[Hugh Bayley in the Chair] — Housing (Greater London)

Part of the debate – in Westminster Hall at 9:30 am on 11th November 2008.

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Photo of Jeremy Corbyn Jeremy Corbyn Labour, Islington North 9:30 am, 11th November 2008

I thank the hon. Gentleman for that intervention. We must deal with housing benefit with great care. First, I should state that I support the housing benefit system in the sense that it gives people the right, when they are on income support, jobseeker's allowance or a basic state pension to receive support for their housing costs. I do not want to take that away from anybody.

However, I have a problem because, in effect, the local housing market is maintained by the housing benefit system, through which high rents are paid. That maintains what somebody decides is the market level and the problem goes on. The cost to the public is phenomenal. A few weeks ago, a family came to me who were living in a small, former council house. The rent was £420 a week. The house next door is still owned by the local authority and the local authority tenants were paying a rent of something like £100 or £120 a week. In other words, there is a £300 gap, which goes to somebody who bought the council place on a discount some years ago. Owners of former council houses can live off that money quite easily because their mortgage is probably small—or perhaps they do not have a mortgage. They can live off one property and we, the public, are paying the difference. We, the public, are paying a phenomenal amount of money to keep somebody in temporary accommodation, which normally involves a six-month contract. In the case I have mentioned, the property was in a reasonable condition, but often the conditions in which people live are appalling.

I am not given to quoting the Evening Standard; indeed, in many ways, I do not have a huge regard for the paper. However, yesterday it provided an interesting breakdown of housing benefit costs across London. The article states that they amount to £4,151 million—in other words, £4 billion a year is spent on housing benefit in London. As I have said, I have no problem with people receiving housing benefit. However, if we break down the figures further, the average cost created by people in private rented accommodation who receive housing benefit compared with those in social rented accommodation is more than double. We are subsidising a private rented system and something has to be done about that. I reiterate that I am not in favour of taking the right to housing benefit away from people and I am not in favour of red-lining. However, I am in favour of examining the problem. We must consider putting in place rent controls across London or the country, as the Labour Government of the 1970s did to deal with a similar housing crisis. We must be prepared to be bold in dealing with the problem.