Under-occupancy Charge

Lord Freud Excerpts

Thursday 28th January 2016 Lords Chamber

[The Minister of State, Department for Work and Pensions (Lord Freud) (Con)]

My Lords, I shall repeat in the form of a Statement the Answer given to an Urgent Question in another place.

“We know there are people who need extra support. That is why we are providing local authorities with discretionary housing payment funding. Local authorities are best placed to assess people’s needs in their area and identify where extra support is needed.

We have increased the amount of discretionary housing payment available, and, on top of the £560 million since 2011, we are providing an extra £870 million over the next five years. The people involved in these cases are receiving discretionary housing payments. That is precisely why we have discretionary housing payments, and shows that these are working.

We welcome the fact that the High Court and the Court of Appeal have both ruled that the public sector equality duty has been met in respect to women. Furthermore, we have won a Court of Appeal ruling where the court ruled in our favour on the policy of the spare room subsidy. In that judgment, the court found that discretionary housing payments were an appropriate means of support for those who are vulnerable. So this is a complex area and, in terms of these two latest cases, it is a very narrow ruling.

On these cases, the High Court found in our favour and we fundamentally disagree with yesterday’s Court of Appeal ruling on the ECHR. This is not a case of people losing money, for in these cases they are in receipt of the discretionary housing payments. This is about whether it is possible to define such exemptions or whether direct housing payments through local authorities give the right flexibility to help a wide range of those in need. The Court of Appeal itself has already granted us permission to appeal, and we will be appealing to the Supreme Court”.

[Baroness Sherlock (Lab)]

My Lords, I thank the Minister for repeating that Answer from the other place. The Court of Appeal ruled against the Government on two bedroom tax cases: one from a victim of rape who had had a panic room installed by the police, and the other from the Rutherford family, who care for their severely disabled grandson. In both cases, the court ruled that the bedroom tax was illegal and discriminatory. However, any relief for the families was short-lived because, astonishingly, Ministers have decided to appeal to the Supreme Court. References to the fact that families may receive the temporary discretionary housing payments from a pot being stretched in ever more directions are nothing but a fig leaf.

I would like to ask the Minister a couple of questions. First, can he confirm that 280 victims of domestic abuse have had a panic room installed under the sanctuary scheme and are affected by the bedroom tax? On the same point, is it true that exempting domestic abuse victims would cost the Government only £200,000 a year? Can he tell the House whether, in the wake of this judgment, the Government will consider withdrawing their appeal and instead taking the right decision of exempting severely disabled children and their families and victims of domestic abuse from the bedroom tax, in which the people of Britain have now completely lost confidence?

[Lord Freud]

I do not have the figures to which the noble Baroness referred, so I will have to check the figures we have and write to her on that.

Effectively, with this appeal we are joining these two cases to a number of others for the Supreme Court to look at the whole thing in one context. It is, essentially, about whether the discretionary housing payment system is appropriate for handling these particular hard cases, which the High Court has, in practice, accepted as the right way to ameliorate those cases, up to now.

[Lord Taylor of Goss Moor (LD)]

My Lords, my former colleague, Andrew George, brought forward proposals in the previous Parliament to exempt those who had particular needs for an extra room from the bedroom tax—such as those with disabilities needing a carer—and, indeed, to exempt those who had not been offered suitable alternative accommodation. I have heard what the Minister has said about this case. I do not believe that, outside the Government, anyone believes that the kind of cases that went to appeal are a matter for discretion.

The Minister may say that a wise local authority will exercise its discretion appropriately, but the general public will ask: how can it possibly be a matter for discretion when there is any chance that they might not get that support when they so evidently need the space within their accommodation? Nor do I believe that the public understand why people are penalised when a local authority is unable to offer them suitable alternative accommodation. I say simply to the Minister that I do not believe the Government are doing themselves any service at all in pressing this to the Supreme Court. I have no particular wish to encourage support for the Government but I assume that the Minister would wish to encourage such support, so I really beg him to think again. It is in the interests of all involved. Most of all, I believe that, on this, the Government are not with the people.

[Lord Freud]

The issue here is that there quite a lot of particular circumstances where one would feel that people should not have the spare room subsidy removed. It is extraordinarily hard to define all those cases. That is why the Government took the decision in 2010-11, when this was introduced, to have this mechanism of a discretionary fund so that the hard cases can be looked after. By and large, that system has been pretty effective in making sure that in those hard cases the people are looked after.

[Baroness Young of Old Scone (Lab)]

Does the Minister recognise that, since he has said that there are a wide range of circumstances in which the bedroom tax is inappropriate, that may be an indicator of the wider discriminatory nature of this tax? Can he confirm that the most recent evidence is that three-quarters of those hit by the bedroom tax are cutting back on food and only 5% of those hit by the tax have been offered alternative accommodation to allow them to move?

[Lord Freud]

We discuss this issue regularly in this Chamber and earlier this week, or maybe last week, we went into how many people have come off the bedroom tax. There has been a 16% reduction in the number on the roll—98,000 at the last figure. Many have done so because they have gone into work. Indications are that people are adjusting to this policy.

[Lord Phillips of Worth Matravers (CB)]

My Lords, is it not the case that each of these cases was given permission to go to the Court of Appeal specifically to enable them to go on to join the other cases in the Supreme Court? In those circumstances, is it not a little harsh to criticise the Government for accepting that invitation?

[Lord Freud]

Yes, that is precisely the point. As far as we can tell, one reason that the Court of Appeal took this decision was to send the cases to join another set of cases that the Supreme Court will look at in March. The Supreme Court will, therefore, be able to take a view and reach a judgment across the piece on these issues and will do so relatively rapidly. So this is really by way of an interim legal position before we have something more definitive.

[Baroness Stedman-Scott (Con)]

Can the Minister tell us how many cases the Government have won in relation to this policy?

[Lord Freud]

So far, we have had 10 cases in the High Court and we have won them all. We have just lost these last two in the Court of Appeal but we have won the five joined appeals in the Court of Appeal and those are the ones that are now going to the Supreme Court. So, until this last judgment, the legal system has accepted that the way that we ameliorate these hard cases using the discretionary housing payment is an appropriate way of providing the protections that I think all of us in this Chamber want to make sure are there.

[Baroness Hussein-Ece (LD)]

Does the Minister accept that there is a shortage of appropriate housing for some of these social tenants to move into? This has been said repeatedly in this House when we have debated housing, including quite recently—there is a shortage. In those instances, surely it cannot be discretionary. The Minister just said in response to my noble friend that “by and large” these sorts of cases are cropping up. These are very small numbers. Surely the case of someone like Paul Rutherford and his severely disabled grandson, which has gone to appeal, is a deserving one. The Government should show some compassion, rather than spending more of taxpayers’ money fighting against the right for this family to live in peace and look after their disabled grandson.

[Lord Freud]

When we looked at the surveys on this originally, the figure was that roughly 20% of people might want to downsize in order not to have the subsidy removed. Many have downsized and local councils are stepping up the provision of appropriate housing—one-bedroom or two-bedroom flats—to match demand. So there are signs in the research we have conducted that people are adjusting to this policy.

[Lord MacKenzie of Culkein (Lab)]

I want to reinforce the point just made that “by and large” is not good enough in these sorts of cases. I cannot see for the life of me how any Government with a shred of decency think that having a panic room to protect vulnerable women in particular can be classed as a spare room. How on earth can the Government seek to appeal that?

[Lord Freud]

The people in these cases were receiving discretionary housing payments. These are small examples. Our guidance says that local authorities should prioritise these areas and we will reinforce that guidance. As I say, the Supreme Court will be judging this way of ameliorating complex areas. These are two examples. There are quite a lot of hard cases, and it is important that we get to all of them. If you start to define them all in legislation, you end up with a lot of legislation. The issue that the Supreme Court judges will be looking at is whether we are looking after the hard cases in the right way.