Welfare Reform Bill

Jenny Willott Excerpts

Wednesday 9th March 2011 Commons Chamber

[Jenny Willott (Cardiff Central) (LD)]

I welcome the Bill, especially the introduction of the universal credit system. It is a huge improvement on the current over-complicated and burdensome benefit system, which has spiralled out of control under a number of previous Governments. I think that several elements of the Bill require further work, and I look forward to their being discussed today and during the Bill’s later stages, but I do not consider that a good enough reason not to give it a Second Reading.

I am glad that a couple of earlier proposals have already been reconsidered. Both have been mentioned by other Members. I am delighted that the Government listened to Liberal Democrats, the Select Committee and others throughout the United Kingdom who called for the proposal for a 10% cut in housing benefit for those who have received jobseeker’s allowance for a year to be dropped, because it was unfair. It is very good news that the proposal has indeed been dropped, and I am sure that Members on both sides of the House welcome that.

I am also glad that the Government are listening to those who are concerned about the removal of the mobility component of disability living allowance from those in residential care. A number of Members have mentioned that today, and I expect that it will be mentioned again before the end of the debate. I am pleased that the proposals have gone back to the drawing board, and I hope that the Government will take account of the serious concern that many Members have expressed and will, I am sure, express again during the Bill’s subsequent stages.

I welcome wholeheartedly some measures that are in the Bill, as well as the absence of some measures that are not. As I said earlier, those that I welcome include the introduction of universal credit, which will finally end the absurd circumstances in which people can be better off on benefits than in work. I am sure that many Members have met people who are frustrated and desperate because they know that although their lives would be better if they were in work, financially they would not be better off in work. I think that everyone should welcome the fact that universal credit will put right that wrong.

A number of Members have expressed concern about the changes in employment and support allowance. As the hon. Member for Aberdeen South (Dame Anne Begg) pointed out, and as the Secretary of State acknowledged earlier, there is particular concern about the decision to time-limit contributory ESA. I hope that during the Bill’s passage the Government will consider, for instance, whether the period before the cut-off should be longer than a year, whether it is appropriate to include the 13-week assessment period in the calculation, and whether those with certain conditions could either be entirely exempt from the cut-off or be allowed extensions at the discretion of Jobcentre Plus staff. A good many people will be affected by the limit, especially if, as is currently planned, it is applied retrospectively.

I mentioned the controversy surrounding disability living allowance. As I have said, I am delighted that the proposals affecting those in residential care are being reconsidered. However, concern remains about the increase from three months to six months of the period before people are eligible to apply for the allowance. I understand the logic of trying to ensure that it is given only to people with long-term conditions, but in the case of sudden-onset conditions such as cancer, strokes or accidents, the greatest financial need is at the start. I hope that thought will be given to whether people in those circumstances can be helped to deal with the serious financial implications of such conditions.

I agree with the hon. Member for Aberdeen South that a huge number of issues could be raised in relation to the Bill, but today I can focus on only a few of them. The last issue that I want to raise is the total cap on benefits. Again, I understand the rationale. Many working people with low incomes find it very difficult to see others receiving more money from the state than they themselves can earn, and I understand their frustration and resentment. However, we have yet not been given enough detail to establish the precise impact of the Government’s proposal.

Some people also resent the fact that families, particularly large families, are living on benefits, but the choices made by parents are not the fault of their children. By the time the Bill has completed its passage, we must ensure that any cap has been set at an appropriate level, that there is no prospect of children being pushed into poverty, and that families—especially in London, where housing costs are so high—will not be disproportionately hit. Given that the housing benefit cap is £400, a total benefits cap of £500 could leave a large family with just £100 a week to cover all their other living costs. I hope that the Government will consider excluding housing benefit from the calculation, or, preferably, excluding child benefit. Given that child benefit reflects the size of families, that could have an impact on child poverty. I am very concerned about the implications of that policy, and we will need to know the impact on children, in particular, before I can agree to support it.

Most of the Bill is well thought out with a strong sense of principle, and I wholeheartedly support the overwhelming majority of its measures. I welcome the moves to simplify the benefits system and to create a more individually tailored welfare system, but I also have concerns, and I hope the Government—

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. Time is up. I call Mr Tom Clarke.

Social Security

Jenny Willott Excerpts

Thursday 17th February 2011 Commons Chamber

[Jenny Willott (Cardiff Central) (LD)]

Like the right hon. Member for East Ham (Stephen Timms), I refer to the Welfare Reform Bill, although we are debating the uprating orders. With the introduction of the universal credit when the Bill becomes law, the complicated changes that we are processing in these orders will become a thing of the past, which I think we welcome on both sides of the House. It will be much simpler for people to understand their entitlement to benefits, and there will be a much better deal for many people who are in receipt of working-age benefits.

[Rachel Reeves (Leeds West) (Lab)]

The hon. Lady says that we will not debate uprating in the future, but because the Government have reneged on the universal pension, we shall be debating uprating for pensions every year.

[Jenny Willott]

I shall clarify my remarks in case anyone misunderstood me. I said that we will not be debating complicated uprating changes every year. Clearly, there will still be a debate every year, I assume, on the uprating of benefits; I should hate to think they will be frozen in future. I shall talk about pensions later in my remarks.

According to the Institute for Fiscal Studies, the universal credit will mean that 2.5 million families will be better off. They will get more money, which will in time help to reduce the total benefit bill by making it more worthwhile for people to get work and remain in work and off benefits. That should generate support on both sides of the House, as it is something we all want families to do.

As well as an improvement in prospects for those on working-age benefits, as the Minister said, this morning the Government introduced changes that will make a significant difference to pensioner incomes. The level of pensioner poverty in the UK is a complete disgrace in a civilised country. During the shadow Minister’s remarks, it slightly got me that he seemed to criticise the Government for not sticking to the CPI increase for pensions and going for a larger increase in pensions this year. In 2000, the previous Government were happy to see an increase of only 75p in the state pension, which most of us found stingy, measly and completely unforgiveable. At least, this Government are tackling pensioner poverty and are willing to do something serious about it.

Labour’s efforts to lift older members of society out of poverty resulted in a massively complicated, overly bureaucratic system based on means-tested benefits that has left 2 million pensioners still living below the poverty line. Clearly there is something wrong with the current system, so I am delighted that real progress is being made to safeguard the value of the basic state pension. Current pensioners will now be protected by the triple lock, which is welcome. I am delighted that a Liberal Democrat manifesto commitment is being implemented by the Liberal Democrats in government. What we promised we have delivered, and the state pension will increase by earnings, 2.5% or CPI, whichever is greatest. People over the age of retirement will have the protection they deserve. As the Minister said, the amount can be quite significant. We are talking about £15,000 over a person’s lifetime, which will make a significant difference for a large number of pensioners and will, I hope, have an impact on pensioner poverty.

I am glad to see that change. However, I believe that we are still building up problems for future generations of pensioners. Current pensioners’ circumstances will improve significantly, but the ticking pension’s time bomb was not tackled by the Labour Government or by previous Governments. I would like the current Government to take the bull by the horns and ensure that we do not end up with a problem in decades to come. Far too many people are not saving for retirement. Auto-enrolment will help in that regard, but people need to know that it will pay to save. We must reduce the amount of means-testing to ensure that people know that, if they save while they are working, it will benefit them in retirement.

We have an uncertain jobs market. There are no more jobs for life. Occupational pension schemes are closing at a terrifying rate. Many occupational schemes are defined-contribution, rather than defined-benefit, and far less generous. Even with the triple lock, problems will increase. I would be grateful if the Minister told us what the Government plan to do in the long term to tackle the time bomb. The triple lock will make a significant difference, but we need to look at the whole pension system to ensure that we reform it in decades to come so that it is more appropriate to the needs of society.

Clearly, a big issue is the move from RPI to CPI. I understand why people are concerned about that, but I say to pensioners who are worried about the impact on their basic state pensions that they will be protected by the triple lock. As the Minister made clear, the majority of people on public sector pensions will be protected from a potential reduction in their long-term benefits by the triple lock on the state pension, so they will end up better off in the long term. The impact on people will not be as great as many Opposition Members have said it will be.

I can see that benefits come with the change to CPI. It is more stable. It means that we will not face issues such as the one that arose last year when benefits were frozen, which caused significant hardship for many millions of people. CPI is also a more appropriate system as 70% of pensioners own their homes outright. As the Minister said, there is a negative impact for those pensioners as the rate of mortgage interest is taken into account under RPI. They do not benefit in any way from the massive fluctuations that that can generate in their pension increase.

[Dr Eilidh Whiteford (Banff and Buchan) (SNP)]

One of the big concerns is that the Royal Statistical Society has said that the CPI is not a good measure for pension inflation. The differential impact of that measure is causing many Opposition Members concern.

[Jenny Willott]

I thank the hon. Lady for her comment. The issue is likely to be taken up by the Minister in his summing-up because, from his comments from a sedentary position, he seemed to disagree with similar comments by the shadow Minister. I do not have a copy of the whole quote in front of me, but I am sure that he will be able to fill the House in on that and respond to her question later.

[Kate Green]

Does the hon. Lady accept that CPI is not a good measure for most working-age households precisely because of its exclusion of housing costs?

[Jenny Willott]

As I understand the way in which that relates to working-age households, people who are on benefits are much more likely to be living in social housing and so will not face large fluctuations in mortgage costs. For those of working age who are on benefits and do have mortgage costs, there is a lot of assistance from the state. They are not bearing the full brunt of mortgage interest fluctuations because a lot of that is borne by the state. Therefore, I believe that CPI relates appropriately to that group, too.

The financial implications, over this Parliament and beyond, for the Government of the difference between CPI and RPI have been discussed a lot today. We are in very difficult financial circumstances and the Government have had to make some extremely difficult financial decisions. The Minister has laid out why the Government believe that CPI is the right measure to use, but the financial benefits of that for the Government coffers are significant. By introducing the triple lock, the Government are protecting the most vulnerable pensioners. The people potentially most penalised are being protected, while the amount of money saved is quite significant and will help the economy to grow in future.

The shadow Minister, the right hon. Member for East Ham (Stephen Timms), eventually made it clear that the Opposition will not vote against the orders and will support the changes and the uprating, which seems to suggest that they understand the logic and agree with the overall decision. Whether it be for the moment, for three years or until the next Parliament, I am not entirely sure, but it is good to see it when occasionally agreement breaks out across the House. It is also good and quite a novelty to see Labour Members finally supporting measures that will save the Treasury some money. If they plan to return to RPI in the future, I look forward to seeing how they plan to find the billions of pounds that will be necessary to implement it.

I congratulate the Government on introducing the triple lock for pensioners, which is a significant step forward. It is also pleasing for me as a Liberal Democrat to see a manifesto commitment implemented.

[Hywel Williams (Arfon) (PC)]

The hon. Lady is generous. She has mentioned the triple lock many times. Is she at all concerned about the ratcheting effect of implementing it, which has been a consideration in the past?

[Jenny Willott]

I would have thought that being too generous to pensioners was a good thing.

[Hywel Williams]

I am unconcerned about it being too generous. When the ratcheting effect was considered in the ’80s, when Barbara Castle presented her proposals for pensioners, I was supportive of her, but concern was expressed in the House at the time.

--- Later in debate ---

[Jenny Willott]

Like the hon. Gentleman, I was not a Member of Parliament at the time, but I would have expressed my disagreement with those views. Pensioners are among those in society with the lowest incomes, so they are most in need of protection. Anything that prevents them from falling even further behind, as they have over the past few decades, is a good thing. Since the link to earnings was taken away under the previous Conservative Government, pensioners’ incomes have fallen significantly behind. Pensioner poverty is still at a disgraceful rate. I am glad to see measures being put in place today that will start to tackle that problem and stop pensioners falling further behind the rest of society.

[Sheila Gilmore]

Does the hon. Lady not accept that pensioner poverty was substantially tackled by the Labour Government, as pensioners were among 1 million people lifted out of poverty by their policies?

[Jenny Willott]

I absolutely accept that the previous Labour Government tried to tackle pensioner poverty by introducing pension credit, guarantee credit and so forth. However, the system they introduced has had a number of unintended consequences. It was so complicated that millions, or at least hundreds of thousands, of pensioners did not apply for the benefits to which they are entitled. The system is so degrading and complicated that they do not receive the benefits due to them. These are people living below the poverty line who are among the most vulnerable in our society.

Another unintended consequence of the system is that when people are working, they do not know whether they will end up better off when they retire. The system acts as a disincentive for people on low incomes to save. With auto-enrolment into pension schemes, I would like to see the means-testing taken out of the system so that people know that every penny they save when they are working and earning low incomes will benefit them in retirement. That is preferable to ending up being trapped, as a number of people are, in the pocket between those able to get means-tested benefits and those who are not. Although a lot was done under the Labour Government, the unintended consequences have, I feel, been quite damaging as well. The Office for National Statistics says that more than 2 million pensioners live in poverty; for me, that is far too many and I would like to see the problem tackled further.

[Sheila Gilmore]

Do I take it from the hon. Lady that she would support the raising of the basic state pension to the level of pension credit for everyone? Does she accept the consequential decisions that we would have to take as a society about the level of taxation appropriate to support such a change?

[Jenny Willott]

As the hon. Lady might well be aware, as a Liberal Democrat I stood on a manifesto that said we would like to introduce a citizen’s pension, which would result in the basic state pension being lifted to the level of pension credit so that everyone who was retired would be living on a decent pension above, or at, the poverty line, rather than people having to go through the demeaning process of applying to the Government to lift their income above the poverty line. That would also remove the disincentive to save. Perhaps the Minister will say in his summation whether he agrees with me that we should introduce such a citizen’s pension.

Given that the Welfare Reform Bill was launched yesterday with proposals to update significantly the system of working-age benefits, will the Minister tell us what the Government will do to update the old-fashioned and outdated system of benefits that go to those of pension age? We seem at present to be able to think imaginatively about changes to benefits and state support, so I hope the Minister will tell us a bit more about what vision the Government might have for older members of our society.

Youth Unemployment

Jenny Willott Excerpts

Wednesday 16th February 2011 Commons Chamber

[Jenny Willott (Cardiff Central) (LD)]

It is worrying how many young people are unemployed at the moment. We can bandy figures around all day, but the figure that sticks with me is that one in five young people between 16 and 24 is out of work. That is a worrying—indeed, horrifying—statistic, and is a tragedy for every one of them, and for their families and the communities around them too. However, when we look more deeply it becomes clear that this situation is, in part, the Labour legacy, as has been mentioned over and over today. The number of people who have been unemployed for more than 12 months has increased. This Government have not yet been in power for more than 12 months, so we are clearly dealing with a legacy left by the last Labour Government. As a result of Labour messing up the economy, the Government are having to deal with a serious financial mess and the unemployment that goes alongside that.

People have talked about complacency about the youth unemployment figures. I have not seen complacency on either side of the House today—clearly people are seriously concerned—but if Labour Members were that concerned, they could have done significantly more when they were in office, rather than leaving a lot of young people on the shelf. Labour could have done more in power to ensure that people had the opportunities that they needed.

[Mr Lammy]

Will the hon. Lady give way?

[Jenny Willott]

I will not give way. Everyone will have the chance to speak later if they wish.

As has been mentioned, unemployment among young people has gradually increased since 2002, and that was during the good times, so clearly in the bad times it will not be easy to get people back into work. It is now even harder for the new Government to get them into work, as they have already been out of work for longer, and we know that the longer people have been out of work and the further they are from the jobs market, the more effort, money and time it takes to get them back into work. However, the problem is that the future jobs fund was not working. It was created to ease youth unemployment and make the figures look better; it was not established to create long-term sustainable jobs. Opposition Members have mentioned that many times, but it is not that public sector jobs are not real jobs—of course they are—but rather, that the jobs created for the future jobs fund were not real jobs. They were short-term, six-month placements created for the purpose of the fund; they were not jobs that were sustainable in the long run. That has been borne out by the initial information on what people have done after being placed by the future jobs fund. About 50% of people were back on working-age benefits after seven months—one month after finishing their placement. Of those in a comparable group who found work through other programmes or found work for themselves, only 35% were back on jobseeker’s allowance after seven months. Clearly, the future jobs fund has not been working. It is performing less well than the other programmes that the previous Government put in place.

[Chris Leslie (Nottingham East) (Lab/Co-op)]

Will the hon. Lady give way?

[Jenny Willott]

No; I want to ensure that there is time for as many people as possible to speak.

The future jobs fund is not cost-effective. It costs a lot, and that money could be better spent. In theory, it was aimed at those who were furthest from the jobs market, but it seems that a large number of those people in placements were graduates. For example, about 20% of the people taken on by Birmingham city council had at least one degree.

[Mr Byrne]

Will the hon. Lady give way?

[Jenny Willott]

I will not.

The future jobs fund was clearly not working in the way that it was supposed to. As with many of Labour’s programmes, the words and the theory were positive but the practice was poor. It was not properly designed or monitored. It simply was not thought through. It did not deliver sustainable employment for young people.

Instead, we need to create a skilled work force and generate jobs for those skilled young people. Apprenticeships make people more employable, potentially by the people by whom they have been trained, but also by similar businesses. CBI evidence shows that 90% of apprentices find employment or become self-employed immediately after their training ends, which means that apprenticeships are clearly far more successful than the future jobs fund.

The group that concern me the most are those who are furthest from the jobs market. For many of them, apprenticeships are inappropriate. They are a particularly vulnerable group, and in the past they have been particularly ill-served. We need to ensure that the Work programme will work, and that the Government learn the lessons from previous programmes to ensure that those vulnerable young people are helped back into work.

I am glad to see that, under the Work programme, young people will get help at a much earlier stage than they do under the future jobs fund. They will be referred to the Work programme when they have been on jobseeker’s allowance for nine months, rather than 12 months as happens under the FJF. More tailored support will be available for those with the most severe disadvantages, and they will be referred after three months if they are not in employment, education or training. All the evidence shows that we need to get in there as early as possible if we are to have an impact. Even with all that evidence, however, the previous Government did not quite achieve their aims, so we really need to ensure that we learn those lessons now.

In addition, under the Work programme, the fees will be structured so that providers will get more if they help those who are furthest from the jobs market and keep them in work for longer. We hope that that will make a real difference to that group of people. Again, that is something that the previous Government tried to do, but they did not go quite far enough. I hope that the coalition Government will learn the lessons from that and ensure that these measures are implemented.

Following the demise of the future jobs fund, we all want to see much better, tailored support aimed at the needs of young people. We cannot afford to damage the career prospects of another generation of young people, as happened in the 1980s and early ’90s. We have to learn the lessons, particularly the ones that the previous Government did not learn from the work that they were doing.

The numbers are bad, and the individual stories are heart-wrenching. I am sure that we have all had people coming to see us in our surgeries who are at their wits’ end and absolutely desperate to find work. We need to ensure that another generation is not left behind, but the Opposition’s proposals in the motion today are simply not the way to do it. The future jobs fund has not worked so far, and given that the number of young people unemployed for more than 12 months has been increasing, why on earth do they think it will start working now? It is time to adopt a new approach, to ensure that we do not leave hundreds of thousands of young people behind. Instead, we must give them the skills and the confidence that they need to build a future for themselves and our economy.

Benefits Uprating

Jenny Willott Excerpts

Wednesday 8th December 2010 Commons Chamber

[Jenny Willott (Cardiff Central) (LD)]

As the Minister said, the move from RPI to CPI will lead to much more stable increases in the uprating of benefits and pensions, and the triple lock will ensure that pensioners do not fall behind the rest of society. Some concerns have been raised, however, because the CPI does not include any costs associated with housing. The Government have announced plans to consider including some housing costs in the CPI calculation, but when does the Minister expect that to be done, and what impact is it likely to have?

[Steve Webb]

I am grateful to my hon. Friend, who is right that CPI rises tend to be more stable compared with the surges and freezes that we had with the RPI. On the point about the inclusion of housing in the CPI, costs in the form of rents are in the CPI already, so that is covered for lower-income renters. The CPI advisory committee is undertaking a two-year programme to see how housing costs might be included, but it has already ruled out directly including mortgage interest payments specifically, which will help with the issue that we have raised. As and when the Office for National Statistics comes up with alternative measures, we will certainly look at them, but that is without prejudice at this stage, because the work is ongoing.

Disability Allowance

Jenny Willott Excerpts

Tuesday 30th November 2010 Westminster Hall

[Maria Miller]

As the Chancellor has set out, the measure is due to come into place in October 2012, and others will come into place in a similar time frame. It is important to focus on time because, as hon. Members have said, that will give us the opportunity to work across the Departments affected by the measure to ensure that good provisions are put in place and delivered effectively.

We remain fully in support of the principles of DLA as a non-means-tested cash benefit contributing to the extra costs incurred by disabled people. However, we must ensure that the benefit reflects the real needs of disabled people today and their aspirations for greater control in the future and that the system is sustainable in the long term. As the hon. Member for Glasgow East (Margaret Curran) will know from her colleagues who were in government, more than 3 million people currently receive DLA and the expenditure this year is forecast to be £12 billion, which is substantially more than was intended when the allowance was introduced.

[Jenny Willott (Cardiff Central) (LD)]

The Government are trying to make savings in that budget, but has the Department considered maintaining support for at least the most vulnerable, for example by keeping the higher rate mobility allowance for those living in care homes, as they have the highest costs and the greatest need for mobility support?

[Maria Miller]

We are absolutely committed to ensuring that the independence of disabled people living in care homes is maintained, and that is our prime responsibility. I will give more details on how we intend to do that later, but I am conscious of the fact that other Members have raised points and that I should make progress in answering them.

At a time when we are spending £120 million a day in interest payment on the debt we inherited from the previous Government, the unbridled expansion of DLA is unsustainable. We need to be certain that public money is focused where it can have the most impact in an affordable manner, helping people to lead independent lives. That is why we propose an objective assessment, which we are developing with the help of medical experts and disabled people.

Oral Answers to Questions

Jenny Willott Excerpts

Monday 22nd November 2010 Commons Chamber

[Jenny Willott (Cardiff Central) (LD)]

7. What discussions he has had with representatives of the social care sector on the cost of mobility support for disabled people.

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

The Government remain committed to involving disabled people when developing their policies, and I can tell my hon. Friend that we discussed the care homes measure with a number of disability organisations at the Department for Work and Pensions policy and strategy forum on 16 November.

[Jenny Willott]

We have already heard a number of concerns raised today about these particular proposals. I understand the Government’s rationale, but what consideration has been given to ensuring that residents in care homes who currently receive mobility disability living allowance will still be able to buy Motability cars, and scooters where appropriate, so that they can remain as independent as possible?

[Steve Webb]

My hon. Friend has raised an important facet of these changes, and I can assure her that the Department is already in discussions with Motability about how it might be handled.

Welfare Reform

Jenny Willott Excerpts

Thursday 11th November 2010 Commons Chamber

[Mr Duncan Smith]

The system will assess at household level, but of course, the beauty of that is that we will understand better what household needs are. Two things that will hugely benefit women will flow from that. First, in knowing what that household should have, we will have a much higher take-up rate. Therefore, the in-work poverty that has been terrible until now will hugely be resolved. The second aspect that is really good for women is that, as the hon. Lady knows, many women who have caring responsibilities do short-hours work. The proposal will hugely benefit them because they will retain more of their income as they go into work. They will be beneficiaries, which I hope helps her.

[Jenny Willott (Cardiff Central) (LD)]

I, too, welcome today’s announcement, particularly the expected effect on poverty and especially child poverty. This is a critical reform—as the hon. Member for Aberdeen South (Miss Begg) said, some of us on the Work and Pensions Committee have been pressing for it for a number of years.

Who will run the mandatory Work programme? Will that involve third sector partners? How will the Secretary of State ensure that the programme remains distinct from the community sentence programme?

[Mr Duncan Smith]

The Work programme will start well in advance of today’s proposal—we anticipate that it will start next summer. There will be a set of contracts on a regional scale that will involve the private and voluntary sectors. Organisations will run programmes against a set of outcomes, for which we will pay them, so that as they deliver and get more people back to work, they will be paid for those results. That will be carefully balanced so that we do not pay them for dead-weight costs that might otherwise have been in the system, but it will certainly be clear.

Housing Benefit

Jenny Willott Excerpts

Tuesday 9th November 2010 Commons Chamber

[Jenny Willott (Cardiff Central) (LD)]

For many years, housing benefit has acted as a barrier for people who are trying to get back into work. I remember many debates in the last Parliament in which hon. Members raised concerns about people being trapped in poverty, out of work and frustrated. If, for example, a constituent got a job and lost their housing benefit, they would not be able to afford their rent. To be fair, the previous Government put much effort into ensuring that people would be better off in work than they were on benefits, but the housing benefit rules often scuppered such efforts. I hope that these proposals, which are part of the wider reform of the benefit system of which universal credit is a part, will help people get out of that benefit trap and into work. They should also benefit people who are working and paying tax. As many hon. Members have said, it is unfair when such people see the Government paying for a home for someone else that they could not possibly afford themselves, even though they are working.

There have been some positive changes, including the proposals for people with disabilities. Previously, a person who had a full-time carer could not claim for a room for them. In the previous Parliament, as the hon. Member for North East Hertfordshire (Mr Heald) said, the Work and Pensions Committee recommended a change to that unfair system. I am very glad that such a proposal is now being introduced, as it rights a wrong.

I warmly welcome the long-overdue decision to reform housing benefit. Although I have concerns about some of the Government’s proposals, I have to say that much of the criticism of the plans has been extremely overblown. Much has been said in the media and in the debate today, and I am sure that more points will be raised later tonight. I will raise my concerns with the Minister, and I look forward to his response.

One problem with the local housing allowance that was identified in the previous Parliament concerns the broad rental market areas. Many BRMAs are very large and cover very different areas. Cambridge is often cited as an example. The BRMA covers the city itself, a large rural area and some smaller towns, including Newmarket and Ely. Shelter’s research found that in Cambridge itself, only 4% of rental properties were affordable to people on LHA, while in rural areas up to 70% were affordable. That has significant implications for people on local housing allowance who want to access work. They are pushed out of the city, which is where most of the jobs, particularly the low-paid jobs, are to be found. That is not a new problem. It arose as soon as LHA was introduced.

If the Government change the LHA calculation from the median rent to the 30th percentile—I am afraid that this sounds like jargon—BRMAs such as Cambridge or Blackpool, which already have a problem, could find things getting even worse. The Select Committee recommended an urgent review of the particularly problematic BRMAs, which I hope the Government will consider further in the light of the proposed changes.

I would also like some reassurance on the raising of the age limit for the shared room rate from 25 to 35. I understand the Government’s argument that it is often unlikely that young people in work could afford to rent on their own, and they are more likely to rent a room in a shared property. However, when the Select Committee considered that point earlier in the year, we found that the shared room rate led to an increased threat of homelessness, particularly for vulnerable young people. It is unlikely that those who have recently been made homeless, or those who are suffering from a mental illness or recovering from an addiction, will be able to organise living in a shared household, but they constitute the group most likely to face a shortfall between rent and local housing allowance. Increasing the age limit to 35 could broaden that pool of people and increase the number of people facing a shortfall and homelessness—and because plugging that gap is often left to discretionary housing benefit, this has implications for the Government’s plans in that area.

I welcome the significant increase that the Government have announced in the amount available for discretionary housing benefit over the next four years. That will be very important in determining how well the changes are made. However, discretionary housing benefit is usually used only for short-term payments—certainly, my constituency casework leads me to believe that that is how local authorities see it. Often, for example, it will be paid, following a change of circumstances, to tide people over until they can make longer-term arrangements. Some of the Government’s proposals for changing housing benefit will have more long-term implications there, including the changes involving the shared room rate, and so on. Local authorities need more flexibility in their use of discretionary housing benefit over the long term in order to plug the gap and ensure that we do not end up targeting particularly vulnerable people.

The biggest issue for my colleagues and me, however, is one that has been mentioned by hon. Members already—the proposal to reduce housing benefit for those claiming jobseeker’s allowance for more than a year. If we really are trying to help people off benefits and into work, this arbitrary limit makes no sense. It does not take into account the job market in a particular area or the effort that a claimant may have made to find a job, and it could have serious implications for child poverty, in particular. I hope that the Government can think through that proposal again. If we are applying the test that the reforms should support vulnerable people, help them into work and ensure they have a roof over their heads, while ensuring that work pays, reducing housing benefit for jobseekers after one year fails that test.

That is a shame, because most of the rest of the proposals are sensible. Overall, I welcome the reforms, and I am glad that at last the Government are doing something.

[Clive Efford (Eltham) (Lab)]

Will the hon. Lady confirm that her website states that the benefit cuts will hit the poorest hardest? If so, would she like to put that on the record in the House?

[Jenny Willott]

I have to confess that I am not au fait with every page on my website. [Hon. Members: “Oh!”] Having returned a few weeks ago from maternity leave, I am afraid that my brain is suffering somewhat. However, that is for a debate on the comprehensive spending review in general. This debate is specifically about housing benefit, on which I have made my views very clear.

Overall, I welcome the reforms, and I am glad that at last the Government are sorting out housing benefit. It has been of significant concern to Members on both sides of the House for many years. Government Members all have the same aim, and I hope that the Government can take my comments in the constructive spirit in which they are intended. We would all like housing benefit to be set up in a way that helps people lift themselves out of poverty and progress through work, and does not act as a barrier to people trying to show ambition and better themselves. I hope that by tweaking the proposals we can do just that.

--- Later in debate ---

[Mr Clarke]

I am speaking for my constituents, and I have not found a single person in my constituency who supports what the coalition proposes. We will go into the voting Lobby at the end of the debate, and afterwards my constituents will look at how we voted. In particular, they will look at how the Liberal Democrats voted, because they know that the Liberals are propping up a Government in whom they simply do not believe, particularly in this field. Nor do my constituents. No wonder the Liberal Democrat Benches are practically empty, although I pay due respect to the two Liberal Members who have stayed.

We have not been without advice from other quarters. What Shelter has said is important, as is what Brendan Barber of the TUC has said. He has stated:

“Ministers want us to believe that housing benefit is going to what they would call work-shy scroungers, yet in reality only one claimant in eight is unemployed. The rest are mainly low-income working households, pensioners or the disabled.”

The homeless charity Crisis has said that the Government are “peddling myths” about housing benefit claimants. Its chief executive Leslie Morphy said:

“We are concerned to hear those who are reliant on housing benefit being described as making a ‘lifestyle choice’. Nearly half of those on LHA already face a shortfall between their benefit and their rent of an average of £23 per week, meaning tough choices between rent, food, heating or falling into a vicious spiral of debt.”

I could go on. My local associations, such as the citizens advice bureau and disability organisations, agree. We had an excellent meeting in one of the Committee Rooms of the House of Lords just a few weeks ago, with representatives of organisations of and for disabled people. Lord Rix made an outstanding speech, and the overwhelming view was that those people were representing those who are already disadvantaged and not fully recognised by society, and who are being asked to bear the brunt of what the coalition Government are imposing on them. How can that be fair?

How can it be fair to say that we have an economic problem, so we will ask the poor to pay for it? Are all the people who criticise the coalition—Shelter, landlords who have made it clear that they will not reduce their rents, the TUC, the Archbishop of Canterbury, the Church of Scotland and so on—wrong, and coalition Members right? I believe not.

The result of tonight’s Division will be extremely important. We have a choice about priorities and our commitment to people. It is a choice between what is decent, right and reasonable and what I believe is the arrogance of intellect and the exploitation of power.

[Jenny Willott]

On a point of order, Mr Deputy Speaker. I should just like to correct the record. Earlier in the debate, the hon. Member for Eltham (Clive Efford) quoted my website, suggesting that I had criticised the current Government for hitting the poorest hardest. I am sure it was a simple oversight, but in fact the quote that he referred to was from 2009 and referred to my criticisms of the previous Labour Administration.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

I have to say that that is not quite a point of order, but you have certainly got the clarification on the record.

Oral Answers to Questions

Jenny Willott Excerpts

Monday 18th October 2010 Commons Chamber

[Maria Miller]

I thank the hon. Lady for her question. As she knows, we will produce our child poverty strategy in full by March next year. We will shortly go into consultation on it and I hope that she will contribute. On the effect of the cap on families living in poverty, as the Minister of State, my right hon. Friend the Member for Epsom and Ewell (Chris Grayling), said earlier, this is about people earning the equivalent of a gross income of £35,000 a year; the majority of families earning that would not fall into poverty.

[Jenny Willott (Cardiff Central) (LD)]

How will the Minister ensure that lessons are learned from the review of the new work capability assessment, including, as discussed earlier, from the use of more medical information from claimants’ doctors, and how will those lessons inform the design of the medical assessment process for disability living allowance claimants when that is introduced?

[Maria Miller]

I thank my hon. Friend for her question. I should like to set the record straight on that. There is no intention to introduce a medical assessment for DLA. The work capability assessment, which, after all, tests people’s ability to get into work, is very different. DLA is a benefit that is paid to disabled people to make up the additional costs that they incur for being disabled; it is not linked to their ability to work.