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Orders of the Day — Social Security Bill – in the House of Commons at 6:15 pm on 23rd July 1986.

Alert me about debates like this

Lords amendment: No. 40, in page 27, line 20, at end insert— and shall include the whole of the amount which he is liable to pay by way of rates in respect of his home.

Photo of Mr Norman Fowler Mr Norman Fowler Secretary of State for Health and Social Security

I beg to move, That this House doth disagree with the Lords in the said amendment.

The first point to make is that there is nothing in the Bill concerned with 20 per cent. contributions to rates. The Government have made it clear that they want to see greater accountability in local government and that they believe that it is a serious defect of present arrangements that many people have no financial interest in the current level of rates charged or in any proposed increase. We have made it clear that we will put proposals to Parliament to change that position, but this Bill is not the vehicle for that change.

The powers in the Bill go no further than the provisions in existing legislation. When the Government put forward their proposals on domestic rates as they now are, they will be in the form of regulations which will be debated by both Houses. But, of course, the Government are also consulting on the proposals for a new community charge. That consultation is not yet complete, but it is clear that any change there would require primary legislation.

Photo of David Winnick David Winnick , Walsall North

I am sure that the Secretary of State will be perfectly frank with the House. I appreciate that a measure will be introduced in due course, but does he agree that the Government intend to introduce a measure whereby at least 20 per cent. will be paid by those on supplementary benefit?

Photo of Mr Norman Fowler Mr Norman Fowler Secretary of State for Health and Social Security

The point is that this Bill is not the vehicle for that change. I see that we are agreed upon that.

Basically, the amendment pre-empts that decision. Rather than waiting for the proposition to be put, the authors of the amendment have used the opportunity of this Bill to seek to prevent any action at all. Let us be clear that the effect of the amendment is not just to make impossible a 20 per cent. contribution to rates; it would make any contribution impossible. It would not be possible to have a 15 per cent. contribution, a 10 per cent. contribution, a 5 per cent. contribution, or a 1 per cent. contribution. I must say that I find that totally unacceptable. It is unacceptable for the reasons given in the other place by my noble Friend Lord Boyd-Carpenter. It is an attempt to pre-empt Government policy on the whole question of local government finance.

Even on its own terms the amendment is wrong on several important counts. It would diminish a major achievement in the Bill—fairer treatment between those in work and those not in work. It would further weaken the link between payment for and use of services provided by local authorities. There would be greater expenditure on a benefit which has increased dramatically in recent years.

The central aim of the reforms is to treat people at the same level of income in exactly the same way, whether they are in or out of work. Thus, one has the same maximum for both. The amendment would guarantee a 100 per cent. rebate of domestic rates for those with incomes at or below the income support level.

There is a technical flaw in this, as it would also prevent any deduction from housing benefit to take account of the contribution towards domestic rates expected from nondependent members of the same household. Thus, even though the non-dependent is earning, say, £100 a week, no deduction could be made from housing benefit. It cannot be right that a head of household should receive 100 per cent. help from the taxpayer with domestic rates when other members of the household are in full-time work. The cost of that would be about £100 million. But under the present system, and under any changed system, the effect would be to create sharp reductions in benefit as income rises. That would create new unemployment and a poverty trap which the unified structure in the Bill is designed to avoid. It could lead also to the reintroduction of housing benefit supplement.

The only way to avoid the effect of the amendment would be to extend 100 per cent. help with rates to all those who qualify for benefit. That would have the effect of reducing, not increasing, accountability.

7.30 pm

Currently, a substantial minority of householders — about 3 million — are insulated entirely from rises in domestic rates. A scheme which started with 100 per cent. maximum assistance would insulate even greater numbers from the consequences of their local authorities' spending policies. I shall develop that. At present, for standard housing benefit cases, the starting point for calculating rate rebates is 60 per cent. of the claimant's rates. That means that if his rates increase by £1 a week his rebate automatically increases by 60p a week, unless his income or other circumstances change. It would be the same for everyone receiving a rebate, however large or small his rebate was initially. But under a scheme that is based on 100 per cent. of rates, a £1 increase in weekly rates would produce a £1 increase in benefit, again no matter how much rebate the individual was receiving initially. Even if he was entitled to a rebate of only a few pence a week, a £1 rise in rates would still lead to a £1 rise in his rebate if his circumstances remained the same.

Photo of Nick Raynsford Nick Raynsford , Fulham

Will the Secretary of State explain why similar logic should not extend to rents?

Photo of Mr Norman Fowler Mr Norman Fowler Secretary of State for Health and Social Security

We are not making the same proposals for rents. We are seeking more accountability within the rating system between local authorities and those who elect local authorities. The hon. Gentleman knows that the Government have made that clear from the beginning.

In other words, every household receiving a rate rebate — about 5·5 million, on the basis of our illustrative figures—would no longer have any financial interest in the spending policies of its local authority. That would weaken and, in some authorities, threaten to destroy the link between those who vote for more services, those who use the services and those who pay for them. That would be bad for local accountability and for personal responsibility. Our initial proposal is that everyone should pay a contribution towards his domestic rates. This proposal will have to be developed in the light of the consultations and discussions on the proposals in the Green Paper, "Paying for Local Government". In principle, however, our case is clear and remains firm. Local electors must be aware of the costs of the policies that they are invited to support.

Finally, we have been entirely open in our commitment to restrain the cost of housing benefit. Total expenditure on assistance with rent and rates has more than doubled over the past six years. Current expenditure is estimated to be about £4·5 billion. At the same time, the numbers have risen so that one in three households is receiving some assistance. Overall, our proposals seek to restrain future housing benefit expenditure, and the proposal that everyone should make a contribution towards his domestic rates is an important part of that saving. I do not believe that the Government can be pre-empted from making financially important proposals of this sort.

The Opposition have sought to alarm people and will no doubt seek to do so again. I understand that they will claim that this measure will have dire consequences for poor households. We should be clear that we are talking about benefit rates to be set at the uprating that is due to take place in the autumn of 1987, not at the next uprating. Even on the illustrative figures published with the White Paper, the majority of those on income support would not experience any reduction in disposable income overall.

In summary, the amendment would not increase accountability in local government. In fact, it would reduce it. It would not restrain future spending on housing benefit. Instead, it would multiply it. Above all, the amendment is out of time. It seeks to pre-empt the Government's right to make proposals to Parliament in a vital area of policy. That is a fundamental issue, and I ask the House for its support.

Photo of Mr Ernest Armstrong Mr Ernest Armstrong , North West Durham

I remind the House that the amendment involves privilege.

Photo of Michael Meacher Michael Meacher Shadow Secretary of State, Member, Labour Party National Executive Committee

Contrary to the clear decision and vote of a significant majority in another place, the Government are seeking to revert to their original intention to impose this iniquitous 20 per cent. rates payment on even the poorest in our society. This proposal has been rejected by the Government's housing review committee, which was set up in the course of the social security reviews. It has been rejected virtually unanimously by public opinion in the course of consultation. It has been rejected—this is the reason for the debate—by a decisive vote in another place. Lastly, it has been rejected by the Social Security Advisory Committee, the Government's own advisory body. There is no support anywhere for this measure except among the Institute of Directors and among those who, to their shame, submit to the Tory Whip in this place.

Contrary to the Secretary of State's complacency, the Government's proposal will mean that the poorest claimants, even those on supplementary benefit, will have to use money which is intended for food and clothing as well as fuel to pay part of their rates. The proposal has been opposed by a wide range of political opinion, as well as by local authorities and those concerned about the welfare of claimants. Contrary to the Secretary of State's statement, the amendment is not an attempt to pre-empt the Government's policy. The vote in another place was not an attempt to pre-empt Government policy on local finance.

The Government's action is a deliberate one to cut benefit by between £300 million and £400 million a year, and this will affect some of the poorest in our society. That and that alone is the reason why the Government's proposal has been brought back to the House.

The Opposition have two main complaints about the 20 per cent. proposal. We say that it will cause hardship and that administratively it will be highly inefficient. Supplementary benefit claimants — if the right hon. Gentleman has any doubt about this I suggest that he should have rather more experience of what it is like to live on supplementary benefit—already have a pretty hard time getting by. By any standard, their income is extremely low. Many have to forgo necessities or get into debt, or both.

I shall quote one example of the impact of the Government's proposal. Let us consider the position of a pensioner couple aged 72 and 74 years whose sole income consists of supplementary benefit of £64·90, including allowances for the wife, who is diabetic, and heating addition. That is their income, apart from rent and rate rebates. They receive a full rent rebate, plus a fuel rebate of £7·50 and an allowance for water rates of £1·50. That is the position of a fairly typical couple in retirement. Their income support would total £63·25, out of which they would have to pay water rates and 20 per cent. of their domestic rates. They would be worse off by £4·65 per week. The 20 per cent. rate rebate cut would be £1–50 of the loss. That is a substantial cut. I am amazed that anyone in the House believes that that is justified and can find it in himself to vote for it.

Photo of David Winnick David Winnick , Walsall North

As my hon. Friend says, is not the situation deplorable? Is it not the case that, whereas now those on supplementary benefit are entitled to some assistance during a harsh winter, however bureaucratic the regulations are, and however inadequate the sums are, under the new position, such sums will not be paid? Therefore, apart from all the other difficulties of paying 20 per cent. in rates, certainly during the winter months, the people concerned are likely to have less income than they have now.

Photo of Michael Meacher Michael Meacher Shadow Secretary of State, Member, Labour Party National Executive Committee

My hon. Friend is right. We are debating just one item from the Social Security Bill. There are several others and, unfortunately, some of them combine. Therefore, the overall loss of income in particular cases, which is what matters, is greater than that as a result of any single one of the cuts, such as the one that we are now debating.

The DHSS tax-benefit model, which is the best indicator of the effect of the proposal, suggests that the average loss to claimants from the measure will be about £1·25 a week. In certain places where there is a great deal of poverty, it will be considerably higher. In Camden, it will be more than £3 a week because the average rent level there is over £15. In Islington, Lambeth, Lewisham, Brent and Hounslow it will be over £2·50 a week, which is a considerable sum to people on low incomes. The loss may not seem a lot to many hon. Members, but it is sobering to reflect that it is almost a day's benefit, in supplementary and child benefit combined, for a 10-year-old. Claimants live in a hard world where those figures are a serious business. The hon. Member for Derbyshire, South (Mrs. Currie) smiles. We know that she comes from a very rich and well-off family, with both her income and that of her husband. She would do well to listen carefully to the effects that the measure has on many people with very low incomes, something that she has never experienced in her life.

Photo of Michael Meacher Michael Meacher Shadow Secretary of State, Member, Labour Party National Executive Committee

I shall not give way. If the hon. Lady is insulting enough—[HoN. MEMBERS: "Give way."] If the hon. Lady is insulting—

Photo of Michael Meacher Michael Meacher Shadow Secretary of State, Member, Labour Party National Executive Committee

I shall not give way. If the hon. Lady insults those whom we are discussing tonight, she has no right to speak at this time. She can make her own speech in her own time.

Photo of Mrs Edwina Currie Mrs Edwina Currie , South Derbyshire

On a point of order, Mr. Deputy Speaker. As it appears to be in order for the hon. Member for Oldham, West (Mr. Meacher) to make such insulting remarks across the Chamber, is it not in order for him to give me a little time to reply?

Photo of Mr Harold Walker Mr Harold Walker , Doncaster Central

I cannot compel an hon. Member to give way to someone who seeks to intervene.

Photo of Mr Norman Fowler Mr Norman Fowler Secretary of State for Health and Social Security

I simply want to say to the hon. Member for Oldham, West (Mr. Meacher) that I gave way to the hon. Member for Walsall, North (Mr. Winnick) a moment ago. Surely, having referred directly to my hon. Friend the Member for Derbyshire, South (Mrs. Currie), he will at least have the courage to give way to her.

Photo of Michael Meacher Michael Meacher Shadow Secretary of State, Member, Labour Party National Executive Committee

My hon. Friend asked a proper and courteous question. I only wish that the Secretary of State were as defensive of the poor people as he is of some of his insulting hon. Friends.

Photo of Mr Harold Walker Mr Harold Walker , Doncaster Central

Order. I understand the hon. Lady's resentment, but she must not persist in seeking to intervene when the hon. Gentleman has made it clear that he will not give way.

Photo of Michael Meacher Michael Meacher Shadow Secretary of State, Member, Labour Party National Executive Committee

The Social Security Advisory Committee, which advises the Government, had this to say: We are …seriously concerned at the proposal to limit eligible rates to a level which is less than 100 per cent.—and possibly as low as 80 per cent. Our concern is twofold: First, and most important, we believe that the proposal could cause real hardship to many claimants, especially those on income support; and second, the proposal will cause local authorities extra administrative difficulties, and therefore higher administrative costs, at a time when the Government is committed to simplifying administration and controlling costs". The SSAC is right on that score, too.

The amounts regained from claimants may cause hardhip—I believe that they will but they are puny in administrative terms, and local authorities regard the costs of collecting them as a nonsense, out of all proportion to the amounts collected and directly contrary to considerations of efficiency in social security. That applies even more to the costs of pursuing arrears, leaving aside the effects on claimants of losing furniture to the bailiffs or appearing in court.

7.45 pm

A paper has been passed to me from the Department of the Environment, which is headed: The community charge: Enforcement of payment. Although the paper is about collecting the community charge, it also applies to collecting arrears on the 20 per cent. rates payment. It talks of introducing "time to pay" orders and attachment of earnings to cover arrears, with direct payment arrangements by the DHSS where debtors are on benefit. That is particularly interesting. I quote from that paragraph: Attachment of earnings would not cover those on benefit who had fallen into arrears. One possibility in these cases might be for local authorities to seek to have amounts deducted from benefit and paid direct to the local authority to cover community charge payments and to pay off arrears." That is an insight into the way in which the measure is likely to be administered between the two Departments.

Photo of Mr Andrew Bowden Mr Andrew Bowden , Brighton, Kemptown

I am grateful to the hon. Gentleman for giving way. Does he accept that, if I believed that tonight we were discussing the issue of pensioners on supplementary benefit and those on low incomes being charged 20 per cent. of their rates, I would not hesitate to vote against the Government? I would do so if that was the specific issue, but is it really the issue? Surely the issue is that that cannot be done under the Bill without further legislation. The amendment is preempting something that may never happen. Therefore, if at some future time legislation were brought before the House to charge supplementary pensioners and those on low incomes 20 per cent. of their rates without any compensating increase in their income, I would vote against that. But the hon. Gentleman has not made out the case for me to vote for the Lords amendment.

Photo of Mr Harold Walker Mr Harold Walker , Doncaster Central

Order. Interventions should be brief.

Photo of Michael Meacher Michael Meacher Shadow Secretary of State, Member, Labour Party National Executive Committee

I can be brief, as I see that time is going on. The hon. Gentleman raises the point that I am just coming to. If he really believes that the measure is not about cutting into the budgets of pensioners on supplementary benefit, among others, in a significant way, he is more credulous and gullible than I believe he is. It will have exactly that effect.

I refer to the Government's arguments. The Secretary of State talked about accountability. The Government want the measure to affect voting intentions. The Widdicombe report found that rate rebate claimants did regard themselves as ratepayers. There is no need to punish them so that they can see themselves in that light. Moreover, the fact remains that claimants are innocent bystanders in the Government's dispute with local authorities over rate levels. Wherever one stands on the rates question, which goes broader than what we are discussing tonight, it cannot be right to deploy as a tactic the threat of hardship to claimants. They are simply being used as pawns or weapons in the Government's fight with local authorities. Surely that is wrong.

The amendment from the other place is said to be defective. I do not believe that it is deficient; it is technically sound. It has certain incidental consequences. While claimants at or below the income support level are protected, the Secretary of State could still, if he so wished, impose the reduction above that level, thereby introducing an anomaly into the scheme. But one presumes that such anomalies would not be knowingly included in regulations. Indeed, the Government spokesman in another place said that that could happen only if the Secretary of State so wished. So I do not regard that as a justification for altering the amendment.

The Secretary of State said that certain other deductions are prevented, notably the non-dependant deductions. I believe that they are of dubious relevance anyway, because they apply only to housing benefit and not to mortgage interest tax relief. They also tend to discourage efficient use of housing stock. The Government could restore these non-dependant deductions if they wished without overturning the wider protection. That is the real point.

If there are deficiencies in the way that the amendment is drawn as it was finally decided in another place, these deficiencies can be put right within the terms of reference of preserving 100 per cent. coverage of rates for those on supplementary benefit, including pensioners. That would be completely acceptable to the Opposition. However, it is not acceptable for the amendment to be altered in a way that ensures that the 20 per cent. shortfall will be reintroduced. That must harm pensioners and others on supplementary benefit.

On those grounds, I strongly invite the House to reject this attempt to overturn the decision made in another place and to protect some of the poorest in our society.

Photo of Mrs Edwina Currie Mrs Edwina Currie , South Derbyshire

I am very glad to have this opportunity to put one or two matters right. First, I would like to tell the hon. Member for Oldham, West (Mr. Meacher) that I believe that the personal circumstances of hon. Members are irrelevant. I consider his personal circumstances are irrelevant, even though he comes from a far wealthier background than I. I stress to the hon. Gentleman that I merely taught in a public school, whereas he went to one. If the hon. Gentleman's behaviour reflects the manners that he was taught in that public school, I wish that I had been there to teach him. He would not have come out of my classroom behaving and talking in the way he did.

Last week the Labour party very nearly lost an election on the issue of the personal circumstances of their candidate. If the Labour party wishes to indulge in such remarks against the Conservative party, Labour Members had better watch their own backs. They might find that the electorate begins to listen and calculates very carefully in regard to the people whom the Labour party puts up for election.

Photo of Mr Michael Stern Mr Michael Stern , Bristol North West

I congratulate my hon. Friend on her thoroughly well deserved comments against the hon. Member for Oldham, West (Mr. Meacher). Would my hon. Friend agree that the hon. Gentleman is smarting at the publicity in Private Eye today?

Photo of Mrs Edwina Currie Mrs Edwina Currie , South Derbyshire

My hon. Friend the Member for Bristol, North-West (Mr. Stern) knows that, as soon as this debate has finished, I will go straight to the Library and find out what Private Eye says.

I deplore the implication that I am not capable of asking the hon. Member for Oldham, West a courteous question. The hon. Gentleman should know that I am never discourteous in the Chamber. Whatever I may do to the hon. Gentleman or to the hon. Member for Derby, South (Mrs. Beckett) outside the House, I try to observe the rules in this House and he should do that as well. However, I do not indulge in synthetic indignation like the hon. Gentleman.

I would like to consider the amendment and the Government's view on this matter. The current system of local government finance is thoroughly unsatisfactory. There are wide differences in the rates that are charged and differences in the services available to people. There are also differences of geography and political philosophy. The position is simply not satisfactory.

I am not sure that any proposed change in the system would satisfy all the critics. Rates are a tax and there is no such thing as a fair tax. The only nice tax is a nil tax. However, if we had nil taxes we would not have the services that we need.

One of the methods to ensure that efficient services are provided is to use some form of pricing or charging system. In that context, the proposal that people should have to pay 20 per cent., or whatever figure is eventually written into the regulations, should be adopted.

I do not believe that services should be free. When I was responsible for community services in Birmingham as chairman of the social services committee, I insisted that we charged for basic services like home helps, meals on wheels, night watchers and day care for children. I thought that it was right and proper that we should charge for these services. We did not charge the full economic value, but we charged a figure that was related to that. If the economic costs rose, we considered increasing the cost and in many cases we did that.

Photo of Mr Bill Michie Mr Bill Michie , Sheffield, Heeley

Can the hon. Lady tell us what happened if they could not pay? Did they receive no services?

Photo of Mrs Edwina Currie Mrs Edwina Currie , South Derbyshire

We found that in the case of certain services like the night watch, people were willing to pay. They were prepared to put money on one side to pay for that service. The result of this charging was extremely beneficial to the people concerned. We had some 20 per cent. of the budget available and as a result of the charges we brought in about £10 million on a budget of some £40 million, which we could then spend completely within our own control. The same principle applies to rates. These should also be seen as a charge for local services.

I have just ceased to be a councillor in Birmingham. The ward that I represented consisted of 55 per cent. council tenants and 45 per cent. other occupants.. Three quarters of the council tenants in the ward were on benefit of one kind or another. One does not need to be an arithmetical genius to work out that a significant minority of the people whom I represented were able substantially to ignore the rate proposed by the local authority. They did not need to pay attention to the results of their voting pattern. I am delighted to say that the people in my ward had incredible common sense. After I gave up my seat of 11 years, they elected another Tory. Indeed, they elected another woman, with a majority of 600. That was a bigger majority than I had 11 years ago on a bigger electorate and I believe that the ward is a darn sight more Tory now than it used to be.

The hon. Member for Oldham, West spoke about taking money from fuel bills to pay the rates. If that is the case, I am surprised that the Labour party ever backed the miners' strike. If Mr. Scargill had won, the costs of electricity would have shot through the roof. Instead of a cut of 3·5 per cent., electricity charges would have rocketed.

I want to put a serious point to the hon. Member for Oldham, West which arises out of the point that he made about the week-by-week effect which these proposals would have on the finances of the people concerned. I served on the Select Committee on Social Services when the Committee expressed concern about the problems of collecting very small bills week by week. The hon. Gentleman said that the effect would be to create bills of the order of some £3 a week. That is not a tiny sum. Therefore, the problem of lots of little bills flying around would diminish.

At the moment, I am dealing with a case in my constituency of a widow who was moved into a new bungalow. The bungalow has just been rated and her rates are £25 a week. Under the proposals we would be able to help her to the tune of £20 a week and she would have to find £5. That procedure is administratively straightforward and would deal with the Select Committee's objection about bills of that order. We have also found that the payment of small amounts for water rates, which are often paid weekly through the use of payment books, has proved to be no problem. The money is collected and the procedure is straightforward.

For these reasons, I am glad to support the Government and I hope that we will see the changes introduced so that people will think about their rates when they go to the ballot box in future.

Photo of Mr Archy Kirkwood Mr Archy Kirkwood , Roxburgh and Berwickshire

I would like to contribute a few brief remarks to the debate. I accept that there are problems about accountability because some local authorities have been acting in a profligate way. However, to achieve accountability by this route is completely unjustified. I cannot begin to support the proposal, whether it is hypothetical. pre-emptive, or whatever. It is right that the House should take and express forcibly a view about the proposal.

If the Government are thinking about increasing and improving local accountability, there is clearly an alternative available. They can change the electoral system. If there were a system of multi-member constituencies with a single transferable vote, the local electorate would be given the power to choose—

Photo of Mr Harold Walker Mr Harold Walker , Doncaster Central

Order. I do not think that this has very much to do with Lords amendment No. 40.

Photo of Mr Archy Kirkwood Mr Archy Kirkwood , Roxburgh and Berwickshire

We are discussing local government accountability, Mr. Deputy Speaker. I was arguing that there are ways of improving and increasing the level of accountability. That was the only point that I was trying to make. I will pass from it as there is not enough time to develop it further.

Photo of Mr Harold Walker Mr Harold Walker , Doncaster Central

Order. It is a matter not of time but of order. The hon. Gentleman would be out of order if he sought to develop that point further. I hope that he will not do that.

Photo of Mr Archy Kirkwood Mr Archy Kirkwood , Roxburgh and Berwickshire

Thank you, Mr. Deputy Speaker.

My other objection, which was mentioned by the hon. Member for Oldham, West (Mr. Meacher), relates to the important question of hardship. There is no way that the proposal could be introduced without producing an unacceptable degree of hardship. I hope that when the House of Lords considers our scant debate this evening, it will continue to be resolute in its opposition which it voiced recently on the matter.

I do not believe that this proposal will work in any shape or form. Interestingly, the Secretary of State said that consultations were not complete. Yet the Secretary of State for Scotland is working on a Bill to introduce these very proposals for Scotland next Session. I was interested in the comments of the hon. Member for Oldham, West on the enforcement provisions being considered by the Department of the Environment. I hope that the Secretary of State will bear in mind that the situation in Scotland is even more urgent.

8 pm

Given the way in which the Government introduced the proposal and the Lords' reaction to it, it is entirely right that the House should support the position taken by their Lordships, and I hope that they will continue to maintain that position when the Bill returns to the other House.

Photo of Mrs Jill Knight Mrs Jill Knight , Birmingham, Edgbaston

It is an important democratic concept that there should be no taxation without representation. I believe that the converse is also true — that there should not be representation without taxation.

Photo of Mrs Jill Knight Mrs Jill Knight , Birmingham, Edgbaston

One might use the word "reception" rather than representation. It is extremely important that people should understand that there is no Father Christmas and no golden tree which drops benefits upon the fortunate without payment. Under the present system, votes have been bought. That is immoral. I wonder what the Opposition would say if we bought votes by dishing out largesse as they do.

Photo of Mr Bill Michie Mr Bill Michie , Sheffield, Heeley

You do it all the time.

Photo of Nick Raynsford Nick Raynsford , Fulham

What about mortgage tax relief?

Photo of Mrs Jill Knight Mrs Jill Knight , Birmingham, Edgbaston

If the hon. Gentleman wishes to intervene, he is welcome to do so. I am not like the hon. Member for Oldham, West (Mr. Meacher).

Photo of Nick Raynsford Nick Raynsford , Fulham

Would the hon. Lady deny the vote in parliamentary elections to people who do not pay tax because their incomes are too small?

Photo of Mrs Jill Knight Mrs Jill Knight , Birmingham, Edgbaston

I did not say that. The hon. Gentleman should listen more carefully. His suggestion is ridiculous. I am talking about rates.

Photo of Nick Raynsford Nick Raynsford , Fulham

The hon. Lady enunciated the principle that there should be no representation without taxation. I asked her to draw the analogy with elections to this House.

Photo of Mr Harold Walker Mr Harold Walker , Doncaster Central

Order. We are dealing with the Social Security Bill. I hope that we can get back to it.

Photo of Mrs Jill Knight Mrs Jill Knight , Birmingham, Edgbaston

I will gladly follow your guidance, Mr. Deputy Speaker.

When things are made available totally free there is no understanding of their value. There must be a relationship of experience between the cost of meeting need and the need to meet the costs. Labour authorities lash out on endless benefits to people who never pay a penny. A girl being helped by Labour-controlled Islington council spent five months in 18 London hotels at a cost to the ratepayers of more than £4,000. She was not just placed in a bed-and-breakfast hotel — dear me, no! The social workers decided that she must be in a large, impersonal, good hotel, in which she was allowed unlimited use of the telephone and had £7 per day pocket money. That girl paid not a penny towards the cost of what she received. I am sorry, but I believe that that is wrong.

Photo of Mrs Jill Knight Mrs Jill Knight , Birmingham, Edgbaston

I will give way, but only briefly, as others wish to speak.

Photo of Jeremy Corbyn Jeremy Corbyn , Islington North

As the hon. Member has referred to my borough, she should allow me to comment. Islington borough council does not like putting people into bed-and-breakfast hotels. It chooses quality hotels where there is room for children to play and people can live decently. Islington and other authorities put people into bed-and-breakfast accommodation not because they wish to do so, but because of Government cuts in the housing programme and the Government's refusal to provide sufficient money to repair existing properties. None of that is the fault of the people in bed-and-breakfast accommodation.

Photo of Mrs Jill Knight Mrs Jill Knight , Birmingham, Edgbaston

The hon. Gentleman does not listen. It was not bed-and-breakfast accommodation; it was expensive hotel accommodation.

Photo of Jeremy Corbyn Jeremy Corbyn , Islington North

In which they were given bed and breakfast.

Photo of Mrs Jill Knight Mrs Jill Knight , Birmingham, Edgbaston

No doubt that wounded the social workers all the way to the budget box because it was the ratepayers who had to pay for that largesse.

Photo of Mrs Jill Knight Mrs Jill Knight , Birmingham, Edgbaston

It was not bed-and-breakfast accommodation. A cost of £4,000 plus free phone calls and £7 per day pocket money is ridiculous. The hon. Gentleman should hang his head in shame at some of the things that Islington council has done. That girl was deliberately led to believe that money grew on trees. She did not have to pay and no one she knew had to pay. That is quite wrong.

Photo of Mrs Jill Knight Mrs Jill Knight , Birmingham, Edgbaston

There will be no understanding of the cost and no accountability unless the system is changed.

Photo of Mrs Jill Knight Mrs Jill Knight , Birmingham, Edgbaston

No. I have given way a great deal, and others wish to speak in the debate.

The more that local authorities spend on goodies, the more the lucky recipients will wish to keep the reckless spenders in office. That is wrong, too, because someone has to foot the bill, and the more the expenditure increases the greater the burden on the pockets of those who have to pay. Labour Members do not seem to realise that many people who pay rates are often much worse off than the people receiving all these benefits and there is great resentment among them when cases such as I have described are made public, because they have to foot the bill while the people who receive all the money pay nothing at all.

Photo of Mrs Jill Knight Mrs Jill Knight , Birmingham, Edgbaston

I have given way twice and that is enough in a short speech.

The proposed cost for poorer households is very reasonable. We shall continue to pay 80 per cent. of the burden for those who find it hard to meet their rate bills. That is a very reasonable way to sort out the problem. Removing the assistance altogether would be another matter and I would vote against such a proposal, but we are talking about paying 80 per cent. out of the public purse. We are merely asking that people should understand that benefits cost money and that there is some relationship between what they receive and what they pay.

The Labour authorities are the big spenders.

Photo of Mr Bill Michie Mr Bill Michie , Sheffield, Heeley

They are the authorities that care.

Photo of Jeremy Corbyn Jeremy Corbyn , Islington North

And their rate support grant has been cut.

Photo of Mrs Jill Knight Mrs Jill Knight , Birmingham, Edgbaston

It is no use weeping crocodile tears. If Labour authorities were more careful in their spending, there would not be such hardship for ratepayers.

Photo of Jeremy Corbyn Jeremy Corbyn , Islington North

How much has Westminster city council spent on decorating the pavements?

Photo of Mrs Jill Knight Mrs Jill Knight , Birmingham, Edgbaston

The remedy lies in the authorities' own hands. For goodness sake, let us have some realism and understanding. I urge the House to support the amendment.

Photo of Nick Raynsford Nick Raynsford , Fulham

From the comments of the hon. Member for Birmingham, Edgbaston (Dame J. Knight), one would not suppose that we were discussing a proposal to cut benefit to 5 million or more households with a considerable saving for the Government. The proposal is about cuts, and the House of Lords has rightly rejected it on a number of grounds.

First, it is unfair because rate bills differ widely from one house and one area to another in a way that does not necessarily have anything to do with the political complexion of the local authority. Often it has more to do with the rateable value, when the property was last valued, the size of the property, and so on.

Photo of Dr Norman Godman Dr Norman Godman , Greenock and Port Glasgow

A 20 per cent. contribution to rates would fall especially hard on Scottish ratepayers because of the revaluation that the Government made in Scotland but dare not repeat south of the border, for obvious reasons.

Photo of Nick Raynsford Nick Raynsford , Fulham

I am grateful to my hon. Friend. He highlights yet another of the variations in rate bills which mean that the impact of the Government's proposal would cause greater hardship to people who, for whatever reason, are paying a high proportion of their income in rates.

The proposal would be administratively inefficient. In many areas, it will cost local authorities more to collect the money than they will be able to bring in. I remember the Minister for Social Security arguing in the House a few weeks ago about the proposal to cut housing benefit for students and saying that one of the reasons for the cut was that the administrative cost of paying out the benefit was so high as to make it not worth while. The Government are here proposing a system that would incur quite unnecessary but considerable extra administrative costs.

The proposal will cause hardship and suffering and a mounting burden of debt among people who are already burdened with debt. The Minister's arguments are threadbare. If he claims that there is no proposal to take 20 per cent. of the rates, why did he and his colleagues talk about it incessantly during the consultation period?

It being two hours after the commencement of the proceedings on the Motion relating to the Social Security Bill (Allocation of Time), MR. DEPUTY SPEAKERproceeded, pursuant to the Order this day, to put forthwith the Question already proposed from the Chair, That this House doth disagree with the Lords in the said amendment:—

The House divided: Ayes 238, Noes 175.

Division No. 276][8.12 pm
AYES
Adley, RobertCrouch, David
Aitken, JonathanCurrie, Mrs Edwina
Alexander, RichardDorrell, Stephen
Alison, Rt Hon MichaelDouglas-Hamilton, Lord J.
Amess, DavidDover, Den
Ancram, MichaelDunn, Robert
Arnold, TomEvennett, David
Ashby, DavidEyre, Sir Reginald
Atkins, Rt Hon Sir H.Fairbairn, Nicholas
Atkins, Robert (South Ribble)Farr, Sir John
Atkinson, David (B'm'th E)Favell, Anthony
Baker, Nicholas (Dorset N)Finsberg, Sir Geoffrey
Baldry, TonyFletcher, Alexander
Batiste, SpencerFookes, Miss Janet
Beaumont-Dark, AnthonyForman, Nigel
Bellingham, HenryForsyth, Michael (Stirling)
Bendall, VivianForth, Eric
Benyon, WilliamFowler, Rt Hon Norman
Best, KeithFranks, Cecil
Bevan, David GilroyFraser, Peter (Angus East)
Biffen, Rt Hon JohnFreeman, Roger
Biggs-Davison, Sir JohnFry, Peter
Blackburn, JohnGale, Roger
Blaker, Rt Hon Sir PeterGalley, Roy
Bonsor, Sir NicholasGardiner, George (Reigate)
Boscawen, Hon RobertGardner, Sir Edward (Fylde)
Bottomley, Mrs VirginiaGarel-Jones, Tristan
Bowden, Gerald (Dulwich)Glyn, Dr Alan
Boyson, Dr RhodesGoodhart, Sir Philip
Braine, Rt Hon Sir BernardGoodlad, Alastair
Bright, GrahamGow, Ian
Brinton, TimGower, Sir Raymond
Brooke, Hon PeterGrant, Sir Anthony
Brown, M. (Brigg & Cl'thpes)Greenway, Harry
Bryan, Sir PaulGregory, Conal
Buchanan-Smith, Rt Hon A.Griffiths, Peter (Portsm'th N)
Buck, Sir AntonyGrylls, Michael
Budgen, NickGummer, Rt Hon John S
Bulmer, EsmondHamilton, Neil (Tatton)
Burt, AlistairHampson, Dr Keith
Butcher, JohnHannam, John
Butler, Rt Hon Sir AdamHargreaves, Kenneth
Butterfill, JohnHarris, David
Carlisle, John (Luton N)Haselhurst, Alan
Carlisle, Rt Hon M. (W'ton S)Havers, Rt Hon Sir Michael
Carttiss, MichaelHawkins, C. (High Peak)
Cash, WilliamHawkins, Sir Paul (N'folk SW)
Chalker, Mrs LyndaHawksley, Warren
Chapman, SydneyHayes, J.
Chope, ChristopherHayhoe, Rt Hon Barney
Churchill, W. S.Hayward, Robert
Clark, Dr Michael (Rochford)Heathcoat-Amory, David
Clark, Sir W. (Croydon S)Heddle, John
Clarke, Rt Hon K. (Rushcliffe)Hickmet, Richard
Clegg, Sir WalterHiggins, Rt Hon Terence L.
Colvin, MichaelHill, James
Coombs, SimonHind, Kenneth
Cope, JohnHirst, Michael
Corrie, JohnHogg, Hon Douglas (Gr'th'm)
Couchman, JamesHolland, Sir Philip (Gedling)
Critchley, JulianHordern, Sir Peter
Howard, MichaelNicholls, Patrick
Howarth, Alan (Stratf'd-on-A)Onslow, Cranley
Howarth, Gerald (Cannock)Oppenheim, Phillip
Howell, Ralph (Norfolk, N)Oppenheim, Rt Hon Mrs S.
Jenkin, Rt Hon PatrickOsborn, Sir John
Jessel, TobyOttaway, Richard
Johnson Smith, Sir GeoffreyPage, Sir John (Harrow W)
Jones, Gwilym (Cardiff N)Page, Richard (Herts SW)
Jones, Robert (Herts W)Parkinson, Rt Hon Cecil
Jopling, Rt Hon MichaelPatten, Christopher (Bath)
Kellett-Bowman, Mrs ElainePatten, J. (Oxf W & Abgdn)
Kershaw, Sir AnthonyPattie, Geoffrey
Key, RobertPawsey, James
King, Roger (B'ham N'field)Percival, Rt Hon Sir Ian
King, Rt Hon TomPollock, Alexander
Knight, Greg (Derby N)Porter, Barry
Knight, Dame Jill (Edgbaston)Portillo, Michael
Knowles, MichaelPowley, John
Lang, IanPrentice, Rt Hon Reg
Lawler, GeoffreyPrice, Sir David
Lawrence, IvanProctor, K. Harvey
Lee, John (Pendle)Raffan, Keith
Leigh, Edward (Gainsbor'gh)Rhodes James, Robert
Lennox-Boyd, Hon MarkRidley, Rt Hon Nicholas
Lewis, Sir Kenneth (Stamf'd)Ridsdale, Sir Julian
Lightbown, DavidRifkind, Rt Hon Malcolm
Lilley, PeterRoe, Mrs Marion
Lloyd, Peter (Fareham)Rossi, Sir Hugh
Lord, MichaelRost, Peter
Luce, Rt Hon RichardSainsbury, Hon Timothy
Lyell, NicholasSims, Roger
McCurley, Mrs AnnaSkeet, Sir Trevor
Macfarlane, NeilSmith, Sir Dudley (Warwick)
MacKay, Andrew (Berkshire)Smith, Tim (Beaconsfield)
MacKay, John (Argyll & Bute)Soames, Hon Nicholas
Maclean, David JohnSpeller, Tony
McLoughlin, PatrickStern, Michael
McNair-Wilson, M. (N'bury)Stewart, Andrew (Sherwood)
Madel, DavidTaylor, John (Solihull)
Major, JohnThatcher, Rt Hon Mrs M.
Malins, HumfreyThompson, Donald (Calder V)
Malone, GeraldThompson, Patrick (N'ich N)
Maples, JohnThorne, Neil (Ilford S)
Marland, PaulThurnham, Peter
Marshall, Michael (Arundel)Townsend, Cyril D. (B'heath)
Mates, MichaelViggers, Peter
Mather, CarolWakeham, Rt Hon John
Maude, Hon FrancisWalker, Bill (T'side N)
Mawhinney, Dr BrianWall, Sir Patrick
Mayhew, Sir PatrickWardle, C. (Bexhill)
Merchant, PiersWatts, John
Miller, Hal (B'grove)Wells, Sir John (Maidstone)
Miscampbell, NormanWheeler, John
Moate, RogerWiggin, Jerry
Montgomery, Sir FergusWood, Timothy
Moynihan, Hon C.Young, Sir George (Acton)
Murphy, Christopher
Neale, GerrardTellers for the Ayes:
Needham, RichardMr. Tony Durant and
Newton, TonyMr. Michael Neubert.
NOES
Alton, DavidBoyes, Roland
Anderson, DonaldBrown, Gordon (D'f'mline E)
Archer, Rt Hon PeterBrown, N. (N'c'tle-u-Tyne E)
Ashdown, PaddyBuchan, Norman
Ashley, Rt Hon JackCaborn, Richard
Ashton, JoeCallaghan, Jim (Heyw'd & M)
Atkinson, N. (Tottenham)Campbell-Savours, Dale
Banks, Tony (Newham NW)Carter-Jones, Lewis
Barnett, GuyCartwright, John
Barron, KevinClark, Dr David (S Shields)
Beckett, Mrs MargaretClarke, Thomas
Beith, A. J.Clay, Robert
Bell, StuartClelland, David Gordon
Benn, Rt Hon TonyClwyd, Mrs Ann
Bennett, A. (Dent'n & Red'sh)Cohen, Harry
Bermingham, GeraldColeman, Donald
Blair, AnthonyCook, Robin F. (Livingston)
Boothroyd, Miss BettyCorbett, Robin
Corbyn, JeremyMadden, Max
Craigen, J. M.Marek, Dr John
Crowther, StanMarshall, David (Shettleston)
Cunliffe, LawrenceMartin, Michael
Dalyell, TamMaynard, Miss Joan
Davies, Rt Hon Denzil (L'lli)Meacher, Michael
Davis, Terry (B'ham, H'ge H'l)Meadowcroft, Michael
Deakins, EricMichie, William
Dewar, DonaldMikardo, Ian
Dixon, DonaldMillan, Rt Hon Bruce
Dobson, FrankMorris, Rt Hon A. (W'shawe)
Dormand, JackMorris, Rt Hon J. (Aberavon)
Dubs, AlfredNellist, David
Duffy, A. E. P.Oakes, Rt Hon Gordon
Dunwoody, Hon Mrs G.O'Brien, William
Eadie, AlexO'Neill, Martin
Eastham, KenOrme, Rt Hon Stanley
Edwards, Bob (W'h'mpt'n SE)Owen, Rt Hon Dr David
Evans, John (St. Helens N)Park, George
Ewing, HarryPatchett, Terry
Fatchett, DerekPavitt, Laurie
Field, Frank (Birkenhead)Pendry, Tom
Fields, T. (L'pool Broad Gn)Pike, Peter
Fisher, MarkPowell, Raymond (Ogmore)
Flannery, MartinRadice, Giles
Foot, Rt Hon MichaelRandall, Stuart
Forrester, JohnRaynsford, Nick
Foster, DerekRedmond, Martin
Freeson, Rt Hon ReginaldRichardson, Ms Jo
Garrett, W. E.Roberts, Ernest (Hackney N)
Gilbert, Rt Hon Dr JohnRobinson, G. (Coventry NW)
Godman, Dr NormanRogers, Allan
Golding, Mrs LlinRooker, J. W.
Gould, BryanRoss, Ernest (Dundee W)
Gourlay, HarryRoss, Stephen (Isle of Wight)
Hamilton, W. W. (Fife Central)Rowlands, Ted
Hancock, MichaelSedgemore, Brian
Hardy, PeterShore, Rt Hon Peter
Harman, Ms HarrietShort, Ms Clare (Ladywood)
Harrison, Rt Hon WalterShort, Mrs R.(W'hampt'n NE)
Hart, Rt Hon Dame JudithSilkin, Rt Hon J.
Hattersley, Rt Hon RoySkinner, Dennis
Heffer, Eric S.Smith, Rt Hon J. (M'ds E)
Hogg, N. (C'nauld & Kilsyth)Snape, Peter
Holland, Stuart (Vauxhall)Soley, Clive
Home Robertson, JohnSpearing, Nigel
Hoyle, DouglasStewart, Rt Hon D. (W Isles)
Hughes, Dr Mark (Durham)Stott, Roger
Hughes, Robert (Aberdeen N)Strang, Gavin
Hughes, Roy (Newport East)Straw, Jack
Hughes, Simon (Southwark)Thomas, Dafydd (Merioneth)
Janner, Hon GrevilleThomas, Dr R. (Carmarthen)
John, BrynmorThompson, J. (Wansbeck)
Johnston, Sir RussellThorne, Stan (Preston)
Jones, Barry (Alyn & Deeside)Tinn, James
Kaufman, Rt Hon GeraldTorney, Tom
Kirkwood, ArchyWardell, Gareth (Gower)
Lambie, DavidWareing, Robert
Leadbitter, TedWeetch, Ken
Leighton, RonaldWelsh, Michael
Lewis, Terence (Worsley)Wigley, Dafydd
Livsey, RichardWilliams, Rt Hon A.
Lloyd, Tony (Stretford)Wilson, Gordon
Lofthouse, GeoffreyWinnick, David
Loyden, EdwardWoodall, Alec
McDonald, Dr OonaghWrigglesworth, Ian
McKay, Allen (Penistone)Young, David (Bolton SE)
McKelvey, William
MacKenzie, Rt Hon GregorTellers for the Noes:
McTaggart, RobertMr. Ron Davies and
McWilliam, JohnMr. James Hamilton.

Question accordingly agreed to.

Lords amendment accordingly disagreed to.

Subsequent Lords amendments agreed to, some Special Entry.