Housing Benefit (Transitional Provisions) (Amendment) Regulations 2014

Baroness Lister of Burtersett Excerpts

Thursday 3rd April 2014 Lords Chamber

[Baroness Nye (Lab)]

My Lords, I completely share the views so ably put by my noble friend Lady Sherlock and my other noble friends, so I will be brief.

On the anniversary of the introduction of the bedroom tax legislation, the Government are trying to close by statutory instrument a loophole without any understanding of how local authorities can identify the people affected or the numbers involved. Instead of trying to close this loophole the Government should finally do the right thing and scrap the bedroom tax altogether, because as the Budget figures show, it will cost more money than it saves. According to the BBC, due to the lack of smaller accommodation only 6% of those affected have moved.

I know that the Minister will have heard these arguments many times before, but they bear repeating. He will have heard that the bedroom tax discriminates,

“against the most vulnerable in society”,

and that the Government have shown,

“a lack of appreciation of the housing requirements of children and adults with disabilities and care needs”.

Those words are not from this side of the House but from the motion passed by his coalition partners at their annual conference last year. I welcome the words of the noble Lord, Lord Taylor of Goss Moor, and I hope that more of his colleagues will join us in the Lobby this afternoon.

The one thing the Government have managed to do is to unite the noble Lord, Lord Tebbit, and the Liberal Democrats in the view that this bedroom tax will have damaging electoral consequences for both parties of the coalition. However, there are other voices, too. The chief executive of the CAB says:

“The Government’s solution to spiralling Housing Benefit costs is simply creating more problems. Thousands are being pushed into arrears, 96 per cent of people affected have no alternative smaller homes to move into and some housing associations”—

as we have heard—

“say they are being forced to demolish homes whilst 1.8 million languish on waiting lists”.

The United Nations says that the bedroom tax is taking a heavy toll on the most vulnerable and recommends abolition and that there is a,

“danger of retrogression in the right to adequate housing in the United Kingdom”.

The Chief Executive of the National Housing Federation has described the policy as an,

“unfair, ill-planned disaster that is hurting our poorest families”.

This retrospective “move or pay” tax simply is not working. For instance, in Merseyside more than 26,000 families are affected, but only 155 have moved. The Work and Pensions Committee has found that between 60% and 70% of homes affected by the change contained,

“someone with a disability and many of these people will not be able to move home easily due to their disability”.

It asked the Government to exempt anyone whose home had been adapted. Instead they are closing a loophole to bring more people into its remit.

Of the 660,000 people affected, two-thirds of those are disabled. The think tank Demos reports that £28 billion will have been taken out of disabled pockets by 2018 due to the cuts in DLA, ESA and housing benefit. Empty properties are increasing, in some areas by a third. In South Shields there are whole empty streets because people are afraid to move into larger houses.

If people end up in emergency accommodation, it costs the country more. But the human cost is huge, too. Grandparents cannot have their grandchildren to stay, so childcare arrangements are affected, and single parents are losing children’s bedrooms. Informal care arrangements for disabled people have come to a halt. A room is not a spare room when carers sleep in it, when couples cannot share a bed for health reasons, or when it houses vital medical equipment such as dialysis machines.

Now the Government have realised that they have been telling local authorities to take away housing benefit from people who were entitled to it all along, so they want to close that loophole. That will mean that local authorities will now have to spend more money and time trying to find out from their records—which go back to 1996 and which they may not have in electronic format—the identity of those people who qualify. It causes bureaucratic chaos and will lead to even greater chaos. This Conservative-led Government should be listening to what people—including their partners in the coalition—are saying, and scrap the whole sorry mess.

[Baroness Lister of Burtersett (Lab)]

My Lords, as the Regret Motion makes clear, we have to understand these regulations in the context of the impact of the bedroom tax.

My noble friend Lady Sherlock quoted Esther McVey on Radio 5. I will take us back to her rather wonderful interview on Radio 4, in which the interviewer had to drag out of her that the Government’s estimate is that only 8% of people had moved—a whole two percentage points more than the BBC estimate which she had been contesting. She was asked if she was disappointed. She replied:

“Well no, because it wasn’t that you had to move house”.

How is that consistent with her statement in debate in the other place? She said:

“The reason that we are putting these measures in place is that we want to ensure we make the best use of our social housing”.—[Official Report, Commons, 26/2/14; col. 311.]

In addition, how is it consistent with the constant refrain:

“How can we justify 1 million spare rooms when other people are sometimes crammed together in a room?”.—[Official Report, Commons, 24/3/13; col. 27.]

Can the Minister tell us exactly how many rooms have been freed up by this policy? As the Work and Pensions Committee report observed, it is,

“a blunt instrument for achieving this”

aim, and one that is causing hardship, as we have already heard from other noble Lords.

Why, then, have people not moved? As has already been said, it is partly because there is nowhere to move to. In the Independent, on 3 March, it was reported that,

“a severe shortage of smaller council homes across the country is being exacerbated by the right-to-buy scheme—leaving many victims of the bedroom tax with no choice but to accept reduced benefits”.

Also, many people do not want to move because they do not want to lose social networks that are very important to them—a point I have made over and over again in this House. We are not talking about housing in the abstract, but about people’s homes within communities that matter to them.

As Demos said, in a study it carried out on social ties,

“policies can serve to actively undermine the kind of self-help and mutual support that families engage in”.

One would have thought that that would be approved of by a Conservative-led Administration who believe in the big society. Reforms such as the removal of the underoccupancy penalty—dubbed the bedroom tax—have left people with a choice of either finding more money for rent from already stretched budgets or moving away from support networks that make life liveable for many.

We have heard about rising rent arrears, but they are only the tip of the iceberg. Earlier this week I attended the launch of a report by Community Links on the impact of the first year of so-called welfare reform—although I would call it social security cuts—in the London borough of Newham. The person presenting the findings pointed out that many people prioritise rent for fear of eviction. Therefore, there may not be rent arrears, but what other impact is it having on what people can spend on other essentials, and how many people are turning to payday lenders or, even worse, to loan sharks? That morning we heard tales of utter despair—the result of the cumulative impact of this and other benefit cuts such as council tax benefit.

The suggestion has been made: “Let them take lodgers”. Do we know how many people have taken on lodgers as a result of this policy? Some noble Lords who are following the Immigration Bill will know that later this afternoon we will talk about its residential tenancy provisions. Anyone who takes a lodger as a result of the bedroom tax will be turned into a mini-immigration officer and will have to check the immigration credentials of their lodger. Do we really want people on benefit being turned into mini-immigration officers to prevent illegal immigration?

The Minister, Esther McVey, pleaded that the BBC report showed how complex this is. I can suggest a simple solution: follow the policy of the Opposition—which I hope will very soon be the official policy of the Liberal Democrats—and abolish the bedroom tax.

[Lord Beecham (Lab)]

My Lords, I think I am the only serving, elected councillor who is likely to speak in this debate, unless the noble Lord, Lord Tope, in his declining days as a councillor—I believe he is standing down shortly—joins in to proclaim the new, belated Lib Dem policy on the bedroom tax. I bring a snapshot from Newcastle, where 5,400 households are affected, at an average cost to each of them of £13.47 a week. If paid, that represents around £3.75 million to be taken out of the local economy, so there is a knock-on effect, quite apart from the housing effect, on that economy. Just under one-quarter of those are working households, one-third have children and, as we have already heard, many have disabled people in them. In my own ward, there are 315 such households.

As has already been pointed out, it is not a simple matter to transfer into a smaller property. In Newcastle, we have 3,558 people seeking one-bedroom accommodation. The average number of available one-bedroom properties per year is 64. It would take a generation or more to accommodate those people. Some 615 are seeking to move down to two-bedroom accommodation. There is, admittedly, a slightly higher availability of this—all of 101 a year. Any effect on the private sector, which in Newcastle is largely taken up with students, will drive up rents. Landlords are increasingly reluctant to take tenants who are on benefits of one kind or another. This policy is not only cruel and inefficient; it is based on a complete misunderstanding—to put it generously—of what happens in the social housing market. It is damaging people’s lives.

I conclude with an anecdote about meeting a couple of people in their fifties—not in my own ward—who benefited from the decision which required the Government to effectively refund the amount paid because of the length of their tenure of the property. I was able to tell them they would be getting the money back but I also had to give the bad news that the Government were seeking to ensure that the money returned to them was spent on paying the bedroom tax. Here were two disabled people, living in a house for just under 30 years, with one of their grandchildren staying with them when I called. This just illustrates the cruelty and incompetence of the measure and I congratulate my noble friend on bringing this Motion of Regret.