Oral Answers to Questions

Nia Griffith Excerpts

Monday 5th December 2022 Commons Chamber

[Afzal Khan (Manchester, Gorton) (Lab)]

2. What assessment his Department has made of the potential impact of real-term reductions in local housing allowance rates on levels of poverty.

[Dame Nia Griffith (Llanelli) (Lab)]

5. What assessment his Department has made of the potential impact of real-term reductions in local housing allowance rates on levels of poverty.

[Rachel Hopkins (Luton South) (Lab)]

6. What assessment his Department has made of the potential impact of real-term reductions in local housing allowance rates on levels of poverty.

--- Later in debate ---

[Mel Stride]

As I have just indicated, I will review that in just under a year. There are of course the discretionary housing payments, which are administered by local authorities for those who feel that they need additional support, and I also point the hon. Gentleman in the direction of the significant cost of living payments that we are providing at the moment to support those in most need.

[Dame Nia Griffith]

As my hon. Friends have said, the very least the Government must do is to raise the local housing allowance to keep pace with the real rate of rent inflation. The Department has also cut the funding of last resort, namely, that given to the Welsh Government to provide discretionary housing payments—a cut of 18% last year and a whopping 27% this financial year. Will the Secretary of State now commit to reversing that latest cut, so that local councils in Wales can at least offer some help to those in most dire need and avoid further evictions?

[Mel Stride]

I would just say to the hon Lady that there is the household support fund as well, which she did not mention. That is there to provide support in the circumstances that she described, along with the discretionary housing payments that I set out and the fact that, in 2020, we did indeed raise LHA to be in line with the 30th percentile of local rents.

--- Later in debate ---

[Tom Pursglove]

Again, I thank the hon. Gentleman for raising this issue so constructively. He is right to say that I responded to his earlier question in a letter last week. This matter is sitting with the HM Courts and Tribunals Service, which of course relates to the work of the Ministry of Justice and is independent as part of the judiciary. I will take his point away and flag it with Justice Ministers so that they can see whether there is anything that they can do to raise it.

[Dame Nia Griffith (Llanelli) (Lab)]

The Secretary of State mentioned the reduction to 25% of the deductions to universal credit to claw back overpayments or advances, but deducting 25% of money that barely covers the essentials is far too much. A report by Lloyds Bank Foundation says that even at 25% the deductions are pushing people into other debt and leaving them without enough to live on. The Secretary of State will also know that the Work and Pensions Committee has recommended pausing debt recovery during the cost of living crisis. Will the Secretary of State now pause that debt collection and, when it resumes, resume it at a lower level?

[Mel Stride]

The hon. Lady will know that the level of 25% she refers to has been decreasing through time; it was 40% not that long ago, then 30% and now it is 25%. It was paused altogether during the pandemic, and the experience then was that debt started to increase among claimants, in many cases in a way that was not helpful to the claimant. It is an important principle that, where people are in debt, we work with them to make sure we get them out of debt through time, but I accept that we need to do that with great care, hence the various elements of the process that I described earlier.