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Second Reading

Part of Welfare Reform and Work Bill – in the House of Lords at 8:57 pm on 17th November 2015.

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Photo of Baroness Andrews Baroness Andrews Deputy Chairman of Committees 8:57 pm, 17th November 2015

My Lords, it is a pleasure to follow the right reverend Prelate the Bishop of Durham, even if he has made most of my speech for me—although I can hardly complain about that. I shall try to add a few points that he did not mention.

This is a very regressive Bill that plays fast and loose with language and is based on a series of false premises. The basic tenets of the Bill have already been demolished by my noble friend Lady Hollis and the cumulative impact exposed by my noble friends Lady Sherlock and Lady Lister, the latter of whom also offered the House an alternative and rather more accurate title for the Bill.

I will confine myself to two broad points. The whole tone of the Bill is based on the assumption that if we call poverty by other names or measure it in other ways it will go away. In fact, as has been systematically demonstrated this evening, the Bill cuts the incomes of the poorest, and the working poor in particular. It puts children inevitably at the greatest risk. It prejudices family life and threatens the most vulnerable. It is a prospectus for greater poverty and greater inequality. It is a deliberate policy choice by this Government.

Clauses 1 to 7, which eradicate the poverty targets, are a very simple solution to the problem—they aim not to abolish poverty itself but simply the targets in the framework that has enabled successive Governments to examine, understand, chart and attack poverty. As we have heard many times already, the targets would be replaced by a set of life chances. It is a solution worthy of Kafka. The Government, as we have heard, are virtually alone in defending this. My own figures—perhaps the Minister can confirm this—say that 97% of respondents to the consultation on the new measures believe that the targets under the Child Poverty Act should be retained; a mere 3% disagreed. Can the Minister in winding up tell us who constituted the 3%? It would be quite interesting to know who agreed with him.

The reasons for the abolition are pretty unsubtle. Those income measures tell a graphic story of failure: half a million more children will be in absolute poverty after 2016 and a likely 4.7 million will be in absolute poverty by 2020. Clearly, income is no longer an indication, let alone a determinant, of poverty, because the Government decree it so. I find it astonishing that this can be defended with any integrity or logic, yet we know that the Minister is a man of great intelligence and integrity. Instead of robust, independent targets that will impose on the Government reporting requirements and accountability for troubled families, worklessness and educational achievement—these are the substitutes for the hard measures of income poverty. They are not, as they have been described by the Minister in another place, measures of poverty. They are not the root causes of poverty. Research shows that they are more likely to be the outcomes of poverty. There is a mass of evidence showing the proven link between poverty and educational failure, and much of the other indicators. If the Government were serious about the root causes of poverty, they can do something very simple: keep the income measures in place, add them to the new measures of life chances, explore the relationship between them and devise policies to attack them.

When I think about what the Government are trying to do by redefining poverty, I think of a young man I heard about last week. He is a student who was unable to go to school because he had only one shirt. When it was washed he had to wait for it to dry, but there was no money for the meter, so he missed school.

That is what poverty means: it means having no money for the meter, not having a spare shirt or a spare pair of shoes. That young man possibly came from a troubled family, and it would be good to measure his educational achievement and his social mobility, although it would take years and involve sophisticated methodologies. The point is, by dismantling the full picture of the impact of policies on incomes of families in and out of work, we cannot equip ourselves to understand or frame the policies that have the greatest effect, let alone eradicate material poverty.

One of the most disingenuous aspects of this part of the Bill is that the new measures proposed are at most half measures. The most egregious gap is that there is no measure for the poverty of families in work—those families attacked by the attempted tax credit changes. Another is that there is no reference or target for measuring the cost of housing on families, at a time when working families are being priced out of the private rented sector. Will the Minister explain why these measures do not take into account those two most fundamental aspects of family costs?

That brings me to the second area: housing. As we have heard, Clause 21 introduces a 1% reduction to social housing rents for each of four years, beginning in April 2016. It looks like a sensible step and has been cautiously welcomed. What are not welcome are the perverse consequences. The predicted loss of income to housing associations is £3.85 billion. The Office for Budget Responsibility has estimated a loss of 14,000 homes; the National Housing Federation, 27,000. Which of these figures does the Minister agree with, or does he have an alternative figure? There is only one way to compensate for this: maintain funding for the affordable homes programme. Will he give us that assurance?

As we have heard, some of the most vulnerable people in society will be badly hurt by these reductions in rent. These are people in supported housing, people who need shelter from domestic abuse, people who would otherwise be on the streets. It is the most expensive form of housing support. It carries high rents. As the noble Baroness, Lady Greengross, said, housing associations are already cutting back on their plans. It is such a false economy. Supported housing is estimated to save the country about £640 million a year. In 10 years’ time the shortfall, if these plans go ahead, will be 46,000 homes. The only certain prognosis is a massive increase in homelessness and greater cost to the NHS. This is yet another example of the dysfunctional disconnect between housing and health policy. The Bill has already been amended in the House of Commons to allow for some limited exemptions. I urge the Minister to do what many of the agencies that really know what they are talking about are asking him to do and introduce an amendment for the whole of the supported housing sector. That is the only thing that we can do to guarantee viability.

Finally, I come back to a very significant point about young people. The Government announced in the Budget that 18 to 21 year-olds making a new claim for universal credit will not be automatically entitled to support with their housing costs. As yet, the details are unclear, as is the process of implementation, but there is widespread concern that many young people may not fall into a protected category. Already, 8% of 16 to 24 year-olds report homelessness. The last thing we want is more young people recruited on to the streets. Will the Minister give us an assurance this evening that he will provide the list of exemptions that takes into account all the reasons that young people may need support with their housing costs, and that this will be the subject of wide consultation before any regulations are brought forward?

In conclusion, in his foreword to the Cabinet Office briefing on the Bill, the Prime Minister said that the Bill was designed to champion social justice. We on this side of the House have a better idea of what social justice means. It does not mean cutting benefits. It does not mean removing a guaranteed framework so that you know how many people are in poverty and whether those figures are going up or down. It means being fair and introducing policies that really support families and the most vulnerable in our society.