Housing Benefit (Wales)

Nia Griffith Excerpts

Thursday 1st May 2014 Westminster Hall

[Nia Griffith (Llanelli) (Lab)]

Housing benefit is an important issue for people in Wales. Forty-six per cent. of tenants in social housing have been affected by the Government changes that we call the bedroom tax; of the 40,000 households affected, 25,000 contain a person who is disabled. It is a significant problem.

In response to the report, the Government have said that they will be monitoring movement into the private rented sector. Will the Minister tell us what monitoring has been done? In their response, the Government also say that there is “no evidence” of cost to the taxpayer, but that is probably largely due to the small numbers of people who have moved into the private rented sector. As has already been mentioned, we know that in Wales there is only one available one-bedroom property for every 100 families that need to move. That figure was produced by Rebecca Evans AM after she got in touch with a number of housing providers: some 20,800 families were looking to move but only 280 properties were available.

Another problem is that there are not huge numbers of people on the waiting list who would qualify for those three-bedroom properties that we have in Wales. A family qualify for three bedrooms if they have a girl and a boy over nine, but a family of two parents and two children of the same sex aged up to 16 qualify only for two bedrooms. In fact, the vast majority of applicants do not qualify for three bedrooms. That is one of the problems. Even if a property is vacated, there are no savings to be made by moving other families into it.

The problem in Wales is that the landscape is semi-rural and there are former mining communities where no one would have settled were it not for the mines. Some of the valley tops are great distances from available work and it is difficult to rehouse people and to keep them in their communities.

[Mr Mark Williams (Ceredigion) (LD)]

The hon. Lady will be aware that large tracts of Wales are very rural. She referred to distances, and the distances that people might be expected to move are unacceptable. As the Chairman of the Select Committee said, they could amount to 50 miles.

[Nia Griffith]

Absolutely. It is a considerable problem.

The Government state in their response that they will not consider a blanket ban on forcing people in adapted premises to move. When there has been investment to make properties suitable many housing authorities in Wales try to keep them available for disabled people. Not having a blanket ban on hitting disabled people with the bedroom tax is a short-sighted policy. Apart from the tremendous upset for the individual, it is not good use of public funds.

[The Minister of State, Department for Work and Pensions (Steve Webb)]

Will the hon. Lady say how she would define what “significantly adapted” is in practice?

[Nia Griffith]

I am sure we can all imagine major adaptations such as changes to bathrooms and additional rooms. The only one that might be considered less significant is a stair lift that could be put in or taken out, but any other form of adaptation should be taken into consideration. Further to that, it should be noted that legislation passed by the Welsh Government has enabled local authorities in Wales to desist from selling off some types of properties. They have largely chosen to keep in their stock properties such as those suitable for old people who downsize precisely because adaptations have been made that suit older people as they become less physically active.

Another point in the Government’s response is that the bedroom tax

“may encourage more claimants to move into work”.

That sounds like forcing people to look for work. People are already looking for work. People who have the capabilities are already looking for work. We must take into account the fact that some of them have significant disabilities and there are not many suitable jobs available.

Transport and child care are problems in rural areas, which are multiplied because of trying to fit in transport to work with picking up children and getting home from work. It is not easy to find jobs with hours that fit in.

I have taken issue with the Minister about the fact that the issue is not just a matter of obtaining a few extra hours. We all know that because of the complex way in which housing benefit is worked out people effectively lose around 60% of the benefit for additional earnings. The equation does not involve simply a few extra hours. The matter is much more complex. On tapering or claw back, I am extremely concerned about the proposals for universal credit because 76p in the pound of each tax credit will be clawed back when people take on more hours of work. The Centre for Social Justice suggested that it should be only 55%. That is another enormous hurdle for people taking on more work or going out to find work.

What progress has there been on collecting information and monitoring rental costs? That was promised in the Government’s response.

I turn to discretionary housing payments. The whole point about them is that they are discretionary, but they are imposing an enormous work load on local authorities because everyone on housing benefit is deemed to have insufficient funds to cover their rent. That was our definition of housing benefit. It was provided for people whose residual money after deducting various items was not sufficient to cover their rent, so it is inevitably massively oversubscribed.

The Government have said that they have provided extra money, but let us look at what that really means. I will use the example of Torfaen, which was given £193,000 of additional money for its discretionary housing payments but the shortfall in housing benefit is approximately £1 million, or five times the discretionary amount allocated. Torfaen was then told that it could spend up to £430,000, but that extra money must come from its own funds. In other words, it must make sweeping cuts elsewhere when it is already facing significant cuts.

The Welsh Government have provided £1.3 million of extra money throughout Wales to help with the additional administrative burden, but what a waste of money. If housing benefit was paid, none of that would be necessary. Having gone through the process once, it will have to be repeated because the whole point of discretionary housing payment is that it is supposed to be a temporary measure, as the Government noted, to tide people over. However, if there is nowhere for them to move to, the process will be repeated.

The officer in charge of housing benefit for Monmouth and Torfaen, Richard Davies, summed up the situation when he said that administering the huge demand for help has dramatically increased council work load and dealing with discretionary housing payment

“applications is like dealing with a totally separate benefit scheme. It’s shifted everything from statutory to discretionary”

so

“it’s a huge burden of administration.”

[Guto Bebb]

I am interested in the hon. Lady’s comments about Torfaen, but she could mention the situation in Denbighshire and Conwy where a report from Eryl Rowlands, who is responsible for the matter in both counties, makes it clear that the anticipated problems associated with the so-called bedroom tax have not come into play.

[Nia Griffith]

There may be differences in different areas because of the availability of different types of property and work. In my county, we are building bungalows in, for example, Seaside and Kidwelly, but we know perfectly well that the rate of building will not keep up with more than 1,000 households in Carmarthenshire that are waiting to be moved or to be given an alternative option to their present situation.

I want to respond to the criticism that the Welsh Government have not had a building programme during the past 15 years. Many properties have been built, especially adapted properties for disabled people and a range of supported housing and housing association housing. However, when we have small communities with a limited housing stock we need it to be as versatile as possible. It is always possible to put a small family unit in a three-bedroom house, but it is not possible to squash a large family unit into a one-bedroom flat. Our tradition in Wales, where land is relatively plentiful, has been to build houses rather than flats. That is the situation we find ourselves in. It is not the fault of tenants that they may have been allocated a two or three-bedroom property when under the bedroom tax theory they should have a one or two-bedroom property.

The Government must rethink their policy, particularly bearing in mind Lord Freud’s comments that there may be issues in particular areas. More than that, we would like them to monitor the situation. Many people are now finding it almost impossible to make ends meet, with arrears running at more than 50% in many areas, often involving people who have never been in debt in their lives.

On a slightly different note, landlords are also affected. One issue that has been raised again and again, and has not been terribly well answered by the Government, is direct payment to landlords. There has to be two months of being in arrears before it is possible to get somebody switched across to having a direct payment. That is causing us real problems, in terms of availability of property. Some whom we might call “amateur” landlords—people who have perhaps become landlords by accident, because they cannot sell a property—are now becoming very reluctant to rent out properties to people who are on housing benefit, whereas before they would have had a guaranteed cheque from the council. That is also affecting bigger landlords—the social housing providers. So will the Government take another look at the response they have made about those direct payments? I am not the only person to mention that; it has been mentioned very vigorously by lobbyists on behalf of landlords. On that note, I shall finish.

[Mr Mark Williams (Ceredigion) (LD)]

It is a privilege to serve under your chairmanship this afternoon, Sir Roger. Given the interest in the subject and the number of people here, I will be as brief as I can and focus my remarks on bedroom tax, or spare room subsidy—or whatever we choose to call it.

Before I start, it would be remiss of me as a member of the Welsh Affairs Committee not to congratulate my hon. Friend the Member for Monmouth (David T. C. Davies) on his chairmanship of the Committee. He is right to say that the subject matter was not without controversy. The debates were always going to be spirited and the deliberations could be lively at times. It is perhaps remarkable that we reached the point at which there is a report to discuss today, but we have, and that is in no small part due to his endeavours as our Chairman.

I want to focus my remarks on three areas: first, the application of the policy to rural areas such as mine; secondly, the policy’s application to the homes of disabled citizens; and thirdly, the increasing concern expressed by members of the veterans community in my area about the application of the policy.

As we have heard from everyone so far, 40,000 housing benefit claimants in Wales will be affected by the policy. That is about 46% of the working age social rented sector housing benefit claimants—the highest proportion of people affected among the regions and nations of the United Kingdom. On top of that, it is a plain fact that the amount of accommodation required to pursue the policy simply is not available. My particular concern is that the shortage has a disproportionate effect in rural areas, as my hon. Friend and the hon. Member for Llanelli (Nia Griffith) said, where the large distances between communities and the potentially available—potentially being the key point—housing stock are far greater.

We asked—I remember asking this in one of our hearings—whether we should be asking people to travel 40 miles each way, each day, for their jobs, so disrupting family networks and inconveniencing children and their schools in terms of their education, particularly in areas where transport links can be difficult, non-existent or disproportionately more costly. Should we put people in the position of having to consider such things in the first place?

The reality on the ground is that the required social housing stock is not available. That is compounded in my constituency by two university towns, which have a huge effect, making the private rented sector highly competitive in Lampeter and particularly in Aberystwyth. The challenge to provide accommodation was brought graphically to our attention in Aberystwyth recently, when a development of social housing flats, Plas Morolwg, managed by the Tai Cantref housing association, was closed due to storm damage. The occupants of the 40 flats had to be rehoused under emergency arrangements. That was just about achieved—only just. It would be a near impossibility for 40 families to be moved under any other guise. I cite that example because it illustrates that there is no slack in housing, which is why we are right to question the Labour Assembly Government about their plans and record of house building to date.

One recommendation of the report was about whether we should incentivise the over-60s with cash payments to move. I am very relieved that the over-60s—people of pensionable age—were not included in the provisions in the first place. A lot of misinformation was going around at one point that they were included. I am very glad that that was sat on. Again, even if we could offer people choices, suitable housing for pensioner couples and individual pensioners is simply not available.

[Nia Griffith]

Does the hon. Gentleman find in his area, as in mine, that pensioners are queuing up to have smaller properties if they become available and that they do not really need incentives because they are very keen to move?

[Mr Williams]

We could well have attended the same surgeries. It is certainly my experience that I have had people willing to move, but there is simply nothing available for them.

--- Later in debate ---

[Glyn Davies]

The right hon. Gentleman makes a good point in that there are great differences between constituencies. He may well speak later in the debate and describe what has happened in his constituency, but when the policy was debated early on, a number of people said that it was going to hit rural areas harder—that was going to be the real problem. No area is more rural than my constituency, and the reality is that the commitment of the local authority and Mid-Wales Housing Association has made the policy work. I am not pretending that it has been easy, but they have made it work as well as possible.

The final issue I want to discuss is new housing, which is clearly needed for the policy to work well in the longer term. Housing deliverers did not respond to what they could have anticipated, perfectly reasonably, to be Government policy. To say that the policy was suddenly dropped on them, out of the blue, and that they need two years to deliver is, I think, a bit of an excuse. They could have anticipated that the policy would be introduced, but we are where we are.

We need the Welsh Government, as well as housing and planning authorities in Wales, to recognise that we need new properties. They should not be piling on extra costs. The Welsh Government have not delivered on new housing. We only need look at the figures to see that they have gone down. They have put on new costs. The planning authorities demand planning gain for this, that and the other, and make it almost impossible to build housing. The Welsh Government have put on the extra cost of sprinklers, which in themselves are fine—

[Nia Griffith]

Will the hon. Gentleman give way?

[Glyn Davies]

I will in a second—let me just finish the point, because I am getting warmed up. They put on all these extra costs, the consequence of which is that housing is not built. People might have some idealistic objective to deliver something of which they can stand up and say, “Isn’t it grand? We must do this,” but the reality is that builders moved out of Wales because they could not accommodate the extra costs. We need a positive attitude in Government and local authorities. In order to house the people of Wales affordably, both national and local government must ensure that housing is delivered and not start from a position of trying to stop people building.

I do not have much else to say, but I would like to allow the hon. Lady to intervene.

[Nia Griffith]

Will the hon. Gentleman explain how, with his Government cutting capital expenditure funding to the Welsh Government by half, he expects them to be able to build more houses? What progress is Montgomeryshire making on taking similar steps to Carmarthenshire county council, which has been able to borrow funds to build houses?

[Glyn Davies]

Again, we have a complete separation, as if the private sector is over here and the public sector is over there. The issue is not the funding of the public sector; we must allow the private sector to deliver the housing we want. The private sector will deliver what we want if we create a situation in which it can. For the past few years, all I have seen is local and national Government making it more difficult for people to deliver what the people of Wales want.

--- Later in debate ---

[Nia Griffith]

Will the Minister give way?

[Steve Webb]

No. For example, when the Labour Government introduced the principle that private sector tenants with a spare room should have to pay for it, they did not describe the measure as a bedroom tax, so I do not see why a similar one for a social tenant should be.