Under-Occupancy Penalty (North-West)

Debate between Yvonne Fovargue and Chris Bryant

Tuesday 25th March 2014 Westminster Hall

[Chris Bryant (Rhondda) (Lab)]

It is a delight to serve under your chairmanship, Ms Dorries. I note that I am the only man taking part in this debate, which must be a first for the House of Commons. I hope there are many more debates in which men are in the minority. It is a shame that, all too often, debates involve men talking to men—probably with nobody listening.

I warmly congratulate my hon. Friend the Member for Makerfield (Yvonne Fovargue) on securing this debate, not least because all too often in Westminster politics we think that, once we have pulled a lever, everything will suddenly change out in the rest of the country. Actually, the vast majority of policies advanced by any Government, of left or right, end up having to be implemented by local authorities, and this policy is a classic instance. In many cases, not just local authorities but a series of social landlords are involved.

The direct relationship between Government and those implementing the policy is not as clear as people might assume, which is one of the reasons why the Government have got some areas of the policy profoundly wrong. They did not do the groundwork to establish what the real situation is out in the wider country before enacting the policy.

This is the kind of policy that someone might dream up just before they go to bed or when they are in the shower. They suddenly think it is a brilliant idea because there is no official there to say, “Ah, but Minister.” By the time they have got into the office, they think it is the best idea ever. Unfortunately, they then meet other Ministers who are also desperate for a good idea, and they think, “That sounds like a good old wheeze. Let’s do that.”

The policy, as a whole, was advanced too rapidly. However shiny and new it might have seemed to the Government, I know a large number of Conservative Back Benchers who wish it had not been implemented and look forward to the day when the whole thing can go. All that glisters is not gold, and this has been a meretricious policy.

My first problem is that, as my hon. Friends the Members for Makerfield and for Edinburgh East (Sheila Gilmore) have said, the policy’s implementation has been fundamentally unfair. Both my hon. Friends have said that the significant difference between the Government’s policy and our policy, which addressed commercial landlords, is that the Government’s policy has been implemented retrospectively. In other words, it affects people who are already living in a property.

In recent months, we have discovered that people who live in social housing, particularly council housing or housing association properties, are more likely to live for long periods in the same property than anyone else in the housing market. Some may see that as a problem, but it also presents a significant challenge because the policy is radically changing people’s understanding of their home.

What I have just said does not apply to me because I moved so frequently as a child that I have always thought of wherever I lay my hat as my home. However, the vast majority of people live in the same house for 10, 15 or 20 years, and sometimes for much longer. In some constituencies in the north-west, there will be people who not only live in the house they moved into when they were first married, but live in the same street or estate in which the rest of their family have lived since the estate was first built. In some cases, they will have taken over the tenancy from their parents and have effectively lived in the same house all their lives.

The policy, of course, drives a coach and horses through that understanding of a home. Ultimately, it is profoundly—I want to say un-English, but I am Welsh and my hon. Friend the Member for Edinburgh East is Scottish—un-British not to think of the home of an Englishman or Englishwoman as their castle.

[Yvonne Fovargue]

Does my hon. Friend agree that it is not only family lives that are being destroyed? The aim was to build stable communities in which people support and help each other and run voluntary groups. The policy destroys communities, as well as lives.

[Chris Bryant]

Absolutely, not least because one of the key things that all parts of the House agree about is that we need to get more people into work. Particular families and communities have historically found it much more difficult to get into work. The issue is not only about whether work pays—although that is key and is why we originally supported the national minimum wage, facing down the howls of those who said it would lead to mass unemployment—but the support mechanisms that someone has when they first go into work. Otherwise, benefits are seen as more reliable, and if someone thinks that, they will stick with them.

If someone has child care responsibilities or care responsibilities for an adult relative, they need other family members close by. All too often since the bedroom tax was introduced, we have seen people forced to move to areas where they have no support, which makes it more difficult for them to get into work. Perhaps we Opposition Members too often rant and rave at Conservatives for being cruel, out of touch and not having any interest in the working poor—that has not always been true of them, historically—but some of the policies advanced, particularly those of the Department for Work and Pensions, have effectively cut off a nose to spite a face. They have seemed like savings and cuts, but in practice they have just added costs to the social welfare budget, which is why the Chancellor had to announce last week that he was increasing the estimate for welfare spending for this year by £1 billion and for next year by another £1 billion.

People are living myriad different lives, with different congregations of families and different community set-ups, social understandings and cultural mores, and it is incumbent on Ministers, particularly DWP Ministers, to work with the grain of human nature, rather than against it. The policy fundamentally works against the grain of human nature and the housing market.

All too often the Government have presumed that, because they said in theory that the policy is all about dealing with the mismatch of some properties being under-occupied and many properties being over-occupied, they have to get the families that are overcrowded to move into undercrowded properties. If everyone could step on to the pavement on one day, immediately swap and move into the next property, that might be true, and if there was an exact match of overcrowded and underused in each area—whether geographical, local authority or housing association—that presumption might work.

The facts on the ground, however, as we know from all the different surveys that have been done over the past year, are that there is a total mismatch. People have no choice about moving, downsizing or going to smaller properties, particularly in the short term. It might take them two, three, four, five, six, or, as my hon. Friend the Member for Makerfield said, seven years to move, and that is why the measure is a tax. In the end, people have no choice and have to surrender that extra bit of money.

The £16 might seem like nothing to Ministers in a Department that thinks that pensioners might spend their pot on a Lamborghini, but that is a significant amount of money to my and my hon. Friends’ constituents, particularly when real wages have been depressed and the number of hours and amount of overtime that people are allowed to work have fallen. Many more people have been put on zero-hours contracts. In that environment, £16—or £25, if it is two rooms—extra cost a week is a significant amount of money, and that is why the policy is unfair. It might seem fair to put all the overcrowded people into the underused accommodation, but if no one has checked whether there is enough accommodation to do that, it ends up being unfair.

The evidence of the unfairness is that the Government have had to provide discretionary housing payment schemes for local authorities. With discretionary housing payments, the word I dislike most is “discretionary”, because it means that someone living in one local authority on one side of the road in the north-west might be granted a DHP, while someone on the other side of the road will not get that payment, for the single reason that they live in a different local authority.

There is an added problem with discretionary payments, which is that the local authority knows—let us say it is getting £1 million over a year—not to spend any in April, May or June. That happens every time the Government introduce such a system. The authority will start spending a little only in July, August and September, because it knows that the big numbers will come knocking on the door in December, January and February. That means that there is no consistency across the year.

The Minister revealed that fact—I do not think she intended to—when she was attacking one of my hon. Friends from Manchester about the discretionary housing payment system there. She said that it was outrageous that we were complaining about the amount available to Manchester last July and September, because the city had not spent that part of the year’s money. Of course the city had not spent it, because no local authority does. Local authorities are prudent and save money for when they will have to spend more, which is in winter, at Christmas and towards the end of the year. They have to save against what might be a particular rainy day. The Minister, by her own admission, has laid out that the policy is unfair.

As my hon. Friends said, the Government never expected everyone to move. They said:

“In many areas this mismatch could mean that there are insufficient properties to enable tenants to move to accommodation of an appropriate size even if tenants wished to move and landlords were able to facilitate this movement.”

If there was ever an ownership of the fact that the measure is a tax, that was it. It made clear that the Government know that many people will simply have to pay more money.

I disagree with the policy’s fundamental principles and also with how it was introduced. The Prime Minister more than once boldly stated at Prime Minister’s Question Time that no disabled people would be affected by the bedroom tax. He said that on countless occasions, but we know that two thirds of those affected, according to every survey that has been done in local authorities up and down the land, are disabled. The Prime Minister is closing his eyes to the truth, he does not know the truth or someone is not putting the truth in front of him. I do not know what it is, but the point is that the Prime Minister is completely and utterly misled. I am not saying that he has misled people; I am simply saying that he must be misled.

The other incompetence in how the Government have advanced the policy—we know the legislative incompetence: they brought forward the legislation quickly and then discovered a loophole some nine months into the process, or perhaps a little earlier—is that they are still going through this ludicrously bizarre process of denial about how many people are affected by the loophole. On one day earlier this year, the Minister for Welfare Reform, Lord Freud, said in the House of Lords that an insignificant number of people were affected, the Minister here replied to a written question saying that she did not have any idea how many people were affected, and the Secretary of State said that between 3,000 and 5,000 people were affected.

Yesterday, after the urgent question in the Chamber, the Minister let it be known that the Department will provide £2.1 million for local authorities to do the trawling. That is just for the process of trawling, and not for the payments that will have to be made to those who were illegally charged. She says, and said again yesterday, that the £2.1 million applies to 5,000 people. Sometimes she says it quite angrily and sometimes she says it more emolliently; we will see which version we get today, although it looks like it will be the angry one, given the furrowed brow I am getting. I presume that the Minister can calculate for me how much that is per person. Is a trawl really going to cost £420 per person? By her own admission, the Minister has yet again suggested that the 5,000 figure is not right. I do not know whether it will be 40,000 in total, but it certainly will not be just 5,000.

The Minister has regularly pooh-poohed the statistics that the Opposition provide, but we are only going by the freedom of information requests that we have made to local authorities. Let us look at how some authorities in the north-west replied when we asked them how many households had been affected. Burnley borough council said 60, Bury metropolitan borough council said 83 and Chorley borough council said 32. Eden district council said 30, while Fylde borough council said 80. For Lancaster city council, the figure was 35. Preston city council said 124. South Ribble borough council said 22, and Stockport metropolitan borough council said 126.

It is true that I do not have figures for all local authorities, because, despite our being long past the date by which they should have replied to the FOI request, only 15 out of 39 local authorities in the north-west have replied. Even so, there are 2,609 cases in the north-west alone thus far.

The Minister has criticised me several times, saying that the figure of 480 that I provided for St Helens is incorrect, but we have never provided that figure. We said that there were 178 confirmed cases in St Helens—178 cases where people have already been paid back. Not included in the figure for the north-west, however, is what Liverpool city council states it has already paid back, which is 1,300 households. It is absolutely clear that the 5,000 figure that the Minister cites for the whole country will probably be exceeded in the north-west alone.

It could be said that this is all neither here nor there and that it is dancing on the head of a pin and just about statistics, but what it suggests to me is that the Department for Work and Pensions simply has not done its homework and does not know. I would be quite happy were the Minister to stand up and say, “You know what? I really don’t know what the numbers are. They may be 40,000 or 5,000. Let us see what they are.” However, I object to the Minister’s simply going into denial and saying that nothing is happening because it implies a degree of callous disregard for what is going on in people’s lives. Incidentally, the total number of cases that we have received from local authorities is, with no spin from us, 23,309. That figure is based on the responses of fewer than half the local authorities asked, so it is likely that the final figure will be much higher than the Minister has suggested.

The danger is that if the Department has got this wrong, what else has it got wrong? I am absolutely certain that the Government’s predicted savings will nowhere near be met. Indeed, I suspect that the total effect, including people claiming other benefits, such as out-of-work benefits, will end up costing the taxpayer more. I hope that the Government will one day provide the full details.

So many areas of the policy have been incompetently laid out, not least what counts as a bedroom. Last year, the Minister tried to say that people should take a sledgehammer to walls and knock them down and that that would change the rules. According to the Department for Work and Pensions guidance, however, it does not. Liverpool city council was sent an e-mail by the Department that flatly contradicted what the Minister said in the House yesterday afternoon about who qualifies to inherit a tenancy. According to the e-mail, those qualified include any child or relative of a “polygamous marriage”. I thought that polygamous marriages were illegal in this country, but that is the advice that the DWP has provided to the council. Perhaps the Minister can respond to that specific issue.

Some people who have been illegally forced to pay the bedroom tax will now, because of the loophole, have been given discretionary housing payments. What is the Minister’s advice to local authorities? To how many people does she think that it will apply? How much is it costing? Is the Department paying it or do local councils have to pay it? Will individuals have to pay that money back or are the Government writing it off? If so, how much will that be?

We have already heard about some of the problems caused by the faulty policy. Thousands more people are in arrears, which is a real problem for local authorities and for social landlords around the country. Thousands more have been evicted—not only a tragedy for the families and individuals concerned, but also a problem for social landlords.

The policy fails to address some big, long-term issues and has made them worse. When I come up to Westminster from south Wales, it often feels that there is something of an economic recovery going on and I can see house prices rising magnificently, but my experience elsewhere in the country is completely and utterly different. My anxiety is that an economy that is already heavily overloaded towards London and the south-east will become more so. It is a problem for the people of London and the south-east as house prices get further and further out of reach for ordinary people in ordinary jobs. I worry that the Government’s policies will make that worse.

In the 1980s, contrary to my party’s policy at the time, I completely supported the idea of people being able to buy their own council house or social housing. It was actually first piloted by a Labour authority in Newport. [Interruption.] That is not in the north-west, as I think you are about to warn me, Ms Dorries.