Clause 11 — Housing costs
Bill Presented — European Convention on Human Rights (Temporary Withdrawal) Bill
3:57 pm

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Chris Grayling (The Minister of State, Department for Work and Pensions; Epsom and Ewell, Conservative)

I beg to move, That this House
disagrees with Lords amendment 3B, and Lords amendment 26B.

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John Bercow (Speaker)

With this it will be convenient to discuss the following:

That this House does not insist on its amendment 19A, and agrees with Lords amendments 17B to 17D and 19B.

That this House agrees with Lords amendment 73BA.

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Chris Grayling (The Minister of State, Department for Work and Pensions; Epsom and Ewell, Conservative)

If I may, I shall deal first with amendments 17B to 17D and 19B, on employment and support allowance time-limiting, and amendment 73BA, on child maintenance. The Government wish to accept these amendments.

Amendments 17B to 17D and 19B do not change the Government’s existing policy on the time-limiting of contributory ESA. The limit will remain at 365 days for those in the work-related activity group and will take effect from April 2012. I believe that the limit strikes an appropriate balance between the needs of sick and disabled people and the interests of taxpayers who contribute towards the cost. It will make a significant contribution to reducing the fiscal deficit, which I remind hon. Members once again is the most pressing priority facing the coalition Government. We estimate that the one-year time limit will reduce expenditure by £1 billion a year by 2014-15.

We have listened carefully over the course of the debate, however. The amendments would allow a future Government, if they could identify an appropriate funding source, to increase the length of the time limit by order rather than further primary legislation. We have considered that and decided that it is a sensible and appropriate use of an order-making power and we are happy to accept the amendments.

Amendment 73BA clarifies some of the powers introduced by the previous Government under the Child Maintenance and Other Payments Act 2008 and gives examples of the provisions that may be made under regulations. I should stress again that it does not imply any change to our proposed policies on charging. Specifically, I highlight the fact that we maintain our commitment to a maximum application charge of £20 and to collection charges within the ranges set out in the January 2011 Green Paper.

On Report in the Lords, we committed to undertake a review of the charging policy 30 months after the implementation of the powers, to understand their effect and impact. The amendment clarifies that if changes to

our approach are required following that review, we will have the ability to make them. Although our core proposals on charging remain the same, the amendment ensures that in future—particularly following our review—we will be able to change the charging regime, with specific reference to apportionment and waivers, if we deem such changes to be necessary.

I deal now with housing, where I am afraid we do not agree with Lords amendments 3B and 26B. As you indicated, Mr Speaker, the amendments infringe the financial privileges of this House, and if they are rejected that will be the reason given to the House of Lords.

Let me first ensure that the House is clear about the financial implications of the amendments. We know about the big financial challenges we face. Since we last debated the Bill, Moody’s has placed the UK’s triple A credit rating on negative outlook and made it clear that the Government’s strategy is necessary to retain the credibility of our nation in the international financial arena. That is not a context in which we can relax public spending. We made it perfectly clear on 1 February, when we last considered Lords amendments, that the earlier amendments, which could cost around £300 million a year, were unaffordable. The Government’s response to amendments costing £100 million, as these new amendments would, is no different.

4:00 pm
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Tom Clarke (Coatbridge, Chryston and Bellshill, Labour)

When the Minister considers financial implications, does he bear in mind the fact that the Government’s own calculations indicate that 66% of disabled people will bear the burden of an average loss of £13 a week? Is it any wonder that organisations such as Mencap are appalled that it takes the House of Lords to point out to us the unfairness of such proposed legislation?

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Chris Grayling (The Minister of State, Department for Work and Pensions; Epsom and Ewell, Conservative)

The right hon. Gentleman needs to remember what the amendments are about. Large numbers of people in our community are under-housed and others are in temporary accommodation. We have formed the view that it is neither good value for the taxpayer nor right for those people that we pay for those in social housing to have spare rooms. That is the purpose of our amendments.

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Sheila Gilmore (Edinburgh East, Labour)

If the Minister is successful and people move from homes that they under-occupy and other people move in, and assuming that the same proportion of people are on housing benefit, there will be no financial saving. Which is his real argument?

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Chris Grayling (The Minister of State, Department for Work and Pensions; Epsom and Ewell, Conservative)

The hon. Lady simply has not thought things through properly. At the moment, we are paying expensive temporary accommodation costs, partly because the previous Government—her own party—had such a lamentable record in office in building social housing. When Opposition Members make those claims, they should remember how poorly they performed in that regard.

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Ann Coffey (Stockport, Labour)

I seek clarification from the Minister. The new under-occupancy rule will only apply to working-age housing benefit claimants.

To be of working age, claimants have to be under the qualifying age for pension credit, which will be 61 and a half in April 2013. Will the Minister clarify whether, on the introduction of the change to occupancy in 2013, a couple claiming housing benefit are protected from the change if one of them has reached pension credit qualifying age, or will both need to do so?

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Chris Grayling (The Minister of State, Department for Work and Pensions; Epsom and Ewell, Conservative)

The approach we are taking across all our reforms is that if somebody in a household is of working age, we expect them to work. All our efforts and the support we are putting in place are designed to ensure that people work and that households benefit from an income from employment rather than otherwise.

As I said, the amendments would cost £100 million. They are not modest amendments, as suggested in the other place. In fact, Lord Best, who proposed them, believed that they might cost even more—£150 million a year. Either way, it would significantly reduce the estimated annual savings of £500 million. We simply do not have a blank cheque that will cover the costs of the amendments.

To give their lordships credit, there was at least some acknowledgement in the other place that £100 million is “serious money.” I am glad we can agree on that point; the amendments are certainly not modest. It is incumbent on us to do what we can to drive down the spiralling cost of housing benefit. Left unchecked, expenditure on housing benefit would reach £26 billion by 2014-15. The shadow Secretary of State is always complaining about the cost of housing benefit, yet he and his party have been consistently hostile to measures that bring the cost under control.

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Edward Timpson (Crewe and Nantwich, Conservative)

Will my right hon. Friend confirm that foster carers will not be included in the new under-occupation rules because of the specific discretionary housing payment that will be made available to local authorities to compensate foster carers to ensure that they do not end up unable to continue their great work in our community?

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Chris Grayling (The Minister of State, Department for Work and Pensions; Epsom and Ewell, Conservative)

I give my hon. Friend that assurance and pay tribute to him. I know that he has a deep knowledge of the sector. It is very important, but the approach that we have sought to take is that there should not be a one-size-fits-all solution. Where we can, we should localise and give discretion. There may be circumstances in which somebody is still a foster carer and has a property that is much too large even for those needs, but we want to make sure that we provide proper protection for those who carry out such a vital role in our society. We are making substantial amounts of money available to local authorities so that they have the discretion to protect the people who are performing that important role.

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Charlie Elphicke (Dover, Conservative)

One concern that I have in my constituency is that many people live in overcrowded accommodation and have been waiting to get accommodation with the space that they need. Across the country there are 250,000 people in that position. Meanwhile there are empty-nesters rattling round in houses with spare rooms. Surely we should have an incentive for people with excess housing space to move out and enable overcrowded families to have the space that they need.

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John Bercow (Speaker)

Order. Before the Minister of State responds, may I remind the House that we have only an hour for Lords amendments? After the Minister, there is another Front-Bench speech. There are Back Benchers who wish to speak, so I exhort colleagues who are intervening to remember that they should do so briefly.

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Chris Grayling (The Minister of State, Department for Work and Pensions; Epsom and Ewell, Conservative)

Indeed, Mr Speaker, and I shall try to be as rapid as I can for that reason.

It would be all too easy to bow to pressure to backtrack on these reforms, but we will not do that precisely for the reasons set out by my hon. Friend Charlie Elphicke. There is a real problem of people in temporary accommodation, and we also have about a million spare rooms being funded by housing benefit. We must sort out the situation and solve the problem to which he rightly refers. These reforms are designed to do that.

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Simon Hughes (Deputy Leader, Liberal Democrats; Bermondsey and Old Southwark, Liberal Democrat)

I am grateful to Ministers for their engagement on this difficult but important issue. With reference to families who cannot find suitable alternative smaller accommodation but are in the categories that the Government have wisely exempted from the benefit cap, will the Minister explain to me why they should be penalised and where they will find the money to meet the extra bill—potentially £750 a year?

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Chris Grayling (The Minister of State, Department for Work and Pensions; Epsom and Ewell, Conservative)

I know my right hon. Friend has expressed concerns about the policy. Let me say to him that we will carry out detailed reviews of it, as I know he wishes us to do. We will look at the impact of the policy. We have a year to work with the families involved, and we are providing substantial sums. An additional £30 million was announced as part of the debate on these measures, as well as the substantial amounts available for discretionary housing payments. It is our expectation that in most cases what we will see over the next 12 months is a change of circumstances that addresses many of his concerns, but there will be discretionary funds available to local authorities so that in his constituency and others they can deal with the kind of situation that he has described.

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Simon Hughes (Deputy Leader, Liberal Democrats; Bermondsey and Old Southwark, Liberal Democrat)

If the Bill goes through, but before regulations are laid, will the Minister work with colleagues and local government to make sure that the people affected have certainty? The problem with discretionary payments is the uncertainty, and people who cannot work have enough uncertainty already.

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Chris Grayling (The Minister of State, Department for Work and Pensions; Epsom and Ewell, Conservative)

Let me give my right hon. Friend an assurance that we will work closely with him on the process of reviewing the impacts and over the coming months we will continue our dialogue with him, which has been very helpful and constructive, to make sure that we make him aware of the approach that we are taking and that we seek his input in that approach. I give him that assurance.

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Alan Reid (Argyll and Bute, Liberal Democrat)

I am pleased to hear my right hon. Friend say that there will be discretionary housing payments to take into account particular circumstances. I draw his attention to the particular circumstances of islands and very remote communities where, because of the nature of the housing

stock, there may be no alternative for people to move to. When funds are allocated to local authorities, will the position of islands and remote communities be taken into account?

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Chris Grayling (The Minister of State, Department for Work and Pensions; Epsom and Ewell, Conservative)

We will certainly look very carefully at that. I give the hon. Gentleman that assurance, and again we will talk to him in detail about those issues.

This latest amendment looks to protect certain groups from the size criteria measure where they have one spare bedroom and no suitable offer of alternative accommodation has been made. However, I remind hon. Members that we have already committed to providing extra help—£30 million—to some of those groups, particularly foster carers and disabled people living in adapted accommodation. That money can help around 40,000 claimants. We are not ignoring the fact that some people will find it hard and have sought to put safeguards in place. Our aspiration is to protect the most vulnerable in society while also dealing with the broader challenge of under-occupation. There are a number of responses that individual households can choose to make to this measure.

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Liam Byrne (Shadow Secretary of State for Work and Pensions; Birmingham, Hodge Hill, Labour)

The Minister has sketched out for the House a number of important concessions for groups that will be adversely affected by this policy. When does he expect guidance on how discretionary housing payments will actually work to be available for review by Members of this House?

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Chris Grayling (The Minister of State, Department for Work and Pensions; Epsom and Ewell, Conservative)

Of course, many of the local decisions will be taken by local authorities, but we will provide information to the House as quickly as we can. We are aware that we have 12 months before the measure is in place and so will work quickly. Indeed, we are already working with local authorities to plan ahead and will be happy to make information available to the House in a timely way as it becomes available.

It is all too easy to criticise this measure and propose costly amendments, but I think that that serves to highlight the real challenges we face. What we propose is fair for the taxpayer and for tenants in the private sector who receive housing benefit based on the same size criteria. There is no plausible fairer or affordable alternative.

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Nick de Bois (Enfield North, Conservative)

Will the Minister help me to put this in context? Is he aware that there are high earners living in social housing with excess bedrooms who really should make way for other people who need the space?

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Chris Grayling (The Minister of State, Department for Work and Pensions; Epsom and Ewell, Conservative)

As we know, there are even people close to this place who still occupy social housing. It is our view that, where possible, social housing should be targeted at those on the lowest incomes, those who face the greatest challenges and those who are perhaps struggling in temporary accommodation. I think that those who are living in accommodation that is out of kilter with their financial circumstances might think about their personal circumstances, as was discussed when this matter was before the House previously.

The average weekly reduction will be £14. Nearly 80% of those affected are under-occupying their accommodation by just one bedroom and so are likely

to see an average weekly reduction of £12. By comparison, for private sector tenants the average cost of an extra room is about £20 a week, based on local housing allowance rates. What we are doing is introducing fairness and consistency of treatment for social sector and private sector tenants alike.

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William McCrea (Shadow Spokesperson (Justice); South Antrim, DUP)

Can the Minister assure me that he and his Department are working closely with the devolved Administrations, especially the Minister for Social Development in Northern Ireland, on his proposed reforms?

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Chris Grayling (The Minister of State, Department for Work and Pensions; Epsom and Ewell, Conservative)

I am happy to give the hon. Gentleman that assurance. My noble Friend Lord Freud, who has direct responsibility for housing benefit matters in the Department, is also responsible for liaising with the devolved Assemblies and so is having those kinds of discussions all the time.

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Stewart Hosie (SNP Chief Whip; Dundee East, Scottish National Party)

In his discussions, will the Minister make it clear that the Scottish Government have pointed out that some 70,000 families will be affected by this proposal? There was a huge imbalance between the 95,000 properties that are under-occupied and the 26,000 that are over-occupied, and the cost to people in Scotland and the Scottish economy will be around £54 billion a year. That does not seem to make sense, particularly when he could not answer the point made by Sheila Gilmore, which is that if his policy works there will be no under-occupancy to penalise.

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Chris Grayling (The Minister of State, Department for Work and Pensions; Epsom and Ewell, Conservative)

I suggest that the hon. Gentleman check his facts. The total cost of housing benefit is £26 billion a year, so this cannot cost the Scottish economy £54 billion a year.

Our Department and local authorities have a good track record of delivering housing benefit reform. I am confident that these changes will be communicated and delivered successfully in the same way the local housing allowance reforms were delivered last year. We will work hard to ensure that there is a smooth transition in order to address the challenges and protect the most vulnerable through discretionary payments.

Several hon. Members:

rose —

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John Bercow (Speaker)

We are extremely grateful to the Minister of State for concluding so pithily, and I am deeply obliged to him for doing so entirely when I expected him to.

4:15 pm
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Stephen Timms (Shadow Minister (Work and Pensions); East Ham, Labour)

I hope that Government Members think long and hard before simply voting down Lords amendments 3B and 26B, but at the outset let me comment on the other amendments, as the Minister did.

I want in particular to welcome the Government’s concession on time-limiting contributory employment and support allowance for people in the work-related activity group. Amendments 17B to 17D and 19B provide in circumstances prescribed in regulations for a longer

time limit than one year. That is a very welcome change, and I am grateful to Ministers for permitting it. The Government have made it clear that they have no intention of bringing forward such regulations, but the Bill will now at least allow a future, more fair-minded Government to do so, and I welcome that change very much.

The Minister in the other place also gave some assurances about people being treated for cancer, which has been an important issue in this debate. His assurances were, however, rather vague. They do not help people recovering from strokes or from severe mental health problems, or others who have no chance at all of getting back into work within a year, but the assurances in respect of cancer patients, in so far as they went, were helpful.

Amendment 73BA, which the Government tabled, would allow them to waive charges for the parent with care when accessing the child support system in specified circumstances. Again, we have no idea what those circumstances will be, but the amendment is nevertheless helpful rather than unhelpful.

There also needs to be movement on the policy addressed by amendments 3B and 26B, which the Minister before us still opposes. They have some perfectly reasonable aims, to which attention has been drawn in this debate. Under-occupancy of social housing is a problem; many people are stuck—overcrowded—on housing waiting lists; fewer people under-occupying would help; and a workable penalty for people who refuse an offer of smaller, more suitable accommodation could achieve that aim.

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Tom Clarke (Coatbridge, Chryston and Bellshill, Labour)

I follow absolutely my right hon. Friend’s logic, but in the field of disability does he not recognise that in many cases the so-called extra room is there for a carer or for other physical reasons to help the disabled person? It is therefore pretty unacceptable to change that arrangement.

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Stephen Timms (Shadow Minister (Work and Pensions); East Ham, Labour)

My right hon. Friend is absolutely right, and that is why the Lords propose in their amendment an exemption for people in receipt of disability living allowance, thereby addressing exactly that point.

Our original amendment would have penalised under-occupation in a workable way. If a tenant refused a suitable offer of a smaller home, they would suffer the penalty. If, however, no smaller home were available, they would not suffer that penalty. Unfortunately, that amendment was defeated in our previous debate, but I pay tribute to the 12 Liberal Democrat Members and two Conservative Members who supported it. I am glad to see some of them in their places this afternoon.

Legal challenge to the Government’s policy seems inevitable, because it penalises people for a situation that it is impossible for them to change. The amendment could not be reintroduced in the other place because the Government claimed financial privilege, so this afternoon we have in amendments 3B and 26B a much weaker proposal. It does, however, at least protect those, like the people to whom my right hon. Friend has just drawn attention, who will be hardest hit if the Government’s policy goes through.

The proposal would safeguard four tightly defined groups: first, people in the employment and support allowance support group—those who are too ill to be expected to return to work in the near future; secondly,

adults and children who receive disability living allowance or its successor, the personal independence payment; thirdly, war widows; and fourthly, foster carers, because for the purposes of housing benefit calculations foster children do not count towards a bedroom need.

Let me underline how modest the proposal now is. Many Members will take the view, for example, that war widows should not be penalised for having a spare bedroom. The proposal, however, would not protect war widows in that way. It simply says that no war widow should be fined for under-occupying her home unless she has been offered appropriate smaller accommodation. If such an offer has been made to her and she has refused it, under the Lords amendments she would be penalised. The amendments would protect her position until such an offer was made. Only tenants in one of the four specific groups would have even that safeguard. Everybody else who was under-occupying their social tenancy would, under the amendments, be penalised even if it was impossible for them to move to somewhere smaller.

The Child Poverty Action Group has highlighted an example of how similar rules currently apply in the private rented sector, which highlights the point made by my right hon. Friend Mr Clarke. Let us consider a claimant who has two daughters, one of whom has severe and uncontrollable epilepsy with frequent fits during the night. Her social worker and occupational therapist agree that the two girls need separate bedrooms. The claimant currently rents a three-bedroom house, but housing benefit covers the cost of only a two-bedroom house. The Lords amendments would fix that situation for social housing because the daughter is in receipt of disability living allowance.

I will now consider the hypothetical example of a couple in which one person has terminal cancer, which puts them in the employment and support allowance support group for people who are not expected to work again. That is one of the four specific groups that the Lords amendments would protect. The couple have a spare bedroom in their two-bedroom council house because their child moved out recently. They would be happy to move to a one-bedroom council or housing association flat but none is available. Under the Minister’s policy, that couple will be penalised, on average by £12 a week. Under the amendments, because of the exceptional circumstances, they would not be penalised. That would be the modest and reasonable effect of the amendments that the Lords agreed.

The National Housing Federation tells us that 180,000 social tenants in England are under-occupying two-bedroom homes, but that only 68,000 one-bedroom social homes became available to let in the year 2009-10. The impact assessment from the Department for Work and Pensions, which is well worth reading, states:

“According to estimates from DCLG there is a surplus of 3 bedroom properties, based on the profile of existing working-age tenants in receipt of Housing Benefit, and a lack of 1 bedroom accommodation in the social sector. In many areas this mismatch”—

I am quoting the Department here—

“could mean that there are insufficient properties to enable tenants to move to accommodation of an appropriate size even if tenants wished to move and landlords were able to facilitate this movement.”

That is the reality in many places. There simply will not be a one-bedroom home to move to. That will be the case in the constituency of Simon Hughes, who intervened earlier, and in my constituency. Of course, the policy will not release a single one-bedroom home, because one cannot under-occupy a home with one bedroom.

The couple in the example, in which one person has terminal cancer, would see a cut of £12 a week or nearly £60 a month in their income. That is the average across the country. They would somehow have to make that up to their landlord from other income. The Department, no doubt trying to be helpful, gives some suggestions in the impact assessment of how they might do that:

“In these circumstances individuals may have to look further afield for appropriately sized accommodation or move to the private sector, otherwise they shall need to meet the shortfall through other means such as employment, using savings or by taking in a lodger or sub-tenant.”

I ask the House to reflect on each of those three suggestions in the case of somebody with terminal cancer. People in the ESA support group are, by definition, not in a position to work. That is why the Government have placed them in the support group. That suggestion therefore does not help. The DWP suggests instead that our terminally ill tenant in a two-bedroom flat should take in a lodger to help pay the rent. One has to ask whether the people promoting these policies have ever met anyone who will be affected by them. Of course, in many cases, the social landlord would not permit somebody to take in a lodger under the terms of their tenancy. The Department’s other suggestion is that they can use their savings. People in receipt of income-related ESA do not have very much saved—if they did, they would not receive income-related ESA.

Another alternative, as the impact assessment suggests, is that the tenant will have to move out of their council home into the private sector. In that case, their housing benefit will rise sharply. Where is the gain in forcing that to happen? The National Housing Federation, whose members are very worried about the change that the Government insist on making, makes the point that

“a couple with one child moving into the private sector from a three bed social flat in Crawley would be entitled to around £66 per week more in benefit to cover their additional housing costs.”

The key point is that it will be impossible for many of those affected to avoid the penalty. If suitable alternative accommodation can be offered to them, then fine, they can move and will no longer be under-occupying, and their benefit will continue to cover their full rent. The Lords amendments specifically allow for that. However, if there is no smaller flat available, our cancer patient will just have to take the £60 a month hit. How can that be justified?

The Minister will tell us, as he has before, that £30 million has been made available to councils in discretionary housing payments to avoid penalising a limited number of households. However, the Minister in the other place made it clear that, as the Minister of State hinted today, that money is to help foster carers and disabled people with adapted homes—so no help there for our terminally ill tenant.

Even for foster carers and disabled people in adapted homes, contrary to the impression that the Minister of State gave to Mr Timpson and the right hon. Member for Bermondsey and Old Southwark, there will be no certainty. People wanting help will have to go to their local council and ask for it, because it will be discretionary—that is what the word means. It will up to each local council to decide what it does with the money. It could use it for that purpose, or it could use it for a different one. If other people have already taken all the discretionary funding that has been provided, that will be it. No further help will be available.

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Charlie Elphicke (Dover, Conservative)

I understand that the policy in the Lords amendments would cost the Exchequer £150 million. How would it be funded?

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Stephen Timms (Shadow Minister (Work and Pensions); East Ham, Labour)

The hon. Gentleman should reflect on the fact that, as I have described, the costs will be greater in a number of ways with the Government’s provisions in place than they would be if the Lords amendments were retained.

Before I leave the topic of discretionary housing payments, it is worth my noting how the extra £30 million has been found. Initially, the average penalty for under-occupying by one bedroom was going to be £11 a week, and now the Government have increased it to £12 a week. They have increased the penalty for everybody affected in order to scrape together the extra cash to increase discretionary payments.

The last time this policy was debated, we offered an effective alternative whereby a tenant would have their benefit cut as a penalty if they refused a suitable move. Unfortunately, Government Members threw it out. The Lords amendments would limit that safeguard to the four groups that I have mentioned—the sick, the disabled, war widows and foster carers.

Ministers have said that their policy will be a work incentive, but the support group comprises people who are not in a position to work. A work incentive will do them no good at all. Let us call a spade a spade: this is a spiteful cut in people’s income. Foster carers provide a service that saves the Exchequer billions. The Fostering Network has warned that people will be forced by the penalty to give up fostering, which will increase costs to the Exchequer. War widows and widowers have seen their loved ones die for their country. Their grieving barely over, they will be fined under the Government’s policy because they have one bedroom too many. I ask whether that is really what Government Members came into the House to do to their constituents. The Government’s policy, without the Lords amendments, will penalise everybody regardless of whether they could move.

Fourteen Government Members joined us in voting for the relevant Lords amendment last time. I thank them for that, and their constituents will do so as well, even if their Whips will not. As we were not successful, social landlords will have to take on extra staff to chase the resulting arrears that will start to accrue in every social landlord’s stock across the country. The current Lords amendments are much more modest than the previous ones, but they would at least protect those who stand to lose the most from what the Government want

to do. I hope that hon. Members will support the Lords amendments and oppose the Minister’s motion.

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Andrew Percy (Brigg and Goole, Conservative)

When I spoke during our last consideration of the Lords amendments to the Bill, I expressed concerns about this policy, particularly about the changes to child maintenance payments. I am pleased that there has been some movement on that front, but I find myself once again in support of their lordships. I am sorry about that, because the ministerial team is one of my favourites. I will not tell you which is my least favourite, Mr Speaker, but people can guess.

The amendments are less perfect than the original set, but the reasons for that have already been explained. As I said last time, when we talk about people’s homes, we need to remember that they are exactly that—people’s homes, not just a public asset that we need to release for others. We all have constituents who have problems with being in houses that are not suitable for them and want bigger homes, but I am not sure that this measure is necessarily the right way to deal with that. In my constituency, one of the biggest problems of under-occupation relates to older people. That age group is completely exempted from the measure. Staff time will be focused on dealing with the problem before us, and that could detract from the work that can be done in helping and encouraging older people into more suitable housing, to free up bigger houses. The amendment is imperfect because it is restricted to people in receipt of certain benefits, and I would have preferred it to be more widely constructed.

When I spoke to a constituent about this a week or so ago, her explanation of why she needed another bedroom brought it home to me that, as I said, these are people’s homes and not just public assets. She said, “My kids have moved away, but they come and go. They sometimes come back home because relationships break down, and so on, and having the space there for them is very necessary.” She added that her husband snores a lot and she likes to kick him out into the spare room, but I suspect that that is not necessarily a reason to allow people to have extra housing. It is important to remember that nowadays people come and go and relationships are flexible. Like the shadow Minister, I was concerned to hear the ideas about how people can find extra funding. It is not practical to expect people to take in an additional lodger, and in the case of many social housing landlords that would not be allowed anyway.

I will again support the Lords on this matter, with apologies to my colleagues on the Front Bench. They have entirely the right reasons for taking the policy forward, but in policy making we always have to consider the law of unintended consequences. When I served for 10 years as a councillor in the city of Hull, we had a large council estate where there was a huge problem with people under-occupying homes, and it was incredibly complicated and difficult to deal with. It is a fallacy to think that we will suddenly be able to move all these people out into more suitable accommodation.

4:30 pm
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Tom Clarke (Coatbridge, Chryston and Bellshill, Labour)

I find myself agreeing with almost everything that the hon. Gentleman has said, apart from his view of those on the Treasury Front Bench.

In addition to his experience in his own constituency, is he influenced by the fact that disability organisations have told us about the example of a man with a learning disability who had to wait for 25 years for appropriate accommodation? It turned out to be a two-bedroom house, which has now become his home.

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Andrew Percy (Brigg and Goole, Conservative)

I do not know the circumstances of that case, but in my time as a councillor we had a number of properties that were very difficult to let because people did not want to live in them. That was particularly true of the maisonettes. In Old Goole in my constituency, a two-bedroom maisonette has recently been let to an individual after about 20 years. He will be under-occupying because of the spare bedroom, but we are grateful that he has taken the property off our hands.

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Kevan Jones (Shadow Minister (Defence); North Durham, Labour)

Given my time in local government in my constituency, I totally agree with the hon. Gentleman on that. Does he recognise that for many years, the Housing Corporation, which funds a lot of social housing, has not given grant to the building of one-bedroom properties?

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Andrew Percy (Brigg and Goole, Conservative)

Indeed. The standard for many housing associations is to provide two bedrooms—there is a programme in my constituency to renew such properties at the moment. In a few years’ time, we could end up with a lot of people who, through no fault of their own, are under-occupying homes because the standard has changed.

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Julian Sturdy (York Outer, Conservative)

Is that not the argument? There is a lack of family accommodation and we need to house families who are in temporary accommodation, especially for the children.

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Andrew Percy (Brigg and Goole, Conservative)

We need to address the failure to provide adequate housing stock in this country. However, I say to my hon. Friend and near neighbour that the Government’s proposal is not a way to do so. It is not a simple problem to solve.

The crux of the amendment is that if there is suitable accommodation to go into, people should go into it, but just as there is an insufficient number of bigger homes for families, there is an insufficient number of smaller, one-bedroom properties for those groups of people to go into. If we apply the argument that there is no suitable housing for one group of people and we must therefore do something about them, we should also argue that we should not penalise people who are under-occupying if there is no suitable accommodation for them.

The sensible element of the Lords amendment is that the penalty kicks in only if people refuse a suitable property. That is eminently fair. Hon. Members must come to their own conclusions, but I will vote accordingly. I look forward to hearing other contributions to the debate.

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Frank Field (Birkenhead, Labour)

As the House may know, I agree with the Government on many aspects of the Bill and I have not always shared the

sentiments of Opposition Front Benchers. I regret that, but I have made my position clear. However, I today wish to speak against the Government on their stance and to support my right hon. Friend Stephen Timms.

I do so because the change that the Government are making is shameful. Anyone who has sat through debates on the Bill will know that the Government’s body language is totally different to that in respect of other measures. They have been forced to take this measure by the Treasury. It goes against all that the Bill tries to achieve, which is to work with the grain of human nature. This proposal, which has been forced on the Department for Work and Pensions, works against that grain.

There are four reasons why Government Members should today save their favourite Front Benchers from the course that the Treasury is making them go down. First, let us imagine that places are available—that we could wave them into existence with a magic wand—and that all the people whom the Government condemn as under-occupying could move. That is the last thing the Government want, because to satisfy the Treasury requirements, the Department has had to enter into the accounts that it will make a substantial saving. If it were possible for people to move—all hon. Members know that it is not—the measure would fail, because it is being introduced not to even out housing, but to deliver a major saving in public expenditure to the Treasury by singling out the group who under-occupy. Therefore, the first reason why I hope Government supporters reject the measure is that it makes no sense.

Secondly, as we have heard, even if people move into the private sector, the total bill to taxpayers will be greater than if they stayed in social housing and were not penalised. The Government risk making the achieving of cuts in public expenditure that much more difficult than it is.

Thirdly, the Government’s proposal strikes against other major Government objectives with which I agree. The Government say that the reform is aimed at strengthening families and building stronger communities, but this move sticks a dagger into both those objectives. It will affect parents in families that have broken up and wish children to come and stay, and people who have carers rather than entering permanent care. Furthermore, as Andrew Percy said in his fine speech, people might snore. How many marriages have been saved because one partner who snored could move into another bedroom? These details do not appear in public accounts details but they appear in real life. If this measure passes, far from strengthening families and enabling them to relate to and visit one another more easily, it will make it more difficult, and it might well drive out of the community upstanding citizens who play a much wider role, in the most difficult circumstances, in trying to beat the yob culture that engulfs them.

There is a fourth reason I speak and wish Members, particularly on the Government Benches, to vote against the Government and save their own Front Benchers. The Government know that I do not accept all their poverty data, but they do not have the courage to come out, as I want them to do, and declare on that—perhaps one day they will find that courage. I do not think that the poverty data properly measure whether people are

benefitting from the general rise in living standards that has occurred for generation upon generation in this country. Harold Macmillan said that the poor should benefit from rising living standards. One way of ensuring that they do so is to give them the freedoms that I and other hon. Members have—those small differences in life that so improve its quality. Having a spare bedroom with which to offer hospitality to family and friends can make such a difference to the quality of one’s life.

The Government know that they are going against a valuable tradition dating back to the Macmillan era. This is not a welfare reform measure. It will be a recruiting sergeant to the money lenders and will be looked on as an eviction measure. Given that the DWP cannot save itself from this terrible measure, forced on it by the Treasury, I hope that Government Members will save the Department from pushing through this nasty, mean little measure. I hope that the House will send a clear message to the House of Lords that, even if we do not win tonight, they should keep up the fight and send it back until there are enough Government Back Benchers to save the Department from this shabby little folly.

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Stephen Lloyd (Eastbourne, Liberal Democrat)

It is a privilege to follow Mr Field on this issue and the issue of welfare reform generally. I have read what he has written for many years. I have some sympathy with what he and other colleagues have said, and with the amendment, and I have some specific concerns that I would like to put to the Government and on which I look forward to receiving clarification from the Minister.

First, however, I want to welcome the fact that the coalition Government have already put aside funds in the comprehensive spending review for severely disabled people who need carers either for 24 hours or overnight. I am glad of that. It was in the Lib Dem manifesto, and I am glad that it is being delivered by the coalition Government.

I have four concerns about the amendment, however, on which I seek reassurance from the Minister. The first is straightforward and concerns foster carers and social housing, about which one of my colleagues talked earlier. I would like the Minister to clarify exactly how the Government will manage the periods during which foster carers have one spare bedroom. Clearly the children of foster carers sometimes move on and there will be a gap before the next child arrives. I would therefore welcome some clarification from the Government of how that will be managed.

Secondly, a number of my disabled constituents, such as wheelchair users, have had extensive adaptations in their homes—I am thinking of one particular individual, in Langney—which have made a considerable difference to their lives. It took probably two or three years to get the work done in that case, and it would frankly be daft to move that individual out of her home because of the one-bedroom rule; the local authority has already spent £10,000 on those adaptations.

4:45 pm
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Stephen Timms (Shadow Minister (Work and Pensions); East Ham, Labour)

I agree with the points that the hon. Gentleman is making. Just to take him back to foster children for a moment, as I understand it, they do not

count towards the housing benefit bedroom entitlement, whether they are there are not. Therefore, not only is there a problem when there are no children; there is a problem when there are children.

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Stephen Lloyd (Eastbourne, Liberal Democrat)

I would welcome a response from the Minister on that issue.

To go back to disabled people and adjustments to their homes, I would like some detail from the Government as to exactly how they will meet that challenge, because clearly it makes no sense to move someone out after their home has been adapted to the tune of thousands of pounds.

Thirdly, what steps are the Government taking to ensure that there is enough housing stock when 2013 comes around? We have a year before that happens, so I would be interested to hear the Government’s plan. Last but not least, what plans are the coalition Government making, prior to implementation, to work with local authorities and housing association in advance of April 2013 to ensure that the changes are made in a sensible and productive manner? I look forward to hearing the Minister’s reassurances in response to those four important questions.

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John Bercow (Speaker)

Before I call the next speaker, let me point out to the House that the Minister is being asked quite a lot of questions—which is absolutely fine—and if the House wants to hear the answers, I think he will need five minutes to provide them.

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Andy Slaughter (Shadow Minister (Justice); Hammersmith, Labour)

I agree with all right hon. and hon. Gentlemen who have spoken, with the exception of the Minister.

As I understand it, the Government’s justification for prosecuting the bedroom tax against even very vulnerable people is that it will free up social housing and relieve the shortage. If that is the case, someone in a constituency such as mine—where 8,000 people are on the waiting list with no possibility of being housed in the private sector because of costs—should welcome such provisions. However, we know, because no alternative properties are available, that this is in fact simply a cost-saving measure. As for the idea of a property being empty for 20 years, as Andrew Percy described, properties are not empty for 20 minutes in Hammersmith before they are snapped up.

Everything that this Government are doing, whether it be the cuts to the social housing grant, the changes to affordable rents—I should say that the affordable rent at 80% of the open market value of a four-bedroom property in Hammersmith would require an income of £96,000 a year—the changes in homelessness legislation or the provisions of the Localism Act 2011, weakens the security and provision of social housing. What we are discussing is another measure to make social tenants second-class citizens and social tenants on benefit third-class citizens.

If I may do so in just one minute, I would like to give as an example my own local authority—a Conservative-controlled local authority and the favoured local authority of the Secretary of State for Communities and Local Government. In the last two weeks it has given approval for more than 3,000 new houses to be built. Not one of those 3,000 properties will be a new social home for rent; rather, they are replacing 750 good-quality homes, which are in the process of being demolished, so we are

already seeing downsizing at work. The authority received £100 million for that demolition from the property developer and another £100 million was received for selling off 300 good-quality social homes on the open market by auction, and it is building 25 new council homes. However, even though those council homes are on estates and will be low-cost homes that therefore could be rented, they will all be for private sale.

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David Ward (Bradford East, Liberal Democrat)

Does the hon. Gentleman agree that the Government are failing to understand the sheer scale of this matter? The largest social landlord in Bradford has 3,800 under-occupied households, and it would take three years with no re-lets or new lets to house people there under the proposals.

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Andy Slaughter (Shadow Minister (Justice); Hammersmith, Labour)

As always, the hon. Gentleman is right on this issue.

The point has been made by those on my Front Bench many times that we are talking about people’s homes. This proposal is cynical not only because it runs completely in the face of Government policy in every other area, which is to reduce affordability and the quantum of available social housing, but because it is about persecuting people in social tenancies and making them feel that their home is no longer their own. For that reason above all, I urge the House to support the Labour Front Bench in supporting the Lords amendment.

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Chris Grayling (The Minister of State, Department for Work and Pensions; Epsom and Ewell, Conservative)

I will probably not be able to cover all the questions that have been raised, but I shall pick out some of the key points.

Mr Field made a passionate defence of the spare room, referring back to the days of Macmillan and to the principles of the welfare state. I know that he is often a champion of welfare reform, and I listen carefully to what he says, but I find it difficult to justify maintaining 1 million spare rooms in the social rented sector when large numbers of families are living in temporary accommodation and in accommodation that is too small for them. I do not believe that the spare room is a luxury that the social rented sector can afford at the expense of children living in temporary rented accommodation. Fundamentally, that is what this change is about.

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Frank Field (Birkenhead, Labour)

But it is not about that, is it? If the Government are going to deliver to the Treasury the moneys that they say they are going to save, that will depend on people not being able to react in the way that the Minister is describing.

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Chris Grayling (The Minister of State, Department for Work and Pensions; Epsom and Ewell, Conservative)

As I keep saying, that is not the case. At the moment, local authorities up and down the country are paying out large amounts of money; the right hon. Gentleman should talk to his own local authority about the challenges and costs of providing temporary accommodation. We depend so heavily on temporary accommodation partly because of the failings of the previous Government, going back 10 or 15 years, in the construction of social rented housing. I remember looking at the figures in the early part of the last decade. Had the Blair Government continued to build

social housing at the same rate as the Major Government, we would have seen something like 300,000 more families in social rented accommodation. The fact is, however, that they did not. This was not a priority for them when they took office in 1997, and they cut back on construction. Today, we are living in extraordinarily difficult times, financially, and we are dealing with the consequences of the decisions that were made 15 years ago.

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Frank Field (Birkenhead, Labour)

We are not interested in the Blair Government or the Brown Government; the electorate decided that they should come to an end. We are interested in what this Government are doing. Does the Minister not accept that if people followed his advice and moved into the private sector, far from saving the amount spent on housing benefit, such a move would actually increase it?

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Chris Grayling (The Minister of State, Department for Work and Pensions; Epsom and Ewell, Conservative)

I simply do not accept that. The right hon. Gentleman is making assumptions about people’s behaviour and about the cost of temporary accommodation. We as a nation are housing large numbers of people in extremely expensive temporary accommodation who can and should be housed properly. At the same time, we are supporting 1 million empty bedrooms in the social rented sector. My colleagues and I believe that we simply cannot afford to do that at this moment in time. This is not the world of 15 years ago. We have come into government with empty coffers, as Mr Byrne keeps reminding us. We are having to take tough decisions, some of which we might wish that we did not have to take, and we are trying to take them in as fair a way as possible.

My hon. Friend Stephen Lloyd asked about foster carers. The foster carers of this nation are to be enormously admired for the work that they do, and I appreciate that this is a sensitive issue. In putting in place discretionary funding, we have focused specifically on those people. On the status of a foster child, the approach that we are taking is not to treat foster children as members of the foster carer’s household in the calculation of the appropriate amount of housing benefit. That is because we are treating them in a different way. It is consistent with the current treatment of foster children in housing benefit assessments for those living in the private rented sector, but we disregard the whole of the foster carer allowance that is given to the foster parents when assessing eligibility for all income-related benefits. That leaves the majority of households who foster substantially better off, so the payment is made through the foster care support system in order to ensure that the family has sufficient resource to make money available for support to cover the costs of those children.

The whole point of making discretionary money available is, as my hon. Friend Mr Timpson said, that there are of course situations where there is a gap in a foster child’s presence in a household. When the money is not coming in, we need to use discretionary funding to ensure that the family is appropriately and properly supported. We do not want to see foster carers forced out for the very good work they do; it is really important that we provide them with support.

In the last few seconds available to me, let me say again that a spare bedroom is a valuable asset. Taxpayers’

money is already being used to provide accommodation at social sector rents, averaging £79 a week in England compared with £160 in the private rented sector. Asking the taxpayer to find a further half a billion pounds to enable—

One hour having elapsed since the commencement of the proceedings on the Lords message, the debate was interrupted (Programme Order, 1 February).

The Speaker put forthwith the Question already proposed from the Chair (Standing Order No. 83G),That this House disagrees with the Lords in their amendments 3B and 26B.

The House divided:

Ayes 316, Noes 263.

Division number 472

See full list of votes (From The Public Whip)

Question accordingly agreed to.

Lords amendments 3B and 26B disagreed to.

The Speaker then put forthwith the Questions necessary for the disposal of the business to be concluded at that time (Standing Order No. 83F).

Lords amendments 17B to 17D, 19B and 73BA agreed to, with Commons financial privileges waived in respect of all Lords amendments.

Motion made, and Question put forthwith (Standing Order No. 83H), That a Committee be appointed to draw up Reasons to be assigned to the Lords for disagreeing to their amendments 3B and 26B:

That Chris Grayling, Stephen Crabb, Stephen Timms, Tom Blenkinsop and Jenny Willott be members of the Committee;

That Chris Grayling be the Chair of the Committee;

That three be the quorum of the Committee.

That the Committee do withdraw immediately.—(Jeremy Wright.)

Question agreed to.

Committee to withdraw immediately; reasons to be reported and communicated to the Lords.