social tenants on housing benefit.

We are talking here about service personnel who live in social rented accommodation with their parents and who are on housing benefit, so we are getting to narrower and narrower groups. If a member of the armed forces who is on a wage is living at home with his mum and dad, the benefit system says, “Ah, there is somebody in the house on a wage.” We expect that person to pay up to £70 a week towards the rent—it is called a non-dependant reduction. When the serviceman or woman goes to the front line, and if they are away for a long period, we no longer treat them as a non-dependant in the household, so we no longer deduct £70 from the housing benefit. When a young person goes away to fight for a long period, the parents’ housing benefit will in general go up. That is not the story that the Labour party has been putting out today.

We have been asked about foster carers. We think that the discretionary housing money that we have made available will assist around 5,000 foster carers. Let us bear in mind, though, that this is not all foster carers. I am talking about foster carers who might be in social rented accommodation, on housing benefit and in need of a spare bedroom, so a subset of all fosterers. Of course the fostering organisations would prefer a total exemption; I accept that. Failing that, their estimate is that these are about the right numbers of people, and we have had meetings and discussions with the fostering organisations.

The important issue of children was raised. The majority of people who are affected by this measure do not have dependent children. We are generally talking about older people. None the less, the position of families with children is important. It was suggested that two teenagers of the same gender should not be expected to share a bedroom. I do not follow that argument. I shared a bedroom with my brother until we were 18, and I do not think that it did us any harm. At a time when we have a great shortage of affordable accommodation, I cannot see what the problem is with older teenagers of the same gender sharing a bedroom.

An important question has been asked about whether DHPs are temporary or permanent. In the past, DHPs were a temporary fix. If someone had a short-term problem, they needed a bit of DHP to bail them out and then they moved or did something about it. Under the new system, DHPs can be for the long term, because some situations will not change. If someone lives in a house that has been substantially adapted, that will not change. Local authorities are getting revised guidance and will have to think about DHPs differently, because some people need longer-term certainty, as has been properly said.

The hon. Member for Banff and Buchan said that we had a size mismatch, and indeed we do. When a council is doing something about it—building houses to match the housing need—the hon. Lady asks how I can possibly think that that is a good thing.