Skip to main content

Inherited Social Housing Tenancies

Volume 578: debated on Monday 24 March 2014

Before I call the hon. Member for Rhondda (Chris Bryant), to ask his urgent question I would emphasise to the House that its terms are narrow. It relates specifically to the question of inherited tenancies and the treatment thereof. I am sure the House had not been planning on a Second Reading-style debate on the merits or otherwise of the spare room subsidy/bedroom tax, but that is not the subject matter. It is a narrow matter and will be treated accordingly, and we are, of course, time-constrained.

(Urgent Question): To ask the Secretary of State for Work and Pensions if he will make a statement regarding the exemption of those who have inherited social housing tenancies from paying the under-occupancy charge.

The issue raised by the hon. Member for Rhondda (Chris Bryant) is not a new matter, but is part of the 1996 provisions which impacted on the spare room subsidy legislation 2012, and which we have debated in the House before. Upon investigation early in the year, it would appear that some claimants have been unintentionally protected from the effects of the removal of the spare room subsidy, including those who have been in receipt of continuous housing benefit since 1 January 1996 and who have lived in the same property since that date unless the move was due to natural disaster such as fire and flood. There is a grace period of four weeks, or 52 weeks if the claimant or their partner is a welfare to work beneficiary. For example, housing benefit would be classed as continuous if the break is fewer than four weeks, or 52 weeks for a welfare to work beneficiary. Where a claimant dies, the partner or an adult child can inherit the protection, but it must be in respect of the same dwelling and they must qualify for housing benefit.

The issue of the inheritance of housing benefit has always formed part of the understanding of what the loophole meant, and this was part of the guidance issued to local authorities a few weeks ago. The loophole derives from a very narrow but complex set of regulations dating back to 1 January 1996, when the local reference rent rules were introduced. In January 1996, transitional protection was offered to existing claimants, which could, and still can, be inherited if the claimant dies: for example, by a partner or, where there is no partner, by an adult child. The protection applies only in respect of the same dwelling—therefore, partners or adult children must continue to live in that property—and only if they qualify for housing benefit. This protection ends if housing benefit ceased or they moved address.

With hindsight, the protection offered by the regulations could have been time limited. Because it was not, it has lain dormant for 17 years, the effect being that it has now unintentionally been applied to a group of people who were not financially affected by the local reference rent rules. During February’s debate, my right hon. Friend the Member for Hitchin and Harpenden (Mr Lilley), who was Secretary of State at the time the regulations were introduced, clearly stated that this exemption was never intended to come into force.

This matter was fully debated, and voted on, on 26 February 2014, to approve amended regulations to close the loophole. Clearly, the House has already spoken on this issue, and guidance was sent out a few weeks ago to inform local authorities. I am pleased to announce that most local authorities are following that guidance and delivering this policy.

That was all very interesting but not to the point, because this is actually about inherited social housing tenancies. The Minister just said that this only applied to the partner or the adult child of somebody who had been holding the tenancy, but in her advice to local authorities of January this year, she included the following highly ambiguous footnote:

“it may be the case”—

only may—

“that the transitional protection has been inherited by a claimant and if so they should be treated the same.”

Yet a separate e-mail from the Department for Work and Pensions includes

“any member of the claimant’s family”

and says,

“if the claimant is a member of a polygamous marriage”—

I am not making this up; this is actually what the Minister has written—

“any partners of his and any child or young person for whom he or a partner is responsible”,

a much bigger number, would be included.

In what circumstances does a tenant inherit the right to be exempted? Does that apply to any member of the claimant’s family or specifically just a partner, as the Minister referred to? How many people does that apply to now? What is the total cost of repayments of these illegal charges? How many people who have received refunds for being wrongly charged the bedroom tax have also received discretionary housing payments, and will they have to pay them back? The DWP advice suggests that in assessing whether someone is exempted, local authorities should

“err on the side of caution”.

What on earth does that mean: err on the side of caution to exempt, or not to exempt?

The bedroom tax always had the air of a policy dreamt up in an ivory tower. I know the Minister would love to put this sorry saga behind her, but she should know that before absolution there always has to be confession. So will she now confess that the bedroom tax has been a fiasco from the beginning, that the figures she has given the House were simply plucked out of the air, and that far more than 5,000 people will be affected? Should she not just repeal the bedroom tax? Because if she won’t, we will.

It is clear that the hon. Gentleman was not listening to the statement that I made and did not understand what the inheritance was or what he was voting for on 26 February. Obviously, we do not necessarily want to have to put this policy in place. It is something that we are having to deliver—

No. It is something we are having to deliver because of what we inherited from the previous Government, including a benefit, the cost of which had doubled in 10 years, and a policy that had left nearly 2 million people on housing waiting lists and 400,000 in overcrowded houses. It was a skewed policy under which people living in private rented accommodation could have their spare room subsidy removed but people who lived in the social rented sector could not. And as for people giving out wrong numbers, I would remind the hon. Gentleman that, when he plucked numbers from the air in the last debate, St Helens said that he had got his numbers wrong. Now, in response to his citing a figure of 2,100 cases, Birmingham has put up on its website this statement:

“We haven’t finished identifying them at Birmingham so can’t give you an exact number, but the number of possible cases has dropped substantially below the 2,100 that was reported in the papers”.

We have trebled the discretionary housing payments. We have also said that we will cover the differences involved for people who are exempt and that we will help local authorities with the administration charges. We have answered these points and we have voted on them. I suggest that the hon. Gentleman look again at the debate we had on 26 February.

The number so far, on best records, is about 5,000. However, the cases are having to be manually checked at the moment, because of a change of computer system, and everybody is going through that. Also, a person has to be in continuous receipt of housing benefit and has to have lived in the same home since 1996.

I know that the Minister can see Wales from her constituency, but has she discussed the matter with the relevant Welsh Assembly Minister? Can she tell me today how many properties and individuals in Wales are affected, and what will happen if any of those individuals have been wrongly charged?

We are looking through all that at the moment, and anyone who can prove that they are covered by this loophole is of course getting that funding back. That is what we have said people should do, as well as paying towards the administrative charges.

Is it not a fact that we inherited more than 1,000 pages of regulations on housing benefit and that there would inevitably be some lacunae while we sought to simplify the system? The real question, which still has not been answered, is why Labour wants to treat people on housing benefit in the social rented sector differently from those on housing benefit in the private rented sector. We still have not had an explanation for that.

My right hon. Friend is quite right. At the moment, the Opposition say that they would like there to be a difference between the people in the private sector and those in the social rented sector. Actually, they had had discussions about introducing this policy too, so they were going to align the policies and do exactly the same as we have done. The only question that they have never asked, as they have sought to reverse what is happening in the social rented sector, is this: should there be a legal challenge by those in the private rented sector against whom they were discriminating, would they reverse the rules for those people too, so as to have fairness and equality for everyone?

Scottish ministers have written to Lord Freud five times since January regarding discretionary housing payments, including for those with transitional tenancies, but they have yet to receive a reply. The Deputy First Minister will be in London on Wednesday. Will Ministers from the Department for Work and Pensions commit to meeting her to discuss these issues and will she give me that commitment today?

I know that the Secretary of State is in discussions with the Deputy First Minister, and obviously we will do the right thing and speak with her.

Given that we are talking about inherited social housing tenancies, may I urge the Minister to stick to her guns to ensure that the welfare state is about being a safety net for people in need and that it is rebalanced to make sure that it is just as fair for taxpayers as it is for people claiming benefits? May I also give some free advice to the Opposition? Given their lamentable response to the Budget last week, they need to do better than to keep flogging this particular dead horse.

As my hon. Friend knows, we are ensuring that welfare works and we have a benefits system that works for the 21st century. We know that we are reaping rewards from that: the number of people living in workless households has fallen; the number of people in employment is at a record level; and youth unemployment has fallen for six consecutive months. What the Government are doing is correct, and in the future the Opposition will no doubt follow.

The Minister has said that we do not yet know the number of people affected by this. Given that she has said that each case has to be individually checked and that this mess is hers, will her Department be paying for these checks?

Is not the crux of the problem that far too many families are waiting for social homes, that there is too much overcrowding in our social housing and that more than 400,000 houses were lost under the previous Government? Is not the answer to build more social housing for everyone who needs it?

My hon. Friend is correct; we have to look at those on housing waiting lists and those in overcrowded accommodation, not that the Opposition seem to care about those people. We have committed to £4.5 billion of spending to ensure that we have another 177,000 social homes by 2015.

The Minister has accepted that because of the Government’s cock-up, local authorities are having to do a great deal of extra work, and she said that they will have more money. How much more money will they have?

We will be covering the costs—that is what we will be doing. So when we receive that, we will have it, just as we trebled discretionary housing payments to support people and just as we did when we put in an extra £20 million to support local authorities, which, in fact, they did not need—they needed only £13 million. We have been supporting them all the way.

Given that nearly 400,000 families in the social housing sector are overcrowded, can the Minister think of a single reason why any individual should be allowed to under-occupy simply because their tenancy is inherited?

My hon. Friend is right; no, I cannot. It is only when we meet people who are living in overcrowded accommodation, or who are on a waiting list with their children, and we look at the conditions they are living in, that we realise what a lamentable mess we had been left with and how we have to clear it up. How can we justify 1 million spare rooms when other people are sometimes crammed together in a room? So my hon. Friend is correct in what she says.

As the Minister has been able to expand on a possible policy area, I would point out that nobody in the private rented sector was ever expected to find £14 or £28 out of their pocket, each week, retrospectively. The Office for Budget Responsibility has said that housing benefit spend will continue to rise. Has the additional spending from this loophole been factored into that, or is that going to be another increase that is not in this Government’s forecast?

The money is obviously in the forecast; I mentioned that we put £20 million in place for local authorities but they did not need it—they needed only £13 million—and so that will come into play. As I also said, we all need to get the housing issues for people across the country right, and we are dealing with them in a way that is fair and proportionate.

I was surprised to read today in my local paper, The Oxford Times, that Oxford city council has spent only two thirds of its discretionary housing funds for 2013-14, leaving £200,000 meant for the most vulnerable unspent. May I therefore ask for the Minister’s guidance on how this fund can be better applied to inherited social housing tenancies and others?

An exceptionally interesting question, but its relationship with the urgent question tabled is, to put it kindly, tangential. However, let us hear the Minister as the product of her grey cells may prove me wrong.

My hon. Friend is right that there are quite a few local authorities that have not spent the full amount, and it is that money that can be utilised here for those who have inherited a house or a property in that way. This is what the money is there for.

A few moments ago, the Minister described this policy as “reaping rewards”. The people who are victims of the bedroom tax fiasco in my constituency would not consider that they are reaping rewards. Does she have any idea of how out of touch those on the Government Benches sound when they stand up at the Dispatch Box and tell my constituents, who have been plunged into poverty by their actions, that they are reaping rewards?

Unfortunately, the thing that Opposition Members never did was to look at this issue in the round, in the full 360°, including looking at those living in overcrowded accommodation and those on waiting lists. Yes, there are people who want to remain in their houses, and that is why discretionary housing payments have been made. Equally, there is support for people to move and to house swap. Many people have said to me, “Actually, downsizing is something that we should have done a lot earlier. We never did that, and by downsizing we have a house in which our bills are cheaper and the cost of keeping it tidy is cheaper. In fact, everything is cheaper. We can now live within our means, which is something that we never did before.” We can help people in many different ways.

Does the Minister agree that it is ironic that on the day that the Opposition claim that they want to cap welfare spending, they are yet again in this House demanding to spend more and borrow more?

If there is one thing that is clear, it is the sheer deficiency of the Opposition. They really do not know what to do with any of the benefit changes. Each time I pick up a newspaper, I read about something that they are doing or not doing, were thinking of doing or of reversing. If they have spent that tax once, they have spent it 20 times.

Has the Minister made any assessment of how much time local authorities, such as my own in Blackpool, will have to spend clearing up this mess, which the right hon. Member for Banbury (Sir Tony Baldry) charitably referred to as “her lacuna”?

Does the hon. Gentleman know how much time local authorities spend trying to find houses for people who are either on a housing waiting list or in overcrowded housing when houses have not been freed up? We have said that we will pay for any extra administrative charges. What we now need to do is move this debate on and think about the families and the individuals who need to live in accommodation that suits their purposes.

Will the Minister write to me to tell me how many people in the metropolitan borough of Tameside are affected by the change? From the intimations given to the House so far, identifying these people sounds like quite a time-consuming process. What cost has she estimated to her Department of this announcement today?

I fear that I have answered this question many times, but people keep coming back to it. We know that a very small proportion of people will be affected by this. When the administrative work has been done and costed, we will provide the funds. That is something we will work on.