Housing Benefit (Abolition of Social Sector Size Criteria)

Steve Webb Excerpts

Wednesday 17th December 2014 Commons Chamber

[The Minister for Pensions (Steve Webb)]

Unlike the shadow Secretary of State I have listened to every speech in this debate in the hope that three questions would be answered—this is a Labour motion, and Labour Members have three questions to answer. First, how they would pay for this motion, which we recognise would cost in the order of £0.5 billion a year? The Minister for Disabled People completely demolished the hon. Lady’s argument about where the money would come from. The Leader of the Opposition said that Labour would not make any unfunded promises, but we have one before us today. The bulk of the money to pay for this motion will allegedly come from “ensuring that the building trade pays tax”, from which Labour claims we will get £380 million. It does not seem to be aware, however, that we have done that already. In the autumn statement 2013, measures to take effect in April 2014 will raise £400 million a year, so the bulk of that money has already gone.

The second point that was mentioned is reversing the stamp duty reserve tax charge, which is money from pension funds and savers. It is true that we can get money by taking it from pension funds—indeed, Labour has quite a record of taxing pension funds—but I am not convinced that that is the place to find money for welfare. The third measure Labour proposed is ending the employee shareholder scheme which, given that it wants to implement the policy in 2015-16, is rather puzzling as the policy costs nothing in 2015-16. In other words, the whole £0.5 billion is either raided from pension funds or does not exist at all.

The second question that we hoped would be answered is why it is fair to apply this principle to the private rented sector and not to social tenants. In other words, during all its time under the local housing allowance scheme, Labour was perfectly content for private sector tenants to pay for extra bedrooms, but not social tenants. When the shadow Secretary of State was briefly in the Chamber and we intervened to ask that question, she gave two reasons. The first was that the local housing allowance was not retrospective. On that basis, do Labour Members think it is okay to say that people in new social tenancies should pay for a spare bedroom? They are not saying that at all, so clearly they are inconsistent.

The hon. Lady’s second argument was absolutely bizarre. She said that people in social housing tend to have secure tenancies while those in the private rented sector tend not to. That presumably means that private rented sector tenants are more vulnerable than social tenants, yet Labour is willing to ask private tenants to pay for a spare bedroom, and not social tenants. Utterly incoherent.

The third thing I waited for in the hon. Lady’s speech—just like her leader who forgot the deficit, she forgot to say how Labour would pay for this policy—was a word that never passed her lips: overcrowding. She did not mention the plight of overcrowded people once, and we heard case studies of people affected by these measures during the debate—[Interruption.]

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. People seem to be talking about all sorts of things around the Chamber. The Minister ought to be heard.

[Steve Webb]

Case studies were mentioned, including one from the shadow Secretary of State who then forgot to tell the House that discretionary housing payments were covering the shortfall. Let me share an example of a previously overcrowded family. Suzanna lived in a four-bedroom home in south Yorkshire when this measure was introduced, and decided to downsize. She joined the HomeSwapper scheme to find a more appropriate property and said:

“I was impressed with the quantity of matches that HomeSwapper provided…the lady I swapped with…had needed to move for a long time but her landlord had been unable to move her. She desperately needed the space for her overcrowded family.”

That is the sort of thing this policy is helping to achieve, but the voice of overcrowded tenants is not being heard in this debate.

[Lilian Greenwood]

rose—

[Steve Webb]

I will give way to the hon. Lady because she mentioned the situation in her constituency. Perhaps she will explain why Nottingham applied for extra cash from the Government, was given an extra £0.5 million, and did not spend it.

[Lilian Greenwood]

The Minister is wrong. Nottingham city has spent the whole allocation that it was given by the Government, and is having to find extra resources to help people. The Minister mentioned HomeSwapper, but that existed before the bedroom tax was introduced. His Government cut money and funding for local authorities that were pursuing projects to encourage people to downsize, including £75,000 that supported Nottingham’s projects.

[Steve Webb]

Nottingham was allocated discretionary housing payment and was given an additional £0.5 million, and of that combined amount it spent 78%. On the question of HomeSwapper, this policy has prompted more people to look to downsize and swap. That is an entirely good thing, as it makes better use of the housing stock.

I want to respond briefly to some of the contributions to the debate. The Chair of the Select Committee, the hon. Member for Aberdeen South (Dame Anne Begg), initially made the claim that the spare room subsidy measure was forcing people into the private rented sector. When my hon. Friend the Minister for Disabled People pointed out that the rate of moves into the private rented sector had fallen, she then said in response that people are not moving to the private rented sector because rents are unaffordable. Well, it cannot be both. It has to be one or the other.

The hon. Member for Makerfield (Yvonne Fovargue) referred to the position of foster carers, but we have recognised this particular need and provided an exemption for foster carers. The hon. Member for Glasgow North West (John Robertson) referred to his constituents as the most affected by the policy, whereas the policy—

[John Robertson]

I never said that.

[Steve Webb]

Yes he did. The policy is bought out in Scotland.

[John Robertson]

On a point of order, Madam Deputy Speaker. I wonder whether you could protect this Back Bencher from a Minister making a statement that I never made. I never said we were the worst area of all. I said we were one of the worst. That is completely different. [Interruption.]

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. The hon. Gentleman knows that that is not strictly a point of order. He wished to correct the record and he has done so. He has also taken up more time in this short debate.

[Steve Webb]

I give way.

[Dame Anne Begg]

Will the Minister tell my Select Committee when we can expect the Government’s response to our report on housing costs, which was published in April?

[Steve Webb]

Even as we speak, officials are working on it and the hon. Lady will have it shortly.

The hon. Member for Edinburgh East (Sheila Gilmore) suggested that the comparison with the private rented sector was something of an afterthought. Uncharacteristically for her, she had not read the impact assessment we published in 2012, in which we made that very point.

We heard from some of my hon. Friends about how their local authorities have been very proactive in this area. We heard how, in Henley and in South Derbyshire, local authorities had substantially reduced the number of people affected by working with tenants. That is exactly the sort of thing that we want to see.

My hon. Friend the Member for St Ives (Andrew George), to whom I pay tribute on this issue, raised whether further mitigations were needed. Let me come to that point. We have a second motion before us, the Government’s amendment, which sets out the areas on which we agree. The areas where we agree are clear: we agree that it is unfair to say to private tenants and low-paid workers not on benefit that they have to pay for a spare room, but that for social tenants there should be a blanket exemption. The coalition parties also agree that the blanket application of the policy would not have been fair. That is why we have exempted pensioners, foster families, serving personnel living at home and disabled children who cannot share a room. In addition, we accepted that further mitigation would be needed. That is why large amounts of discretionary housing payments have been found. That is why an additional fund to bid for was found in 2013-14, and why additional money was found for rural areas. There is agreement between us on that.

In the light of the summer report that indicated the impact of the policy, the Liberal Democrats took the view that further mitigation was needed. Our view is that mitigation is needed for disabled people, adults who cannot share a bedroom, and those who do not have an alternative offer of accommodation. That point is made very clearly in the amendment. I hope my hon. Friends will support the amendment.

It is very easy to put down a simple motion saying, “Let’s have some free money. Let’s spend half a billion pounds reversing a policy, with no idea where the money will come from. Let’s not address the issue of overcrowding. Let’s not address the issue of the welfare budget. Let’s simply promise the voters more money and hope that they will buy it.” Evidence shows that they will not buy it. I therefore urge the House to accept our amendment.

Question put (Standing Order No. 31(2)), That the original words stand part of the Question.