Clause 36
Welfare Reform Bill
10:30 am
John Penrose (Weston-Super-Mare, Conservative)
I begto move amendment No. 267, in clause 36, page 29,line 40, leave out ‘may’ and insert ‘must’.
I welcome you back to the Chair, Mr. Hood, following our brief break. It is hard to resist the temptation to begin by saying, “As I was just saying”, after two or three weeks away for the Queen’s Speech, but I shall try.
The amendment is aimed at preserving the option of making direct payment of housing benefit to landlords without going via claimants, should that be necessary. The Committee had a useful and informative discussion—I think that there was cross-party agreement on this point—about the importance of trying to expand financial literacy and of deepening the level of bank account penetration among claimants of benefits in general and of housing benefit in particular. There is still great support for that proposition.
However, there are occasions when it would not necessarily be appropriate for some groups of claimants to receive housing benefit directly, and when it would be appropriate to pay the benefit directly to the landlord instead. Examples of those to whom it might be dangerous to make direct payments include drug addicts who are not yet recovered, who may be in the process of recovery from their addiction. For such people, the difficulty of dealing with financial affairs and, to them, comparatively large amounts of money, which arrive in one lump every week or so, will create an impossible degree of temptation that would be impossible to manage, given the chaotic lifestyle of people who are in the depths of addiction. Clearly, there are some groups of people for whom direct payment may not be appropriate. The amendment seeks to ensure that there will be a guaranteed facility to preserve the option of direct payments of housing benefit to landlords if necessary.
A number of landlords are very concerned about losing such an option as a way of receiving the benefit. They regard it as an essential piece of certainty and of protection of the rent stream. Many have said that they are concerned enough to consider getting out of the sector and stopping providing accommodation if the option of direct payment ceased.
The Opposition are therefore not asking that the proposed measure should apply to everybody. We completely support the notion that there should be an extension of bank accounts and financial literacy to the majority of people claiming housing benefit, but we feel that for some groups, at some stages, it will be important to maintain direct payment. We therefore hope that the Under-Secretary can give us some reassurance on the matter.