Under-Occupancy Penalty

Hywel Williams Excerpts

Tuesday 5th November 2013 Westminster Hall

[Mrs Lewell-Buck]

My hon. Friend is correct. Elderly people in my constituency have come to my surgery to say, in their words, that they are rattling around in three-bedroom homes. They would like to move, but they cannot.

[Hywel Williams (Arfon) (PC)]

Just out of curiosity, has the hon. Lady received any reply from the Secretary of State to her invitation to visit South Shields? In my own constituency in north-west Wales, we have seen no sign at all of Ministers or of anyone conducting research before the change came into force. I will certainly refer to that in my speech, if I am lucky enough to be called.

[Mrs Lewell-Buck]

This is the first time I have invited the Secretary of State to South Shields, so we will see—watch this space.

Many of my constituents who are desperate for employment or are stuck on zero-hour contracts sincerely want to move to a smaller property, but they simply have no homes to go to. The Government’s policy is hindering the ability of councils and housing associations to build homes for them to move to, so they will not be able to act on the Secretary of State’s advice.

As with so many things this Government do, the disdain with which they treat people in social housing shows how far removed they are from the reality of what is happening in towns such as mine. Opposition Members have put a raft of questions to the Prime Minister, the Deputy Prime Minister, Secretaries of State and the previous Housing Minister regarding the unfairness of this cruel tax and the implications for our housing supply. It is becoming depressingly clear that, from this Government’s point of view, my right hon. and hon. Friends do not need an answer and that the effects of the tax on struggling households and housing supply are not their concern. Their only interest is in appearing tough on those they call scroungers.

Thankfully, the Labour party has an answer. We are committed to repealing this awful tax. We are committed to building 1 million new homes over the next Parliament—200,000 homes a year and a raft of employment opportunities in construction. We are committed to stopping landowners holding on to undeveloped land, so that the housing market will suit the needs of the many, not the few.

The bedroom tax has been a complete failure. It has not reduced overcrowding.

[Mrs Lewell-Buck]

The right hon. Gentleman is correct. More safeguards need to be built into the tax, but a Labour Government would overturn the tax completely.

[Hywel Williams]

The hon. Lady referred to building 200,000 houses every year. Housing is a devolved issue. Has she signed up her colleagues in Cardiff to a total for Wales, which I think would be about 11,000 houses a year? Scotland’s Scottish National party Government will probably build 17,000 new houses a year. Will she be able to deliver?

[Mrs Lewell-Buck]

I will leave that question for the shadow Minister, my hon. Friend the Member for Wolverhampton North East (Emma Reynolds), to answer.

The bedroom tax has not encouraged efficient use of social housing. It has certainly not saved the taxpayer the projected £470 million this year. It has increased homelessness and poverty, led to streets being filled with vacant social housing and cost more than it saved. Taking that and the human cost of the policy into account, the tax is one of the cruellest and most ineffective policies ever to come from any Government.

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[Hywel Williams (Arfon) (PC)]

It is a pleasure to serve under your chairmanship, Mrs Riordan. I congratulate the hon. Member for South Shields (Mrs Lewell-Buck) on securing the debate. We shall, of course, have a further opportunity to deal with the issue next week, and I look forward to that.

I am glad to see the hon. Member for Brecon and Radnorshire (Roger Williams) to my left. I hope that he will soon leap up to defend the Government’s policy. I am also glad to see my hon. Friend the Member for Banff and Buchan (Dr Whiteford), because Plaid Cymru, the Scottish National party and the Green party called a debate on the issue in March. I am glad that the Labour party is joining us in opposing a cruel and pernicious charge.

The aim of the under-occupancy penalty is, allegedly, to free up the logjam in available housing. That is a laudable long-term aim, and people should clearly move to make way for younger people with families.

[Roger Williams (Brecon and Radnorshire) (LD)]

I thank the hon. Gentleman for giving way. He mentioned my name; I supported the Government’s proposal because I wanted young families to be given the opportunity to have better housing. As to the discretionary housing payment, my authority has been allocated £512,000, as opposed to £60,000 last year. It will not spend it, and will have to send it back to Government unless something is done. Does the hon. Gentleman think that the DWP inquiry should include the use of discretionary payments by local authorities?

[Hywel Williams]

That is a good point, to which I intended to refer later. I recently tabled several questions to the Government about the use of discretionary payments, what planning had gone into them, and what amounts were to be available this year and next year. The answers were clearly wanting.

The aim of the charges—freeing up the logjam in the availability of three-bedroom houses for younger people—is laudable in the long term. However, one of my fundamental objections is that the Government are using tenants as a battering ram to free up that logjam. Tenants are carrying the burden of the charge and will have to find alternative accommodation, when there is none available. That is pernicious, and destructive of communities. That is one reason, indeed, for my opposition to the charge.

[Dr Whiteford]

My hon. Friend makes a good point about the allocation of houses, and the need for housing for families; does he agree that social housing, which is always the cheapest available, should be allocated on the basis of need, not household size?

[Hywel Williams]

That is an excellent point. The need has in some ways been artificially generated, and that is not a sensible basis for housing policy, even if people are able to move. However, some hon. Members will have read in The Independent today that 96% of people are unable to move home.

I tabled a question to the Secretary of State, asking

“what estimate he has made of the number of people in Wales who will move house as a result of the social housing under-occupancy penalty.”

The answer was quite revealing:

“The Department is not able to reliably estimate the number of people in Wales who will move house as a result of the Removal of the Spare Room Subsidy due to the small sample sizes involved.”—[Official Report, 4 November 2013; Vol. 570, c. 95W.]

That reveals a great deal, including the fact that the Government do not expect huge numbers of people to move. They expect, I understand, to make substantial savings on housing benefit. That is the reality, and the answer is something of a give-away.

Earlier in the year, I asked the Government what research they had undertaken into the private sector, and private market elasticity—the sector’s ability to respond to an increased demand for one-bedroom places. I was told that no such research had been undertaken before the measures were brought in. There would apparently be research in 2015, and reports would be published in 2016. That will be, of course, more than two and a half years after the charge was brought in—two and a half years of suffering by people who can scarcely afford to lose 12% or 25% of their benefit.

We have heard that particular groups are affected, such as disabled people, who have a legitimate need for extra space. I have constituents who have been charged extra. One such gentleman said, “I shall certainly move from my house, which has been adapted—there is a new bathroom at the back, and a stair lift—and move to a smaller place. The council can then put in a new stair lift, and a new bathroom at the back; and then I will move again.” It is folly. There are single parents without care who will take children for a day or so at the weekend, who will lose out.

More fundamentally, there is an effect on estates. We talk a lot about social life degenerating, and about things not being as good as they used to be. By the way, I was brought up on a council house estate. It was a stable area, with a mix of people from working-class and upper working-class backgrounds and those who were almost middle class, who had been there for a long time. They were the sort of people who had seen their children move on, but still lived in three-bedroom houses, and who provide for such estates the anchor and stability that we think are so important; yet the Government want them to move on. I understand that the technical term is “forced decanting”, which is very bad.

In the short time available to me, I want to point out that we might be left with a further supply of houses that are hard to let, not because they are in difficult areas or do not have basic facilities, but because they have three bedrooms. If the policy actually succeeds, that will be a potential waste of resources.

I end by referring briefly to funding for hardship. My local authority has a group—it brings in people from Shelter, the Department for Work and Pensions and Members of Parliament—to administer such funding. It has added substantially to that fund, with the result that the number of people in arrears is fairly small, and I hope that we will have no evictions. I would like to hear the hon. Member for Wolverhampton North East (Emma Reynolds), who will speak for the Labour party, pledge that the Labour Government in Wales will have a “no evictions” policy. Local authorities and housing associations are doing their best; it is time for other people to step up to the plate.

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[Emma Reynolds (Wolverhampton North East) (Lab)]

It is a pleasure to serve under your chairmanship, Mrs Riordan. I congratulate my hon. Friend the Member for South Shields (Mrs Lewell-Buck) on securing this incredibly important debate and on her outstanding contribution. Many passionate speeches have been made by my hon. Friends, but there is a notable absence of Conservative and Liberal Democrat Members, and we have not yet heard a single speech from Government Members. I welcome the Minister and congratulate him on his appointment. This is, I am sure, the first of many occasions on which we shall debate housing.

The truth is that there is a chronic shortage of homes in our country, and we are building fewer than half the number we need to keep up with demand. Not only is the bedroom tax cruel and unfair, but it is exacerbating the housing crisis that we face. The Government are in denial not only about the effect of the bedroom tax, but about the scale of the housing crisis. Two weeks ago, in his first media appearance, the Minister, who has responsibility for housing, denied on “Channel 4 News” that there is a housing crisis, yet the very next day, the Under-Secretary of State for Communities and Local Government, the hon. Member for Grantham and Stamford (Nick Boles), who has responsibility for planning, said in Westminster Hall that there is a housing crisis and that it is particularly intense in some parts of the country, including pockets of Yorkshire, which is where the Minister’s constituency is. People often say that Departments work in silos, but it is quite incredible to have a division of opinion within one Department—the Department for Communities and Local Government.

The chronic housing shortage is clear for all to see and the Government are presiding over the lowest level of house building since the 1920s. As soon as they took office, they cut the affordable homes budget by 60%. Home ownership is falling and private rents are soaring. Five million people are on the waiting list for social housing, and homelessness and rough sleeping have both risen by more than a third since the general election. The reality is that the bedroom tax is making the housing crisis worse, not better.

The Government continue to maintain that the bedroom tax is about tackling overcrowding, but, as my hon. Friend the Member for Edinburgh East (Sheila Gilmore) has said, the tax is not about making the best use of the social housing stock; it is about saving money, and it is questionable whether it will do that. Indeed, it is making the poorest people across our country even poorer and costing an average family £720 a year. On the same day that the tax came into force, every millionaire in the country got an average tax cut of more than a hundred grand.

Two-thirds of those hit by the bedroom tax are disabled. Some 220,000 are families with children, and many tenants want to move but simply cannot find a suitable property to move to. My hon. Friend the Member for Bolton West (Julie Hilling) said that in her constituency much of the housing stock is three-bedroom properties, which is the case in other parts of the country, including my own constituency.

The bedroom tax is also hitting housing supply. As many of my hon. Friends have underlined, local authorities are suffering. Areas such as Wolverhampton, Nottingham and elsewhere have to put money into helplines to ensure that people are not left without housing. The tax is also having an impact on affordable housing budgets, particularly for housing associations. A survey by the National Housing Federation found that a quarter of households affected have fallen behind in their rent for the first time ever. Such arrears have major consequences for house building, too, and they are jeopardising the ability of housing associations to borrow, plan for the future and, ultimately, build more homes.

I have a number of questions to which I would like the Minister to respond. In particular, what assessment has his Department made of the rent arrears for councils and housing associations and of the impact that those arrears are having on their ability to build the affordable homes that we so desperately need? How many homes are standing empty across the country because of this failed policy, and how many councils have received permission from the Minister’s Department to draw money from the housing revenue account to protect the most vulnerable? I understand why they want to protect the most vulnerable from the impact of the policy, but, as several of my hon. Friends have said, that is having an impact on the money that they are able to spend on repairs and new homes.

The bedroom tax is cruel and unfair, and it simply is not working. The Labour party has pledged to scrap it. Far from tackling overcrowding, the bedroom tax is exacerbating the biggest housing crisis in a generation—a housing crisis that the new Minister says does not exist. We beg to differ. Perhaps the Government want to forget that they are presiding over the lowest level of house building since the 1920s.

The Labour party is determined to get a grip on the issue. The bedroom tax is having a negative impact not only on the poorest in our society, but on the number of houses being built.

[Hywel Williams]

rose—

[Emma Reynolds]

I am nearly out of time.

We want to get Britain building again and have pledged that, by the end of the next Parliament, we will double house building. Something radical needs to change in this Government’s policy. They need to get a grip not only on the implications of the bedroom tax for the most vulnerable and poorest people in our country, but on its impact on housing supply. I hope that they also get a grip on the housing crisis that is affecting families in my constituency and across the country.

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[Kris Hopkins]

The hon. Lady is right. The house that I was talking about was in the private sector. In my period in local government, the housing stock in my city was absolutely appalling. The then Government rightly wanted to intervene, but the then Labour-led council refused to support such intervention. The idea that—[Interruption.] I want to conclude this section and move on to the rest of my speech. It is being suggested that we had a utopian social housing model before 2010 and then somehow we made a transition to an uncaring world, where no one cares about social housing. Let me tell Members that my parents were brought up in a council house. I lived in a council house and I care about those individuals. I want to talk about—[Interruption.] I will continue, because we do not have much time.

I will make one final point on the interventions and the comments that were made. The hon. Member for Bolton West (Julie Hilling) talked about Mr and Mrs Smith, and I understand why she talked about people in that anonymous way. Again, I say to her that if there is anything I can do to respond to the concerns of those individuals, I will do so. I would be grateful if she wrote to me, and I would seek to get an appropriate response.

[Hywel Williams]

I refer back to a point that the Minister made earlier when he referred to research into the charge, to understand what has happened. Will he concede that the usual progress of social policy is that there is research first, then planning, then implementation and then a review? That is the usual way that it is done.

[Kris Hopkins]

There was a significant amount of research into the whole issue of welfare reform, which was debated at length, so I do not think that anyone came to this view without understanding the issue. However, we can only evaluate a process after it has been in place.

[Hywel Williams]

Will the Minister give way on that point?

[Kris Hopkins]

No, I will carry on, because I want to make some progress.

I will just pick up on a point made by the hon. Member for Wolverhampton North East, who said that I had said that there was no crisis. Just to provide some clarification and so that this myth does not continue, I will say that I was asked about a housing bubble in London and whether or not there was a crisis, and there is not. I actually used the backing of the Governor of the Bank of England, who says there is no housing bubble, and that was what I was specifically referring to. Also, the Chancellor has put in place the means to intervene on any of the measures that we have in place, through the Financial Policy Committee; if a bubble was emerging, he could intervene at that point.

An issue that has come out in the debate is the comparison between, “We’ve said it’s about saving money,” and, “You’re saying now it’s about supply.” There is a need to save money. We inherited a bill that had doubled to some £24 billion by the time we came to power, and it was important that we addressed it because we ended up with a deficit where we were spending—in fact, despite a reduction of a third, we are still paying £120 million a day in interest and we have a responsibility to address that.

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[Hywel Williams]

I am very grateful to the Minister for giving way again; he is so generous. I wish to make a genuine inquiry. Will he congratulate the Labour Government in Cardiff on their success in house building, and even possibly the Scottish National party Government in Edinburgh as well?

[Kris Hopkins]

I have great passion for those two areas of our wonderful country, but I cannot bring myself to congratulate those two Governments.