Benefit Cap (Housing Benefit and Universal Credit) (Amendment) Regulations 2016
Lord Shipley Excerpts(9 years, 7 months ago)
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The Lord Bishop of Leeds
My Lords, we have heard a number of impressive figures and statistics this evening. It seems to me that the principle underlying all this is that you can save money with one hand but you will pay it out with another. According to End Child Poverty statistics released this month, we have 3.5 million children living in poverty in the United Kingdom in the 21st century. In some regions, up to 47% of children are living in poverty. In my own diocese, in the Bradford local authority area, 32.7% of children are living in poverty after housing costs. The national average is 29%. In Leeds Central, it is 41.8%. If children are living in housing and food poverty—as we know they are from food banks and all the other stuff we see on the ground in our cities, towns and rural areas—then we will end up paying out through the National Health Service and in other ways for the consequences of what children do not have at present.
Could the Government see their way to reducing the impact of this change on children by excluding children’s benefits from the cap, so that families always receive a basic income to spend on their children’s needs? Secondly, could the Government reverse the reductions to in-work allowances under universal credit in order to incentivise moving into work through the provision of better in-work financial support, recognising that much of the poverty we see around us involves those who are in work? I support the Motion to Regret.
Lord Shipley (LD)
My Lords, I thank my noble friend Lord Kirkwood of Kirkhope for moving this regret Motion. He has raised a very specific issue about the need for additional support to be made available to help those affected by the cap to find work. But, as we have heard, the issue is broader than this. The Government need to get to the heart of the problem, which previous speakers have identified, which is that they have not been building enough new homes, and as a consequence prices have been rising steeply, whether for owner occupation or for rent.
Crucially, the Government’s emphasis on subsidising owner occupation has left the social rented sector seriously short of funding and therefore of supply. Those who cannot afford to buy are increasingly forced into the private rented sector, with its high rents in most parts of the country. We heard from the noble Lord, Lord Best, about the implications for the private rented sector and the likelihood that the availability of homes in the private rented sector will decline for those who are on housing benefit.
Building more homes will help to hold down rents, which in return can reduce the Government’s revenue costs in terms of housing benefit. I understand that there is to be a White Paper on housing supply shortly. That is welcome, but can the Minister confirm whether the purpose of that White Paper is to address the lack of social rented accommodation? Might it also address the absurdity of calling a home “affordable” when for many people such homes are nothing of the kind?
Meanwhile, the impact on homelessness of lowering the cap could be severe. The Government are already committed, as we have heard, to supporting the Homelessness Reduction Bill, but their support for the Bill seems to sit oddly with this cap, which will actually increase homelessness. We have heard a whole set of disturbing figures, from the right reverend Prelate the Bishop of Leeds and others. I understand that Shelter has estimated that there will be more than 120,000 children in temporary accommodation at Christmas. I find that disturbing. Also disturbing is the fact that since the original cap was introduced, around 70% of those affected have not found work. So doubling the number subject to the cap and worsening it for those already subject to it means that many more people who are already poor are going to be made poorer.
When the Prime Minister took office, she declared that his was a Government for all the people. But this is a dubious claim when poor people are being made poorer. The Government must show that they are prepared to invest further in helping people back into work, at decent rates of pay, thus overcoming the barriers so many can face daily in their attempts to do so. If the Government do not do that, they are simply widening social and financial inequalities in our country, which is unacceptable.
The Earl of Listowel (CB)
My Lords, I support this Motion to Regret, over three issues in particular. First, the noble Baroness, Lady Lister, referred to the 17% of mothers who have a child under the age of one. I would add pregnant mothers to that. Can they not be exempted, or can that at least be looked at? The Maternal Mental Health Alliance report published last year highlighted to all of us the terrible bane of post-natal and pre-natal depression and the risk that if a mother’s mental health deteriorates, her relationship with her young infant is damaged. This costs society huge amounts in the long term.
My second concern is about more children being taken into care. We were reminded earlier by the noble Baroness, Lady Lister, that most children coming into care come from poverty. Has the Minister examined this policy to look at whether it increases the risk of children being taken into care?
Thirdly, the noble Lord, Lord Shipley, alluded to the fact that we face having 120,000 children in Britain in temporary accommodation this Christmas. There has been an 18% rise in the past year in the use of bed and breakfast accommodation for such families. I followed a woman’s journey through temporary accommodation last year. First, she was in a domestic refuge and then in a very small single room with her 16 year-old daughter and one year-old child. She was distressed by that, but most distressed by the uncertainty of where she would go next. She was evicted from there to another, even smaller room and then there was the fear that she might be moved away from London, as far afield as Manchester, where she would know no one; she was in despair about this situation. Finally there was resolution. She has, at least for now, a larger and quite comfortable place for the next six months, for which she is so grateful. But one cannot overestimate the impact on the mental health of families and children of being put into homeless temporary accommodation.
I recognise that the Minister may be limited in how far he can help the House today, but I hope he will take very much to heart the concerns that have been raised. I share my noble friend Lord Best’s gratitude to the Government for supporting the current homelessness legislation, the Homelessness Reduction Bill. I look forward to the White Paper on housing supply, and to the Minister’s response.
Welfare Reform and Work Bill
Lord Shipley Excerpts(10 years, 4 months ago)
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Lord Shipley (LD)
My Lords, I will not detain the House that long, but I want first to pay tribute to the noble Lord, Lord Best, in particular and to other colleagues for the progress that has been made in discussions with the Minister on this important matter. Some associations would find it difficult to manage properly with such a reduction.
I received two letters this morning. One was from the Minister, the noble Lord, Lord Freud, explaining the policy the Government are now following, which is a welcome change and I thank him for that. I hope it will prove to be a durable, long-term solution to the problem. I also had a letter from the noble Baroness, Lady Williams of Trafford, also dated 27 January. I had asked a question about the cost of supported housing being exempt from the 1% rent reduction, and I had been told that the total sum involved was around £75 million a year. There has not been clarity about that sum. I am surprised that the Government do not seem to know the cost they will have to meet, given the decision not to implement the measure for one year and, hopefully, for longer. Is there a figure to which the Government are working? I look forward to the Minister’s reply because when we are discussing policy in your Lordships’ Chamber, it is important that we have some idea of the sums involved. If it proves to be true that the figure is £75 million, that is not in fact a significant sum.
As I say, I look forward to hearing the Minister’s reply. I welcome the progress that has been made on this matter, which will be very gratefully received by many people outside your Lordships’ House.
The Earl of Listowel (CB)
My Lords, having six weeks ago spoken to a mother who had just moved into a refuge with her daughter and granddaughter, and heard from her about the years of abuse she had experienced in her family home, I am very grateful to my noble friends, noble Lords and the Minister for the announcement that he has made today.
Welfare Reform and Work Bill
Lord Shipley Excerpts(10 years, 5 months ago)
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Baroness Blackstone
My Lords, I rise briefly to support what has been said very eloquently by all those who put their names to this amendment. I just want to underline one thing. Supported housing of this sort is absolutely central to keeping a wide variety of very vulnerable people out of much more expensive institutional care, whether it be hospitals, residential homes for the frail elderly or criminal justice institutions. It is a really good example of the need for joined-up policy thinking in this particular social area. I hope that the Minister will accept that this is of enormous importance from the point of view of cost and good social policies, but also of the humane cost of the possible abandonment of these people because the housing association special institutions are no longer able to operate.
Lord Shipley
My Lords, I hope that the Minister understands the seriousness of this matter. I do not want to repeat what other speakers have said. Suffice it to say that there used to be three sources of funding for supported housing: the Supporting People programme, specific grants, and the income from rent and service charges eligible for housing benefit. Given the deep budget reductions to the first two, it has left income from rent as critical to the financial viability of schemes. That is an important issue to be made clear, because if rents go down, the income inevitably goes down and cannot be replaced from other sources. As we have heard, that 1% annual rent reduction policy will have two consequences for supported housing: a reduction in new building and lower staffing support for schemes, and, indeed, the potential collapse of schemes, given that the management and maintenance costs of supported housing can often be a third higher than the general housing stock.
When I spoke on this matter at Second Reading, I said that there was a danger that if the preventive role of supported housing were reduced, it would push up costs in other parts of the public sector. As the noble Baroness, Lady Blackstone, has pointed out, there is evidence that the rest of the public sector has to pay out more if supported housing is not there to help people. A few years ago, the Homes and Communities Agency reported that there was a substantial net saving for the public sector from investing in specialist housing.
A further consideration is the evidence of the National Housing Federation, which has identified a shortfall of more than 15,000 units in the number of supported housing lettings available each year to people of working age. Furthermore, there is some evidence that the recent rise in rough sleeping is related to the lack of supported housing lettings. So the conclusion is pretty clear. I understand that the cost to the Government in agreeing Amendments 107 and 109 is around £75 million per year—I would be grateful if the Minister could confirm that number. If it is, then surely it is at a level low enough for the Government to accept the cost, because the advantages to the public service outweigh the cost of the £75 million loss.
Lord Young of Cookham (Con)
My Lords, I intervene briefly from these Benches to add my support to Amendment 109 in the name of the noble Lord, Lord Best. When I intervened at Second Reading, I mentioned that I wanted to return to this issue in Committee. Subsequent to that, the noble Lord, Lord Kirkwood, chaired a meeting on the Committee Corridor of a number of organisations which would be directly affected, and they made some very moving presentations about the implications for them if the Bill went through without further amendment. Subsequently, I added my name to the letter referred to by the noble Lord, Lord Best, to the Times, expressing the hope that the Government would smile on this amendment or give the necessary comfort in some other way.
As others have said, the last thing my noble friend wants to do is to precipitate the closure of valuable schemes run by voluntary organisations providing support to vulnerable groups. Indeed, that is why there is a whole clause in the Bill entitled “Exceptions”, and subsection (5) gives powers to the Secretary of State to do basically what he wants to. The exemptions that have been trailed so far by the Government are welcome, but I agree with others that they may not go quite far enough, and I wonder if we can just nudge the Government a little further to give a greater degree of comfort to those running these projects.
Housing: Spare Room Subsidy
Lord Shipley Excerpts(10 years, 5 months ago)
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Lord Freud
We have approached helping people who are hard cases through the discretionary housing payment route, which has been found sound in the courts. The reason for that is that local areas are best placed to determine how best to help people in their own areas. They are doing it in a variety of ways, but that reflects their views on how best to do it in their areas.
Lord Shipley (LD)
My Lords, I wonder whether the Minister would be prepared to admit that the policy has not worked well. The evaluation by his own department has confirmed that it is creating hardship for many and has failed to get enough smaller housing units built for those who want to downsize. In the evaluation, three-quarters of those affected are now spending less on food and half are spending less on heating. Will the Minister agree that it would have been better not to apply the policy to existing tenants?
Lord Freud
This policy is about making sure that people who are living in oversized accommodation take the decision either to downsize or find the funds to run the extra rooms. That is how this policy works, and we can see in this study that people are now making adjustments. There are substantial moves in various areas in terms of downsizing and finding work between the interim report and this final report.
Welfare Reform and Work Bill
Lord Shipley Excerpts(10 years, 6 months ago)
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Lord Shipley (LD)
My Lords, I declare an interest as vice-president of the Local Government Association and of National Energy Action. As has been said, this is a wide-ranging Bill, in which the housing elements should be seen in the context of the Housing and Planning Bill that we shall shortly be considering. I shall concentrate tonight on issues relating to the future of social housing for rent, the particular difficulties the Bill presents for supported housing and its potential negative impact on delivering welfare-to-work programmes.
I am becoming very concerned about what seems to be clear government policy not to prioritise the social housing sector, nor to support new build-for-rent adequately. In a recent report, the estate agency Savills found that the Government’s focus on boosting home ownership is set to exclude 70,000 more households each year from either buying or renting at a cost people can afford. I am unclear why the Government are so set on promoting owner-occupation, to the exclusion of social renting, and seek to deliver three-quarters of their promise to promote affordable housing through starter homes for sale with a 20% discount. In terms of providing homes to rent, this is not enough as a policy. It will not meet demand and it will not help those who cannot afford to buy.
In terms of supported housing, social housing providers play a critical role in keeping costs down, particularly for the National Health Service, but also for public spending generally. The case of homelessness is an example. In 2012, the Department for Communities and Local Government concluded that an individual being homeless cost the Government between £24,000 and £30,000 a year. It is much cheaper to prevent homelessness arising in the first place and supported housing is part of the means of doing that. The cost of placement in extra-care housing is much cheaper than alternative placements or care packages. There is, therefore, a strong case for the Government to exempt housing for vulnerable people from the 1% cut in rents each year for the next four years proposed in the Bill. Without that exemption, the reduction in rent income could result in fewer refuges, fewer homelessness hostels, fewer homes for veterans and fewer homes for people with disabilities, with the additional public spending that would entail.
The Bill was amended in the other place to allow for the possibility of organisational waivers. Given that the Government have accepted, in their own impact assessment, published at the end of September, that,
“the rent reduction measures may disproportionately impact on supported housing and may cause a reduction in service provision”,
the case for housing for vulnerable people being exempt from the rent decrease provisions in the Bill is very strong.
I move on to local authority housing. There is a difference between the impact of the Bill on housing associations and its impact on local councils. Typically, the rents are higher in housing association properties and housing associations generally carry more reserves. The level of annual surplus for some housing associations is very high—in some cases well into the tens of millions of pounds. This may well be one of the factors in the Government’s wish to reduce rents. However, council housing revenue accounts are different, with little or no annual surplus contributions to general funds. The view from this sector seems to be that it will have to consolidate and concentrate on core business, with the extra services it provides, which in some instances can be very important, facing withdrawal. There will, therefore, be a slowdown in new building across the sector, which is most certainly not in the public interest. The noble Lord, Lord Smith of Leigh, alluded to this. Have the Government assessed the impact on new build, since councils need to be confident about their ability to borrow? Constant changes in rent income levels do not help them and, if they are not helped to build, more prospective tenants will be forced into the private rented sector with its higher rents and an adverse impact, as a consequence, on the housing benefit bill.
A further impact of the Bill relates to social housing provider schemes to develop employability for tenants. It may not continue in the way that it has, yet the outputs for the level of spend are impressive. An example is Your Homes Newcastle, which is where I live. In 2014-15, 64 people were employed through either the Your Homes Your Jobs programme or an apprenticeship programme, with 83% moving into permanent employment. Some 42 tenants were supported to create their own businesses and in excess of 200 tenants received employment support through training programmes provided by Your Homes Newcastle. All this could be in danger of being lost. There are many similar examples that could be provided and of which I hope the Minister is aware. I hope that, in his reply, the Minister will explain whether the Government have plans to enable social housing providers to maintain and, indeed, enhance their welfare-to-work programmes, given the critical role they play in addressing low skills and barriers to employment and reducing social exclusion. These bodies deliver welfare to work, in line with government policy, for large numbers of people and I suggest to the Minister that it would be highly retrograde if this were to be lost.