HC Deb 19 July 1984 vol 64 cc531-71 4.38 pm
The Minister for Social Security (Dr. Rhodes Boyson)

I beg to move, That the draft Housing Benefits (Increase of Needs Allowances) Regulations 1984, which were laid before this House on 6th July, be approved. I hope that it will be for the convenience of the House if, in dealing with these regulations, I also mention the prayers on housing standing in the name of the Leader of the Opposition: That an humble Address be presented to Her Majesty, praying that the Housing Benefits (Miscellaneous Amendments) Regulations 1984 (S.I., 1984, No. 941), dated 5th July 1984, a copy of which was laid before this House on 6th July, be annulled. That an humble Address be presented to Her Majesty, praying that the Housing Benefits Amendment (No. 3) Regulations 1984 (S.I., 1984, No. 940), dated 3rd July 1984, a copy of which was laid before this House on 6th July, be annulled. That an humble Address be presented to Her Majesty, praying that the Housing Benefits (Subsidy) Amendment Order 1984 (S.I., 1984, No. 1001), dated 17th July 1984, a copy of which was laid before this House on 17th July, be annulled.

Mr. Deputy Speaker

If that is the wish of the House.

Dr. Boyson

Four separate statutory instruments dealing with housing benefits are covered in this debate. The first two of these—the Housing Benefits (Increase of Needs Allowances) Regulations and the Housing Benefits (Miscellaneous Amendments) Regulations—are concerned with uprating. The Housing Benefits (Increase of Needs Allowances) Regulations put into effect the Government's proposals for increasing the needs allowances which were set out in the statement which my right hon. Friend the Secretary of State made to the House on 18 June. With the exception of the needs allowance addition for a dependent child, which I shall come to shortly, the needs allowances are to be increased by the usual formula—by 4.8 per cent. The needs allowance for a dependent child will be raised by 50p more than is required to maintain its value and as my right hon. Friend made clear in his statement on 6 February, we also propose, and regulations will be brought forward later, to give a further increase of £1 from April 1985. That will mean an overall rise of over 16 per cent. since November 1983, a real help to low income families with children.

The old and new rates of all of the amounts are set out in the Housing Benefits (Miscellaneous Amendments) Regulations and will apply from November. In all cases, they have been uprated in line with the traditional formulae and in one case by significantly more. We are providing for the total disregard, in the calculation of housing benefit, of any living away from home allowance paid by the Manpower Services Commission. This allowance is currently £40 per week and, at present, the amount that is ignored is £15. This is a considerable improvement which will help all those who have to live away from home while attending training courses run by the commission.

I should also mention the principal earner's disregard. This is the amount of the claimant's earnings that is ignored when calculating entitlement to standard housing benefit. The disregard is intended to take account of the extra expenses of going to work, such as income tax, national insurance and fares. It is calculated in such a way that those work expenses are exactly covered at the point where a person's income net of those expenses equals the single person's needs allowance. The traditional formula produces a new rate of .17 as opposed to the current rate of £17.45. The formula works both ways. In 1981, when tax allowances were not increased, the disregard leapt from £9.60 to £15.25. The reduction this year is due to the fact that personal tax allowances were increased ahead of inflation in the last Budget. I want to make it clear that this does not mean that wage earners on housing benefit will receive 45p less in benefit. Because of the way in which housing benefit is calculated, for most wage-earners the effect on benefit will be in the range of 4p to 17p and this will in all cases be far outweighed by the increases in the needs allowances. All wage earners will therefore get more benefit at the 1984 uprating, on top of the higher personal tax allowances which have also been in effect since April.

The main changes in the Housing Benefit Amendment (No. 3) Regulations are the second phase of the package of measures that was previously announced to restrain the rate of growth of the social security budget. The House has had several debates on these issues. The first stage took effect in April and the second stage measures will come into effect in November.

I should like to put those proposals in perspective. The cost of the social security programme has risen constantly recently. It will be about £39 billion in 1985–86—nearly 30 per cent. of total public expenditure. Despite the financial constraints of recent times we have maintained all of the key elements of social security and we are spending 27 per cent. more in real terms than when we first came into office in 1979. This vast and growing programme cannot be exempt from restraint. It must be kept within overall expenditure targets if our economic strategy is to continue to bear fruit. [Laughter.] There will be little laughter if we discuss the rate of inflation under the Labour Government. I might be forced to remind Opposition Members what happened.

Mr. Charles Kennedy (Ross, Cromarty and Skye)

In view of the Minister's proud boast that the Government are spending 27 per cent. more in real terms, will he say how much that calculation is affected by the simple fact that, as a result of what the Minister regards as the success of Government policies, so many more people are either unemployed or entirely dependent on the state because they are denied the right to provide their own means as they do not have a job? How much does the huge increase in the number of unemployed people account for the percentage increase that the Minister has claimed for benefits?

Dr. Boyson

I am grateful to the hon. Gentleman for raising that point. I hoped that somebody would. That issue was raised in our debate on poverty and wealth about three weeks ago and I gave a calculation which I worked out at the Dispatch Box. I now have the figures. Spending on social security since 1979 has increased in real terms by £7.7 billion. Of that, £1 billion goes on the extra 650,000 pensioners as compared with when we came into office and £3.25 billion is due to the higher number of the unemployed. If we add those figures, we find that the Government have still spent an extra £3 billion in real terms on social security since coming into office. I thank the hon. Gentleman for raising that point. I hoped that somebody would.

We must avoid a return to high inflation rates, which are disastrous for business and industry.

Mr. Brynmor John (Pontypridd)

Does the £3.25 billion increase arise because of the level of long-term unemployment and the additional people who receive supplementary benefit?

Dr. Boyson

I shall write to the hon. Gentleman tomorrow if I am wrong — but I am usually right. [Interruption.] I am surprised that Opposition Members ask questions if they do not believe the answers. I am glad that the scepticism of my right hon. and hon. Friends is not as intense. The £3.25 billion is for the unemployed, whether they receive unemployment pay or supplementary benefit. The Government still now spend between £3 billion and £3.5 billion more in real terms on social security than did the Labour Government. I am grateful to Opposition Members for giving me the opportunity to stress that point.

Mrs. Margaret Beckett (Derby, South)

Perhaps the Minister would like to put something else on the record. According to my calculations for the period that he has quoted, about £50 billion has accrued to the Government from the North sea alone. He has been allowed £3 billion of that for what he describes as real increases in benefits. How much of the rest went on tax allowances for the wealthy?

Dr. Boyson

I shall not be drawn into matters that we discussed in our previous debate. On my calculations, North sea gas provides 5 per cent. at most of gross national product in any year. One hopes for a regular 5 per cent. per annum growth in economic production rather than dependence on the North sea. That is the Government's aim.

Mr. John Fraser (Norwood)

The hon. Gentleman talks about restraint of public subsidy, but does he understand that the rise in mortgage interest rates which was announced last Friday adds about £500 million to £600 million in a full year to the subsidy that the Treasury gives on mortgage interest relief for owner-occupiers? Why are the Government happy to bear that increase while they are reducing the subsidy for housing costs for people who rent rather than buy their homes?

Dr. Boyson

Time and again we ask the Opposition what their policy on mortgage interest relief is. Anyone who reads our debates would believe that mortgage interest relief finds no favour with Opposition Members, although it is popular with the mass of the population. I have the figures with me of the amounts——

Mr. John Fraser

Will the hon. Gentleman give way?

Dr. Boyson

The hon. Gentleman must listen. I have not reached the end of the sentence. The average amount given to each individual who receives housing benefits is higher in money terms than mortgage relief. About 7 million households are receiving housing benefits and about 7 million households receive mortgage relief. The sum spent on housing benefits is near £4 billion and the sum spent on mortgage relief is about £3 billion. So the amount of money paid for housing benefits is higher than that for mortgage relief.

Mr. Fraser

Will the Minister now answer my question?

Mr. Ralph Howell (Norfolk, North)

My hon. Friend says that 7 million people are receiving one sort of benefit and that 7 million people are receiving another. Is he aware that that covers about 75 per cent. of households? That ridiculous situation must be resolved. We are all handing money round to each other and the only people who do not benefit are those who have paid off their mortgages.

Dr. Boyson

I know that my hon. Friend has studied, and written on the problem for many years. I am aware that something has been published on social security almost every day for the past fortnight. Surveys are being conducted in the Department. I welcome my hon. Friend's observation. The proper targeting of social security is being debated all over the country. It is right that that should be done.

Mr. Michael Meacher (Oldham, West)

I was so enjoying the Minister's speech. Will he answer the question put to him by my hon. Friend the Member for Norwood (Mr. Fraser) and say how he justifies cutting housing benefit substantially in November for those on low incomes when those on high incomes will receive at a stroke £500 million to £600 million more from the increased mortgage interest relief?

The Minister boasts about the extra £3 billion in real terms in social security payments. Leaving aside the increased number of pensioners and payments to the greater number of unemployed, what are the three main components in that extra £3 billion of social security?

Dr. Boyson

I shall not give a list of the components of social security expenditure, otherwise there will not be enough time for hon. Members to contribute to the debate. I shall just reply on the question of mortgage interest relief.

I should be very surprised if a calculation could not be made — we shall have one made — to show that the proportion of mortgage interest relief under the Government of 1974–79 going to people who bought their houses was higher than the amount given in housing benefits at that time. Housing benefits have increased far more under this Government.

Mr. Meacher

The Minister is not answering the question that was asked.

Dr. Boyson

Perhaps not, but I am answering this question.

We have considered carefully where savings could be made. Only after considering all the available options did we conclude that housing benefit was the fairest and most reasonable area in which to make reductions. Although it is means-tested it goes to one in three households in Great Britain, including some on average incomes and above. That feature has been recognised by the Social Security Advisory Committee, which wrote in its report on the original housing benefit proposals arising from the autumn statement: There are some aspects of the housing benefit scheme which extend financial help further up the income ladder than anywhere else in the social security system and if cuts in social security spending are essential it might be reasonable to take resources from there rather than from the means-tested safety net.

The expenditure on and coverage of housing benefit has increased sharply over the past five to 10 years. Expenditure on standard benefit and its forerunner schemes has more than doubled in real terms in those years. When indexed for inflation, it rose from just over £500 million in 1972–73 to nearly £1,400 million in 1983–84.

Mr. John

Will the Minister give way?

Dr. Boyson

No, I shall not give way. I intend to give these figures to the House, although the hon. Gentleman may not like them.

The level of rebates as a percentage of earnings in the past five years has risen from 3.6 per cent. to 4.9 per cent. In that period, average rent rebates have increased in real terms from about £5.50 to more than £8 per house. Even though we have sold many council houses to their tenants, which is one of the successes of our Government, the number of council tenants in Great Britain receiving standard housing benefit has increased from 1.2 million in 1978–79 to 1.8 million last year. That shows how far the payments have escalated.

Mrs. Beckett

Will the Minister give way?

Dr. Boyson

I shall give way to the hon. Lady when I have made this point.

We now have an overall housing benefit scheme with more than 6.5 million recipients, costing nearly £4 billion. That means something over £3.50 a week per household. Clearly, some sensible degree of control is necessary, and would have been necessary whichever Government were in power.

The savings from the overall package are relatively modest, amounting to less than 5 per cent. of total housing benefit expenditure. We have designed the changes so that, as far as possible, they affect households with relatively high incomes and those with working non-dependants who can be expected to contribute more to housing costs. By modifying and phasing our original proposals, we have materially lessened the impact on individuals. I remind the House that no one on supplementary benefit or below the needs allowance will be affected by the November changes. We have protected the most vulnerable.

Mr. John

The hon. Gentleman complains that some people on and above average earnings are getting housing benefit. Does he not recognise that that is the result of the Rossi price index, which cut housing benefit and put it on to a different index from the general index of prices? Now the Minister complains about what his Government created.

Dr. Boyson

I was not complaining. I am sorry that the hon. Gentleman read that into my tone of voice. I was merely stating the position. We had to make a decision on that basis.

Mrs. Beckett

Can the Minister reconcile what he is saying about the extent to which benefit is paid, based on the income scale, with the answer that he gave me on 20 June setting out gross income levels at which rent rebates will no longer be payable? The answer did not include figures that even approach the level of average earnings. The Minister claims that benefit is payable in many circumstances to those with above-average incomes. Can he account for his differing replies?

Dr. Boyson

I gave the figures in the last debate on this matter. I shall turn them up later. I did not bring the figures with me today because I presumed that we were all well-read before the debate began. I thank the hon. Lady for showing me the figures at this stage, but I regret that I am unable to speak and read at the same time. I am sorry to disappoint the Opposition by not giving the figures.

Mr. Robin Squire (Hornchurch)

Before the Minister leaves housing benefits and the staggering figures that he has just announced for the scheme will he join me in hoping that the independent review that his right hon. Friend announced will produce recommendations for a streamlined scheme to reduce the cost of administering the complex system, which reaches many households? I hope that the system will be more understandable to those who benefit from it.

Dr. Boyson

I am grateful for my hon. Friend's remarks. I can only concur with his sentiments. He points to the reasons for the survey. I shall refer to the review later in this speech, if ever I get to that part.

The change contained in regulation 2(6) concerns the introduction of non-dependant deductions, or assumed contributions towards housing costs, for young people aged 16 to 17. The deductions are at the lower rate, which will stand in November at £3.30 per week overall.

The deduction recognises the reality in most households where help with housing expenses is expected from a working 16 or 17-year-old. Rather than making cuts right across the board, we thought it right to make some savings where the non-dependants could reasonably make a contribution. This proposal is not entirely new. A deduction for 16 to 17-year-olds has in one form or another been a well-established part of the supplementary benefit scheme, as operated under Labour Administrations, and was discontinued only with the introduction of the housing benefit scheme.

We believe that the amount of the assumed contribution is far from unreasonable. The average weekly wage of male 16 to 17-year-olds is expected to stand at over £67 in November, and for females in that age group it will be over £61. A contribution of up to £3.30 a week towards household costs in these circumstances is not, by any stretch of the imagination, excessive.

We have also taken steps to protect certain individuals. The deduction does not apply to 16 to 17-year-olds on supplementary benefit, on a youth training scheme or noncontributory invalidity pension.

The second proposal is to increase the rent taper above the needs allowance from 26 per cent. to 29 per cent. Viewed in another way, benefit will be reduced by 3p for every £1 of income above the needs allowance. Only the relatively better-off households will be affected, when their income exceeds the needs allowance. For pensioners, from this November, that will be over £10 above the basic retirement pension.

The third change concerns the weekly minimum amounts of benefit payable. The minimal of from 10p to 50p would be raised from 20p to 50p for rent rebates and allowances, and for rate rebates. Clearly it makes administrative sense to reduce the number of small payments so that local authorities can concentrate their effort on those needing more help. There will be no change in the minimum payments for poorest claimants—those with incomes below the needs allowances and those on supplementary benefit including housing benefit supplement. Again, we have ensured that the most vulnerable are covered. Minimum payments will remain at 20p for rent rebates and allowances and 10p for rate rebates. We had originally suggested increasing the rents minima to £1 last year but changed our view after consultation. The Social Security Advisory Committee accepted the fact that the minima were due for an increase because they had not been increased for many years.

Our original proposals for November also included a modification of the criteria for eligibility to the high-rent schemes that offer more generous rebates. Those schemes were originally, in 1972, meant for authorities with exceptionally high rents — 150 per cent. over the average for the country — but over the years the qualifying thresholds have been eroded. We felt that a change was overdue.

We therefore proposed to raise the current thresholds from 120 per cent. of average local authority rents and 115 per cent. of average private sector rents to a more realistic level of 130 per cent. in both cases. However, as hon. Members will recall, my right hon. Friend the Secretary of State undertook to consider with local authority associations how a limit on losses from the taper and high rent changes in November could be brought into effect.

Following discussions with the local authority associations to see whether a cut-off point was possible, we decided that the increases in the high-rent scheme thresholds, which were originally deferred from 1 April, should be deferred again from November this year until April 1985. About 90,000 households are covered by the high-rent scheme, of which more than half are pensioner households. The postponement of the change will limit the amount of benefit lost by those people who would otherwise have experienced the largest reduction in November, while avoiding administrative difficulties for local authorities.

We considered ways of limiting the maximum losses incurred by individuals. However, after consultation with the local authority associations we decided that that would be unacceptably complex and cumbersome. In the words of the Association of Metropolitan Authorities in a letter to us: the administrative burden that would have to be taken on by the local authorities would be in every sense disproportionate to the benefit to the individual claimant". Deferment of the high-rent scheme changes represents effective yet operationally simple protection. Thus, on the suggestion of the local authorities, we have delayed until April introducing the new high-rent levels.

As with the April measures, we have with the November changes sought to protect the poorest families. Out of over 6.5 million recipients, about 5.75 million, including 3.5 million pensioner households, will not be affected by the taper and minima changes. The bulk of the losses will also be small. Average weekly losses from the November taper and minima changes will be about 42p a week—32p for pensioners. I also stress again that no household on supplementary benefit and no family below the needs allowance need lose from the November changes.

I shall now move on to the other changes in the Housing Benefits Amendment (No. 3) Regulations 1984. In response to recommendations made by the Social Security Advisory Committee in its report last December, we are making improvements to the provision under which the lower rate of non-dependant deduction can apply to non-dependants who are sick or unemployed. If that matter is raised in the debate, I know that my hon. Friend the Under-Secretary will be able to give the details.

Finally, we are taking steps to eliminate an area of possible abuse of the housing benefits scheme. Most overseas students are admitted to this country on condition that they support themselves without having recourse to public funds, including housing benefit. That is the agreement on which they enter. However, the regulations themselves do not preclude an overseas student from eligibility for benefit. Consequently, if an overseas student chooses to ignore his entry conditions and claim housing benefit, there is nothing in existing regulations to prevent it being awarded to him. That is unacceptable. Therefore, we are amending the regulations to ensure that overseas students for whom housing benefit is not intended are excluded from eligibility for it.

Mr. John Fraser

Does the Minister realise the burden that that will put on multiracial boroughs such as Lambeth and Southwark, and that it will require housing benefit officers to start looking at the passport and entry conditions of those who claim housing benefit? Does he not realise that we are already taking an enormous amount of money from foreign students who are bringing foreign exchange into this country, and that the least that we could do is leave the scheme as it is for them?

Dr. Boyson

I always believe — I trust that the Opposition do as well—that when people sign a contract of entry, they intend to carry it out. That is what I do when I sign anything, and I expect anyone from here or abroad to do the same. Does the hon. Gentleman now agree with me?

Mr. Fraser

We disagree about the eligibility for benefit. What will happen when a housing benefit authority sees that a student is in breach of his immigration conditions? Will there be a breach of the normal wall that is supposed to exist between the Home Office and the Department of Health and Social Security over the enforcement of immigration control?

Dr. Boyson

Foreign students take courses in this country and many move on to postgraduate work; they do much for the advancement of the universities. I should like to make that clear. We are dealing not with all the students who come into this country but with one section of students who enter under various conditions, scholarships and so on. If they come in under the condition that they will receive not one penny of support from the taxpayer, that should be adhered to. Perhaps I am naive in believing that people should carry out the contracts that they sign, but I shall continue to believe it, and I imagine that the overwhelming majority of the British people would do the same.

The Housing Benefits (Subsidy) Amendment Order 1984 is important and bears out what has been said in other debates. The purpose of this short amendment order is very simple. Once again it has been brought to our attention that a local authority — Sheffield — is looking for ways of increasing its revenue at the expense of the housing benefit subsidy system. In this case, it is proposing a new rent structure from next month that would increase rents considerably for all tenants. In the case of tenants in receipt of housing benefit, the increase would mean that the council would do a few minor repairs for them. Housing benefit tenants would be given no choice in the matter. Other tenants would be given the option of doing their minor repairs themselves in return for a repairs grant from the council. Needless to say, the repairs grant would roughly equal the rent increase.

A system which, leaving aside housing benefit, would automatically mean higher net payments for poorer tenants strikes Conservative Members as decidedly odd We have concluded that the real reason for the different treatment of tenants depending on their benefit status, was simply that the council was looking for a device to milk the housing benefit subsidy system. We made it clear by the inclusion of new provisions in the main 1983–84 subsidy order, considered by the House in February, that we are not prepared to tolerate such a ploy. One of those provisions was specially designed to close an earlier loophole that Sheffield was thinking of using to increase its income at central Government's expense. We warned the local authority associations on that occasion that if we learned of any other proposed abuses, we would act quickly to block them. That is what we are doing now and will do again if it becomes necessary.

I hope that our evident determination in this area will mean that any council that might have thought of following Sheffield's example will now turn its mind instead to discharging responsibly its housing benefit functions rather than wasting time on a cat and mouse game with the Government. I am confident that the great majority of hon. Members will share those sentiments and deplore the attempts that have been made to milk the system. I have no doubt that, given the amounts of money involved, if a Labour Government were in power the same orders would be before the House, despite the artificial indignation that now comes from the Opposition. If we had not put down this amendment order there could have been a net profit to Sheffield of £5 million a year and, if other authorities did the same, a transfer of several hundred million pounds a year from central Government funds to local authorities. No responsible Government of any colour in Britain could allow that to happen when it had not been budgeted for and when it was done by an arrangement made by the local authority.

Mr. Meacher

Will the Minister give the total saving in a full year, which he has not so far given either in parliamentary answers or in the debate, from all the changes in each of the orders?

Dr. Boyson

I do not have that figure now. My hon. Friend the Under-Secretary will give it later. I could give an estimate but I know that the hon. Gentleman prefers accuracy. When we started it was about £55 million. The relevant figures seem to be arriving by divine guidance, if not by lightning, as at York. I now have the figure for the November changes and it is between £45 million and £50 million. My estimate is certainly worth a top second if not a first-class degree.

Mr. Tony Favell (Stockport)

Will my hon. Friend confirm that housing benefit is now costing £3 per week per worker in Britain?

Dr. Boyson

I can confirm that my hon. Friend is as near right as can be.

In the coming months the housing benefit review, under the independent chairmanship of Mr. Jeremy Rowe, will be looking at the scope and structure of the scheme and at ways of improving its administration. Evidence is being submitted to the review and I look forward to its findings.

However, it is fair to say that taken together, all the housing benefit regulations being debated today constitute an important step in the control and development of the scheme. The value of the needs allowances has been maintained and there has been a 50p real increase in the child needs additions, with a further £1 rise to follow in April 1985. There have been several technical amendments making sensible changes and, at the recommendation of the Social Security Advisory Committee, a beneficial one for sick and unemployed non-dependants.

Finally, available resources are being better targeted on those in greatest need. If we are to curb inflation and ease the burden on taxpayers, particularly poorer families and pensioners, we must restrain all increases in public expenditure, and that includes the social security programme.

I fear that the Opposition will promise, as they usually do, to spend more on almost every item of social expenditure, forgetting that there is always a bill. The electorate, however, will not forget that the bill was 112 per cent. inflation under the 1974–79 Labour Government, and that more than half of our people's savings — including those of pensioners — were wiped out. This Government are determined that that will not happen again, and I have no doubt that in that aim we shall have the support of the great majority of British people.

5.13 pm
Mr. Michael Meacher (Oldham, West)

The central argument in the debate is about whether there is any justification at all for further cuts in housing benefit. We have just been told by the Minister that they total £45 million to £50 million. We have listened to the Minister's speech and to many, what I can only describe as weasel words, to justify a whole array of mean and niggardly cuts in the instruments. The Minister's argument, which was the centrepiece of his speech, was that the Government were on the scrounge for cuts and their eye fell on housing benefit. The justification for that was that there are 6 million recipients of housing benefit and that the cost is nearly £4 billion.

What the Minister did not say—and it is the central issue — is that the cost of housing benefit is so great because the Government have put up rents by such an unprecedented amount that there are many people today who, unfortunately, are dependent on means-tested housing benefit. That is the central reason for this situation. That is why it is so unfair for the Minister to say that a Labour Government would act in the same way. The Labour party would never have got into the situation in which the Government find themselves today.

Our first and major reason for praying against the housing benefit instruments is the fact that they have been brought forward at all when, as the Minister said at the end of his speech, the Government have set up a housing benefit review precisely to examine the scope and structure of the scheme. The purpose of the review ostensibly is to find out whether housing benefit is helping those most in need. The review team has been given an appropriately short time scale and is expected to report in the autumn. Yet the Government are rushing to put through further major cuts even though they must clearly pre-empt the results of that inquiry. Surely there could scarcely be a clearer sign that the review is simply a smokescreen for further cuts. So eager are the Government to get on with the business of cutting benefits that they cannot even wait for a few months for their own review to be completed.

The instruments are now bringing forward yet further additional major cuts in housing benefit for both pensioners and low-paid families. It is no good the Minister saying, as he did, that the poorest people are protected. They are not. By any standards many poor people will be hit by the cuts in November. They are damaging and unfair. They are damaging not only because the cuts are large, not only because they are at the expense of the poor, but because they are part of a series of deliberate cuts that the Government clearly have no intention of stopping.

The Secretary of State's statement yesterday in response to pleas to put a limit on housing benefit losses arising from the cuts by postponing the high rent scheme until April 1985 is like someone who has hit a person three times in the face then turning round and saying that he wants to limit the damage so he will not hit him a fourth time. That is really what it amounts to and that is not needed at all.

This time round the Government are making three main cuts in housing benefit—an increase, as the Minister said, in the rent taper from 26p to 29p, a withdrawal of all benefit entitlement of more than 50p in the case of those with incomes above the needs allowance, and the introduction of a deduction from eligible rent when a household contains a non-dependant aged 16 or 17 who is not on supplementary benefit or non-contributory invalidity pension.

The first cut alone will penalise 1,130,000 households. That figure was given in an answer to a question asked by the hon. Member for Brighton, Kemptown (Mr. Bowden). A large number of them are pensioner households. It would be bad enough if that were a one-off but it is in fact part of a continuing and rapid erosion of rent rebates that the Government have been engineering over the past 18 months. Let me give an example provided by the Shelter Housing Aid Centre, which is extremely helpful to all hon. Members. A single pensioner with a gross income of £70 a week and paying an average local authority rent had a rent rebate of £3.93—nearly £4—in March last year. In April, when housing benefit was introduced, the Government cut it to £2.88 a week. In April 1984, the Government cut it again to £1.57. Now it is proposed to cut it yet again in November to only 78p a week. I do not know what conclusion other hon. Members draw, but it seems clear to me that the Government believe that pensioners are so well off that they are able to bear these continual cuts.

That gives the lie to the Government's constant boast that they have honoured their pledge to pensioners by uprating pensions in line with prices. They give with one hand, but they take away with the other. That has happened four times with housing benefit in the past 18 months and no doubt the process will continue after November.

For low-paid families on about two thirds of national average earnings and with two children, the same pattern of increasing cuts is apparent. Assuming an average local authority rent, they had a rent rebate of £3.24 a week in March 1983. By November, that will have been phased out completely.

It is not just that low-paid families are being hammered into the ground by never-ending cuts. They are also being trapped in their poverty, because the taper increase exacerbates the poverty trap. From November, low-paid workers with a rent rebate will face a marginal tax rate of 77 per cent. How can that be right or fair when the highest-paid directors — men like Mr. Giordano, who is the highest paid on £500,000 a year — are liable to a marginal tax rate of only 60 per cent? How can the Government justify worsening the poverty trap? I know that it is difficult to remove it, but the Government are gratuitously worsening it.

Mr. Favell

The hon. Gentleman has been talking about cuts in housing benefits for low-income families. Will he also say something about the cuts in tax for those families in the past two or three years?

Mr. Meacher

The tables issued by the Treasury at Budget time show that the total tax take from all families, except those on incomes of over £30,000 a year, who have made a killing, has increased substantially. That applies not only to those on average earnings, but to those on well below average earnings and those on two or three times average earnings. I am sure that the hon. Member for Stockport (Mr. Favell) is anxious to score a political point, but the facts go against him. Even worse than the losses due to the taper is the Government's continuing vendetta—I use that word advisedly—against young workers on low wages living in council houses. How else can one explain why the Government have picked upon 115,000 such families to take a cut of £3.30 a week as a result of the introduction of non-dependant deductions for 16 to 17-year-olds in work? One third of those families live on supplementary benefit.

That will undoubtedly increase the tension between young people and their families. It will also increase the pressure on young people to leave home to avoid that deduction. There is some evidence of that pressure, but we do not have all the evidence that we need.

The Government's argument is that steep increases in contributions towards housing costs can reasonably be expected from relatives over the age of 16 because, in the words of the Secretary of State, the non-dependant should make a contribution rather than the taxpayer. If that is the logic, why does that logic not apply to non-dependants living in households receiving tax relief on their mortgages? There are about 1.25 million such households and SHAC has calculated that such a move would produce savings of about £269 million—a vastly greater sum than that being saved by all the cuts that we are debating.

Why do the Government not follow that course? Is it because non-dependants in rent rebate families are likely to be working class, living in council houses and voting Labour, while non-dependants in tax relief households are likely to be middle class and voting Conservative? It is difficult to think of any other explanation. That is why we say that the cuts are so blatantly politically motivated. That is what we find so objectionable about them.

There is another reason why we reject the proposals. Housing benefit continues to be the biggest administrative fiasco that we have seen in this country since the war. Despite soaring organisational costs, there is little or no sign that bungling is being brought under control.

The Minister's figures suggest that administrative costs this year will total £56 million, compared with last year's estimate of only £17 million. What will be shown for the extra £40 million of taxpayers' money, which is being squandered on what is supposed to be a streamlining operation?

I have a few examples from citizens' advice bureaux in various parts of the country. They have all arisen in the past two or three months. A CAB in Lancashire reported: We have had several inquiries relating to the changes in Housing Benefit effected in April 1984, most of which have been concerned with a reduction of benefit due to non-dependants. Often there has been no explanation as to why benefit has gone down and in many cases a higher deduction than is correct has been made. There have also been cases where the DHSS have not informed the local authority regarding changes in non-dependant status. A national survey carried out by the CAB found that miscalculations of housing benefit were made in a staggering one in four cases. In more than three quarters of those cases, there were underpayments. Overpayments were made in less than a quarter. That is after the scheme has been in operation for 15 months. Surely that is an unprecedentedly bad record. It is farcical in a scheme that is supposed to be a streamlining operation.

People are still being forced into financial crisis by the bungling that occurs. I know that local authorities try hard and I do not wish to say anything against their sincere efforts to improve the administration of an incredibly complex scheme. The structuring of the scheme makes it difficult to operate.

The CAB in Norwich gives an example. It says of a woman claimant: She used to get £18.76 rent rebate and was told it was reduced to £18.34 from 1.4.84. When she went to her bank she found none had been paid in since 2.4.84. She rang the District Council and was told that a mysterious £64 had appeared on figures from DHSS so they were withholding rebate. No one told her about this or why it had arisen. She pays £25 rent, earns £23.50 and has £24 maintenance. She has an unemployed girl of 17 and is down to her last £14 with an electricity bill of £70 outstanding. I am not quoting cases that have been carefully chosen to demonstrate the difficulties. There are dozens of such cases in CAB files. The hon. Member for Kemptown forcefully makes the point in the House that similar things happen to pensioners who are perhaps least able to look after their own interests.

My third and last case comes from the Hatfield CAB. It states: An elderly pensioner claimed supplementary benefit and certificated housing benefit for the first time. Her daughter asked the DHSS whether her mother would have to pay rates. She was told her mother didn't have to pay anything. The pensioner now has £100 of arrears, a court summons has been taken out and bailiffs have been to the house. The local authority refuses to accept anything less than £10 per week in repayment, even accepting the DHSS's response.

The Opposition intend to vote against these instruments because we believe that they are wrong on five separate counts. They are wrong because they pre-empt the review that the Government have set up. The Government should perhaps have listened to their friends on The Times, who on 14 February said that until the housing benefit review had reported, the Government should forgo their savings from the scheme.

The instruments are wrong because they are, yet again, hitting hundreds of thousands of poor pensioners and poor families, who have already suffered financial hardship from earlier cuts. They are wrong because they penalise the poor while letting the rich off scot free. In a parliamentary answer on 7 March 1983 the Minister, referring to executives who earned more than £30,000 a year, said that they got more than £30 a week in mortgage interest relief. It seems that that will be increased to about £35 a week. It is wrong that the rich have not been required to give up a penny. How can the Government justify the rich retaining that money at the expense of the poor who have already suffered from cuts?

The instruments are wrong because administrative costs continue to soar while organisational bungling continues unabated. I hope that Conservative Members will agree that if a saving must be made it would be much more just to make it by limiting mortgage interest relief to the standard rate. That would save £160 million a year, which is three times and more than the savings that will be made from these niggardly, mean and nasty cuts. For those five reasons we reject the instruments. They are ill-advised, unjust and spiteful and the Government should withdraw them.

5.32 pm
Mr. Andrew Bowden (Brighton, Kemptown)

I shall not repeat in any detail my views and objections to the housing benefit scheme because they are well known to the House. I deeply regret the way in which the scheme has operated during its first year and the Government's intentions to impose further alterations to the scheme in November 1984. It is painfully clear from the origins of the housing benefit scheme that it was put together quickly, and was botched. I has turned out to be complicated and difficult to administer. It was introduced as a result of the demands made by the Chancellor of the Exchequer of the Department of Health and Social Security to find additional reductions in its budget.

The operation of this scheme during the past 12 months has been a disaster for local authorities, who in many cases have been thrown into turmoil. Above all, the scheme has caused real hardship and great stress and strain for a large number of those who are entitled to claim housing benefit.

I was delighted when my right hon. and hon. Friends decided to appoint a housing benefit review in February. I welcomed the words of the Minister when he said: The review is to examine the structure and scope of the scheme to ensure that it is as simple as possible, and that help is concentrated on those most in need. The aim is to improve its administration by local authorities."—[Official Report, 14 February 1983; Vol 54, c. 215.] The housing benefit review was then appointed under the chairmanship of Mr. Jeremy Rowe. On 11 July I gave evidence to that review. I wish to put it on record that I was most impressed by the open-minded and constructive approach of all its members. It was a most enlightening hour, which I hope will mutually benefit both future recipients and the review board in coming to its decisions. The board's briefing papers also impressed me.

I admit that I had initial misgivings and feared that the Minister might wish to restrict the approach of the review board, but clearly from the way in which it is working in practice—I am delighted to pay tribute to the Minister for this—that will not be the case. In the background briefing which the board sent to me and the other joint chairmen of the all-party parliamentary group for pensioners and which we were asked to consider in submitting our written and oral evidence, there were a number of phrases which showed clearly how wide the board's review was to be. It stated: The review team would welcome evidence on all aspects of housing benefit and in particular the three broad areas set out in the terms of reference. Those three areas included the scope of housing benefit, the structure of housing benefit and the administration of housing benefit. The explanatory notes to those headings made it clear that the housing benefit review body had the widest possible chance to present a report of great significance for the Government's consideration.

In the light of the Department's decision, which was right, I was bitterly disappointed that the Department found it necessary to proceed with the changes and alterations in housing benefit in November. I do not go so far as to say, as Opposition Members have said, that that has undercut, destroyed or undermined the work of the review body, but it has not helped. I hope that if the review body in its report makes out a strong case for fairly drastic changes, even if they contradict the changes that have already been made by the Government, the Government will have the courage and determination to accept the report and reverse those changes. It would have been far better if the Government had delayed and put on ice their intentions for November. I regret that they have decided to proceed with the cuts which will affect many groups in society, not least more than 1 million pensioners.

The decision is also bound to create a great many additional problems for local authorities. I have no doubt that many local authorities were over the hump and beginning to see their way out of the tremendous tangles created by the scheme. In some cases those tangles were partially the responsibility and fault of local authorities, and in others, of the DHSS. Now that the worst is over they will, horrifyingly, be confronted with another batch of changes, which will inevitably create confusion and uncertainty within local authorities.

The changes will also confuse many claimants, bearing in mind the fact—I say this with great respect—that not many hon. Members understand the housing benefits scheme. I do not claim to have anything like a full understanding of it. Sometimes when I have spent hours poring over it during late night and early morning sittings in the House, I finish my study and think, "Perhaps I have a pretty good grip of it"; but then I wake up the next morning and realise that I still know very little about it. If it affects hon. Members in that way — the hon. Members in the Chamber this afternoon will have given much time and thought to it—what must it mean to the average claimant? It must be like trying to do Arabic maths with a dash of an antiquated or dead language thrown in. It is impossible. For the many claimants who are completely unable to cope with or understand what is going on, the new scheme will create stress and strain.

The standard housing benefit scheme is difficult enough to understand, but we take another enormous leap into complexity when we consider the housing benefit supplement. Many people have never heard of it. The take-up rate for ordinary supplementary pensions is low, with about 10 per cent. of pensioners who should claim it not doing so. On the figures provided by the Department, I estimate that the take-up rate for housing benefit supplement is, unfortunately, much higher than 10 per cent.—I suspect that the figure is much nearer 40 per cent. and could even be 50 per cent. As the House knows, the housing benefit supplement makes up the difference between standard housing benefit and what a recipient of the latter would have received had he been allowed to claim supplementary benefit. I just about understand that.

Pensioners who are entitled to claim the housing benefit supplement are in the disgraceful position of being shuffled backwards and forwards between local authority offices and DHSS offices. By the time some of them have been backwards and forwards two or three times they have no idea whether they are coming or going, they are thoroughly fed up with the process and, in many cases, they decide not to proceed with their claims for the housing benefit supplement to which they are entitled.

During the past 15 years inflation has had a catastrophic effect upon those who receive small private occupational pensions, who live on incomes marginally above the state pension and supplementary pension rates. I must say bluntly to Opposition Members that they are more responsible for that than anyone else. I understand why the hon. Member for Oldham, West (Mr. Meacher) makes the best of the case that he has in front of him this afternoon—I regret that he has so many weapons to use—but it i s a bit much for him to tell the House that the Conservative Government give with one hand and take away with the other. He quoted some examples that are difficult to refute, but the most cruel method of giving with one hand and taking away with the other is inflation. It destroys the value of people's savings during their working lives. They prepared all their lives for retirement and, adding their basic state pensions, occupational pensions and the little savings they had in the banks, they believed that their retirement would be reasonably comfortable.

However, a series of policies imposed by Labour Governments completely undermined the financial positions of many pensioners. As my hon. Friend the Minister said, in one period of Socialist Government the inflation rate was well in excess of 100 per cent. What did that do to the small occupational pensioners, or to those who worked all their lives and, by the sweat of their brows, managed to save a little money? That was the cruel way of giving with one hand and taking away with the other.

Mrs. Beckett

None of us wishes to see high inflation Although we are all impressed by the passionate way in which the hon. Gentleman speaks about the sufferings of people who worked all their lives to build small savings, does he recognise that under the present Government as many and more people do not have, and never expect to have, an opportunity to build savings or security for their old age, or even their middle age, because of the policies of his Government?

Mr. Bowden

That is an incredible statement. It is comforting to know that the Opposition Front Bench spokesmen do not want high inflation. I am sure that when they came into office previously they did not want high inflation, but we still had it. In some years inflation was more than 25 per cent., and at one stage it was moving rapidly towards 30 per cent. a year. Should the Labour party take office again, which is unlikely, I have no doubt that exactly the same would happen. The hon. Lady is trying to tell the House that today fewer people have the opportunity to provide for their old age, but she should examine what is happening. A steadily increasing number of people are buying their properties and saving more money. More and more people understand that it is now worth saving money because the present inflation rate will not undermine the value of their savings. That should be warmly encouraged and I wish it to be greatly extended in the years ahead.

Ms. Clare Short (Birmingham, Ladywood)

We all recognise that some pensioners who had savings—it was a minority — suffered from high inflation, especially before the introduction of granny bonds. But the hon. Gentleman should compare that position with the present. Millions of people are unemployed and in my area poverty is rampant—one can see it on the streets in a way that one never could before. My hon. Friend the Member for Derby, South (Mrs. Beckett) is right. Workers who are made redundant at the age of 50 or 55, who have no hope of working again and who must live on supplementary benefit, cannot begin to plan for their old age. The hon. Gentleman must face the truth that life for people who are preparing for their old age is worse now than at any time since the second world war.

Mr. Bowden

The hon. Lady is trying to extend the debate into a wide economic debate, and I dare not tread that path. However, I must make it clear to the hon. Lady that the seeds of many of today's economic problems were sown by Labour Governments. They allowed inflation to run rampant, we priced ourselves out of world markets and we had five people doing four people's work; those are the root problems with which the Conservative Government are surely and steadily dealing. Within a few years we shall have dealt with them completely. I must move away from that tack before I run the risk of being out of order.

Small occupational pensioners will be badly affected by the cuts in housing benefit. Quite rightly, the Conservative Party has agonised for many years, both in and out of government, on how best to help this section of the community. It was difficult, not to say impossible, to do this by increasing basic rates of the pension, and therefore it could only be done by looking for special ways and means. One way in which we have been able to help, and are still helping, although not to the same extent, was through the housing benefit scheme. This was giving some positive assistance to those on occupational pensions, whose pensions had been undermined by inflation and who were therefore entitled to a considerable increase in their income—through housing benefit.

Linked to that is a ridiculous position, about which we all know. A person may be in receipt of housing benefit, before the new regulations came into operation this year, of £6, £7 or £8 a week and perhaps more, but on the other hand could be paying £4, £5 or £6 a week in tax. Clearly, much more thought has to be given by my right hon. and hon. Friends to help that section of the retired—those living on small occupational pensions which, by and large, are not inflation-proof and are dropping in value, even I regret to say, to some extent under this Government. It is not as bad as it has been in the past, but such people are still not getting a fair return for a life's work.

There is evidence that those views are not mine alone but are held by many of my right hon. and hon. Friends. I draw the Minister's attention to early-day motion 893. This motion is so important that I shall read it out so that it will go into the record of my speech. The main sponsor is my hon. Friend the Member for Hornchurch (Mr. Squire) and the motion is supported by some distinguished right hon. and hon. Friends. It says: That this House, noting that the aims of a unified and simplified housing benefit scheme have not to date been achieved, welcomes the independent review announced by the Government; and urges the adoption of a single taper unified housing benefit scheme, along the lines advocated by the London Housing Aid Centre (SHAC), to ensure: (a) the elimination of separate assessments by the Department of Health and Social Services and local authorities, (b) the ending of complexities such as housing benefit supplement, (c) the removal of inequities in the treatment of those both in or out of work, (d) a drastic reduction in administrative costs and (e) a scheme which is easy for the general public to understand.

The Under-Secretary of State for Health and Social Security, my hon. Friend the Member for Braintree (Mr. Newton), tragically is not in his place at the moment, but perhaps my hon. Friend the Minister will convey my message to him. I hope that when he winds up the Under-Secretary will tell the House that the Government will look closely at that early-day motion in relation to the report that he will eventually receive from the housing benefits review body. Where the two dovetail — they will in many instances—I hope that the Government will give careful consideration to implementing the recommendations of that early-day motion.

Even at this stage—I fear that it is almost too late—could not my hon. Friend the Minister think again about the proposals for November? He is a fighter. Perhaps tomorrow morning, when he gets into his office, he might like to pick up his phone and call a senior Treasury Minister and say to him, "You will have to whistle for your £50 million. I am not going to implement those housing benefit cuts." There would be a gasp, a choking sound—I have no doubt about that——

Ms. Clare Short

Why tomorrow? Why not make him do it today?

Mr. Bowden

I want my hon. Friend to have the night to think it over. If he really pushed this, he could succeed. He should decide what his approach should be. If he decided that he would do this, I believe that he could still win, tough though the fight might be. I beg my hon. Friend to give this some thought. If he felt that he was able to do this, I should want him to prepare his case carefully. I know it is not easy to think about the implications if he decided to take such a course of action. However, he might still decide to pick up his phone and go through to the Treasury Minister and bluntly state the situation and the views that have been expressed in the House. I was going to say that if either my hon. Friend the Minister or the Under-Secretary can give me an assurance now—this is my answer to the hon. Member for Birmingham, Ladywood (Ms. Short)—that that is what they will do, I should be delighted to tell them that I shall be in the Government Lobby tonight. If they cannot give me such an assurance, it will not be possible to do that.

5.56 pm
Mr. John Fraser (Norwood)

The Minister opened this debate with all the cheerfulness of a workhouse master who, for reasons of economy, has to double up both as a pedagogue and a clown, but there is nothing in these regulations to be cheerful about. In my constituency and in my borough of Lambeth, they represent further poverty for those who need encouragement.

The Minister is right to tell us that the benefit changes do not affect certificated housing benefit—that is to say, the amount of people's social security benefit is not affected because their rent and rates are reimbursed in full. However, if they have had the misfortune to do what the Government are encouraging them to do—hard though it is—and have gone out to work on low wages, they are likely to be penalised. That is true of my constituency, where there is a great deal of poverty.

Let me give three examples. First, there is the reduction in the earnings disregard. It is true that it is only of 45p, but it seems quite unnecessary to interfere with the programming of benefits by reducing the earnings disregard from £17.45 to £17 when it is bound to go up next April. That is one small example of how those who are earning will be poorer.

My second example is of the contribution from the nondependent child aged 16 or 17. If the child is on social security, he will not have to contribute as a non-dependant, as the Minister has said. In Lambeth, the forecast for unemployment for school leavers at the end of 1984 by the Manpower Services Commission youth group is for 60 per cent. unemployment among the 16 to 17-year-old school leavers. If one is lucky enough to obtain a job, often on low wages, he will be contributing notionally something to the rent of his parents. In practice, that does not happen in many households, and where the parents find their income cut because of a notional contribution by the earnings of a 16 or 17-year-old a great deal of tension arises and the cohesion of the family is ruptured.

If the child at first got a job after leaving school but has been made redundant after a year and is then in receipt not of social security benefit but of unemployment benefit, that child, as against the child who has never had a job, will have to make a contribution. As I understand the regulations—the Minister will correct me if I am wrong—somebody who goes into a youth training scheme will be a non-dependent child receiving an allowance. He will have to make a contribution to his parents. That is one of the meanest ways of rupturing family unity and of depressing still further the poverty levels of those who are not on supplementary benefit but are very close to it. In my constituency, it will mean a reduction in living standards, and an increase in poverty and family tension. I ask the Minister to heed the advice given by the hon. Member for Brighton, Kemptown (Mr. Bowden) to regulate such matters, and to fight with other Ministers against the depredations of the Treasury.

The figures for my constituency are not available, but I represent a borough where one man in four is out of a job. That is the measure of the poverty. I represent a borough in which 50,000 households out of a total population of only about 200,000 are in receipt of housing benefit. What possible contribution can it make to the cohesiveness and tranquillity of society to set about such mean cuts when the amount of public money going to the richer sections of society and to those able to buy their houses is being increased?

In answer to the Minister's question, I should point out that I am in favour of assistance for those buying their homes. I have never been opposed to that. The Labour party has said that there should be rough equality between those renting and those buying. Thus, I am not trying to drive any wedge between those two groups. However, it strikes me as mean and petty to make the poor poorer and the rich richer — yet that is the result of this Government's policies.

I turn to a point which I raised in an intervention concerning the new regulation 11(a). I may be wrong, but I believe that the immigration rules are being imported for the first time into rules that deal with social security. My hon. Friend the Member for Peckham (Ms. Harman) has asked to be associated with my remarks. I urge the Minister to consider the effect of importing them on multiracial boroughs such as Southwark and Lambeth. If someone claiming housing benefit at the local authority housing office claims to be a student but seems to have a foreign accent — perhaps African, West Indian, American or Australian—the local authority staff are bound to ask whether he is a foreign student with limited leave to be here. Thus, those who have permanent leave to be in the United Kingdom but who, for example, were born in Jamaica or West Africa or who have, as happens in inner city areas, adopted a sort of Caribbean accent from their peers will be questioned not only as to their level of poverty but as to their immigration status. It is inevitable that black applicants for housing benefit will come under more suspicion and are more likely to be questioned about their status than white applicants.

I ask the Minister to consider most seriously the consequences of those trying to run a social agency suddenly finding themselves involved in what may appear to be — even if it is not in practice — a form of immigration control. Perhaps such matters can be dealt with by the Home Office. But the moment that there is a breach in the wall of confidentiality as between those who administer social benefits and those who administer our immigration laws, the peace and tranquillity that has existed in race relations in housing will take a turn for the worse. For years we have been trying desperately to get town halls to understand the need for equal opportunities in housing. I urge the Minister to think again about the most retrograde step of importing immigration control into the administration of housing benefit.

Mr. John

Will there not be an ever greater furore than occurred when it was discovered that information from legal aid applications was being filtered out of the DHSS?

Mr. Fraser

That is bound to be so. Some of those who administer housing benefit will be faced with a crisis of conscience. It is a very difficult problem, because if such questions are not asked the officers of the council or the councillors themselves will be liable to surcharge for paying out a benefit to which the applicant is not entitled. An argument does not gain strength from repetition, so l simply urge the Minister to think again.

Will the Minister consider making the administration of this benefit less chaotic and speedier? Hardly a day goes by without my receiving a letter from a constituent saying that he applied for housing benefit not a month or three months ago, but 12 or 15 months ago. Often constituents in the private sector have applied for housing benefit but it has not yet been paid.

There is a statutory duty—which the Minister is not prepared and has no power to enforce—to respond to the application within 14 days. It is quite unacceptable that many of my constituents who are old, and who live in private accommodation, should be under pressure from housing associations or private landlords because their housing benefit has not been decided or paid out. I know that one of the problems is that, for example, in Lambeth a huge number of people apply for housing benefit. Of course, if Lambeth takes on more staff, the Minister's colleagues from the Department of the Environment will rate-cap the authority. Because Lambeth is penalised, it is fined £2.80 for every extra £1 it pays in wages to speed up the system. That will be even worse next year. Furthermore, the Government do not even fully reimburse the authority for the costs involved.

That is one constraint on taking on extra staff to administer housing benefits. It is true that mistakes have been made in Lambeth through adopting a computer programme that was far too sophisticated and that did not have sufficient manual back-up. I do not say that the blame rests wholly with the Government, although it does when it comes to reducing the level of benefit. But the scheme is chaotic and it is wrong that members of the public should have their right to benefit denied, or at least delayed, for so long.

There are one or two contributions that the Government can make. First, they can exempt local authorities entirely from rate-capping penalties or any other constraints if they should take on extra staff or undertake expenditure on computer programmes or whatever it may be in order to administer the benefit quickly and efficiently. There should be a total exemption, because they are acting only as agents of the Government.

Secondly, the Government can stop tinkering with the scheme every six months. It is difficult enough to have to do a recalculation when a person's income changes. I believe that changes in the scheme should be kept to a maximum of once every 12 months. The Government should look a year ahead in a spirit of generosity so that benefits are not cut. They should at least minimise the amount of recalculation and clerical work that has to be done in town halls. I am very disappointed about the speed at which the benefit is administered in my borough, although that is not my only concern about the scheme.

I ask the Minister to reconsider those matters.

6.8 pm

Mr. Charles Kennedy (Ross, Cromarty and Skye)

The hon. Member for Norwood (Mr. Fraser) has spoken very knowledgeably about his constituency and the borough of Lambeth. Perhaps there could not be a greater geographical contrast than between his area and mine, in the Highlands of Scotland. Yet I am sure that we would both agree that the level of unemployment in Lambeth, at 25 per cent., is roughly similar to that in certain areas of my vast, spread-out rural constituency in the Highlands. That shows how the Government's general economic policy, which provides the backdrop for the shabby decisions on housing benefit, has had its effect throughout the country. The system of housing benefit has been subject to objections from persistent critics on the Government Benches as well as from Opposition Members, and it is, perhaps, sad that there has been little alteration or deviation from that policy.

There has been little willingness to take some of these considerations on board. Although a review is now taking place, there is, even at this late stage, an apparent unwillingness on the part of the Government to have any delay whatever, lest that be regarded as a climbdown or, perhaps more accurately, lest it loses the Government some money.

It is appropriate, therefore, that before we depart for the recess we debate this issue and remind the Government of the cross-party opposition—opposition at the least and, in certain circumstances, extreme scepticism—to some of the proposals that are being introduced. The Minister permitted me to intervene in his opening speech to query some figures. He spoke with evident satisfaction about the way in which £3 billion more in real terms was being spent across the board on social security benefits.

Ms. Clare Short

Because there are so many unemployed.

Mr. Kennedy

The hon. Lady makes an important point. To be fair to the Minister, he added that another £3.25 billion was being spent as a result of the rise in unemployment.

I am sure that the hon. Member for Birmingham, Ladywood (Ms. Short) and I find common ground in asking—as the Minister is pleased to be able to spend £3 billion extra on social security—if he would not have been even more delighted if double that amount could have been devoted to social security, instead of the extra money being frittered on unemployment benefits resulting from the economic policies which he has supported. In other words, of the £6.25 billion of which he was speaking, half has gone on increasing social security and half on providing insufficient support for people to do nothing when they would rather be working and helping to support themselves.

Housing benefit is an important subject which should receive our attention. Hon. Members who correspond with the Minister on constituency issues will agree that the hon. Gentleman is always reasonable and open-minded and that he goes to great lengths to explore the problems we raise with him. I appreciate that greatly. I find it difficult to set that approach alongside the inflexible approach which overcomes him when he reaches the Dispatch Box.

He slogged away manfully in defence of the organisational shambles which is housing benefit and he could say little to support the Government's proposals on housing benefit. As the Minister was speaking, I thought of the description that a distinguished journalist once gave of the present Foreign Secretary when he was Chancellor of the Exchequer. He said that he was like a barrister who continued to plug away at the defence of his client after his client had changed his plea to guilty. There was an element of that in the Minister's speech today, because, against the facts—even against the arguments deployed by his hon. Friends — he manfully continued with a defence that almost everybody knows has become redundant.

Given that a review is taking place, I cannot understand the unwillingness of the Government to delay housing benefit cuts, or at least to agree to make such alterations in the autumn in line with what may be suggested when the review is completed. That goes to confirm our suspicion about the review. It must be inconsistent, at a practical level, to set an in-depth look at housing benefits alongside ad hoc decision-making about housing benefits. The two do not, with any sense of consistency, stand together.

Hon. Members will agree that the housing benefit system is too complex. Pensioners and others who throughout their lives have adhered to the ethic that there is something unprincipled, even immoral, about being in debt—people who have never been in debt but who, because of the fiasco of the housing benefits system, have found themselves, on paper, informed that they are massively in debt—have been driven to distraction, even to the point of becoming ill. That has been the effect on some who have come to discuss these problems at my surgery.

The complexities of the system are bound to affect the take-up rate, particularly of the elderly. It is complex enough even to put off those of us who are used to paperwork and may not be as intimidated as others are.

Leaving sympathy, charity, compassion and any other Treasury Bench voodoo terms on one side, the Minister must agree that to have cut the earnings disregard from£18 to £17 in the last two years has, at the least, from the point of view of housing benefit, reduced work incentives for those in low-paid categories. The Minister argued that in the Budget the tax allowances were raised by more than the rate of inflation. Giving with one hand and taking with the other applies in this context, for almost half of that tax allowance has been reclaimed through the reductions in earnings disregard. As I say, leaving sympathy and compassion aside, it must be a fact, based on the philosophy of the Government, that that action will inhibit the incentive for people to take on employment. For that reason alone, the Government should re-examine the matter.

I thank the Minister for his comments about MSC and travel allowances, a subject on which I have corresponded with him, and I thank him for the help that he has given to me in relation to a constituent. What he said is good news. I regret that it is on the margin, so to speak, and that to a great extent it is mitigated by the intransigence that has been forced on him by his colleagues at the Elephant and Castle and the Treasury.

The Government should realise that when they play around with housing benefit and adjust figures and so on they are not just indulging in a mathematical exercise. For those on low incomes—for pensioners and the most disadvantaged sections of society—the Government are taking decisions that have a profound effect on people's lives.

I add my voice to the plea made by the hon. Member for Brighton, Kemptown (Mr. Bowden) to the Minister for Social Security. The Minister may want to make a phone call by the end of the debate or by tomorrow morning. I do not know to what extent the hon. Gentleman subscribes to British Telecom's view of "Buzby", which is to make someone happy with a phone call. If the hon. Gentleman made that phone call and took the decision we want, he would make happy those hon. Members who had taken an interest in this issue during several debates. More importantly, he would bring considerable comfort to those who stand to lose and suffer considerably from the effect of the measures that he wishes to pile through the House.

I ask the Minister of State to display conviction politics. I ask the hon. Gentleman not to head towards a firm decision, buttressed by his large majority in the Lobby, but to say that he is willing to listen to the review's findings in autumn. I hope that until then he will be willing to forgo the measures that he wishes to push through the House this evening. I hope that, at the very least, he will make back-dated decisions if the review comes up with worthy recommendations at variance with what has been decided so far. Information along those lines from the Treasury Bench will be welcomed. Unless those decisions are forthcoming, I am obliged to say on behalf of my hon. Friends in the Liberal party and my colleagues in the Social Democratic party that we shall join the official Opposition and, I imagine, several Conservative Members in opposing the instruments.

6.21 pm
Ms. Clare Short (Birmingham, Ladywood)

Hon. Members who have spoken in this debate have objected to the cuts in housing benefit on two grounds: first, because they are cuts in the income of some of the poorest people on low pay, including young workers; and, secondly, because the housing benefit scheme has been a complete mess since its inception. It continues to be a mess. The mess may not be as bad as it was at the scheme's beginning, but it will become worse after these cuts. Because the scheme is such a mess, the Government have been forced to undertake to review the scheme. During that review, however, the Government are introducing further cuts. That is completely unacceptable and against the spirit of their undertaking to review the scheme. I agree with those hon. Members who have called on the Minister of State to look at the matter again, even at this late stage.

The Government are picking on the low paid with these changes and are worsening the poverty trap. The Government claim that they are anxious to eliminate the poverty trap, but it is no good their telling us in words that they believe in one thing, but by their actions proving that they do not. The change which is being deliberately implemented will worsen the poverty trap for the low paid.

I take exception to some of the remarks of the hon. Member for Brighton, Kemptown (Mr. Bowden), who has taken a courageous stand in opposing many previous housing benefit changes, and intends to do so again today. The pity is that there is only one of him. I very much disagreed with the hon. Gentleman when he talked as though we discuss benefits without reference to the Government's economic strategy. We well know that the Government have deliberately used unemployment as their anti-inflationary policy—there is no doubt about that. They have deliberately sought to reduce the income of people in work and to bring down wages to increase profits, because, they claim, that will lead to higher investment and greater efficiency. In practice, it does not work.

Part of the Government's strategy is to increase significantly the number of people living on low pay.

Mr. Andrew Bowden

At the risk of being ruled out of order, Mr. Deputy Speaker, I ask whether the hon. Lady can give the average rate of inflation and the average rate of wage increases during the past 12 months.

Ms. Short

I do not have those figures in my head. I know that they are available, and I could easily obtain them. I assume that, if the hon. Member for Kemptown knew the figures, he would have given them rather than asked the question.

Mr. Bowden

During the past 12 months, the average rate of inflation has been 5.1 per cent. and the average rate of wage increase has been 7.4 per cent. That totally disproves what the hon. Lady said about wages having been forced below the rate of inflation.

Ms. Short

It does not totally disprove what I said. There is no doubt that the Government want to reduce pay levels. Shortly after 1979, they were more covert about that aspect but they now openly admit it in speeches about the economy and their objectives. All sorts of moves have been made to reduce the protection that was formerly available for the low paid.

The Government accept that if they reduce wages more people will be living on low pay. That is a necessary part of their strategy. They deliberately set out to cut supplementary benefit for young people and to cut the allowances paid under the youth training scheme. Indeed, they have destroyed the training value of YTS by making the reduction of pay levels of young people their top priority. That is no secret. It would be ridiculous for anyone to pretend that it is. An open part of the Government's economic objectives is their aim to reduce wage levels and therefore to increase the number of people living on low pay. That fact cannot be contested.

It is no good Ministers or Conservative Members saying in economic debates, "Yes, of course, wage levels must be reduced," and then during debates about poverty, low pay and supplementary benefit pretending that they are sorry that people are living on low pay. It is not good enough to pretend that we should compartmentalise those factors, because they are all part of the Government's strategy. The Government are deliberately increasing the number of people on low pay. They are increasing also the number of unemployed, although on this occasion the cut will not hurt them. As the months grind by, there will constantly be cuts in housing benefit which will make poorer the people living on low pay.

A couple of days ago, we were talking about the fact that in 1984 poverty is visible when one walks around the streets. When I was a child, some people at school with me had the white, grey faces of poverty, thin clothes and poor shoes. Their skin showed that they were not living in decent conditions, obtaining good food, and so on. That sight disappeared during the 1960s and 1970s. It has disappeared in areas like mine. I represent the area in which I went to school, so I am talking about people who live in the same part of the country. All the children who went to school wore warm clothes and good shoes, and the whiteness of poverty disappeared. I see that poverty again in the streets of Birmingham. Two days ago, my hon. Friend the Member for Derby, South (Mrs. Beckett) said to me that she saw that poverty in her part of the country.

This is not a matter of political debate or hoo-ha. We are talking about the fundamental quality of people's lives and whether children can grow up healthy in 1984. The consequences of the Government's economic and benefit policies is that all that poverty, suffering and ill-health will return in increasing proportions.

The other part of the Government's attack is on the 16-year-olds and 17-year-olds who are lucky enough to have a job, but, goodness me, there are few of them. One in every two under-18-year-olds is unemployed or temporarily on the youth training scheme. Our young people cannot leave school, expect to get a job and get started on their lives. The vast majority of them are unemployed. That is the new experience of Great post-1979 Tory Britain when we are told that the economy is being improved and refined.

Many of them are earning less than 16 and 17-year-olds used to earn. That is an open and deliberate part of Government policy. Ministers representing the Department of Employment frequently say that it is desirable that the wages paid to young people should be cut. They claim that it will increase the numbers in work. They have been busily cutting, but the numbers in work have been declining. That, however, is another argument. Those 16 and 17-year-olds who are lucky enough to have a job, although at lower wages than people of that age could expect five or 10 years ago, are the second group that is under attack. It is expected that in future they will pay more towards the family budget.

Our fear is that that will break up families. When 16 and 17-year-olds leave school and start to earn a living, it is a time of tension in all families. Life is changing, young people are becoming adults and conflict within families is normal. It is worse in families with no money. It is an expensive time of life. Young people want to go out, dress up and do all sorts of things. There has been a number of similar benefit changes over the past few years and we fear that the present changes will increase tension within the family and cause 16 and 17-year-olds to leave home, go on the streets, come to live in London and engage in all the desperate things that are happening to young people. The current heroin epidemic must be connected with the conditions in which our young people are living and their lack of hope.

The Government undertook to do research so that we would know whether the changes were increasing the break-up of families. I hope that the Minister will tell us whether the research has been started, what progress has been made, whether there are any results, and whether we are right. I suspect that we are and that one of the effects of this mean change—this further attack on the young—is that more families are breaking up.

The Government claim that they cannot afford to look after the poor better. They claim constantly that public expenditure must be held down. That is another gross untruth, because in the Finance Bill massive tax concessions are being made to the rich as they have been year after year. It is part of the openly declared Government strategy of making Great Britain more unequal so that, they say, we will be greedier, more competitive and more enterprising. The Government say that that will make the market economy flourish and we will become more efficient. There is no evidence of that. The strategy is not working. Our output is lower than it was in 1979, but the Government deliberately gave massive tax handouts to the rich in the Finance Bill.

When we debate supplementary benefit, the Government tell us that there is no money. That is not true. There is money. They are giving it away to the rich because they believe that they are deserving. They are taking it away from the poor. There is no excuse for that, and the Government cannot pretend that there is. We compartmentalise policy discussions in the House and it is not good enough for them to pretend that there is not enough money for supplementary benefit for the poor when they can afford to give a great deal away to the rich.

There has been a massive increase in spending on defence and so-called law and order. There have been fantastic increases in police pay. Many of us think that it cannot be an accident to take from the poor, generate unemployment and then spend more on the forces of law and order because one is worried that the poor may become uppity and start to protest, so that a bigger stick is needed to hold them down with. There is money to build new prisons. The Government can find money when they want to for their political priorities. When they decide that the rich should be given money, to spend more on law and order, and to build prisons, there is plenty of money. When we ask for money for the poor, the Government suddenly do not have any. That excuse will not do, and we will not accept it.

The Government are aware, and have admitted, that the scheme is a mess. It has been a disgraceful chaos. We could all give examples from our own cities and constituencies of old people who run into arrears of rent for the first time. They cannot bear to be in arrears and they have therefore paid the rent and live on less than the survival level measured by the benefits that we provide. They do not spend money on food, clothing and heating so that they do not run into debt.

I do not know whether Conservative Members are aware—I do not believe that they can be—that when people grind along, just about managing on their money, debt is serious and painful. If people just manage to cope for years and years on their money and then receive a letter saying that they owe £400 in back rent, it is an inconceivable amount of money for them to find. It breaks people up. More than one person has come to my advice bureau and told me that they are contemplating killing themselves. They have cried. It has not been just an empty threat. That is what has been happening to people in Great Britain in 1984 because the Government were mean-minded when they designed the housing benefit scheme. The Government tried to save a little money. They did not put enough into administration. The scheme was too complex. Instead of making the level of benefit sufficiently generous so that the administration would be simple, they held back. That is the fundamental problem.

There has been a mess everywhere. Many people have suffered badly. Those of us who attend to our constituency cases are aware of that and the Government have conceded that. They have admitted that they made a muck of the scheme. They have set up an inquiry to review the scheme to see whether it can be improved. That is welcome, but before the inquiry can report they impose further cuts which will create further chaos.

Last week I visited the housing benefit department of Birmingham. Initially the administration was very bad. It has become somewhat better, but I still receive letters from people who are owed masses of money but who are sent letters saying that they will be evicted.

The part of the scheme relating to the private sector is in difficulties now. The council sector is not as bad as it was. I asked whether Birmingham was worse than anywhere else in the country. The officials told me that it was not. I know about Birmingham through my own experience but, from what I was told, I know that we are talking about the whole country. Matters are a great deal better than they were, but there is still a backlog of about 10,000 cases. The officials told me that when the changes are introduced in November the scheme will be thrown back into chaos.

There is an inquiry to review the scheme because it is known to be chaotic. Local authorities are trying to cope. They have increased the staff who run it, but they have been given no undertaking by the Government that they will not be penalised by another aspect of Government policy—one, I presume, that we are not supposed to talk about today. The Government are trying to cut local government expenditure and the number of staff employed.

Will the Minister tell me how the extra staff who have been taken on in cities such as Birmingham to make the scheme run better will be treated for the purposes of the penalties being imposed upon local government staffing levels? That is an important question, and I should be grateful for an answer.

I was told in Birmingham last week that the scheme was working better but was still not perfect, and that it would become more chaotic in November. That is intolerable. The Government are undermining the value of the undertaking that they gave to review the scheme. It is wrong to introduce further cuts and complications before the scheme has been reviewed and starts to work well.

The Government have a number of questions to answer. How is the review going and when shall we know the results? Is the money spent on mortgage tax relief being taken into account? Is the review dealing with the total housing subsidy paid out by the Government? If not, the Government should admit openly the bias and limitation of their policy and of the review.

I apologise for not being present to hear the Minister's opening remarks, but we were here until 3 am today and one has to do one's mail some time. I had intended only to listen to the debate, not to speak, but I was shocked to see so few Members in the Chamber.

Dr. Boyson

There are not many on the Opposition side either.

Ms. Short

It does not matter which side. People should know the truth. There should be more Members present to discuss a matter that is causing so much distress to so many of our constituents. Nevertheless, I sincerely apologise for missing the Minister's opening speech. That was perhaps balanced by the fact that I missed the bulk of the opening speech for the Opposition, too.

Having worked in Whitehall, I know that the appeal made to the Minister by the hon. Member for Kemptown was unrealistic. If the Minister sleeps on the matter and rings up the Treasury tomorrow morning with such a plea, nothing will happen. Indeed, once he sleeps on it he will not even be tempted to try.

There is only one thing for the Minister to do and I shall be happy to give way if he wishes to do it. He must stand up now and say that he agrees with our arguments—I am sure that in his heart he agrees with us—and that he will withdraw the regulations. We are told that he is a brave and courageous Minister. Let him show his courage by withdrawing the regulations. He will then be sacked, but he will have shown that he has guts. In any case, the Government's unpopularity is increasing so much that there will have to be a change. If the hon. Gentleman distances himself from the current Administration he may well improve his future political career in the Conservative party. I appeal to him to show that he is indeed such a fine man as the flattering descriptions claim, that he has courage, that he cares about the poor and that he intends to review and improve the housing benefit scheme.

6.42 pm
Mrs. Margaret Beckett (Derby, South)

I am tempted to pause to give the Minister time to respond to the touching appeal made to him by my hon. Friend the Member for Birmingham, Ladywood (Ms. Short), but it seems that he does not intend to do so. Although there have been many contributions, the debate has been interesting and useful. It must also have been a difficult one for the Minister and for his hon. Friend the Under-Secretary of State.

No one has asked why the regulations have been introduced, because we all know the reason. The simple, straightforward and ultimately compelling reason for the Government was the wish to save money. As my hon. Friend the Member for Ladywood rightly said, that is not because the Government are forced to save money in this area but because they have chosen to do so. Of the many dishonest facets of the Government's behaviour, one of the most consistently dishonest is the claim that they are constantly forced to do unpleasant things because the money is not there. In fact, the money is there, but the Government deliberately choose to spend it for the benefit of those who are already wealthy and to penalise the most vulnerable and the worse off in our society.

The scheme shares many characteristics with the rest of the Government's record. First, it is an administrative shambles. No one has sought to pretend otherwise from the moment that it was introduced. The only argument has been whether it is a greater shambles in Birmingham than in London or in one authority compared with another and who is most at fault.

Secondly, in common with many other Government schemes, this scheme seems to consist of arbitrary, ad hoc rules designed to save money in various ways. The Government have cast about for any nit-picking measure that they can devise and any little regulation that can be slipped in to save a few hundred thousand pounds or a couple of million here or there because they have lost the battle with the Treasury about saving money on the scheme.

Thirdly, the scheme shifts the blame and the burden of housing support on to someone other than the Government. If there is any utterly consistent characteristic of the Government — this is true of the Prime Minister even more than of other Ministers—it is that whatever goes wrong is someone else's fault. It is pathetic to see Ministers casting around for someone to blame for the dozens of things that go wrong daily under their Administration. They never admit that anything is their fault or the result of their actions. They always insist that they are in no way to blame.

In this case, not only the blame but a substantial administrative burden has been shifted on to local authorities, apparently without any understanding of the need to provide extra assistance to the authorities so that they can cope with the additional burden. I echo my hon. Friend the Member for Ladywood in asking for assurances from the Minsiter today that his colleagues at the Department of the Environment will not penalise local authorities for doing the Government's dirty work for them as there is no question at all of the authorities wishing to carry out such work.

The final characteristic that the scheme shares with so much else in the Government's record is that it deals with the poor more harshly and on a different basis from the rich. In his opening remarks the Minister sought to deal with two basic themes. He is too shrewd to attempt any major defence of a scheme that is recognised by every commentator and by anyone with experience of it as utterly hopeless. Instead, he tried to give the impression that the Government were being not merely generous but almost too generous to the poor, implying that the Government were so worried about their over-generosity that they felt compelled in the interests of the poor themselves to claw back some of the money through the cuts now proposed.

The Minister talked about the large earnings of people drawing housing benefit, suggesting that it was undesirable that people with above-average earnings could draw benefit and that the scale rates must be too generous. Ministers must recognise, however, that a person on above-average earnings can be entitled to housing benefit only if he has to pay a substantially above-average rent. The scale rates applying to average rents come nowhere near average male incomes. The Minister's comment thus applies only if the rent is excessive.

As my hon. Friend the Member for Oldham, West (Mr. Meacher) said in opening, excessive rents themselves are largely the result of Government policy. In this case, the culprit is not the DHSS but the Department of the Environment and the Government's overall economic strategy of substantially cutting support for local councils. Here again, therefore, the Government are criticising people for things that are caused entirely by the Government's own policy.

I sympathise greatly with the hon. Member for Brighton, Kemptown (Mr. Bowden) about the difficulties and complexities of the scheme. All of us—including, no doubt, Ministers—who speak on these matters do so with some trepidation. The hon. Member for Kemptown, too, seemed to be emphasising what one might charitably describe as the Minister's mistake in implying that the scheme was over-generous and gave away resources unnecessarily.

The hon. Member for Kemptown referred to the housing benefit supplement. He remarked on its complexity, and said that it was difficult to justify. However, I think that he was aware of the only reason for the existence of that supplement, which is as follows. Let us take the case of a married couple with two children, paying rent of £15 a week—a sum which is by no means uncommon — and who, because of the Government's success in keeping down wages in many of the most low-paid occupations, are earning incomes which are below even the short-term rate of supplementary benefit and yet are still on the rebate side of the scheme. Although their earnings amount to less than the short-term rate of supplementary benefit, they could end up paying a proportion of their housing costs. It is in order to avoid that aspect of the poverty trap that the housing benefit supplement was introduced. That is a clear rebuttal of the Minister's suggestion that the scheme is too generous. It is so ungenerous that the Government are forced to complicate it by special measures to deal with such people.

In particular, the Minister sought to imply that the Government are being generous to those who are really poor. I am afraid that that, too, is not true. Many hon. Members have referred to what may be the worst aspect of the cuts — the increases in the non-dependant deductions which are applied to young people. My hon. Friend the Member for Oldham, West and others highlighted the damaging effects that those cuts are likely to have, but I must return to the point again, because the contrast is so sharp, so significant, and so typical of everything that the Government do.

My hon. Friend quoted the Secretary of State's remarks on 6 February about the taxpayer's contribution. The Secretary of State said that "rather than the taxpayer, a non-dependant living in the house of someone claiming housing benefit should be expected to make a contribution to housing costs."

One could ask whether that is a valid argument, but if it is so vital that a young person with earnings who is living in someone else's household — probably that of his parents—should make a contribution, why is that only the case when the taxpayer's contribution takes the form of housing benefit? Why is it not a matter of concern when the young person is living in a household where mortgage relief is applicable? In such a household, the income is likely to be substantially greater and the need substantially less.

Let us consider the situation of a typical family with a high income and a high mortgage and one or two non-dependent children living at home. We might stretch a point and think of those hypothetical children as, say, Mark and Carol. Those children may have substantial incomes of their own. However, if they choose to live in their parents' household, not a penny will be required from them to lift the taxpayer's burden. It is only those whose families are already disadvantaged, whose families meet the Government's somewhat harsh criteria for entitlement to housing benefit, who are expected to make such a contribution.

Finally, still with the Government's claim to generosity in mind, I should like to follow an example set by the Government. Ministers constantly look back to the record of the previous Labour Government. I propose to look further back, to the record of the Conservative Government which preceded them. There was then a scheme of housing support. I want to highlight two facets of that scheme. We all recognise that in such a scheme of housing support, wherever the level of needs allowance falls, there is additional help for those who fall below the level and less help for those above it. Looking back to 1972, we find that, as one would expect, the treatment of those whose income is below the needs allowance is the more generous. That seems to be logical, because they are the people in the greatest need.

Today, we have heard the Minister warmly commending what his Government have done for the poor. However, the previous situation has been reversed. Among those who are able to benefit from the scheme as it now stands, the less income they have, the more harshly they are treated. The taper is worse for those below the needs allowance than those above it. That is ridiculous, even by the Government's standards.

Secondly, I am interested in the record of previous Conservative Administrations in relation to the level at which all benefit is lost. Today, all entitlement to benefit will be lost in a family where the income is £34 above the level of the needs allowance for that family. Over 10 years ago, in 1972, all entitlement to benefit was not lost until such a family earned £50 above the needs allowance. Those are not figures in real terms. They are cash figures. The difference is even worse than it appears to be at first sight.

We hope and expect that not only the hon. Member for Kemptown, but all the hon. Members who signed the early-day motion will join us in the Lobby. In particular, we intend to vote against the regulations dealing with the taper on the present scheme.

We note that the Government are engaged on a housing review. We have expressed astonishment that, when such a fundamental review—as it has been termed—is being undertaken, the Government should press ahead with these changes. We regret the fact that the review is precluded from examining anything other than the housing benefit scheme, and is not considering the side of housing support which deals with owner-occupiers. Perhaps the Under-Secretary can tell us that he will reconsider that point.

Most of all we regret the fact that—being consistent in this respect at least—the Government, claiming to be faced with the need to look for savings, have chosen once again to look to the poor rather than the rich. For that reason, if for no other, we shall vote against the regulations tonight.

6.57 pm
The Parliamentary Under-Secretary of State for Health and Social Security (Mr. Tony Newton)

I have had an irresistible feeling this afternoon that I am watching an old and familiar film that I have already seen 10 times. Unfortunately, the hon. Member for Oldham, West (Mr. Meacher) and his comments on housing benefit do not have the same addictive qualities as Julie Andrews in "The Sound of Music".

The fact that this has been a re-run of some old and tired arguments from the Opposition was reflected in the fact—acknowledged engagingly by the hon. Member for Birmingham, Handsworth——

Ms. Clare Short

Birmingham, Ladywood!

Mr. Newton

I am sorry. I was wrongly advised from on high. The new constituency includes the old constituency of Handsworth. The hon. Member for Birmingham, Ladywood (Ms. Short) engagingly acknowledged that the Opposition had had the greatest difficulty in sustaining the debate and wheeling in enough hon. Members to trot out the tired old arguments. However, that is a matter for the Opposition.

The debate has had three main elements. The major purpose of discussing both housing benefit and uprating in general is to enable us to discuss the uprating of housing benefit needs allowances, which has attracted relatively little controversy or comment. I entirely understand that—it is for the good and sufficient reason that it is being uprated in a perfectly normal way and will help many tenants because the needs allowances will be increased in line with the normal formula which reflects, among other things, changes in housing costs. It is right for me to remind the House of those beneficial changes as they have not received much attention except from my hon. Friend the Minister for Social Security.

The hon. Member for Norwood (Mr. Fraser) raised a specific point arising from the main uprating of housing benefit needs allowances. He said that there was little point in reducing the earnings disregard, despite the fact that it arose from applying the normal formula, because, he said, it will only go up again in April. I am afraid that I was not present when he made that point. The reduction in the disregard is a sign of the Government's success in reducing the burden of income tax on the low paid, as it is the result of the rise in tax thresholds. Moreover, the changes occur in November so that the low paid who receive housing benefit have already benefited from lower taxation since April. Although I can see that it can be argued whether 45p merits a change, I should say that the original cause was the increase in tax allowances, the benefit of which is already felt by those who are affected.

The second major theme of the debate was the miscellaneous changes in the various measures. They were given relatively little emphasis, partly, I imagine, because they are favourable. Oppositions tend not to comment on what the Government are doing when the results are favourable. Some of the changes are detailed and complicated, but almost all are beneficial. They are being made constructively in response to the comments that the Social Security Advisory Committee made earlier this year or in respeonse to specific suggestions that have been made by local authorities on how we can help them by simplifying and improving the scheme. I should like to emphasise that latter point to Opposition Members and my hon. Friend the Member for Brighton, Kemptown (Mr. Bowden).

Perhaps I should spell out in a little more detail the proposed change to apply the lower rate of non-dependant deduction to non-dependants who are sick or unemployed. Under the existing regulations, claimants must make a special application for the lower rate deduction, which cannot take effect earlier than in the week in which the claim is decided. The Social Security Advisory Committee recommended that the lower deduction should be backdated to the start of the claim if the conditions were satisfied then and that local authorities should make a positive inquiry into whether a non-dependant receives one of the qualifying benefits. We accepted both of those recommendations and this package contains the necessary amendments to give effect to them. The fact that claimants will no longer have to make separate applications for the lower deduction will make it easier for people to benefit. I am sure that both sides of the House welcome that.

We are making two other, albeit minor, changes that will benefit some claimants. When a non-dependant has just left school, he is normally unable to claim supplementary benefit in his own right until the end of his entitlement to child benefit—normally roughly at the end of the school holiday. If, however, he works during that time, he will be treated as a non-dependant for housing benefit purposes and may be expected to contribute towards the family's housing costs. In certain circumstances such as, for example, sickness or unpaid holidays, the fact that a non-dependant cannot claim supplementary benefit could result in his not receiving any income from which to make that contribution. That is clearly undesirable. To avoid such difficulties, we are providing for non-dependant deductions to be waived when a school leaver cannot claim supplementary benefit.

Ms. Clare Short

Big deal.

Mr. Newton

It is not a big deal in the great sweep of things, but it could be quite important to claimants who are expected to make a contribution from low income. The fact that we have taken the trouble to examine and tackle that problem makes pretty fair nonsense of much of what the hon. Lady said in her speech.

Ms. Short

Will the Minister admit that young people used to be entitled to benefit immediately after they left school and that the present Government took away that entitlement, thus creating the anomaly that he now claims great credit for correcting?

Mr. Newton

The cause of the anomaly is a good deal more complicated than that. Of course I acknowledge that the Government changed supplementary benefit entitlement, and I am prepared to defend it, if necessary, as it corresponds with another aspect of the reality of the way in which most people operate on leaving school. The fact remains that we have recognised the problem and tackled it.

We are amending the housing benefit regulations so that, if certificated housing benefit is in payment for two homes—that can happen in limited circumstances—a deduction for amenities that are included in the rent, such as heating, will be made only in respect of the dwelling in which the claimant lives. There is a limit to what can be regarded as available for fuel costs in the supplementary benefit scale of rates, and the amendment will help to ensure that claimants are not expected to pay more than is reasonable. I acknowledge that those changes are small but I hope that the House will welcome them.

The hon. Member for Norwood mentioned overseas students. Local authorities will have to make additional inquiries to establish which students are affected. That should be fairly straightforward in the majority of cases, but it is a sensitive matter. I accept that the hon. Gentleman has raised a serious point and we shall issue detailed guidance to authorities.

I need say little else about the miscellaneous changes except that I am fascinated and encouraged that nobody except my hon. Friend the Minister and the hon. Member for Oldham, West has said one word throughout the debate about the proposed regulation to deal with Sheffield council's attempted fiddled rent scheme to raise the amount of money that the city takes from housing benefit. I say that I am encouraged because——

Mr. Roland Boyes (Houghton and Washington)

The Minister should withdraw the word "fiddled".

Mr. Newton

If the hon. Gentleman prefers the expression "ripped off' to "fiddled", perhaps we can happily agree.

Mr. John Fraser

It could be called tax planning.

Mr. Newton

I was encouraged by the fact that the Opposition have become realistic enough not to attempt to defend Sheffield city council's proposition. It is extraordinary to suggest providing the minimum service at maximum cost, all at someone else's expense. That might be classified the ultimate Socialist scheme.

Mr. Tony Lloyd (Stretford)

I remind the Minister that yesterday the Secretary of State for the Environment called Sheffield the model of efficiency and said that it was an example to all other authorities. Obviously the Under-Secretary should talk to his right hon. Friend.

Mr. Newton

I do not imagine that my right hon. Friend, when he said that, had it in mind that Sheffield proposed to charge its poorest tenants the most rent——

Ms. Clare Short

To get the money back from the Government.

Mr. Newton


Mr. Robert Kilroy-Silk (Knowsley, North)

I like the idea of that.

Mr. Newton

It is a scheme to charge the poorest tenants the highest rent to attract additional subsidy from the Government. It is disguising that by providing a minuscule service which seems to consist primarily of easing doors after decoration. The council proposes to charge £5 a week to other tenants for that service and make them a repairs allowance of £5 a week. If Sheffield city council is spending an average of £5 a week to ease the doors of all of its tenants' properties after redecoration, we do not have to look far to see where it can make further economies.

Mrs. Beckett

Would it not be simpler for the Minister to admit that, as so often happens with the Government, the left hand does not know what the right hand is doing and that the Secretary of State for the Environment does not know what the DHSS is doing from one day to the next?

Mr. Newton

The Government have a consistent local government policy. My right hon. Friend the Secretary of State for the Environment is anxious to restrain increases in local authority expenditure. The DHSS is concerned that local authority expenditure is not sustained at a high level at the expense of the taxpayer and of other social security claimants. That would happen if Sheffield was allowed to get away with its proposals.

The main thrust of the debate is in relation to old ground—the spring package following the autumn statement of major changes in the housing benefit scheme. There is genuine merit in the overall strategy underlying housing benefit, despite the undoubted problems with some aspects of its introduction. I believe that that view is supported on both sides of the House.

The strategy replaced supplementary benefit help with rent and rates, as well as local authority rebates and allowances, with a single scheme administered by local authorities. In doing so, it has largely resolved the so-called "better off' problem—that is to say, the problem of claimants not knowing whether they would be better off on supplementary benefit or with rebates.

I respect the sincerity of my hon. Friend the Member for Brighton, Kemptown (Mr. Bowden) and I have noted his views. He implied that, under the housing benefit scheme, there had been a sudden need for beneficiaries to scurry between the DHSS and local authorities. It is inaccurate to say that the problems that they face have become increasingly complex.

The complexities of the "better off' problem under the previous scheme, when the two detailed systems of support, and of housing costs ran side by side, were at least as great as under the present scheme. In my view, the previous scheme was more complex.

The number of claimants, the amount of housing benefit and, to some extent, the increased difficulties of administration, are greater than anticipated. It is easier now to establish entitlement to housing cost, and it is likely that the take-up of benefits has increased, especially among pensioners who were so confused that they did not know their entitlement.

Ms. Clare Short

As I said in my speech, last week I visited the offices where the scheme is administered in Birmingham. Mr. McGrath, who is running the scheme, said that one of the merits claimed for the scheme was that it would deal with the "better off' problem. It does not do so. In practice, it is so complex that people still cannot work out whether they will be better off.

Mr. Newton

I accept that the new scheme has not entirely resolved the "better off' problem. That is why the housing benefit review was set up. We intend and expect that the review will deal with the problem. The problems encountered by the existing scheme should not be exaggerated as if the previous one had operated perfectly and avoided the difficulties that we are describing.

Mr. Andrew Bowden

I understand my hon. Friend, and I accept that the previous scheme was far from perfect. The difference is that the previous scheme was clear cut. Rebates were dealt with by local authorities, and rent entitlement was dealt with entirely by the DHSS. Now, the scheme works well if one is entitled only to standard housing benefit and difficulties arise when one is entitled to housing benefit supplement. Pensioners and others must go to the local authority office and to the DHSS office to sort out one specific entitlement in housing.

Mr. Newton

I understand my hon. Friend's point. Housing benefit supplement is one of the most difficult areas of the scheme. That is one of the reasons why we have asked Mr. Rowe to conduct the review, and why my hon. Friend is looking into these matters.

I must emphasise that we have made a vigorous effort to overcome one aspect of the housing benefit supplement problem. We have issued a formula to local authorities which should help them to identify readily most of the pensioners who are entitled to housing benefit supplement. I cannot undertake that all local authorities will use the formula or apply it in the way that we should like, but we have sought to tackle the problem. I hope that what emerges from the review will enable the problem to be tackled more effectively.

The hon. Member for Norwood asked some detailed questions. He gave the impression, when referring to non-dependant deduction for 16 to 17-year-olds, that the youngsters on the youth training scheme would be expected to contribute, where unemployed youngsters and those on supplementary benefit would not. That is not the case. The regulations continue the exemption of young people on YTS. They are not expected to make the contributions payable by other 16 to 17-year-olds.

Several general points were raised by the hon. Member for Oldham, West and by other hon. Members. We heard much about the poverty trap, in terms that seemed to overlook entirely the fact that the shallower the tapers for housing benefit — that is to say, the further up the income scale that housing benefit is allowed — the broader will be the poverty trap. More people will be subject to deductions over and above the tax threshold. The hon. Gentleman was really saying that we have slightly deepened the poverty trap for some groups, but have narrowed it. It is a matter of judgment where to strike the balance between narrowing the poverty trap and making it shallower or deeper, but it is misleading to suggest that we have increased the poverty trap without recognising the distinction between its width and its depth. I hope that the hon. Gentleman will acknowledge that at least.

I am tempted to say that the logic of what the hon. Members for Oldham, West, for Ladywood, and others say about the poverty trap would reduce those receiving housing benefit to nil. The quickest and easiest way of eliminating the poverty trap is to eliminate the benefits that give rise to it—the means-tested benefits that rise a long way up the income scale. If Opposition Members are to be serious contributors to the debates on social security, they must think more seriously about the poverty trap than they seem to have done this evening.

The hon. Member for Oldham, West, and to some extent the hon. Member for Ladywood, spoke in terms of a vendetta against 16 to 17-year-olds. Let us be clear that we are talking about 16 to 17-year-olds in work. Young men earn an average wage of £67 a week, and young women and average of £61 a week. We expect them to contribute only £3.30 a week to household costs, including rates. If that is construed as a vendetta against young people, I think that Opposition Members are living in a dream world.

Mr. Meacher

Rent rebate families are basically poor families. If it is not right that the non-dependant deductions should apply to better-off families who are getting tax relief on mortgages, why should not the taxpayer be relieved on the mortgage interest burden?

Mr. Newton

I should like to ask the hon. Member for Oldham, West a question or two. I do not know whether that is in order, Mr. Deputy Speaker.

We have heard much about mortgages this afternoon. We now have it firmly on the record that it is official Opposition policy, as I understand it, to restrict mortgage interest relief to the basic rate of tax. That will be of interest to a number of people. I hope that the hon. Gentleman will confirm my understanding of his remarks this afternoon. But let us now go beyond that. The hon. Gentleman is now suggesting that he intends to reduce mortgage interest relief for families on the basic rate of tax according to their children's income. Is that or is that not the policy of the Opposition?

Mr. Meacher

No, it is not. It is perfectly clear that it is not. The argument was that, if it is right for non-dependant deductions to be made in respect of poor families who are on a rent rebate — that is the Government's policy, not our policy — why is it not right for it also to be done for richer families getting mortgage interest relief? That is a problem for the Government because it is their policy, not ours.

Mr. Newton

In that case, may we take it that the Opposition's policy is to pay housing benefit regardless of the income coming in to households, in other words, to pay subsidies for rent regardless of the ability of people living in the household to contribute to those costs? If so, not only would the benefit bill be increased beyond what the Government think it should be, but, in what I would regard as a profligate and irresponsible way, that would consume money that could be better used for beneficiaries who need additional benefit and for whom we are not able to do sufficient.

Ms. Clare Short

Will the Minister give way?

Mr. Newton

I shall not give way again. The House is anxious to bring the debate to a conclusion.

Ms. Short

What about research?

Mr. Newton

We are looking at that matter in the wider context of a review of benefits for children and young people. The hon. Lady will understand that it is a difficult area. It would require long-term and complex research. It is in that broader context that we are considering the matter.

That brings me to the point on which I should like to end because in a way it reflects the attitude of the Opposition throughout the debate. We have heard a great deal about losers and problems, but we have heard nothing about the million pensioners who gained an average of £1 a week when housing benefit was introduced. We have heard nothing about the million families who will gain first this November and then next April from the real increase in the children's needs allowances under the housing benefit scheme. Above all, we have heard nothing that reflects the fact that the vast majority of the least well off tenants on housing benefit, whether pensioners or others, are left untouched by the package, which does no more than make a modest and sensible economy in the social security budget from those on housing benefit who are among the better off of those who receive social security benefits. It is a reasonable, sensible and balanced policy. I have no doubt that it will have the support of my right hon. and hon. Friends in the Lobby.

Question put and agreed to.

Resolved, That the draft Housing Benefits (Increase of Needs Allowances) Regulations 1984, which were laid before this House on 6th July, be approved.

Motion made—[Mr. Meacher]—and Question put, That an humble Address be presented to Her Majesty, praying that the Housing Benefits Amendment (No. 3) Regulations 1984 (S.I., 1984, No. 940), dated 3rd July 1984, a copy of which was laid before this House on 6th July, be annulled: —

The House divided: Ayes 170, Noes 271.

Division No. 417] [7.25 pm
Abse, Leo Eadie, Alex
Adams, Allen (Paisley N) Eastham, Ken
Alton, David Edwards, Bob (W'h'mpt'n SE)
Anderson, Donald Ellis, Raymond
Archer, Rt Hon Peter Evans, John (St. Helens N)
Ashdown, Paddy Fatchett, Derek
Ashley, Rt Hon Jack Faulds, Andrew
Ashton, Joe Flannery, Martin
Atkinson, N. (Tottenham) Forrester, John
Barnett, Guy Foster, Derek
Beckett, Mrs Margaret Foulkes, George
Beith, A. J. Fraser, J. (Norwood)
Bermingham, Gerald Freeson, Rt Hon Reginald
Bidwell, Sydney Freud, Clement
Blair, Anthony George, Bruce
Bowden, A. (Brighton K'to'n) Gilbert, Rt Hon Dr John
Boyes, Roland Godman, Dr Norman
Bray, Dr Jeremy Golding, John
Brown, N. (N'c'tle-u-Tyne E) Gould, Bryan
Brown, R. (N'c'tle-u-Tyne N) Hamilton, W. W. (Central Fife)
Brown, Ron (E'burgh, Leith) Hardy, Peter
Bruce, Malcolm Harman, Ms Harriet
Buchan, Norman Harrison, Rt Hon Walter
Callaghan, Jim (Heyw'd & M) Healey, Rt Hon Denis
Campbell-Savours, Dale Heffer, Eric S.
Carlile, Alexander (Montg'y) Hogg, N. (C'nauld & Kilsyth)
Carter-Jones, Lewis Holland, Stuart (Vauxhall)
Cartwright, John Howell, Rt Hon D. (S'heath)
Clark, Dr David (S Shields) Hoyle, Douglas
Clarke, Thomas Hughes, Dr. Mark (Durham)
Clay, Robert Hughes, Robert (Aberdeen N)
Clwyd, Mrs Ann Hughes, Sean (Knowsley S)
Cohen, Harry Hughes, Simon (Southwark)
Coleman, Donald John, Brynmor
Conlan, Bernard Johnston, Russell
Cook, Robin F. (Livingston) Jones, Barry (Alyn & Deeside)
Corbett, Robin Kennedy, Charles
Cowans, Harry Kilroy-Silk, Robert
Cox, Thomas (Tooting) Kirkwood, Archy
Craigen, J. M. Lamond, James
Crowther, Stan Leadbitter, Ted
Cunliffe, Lawrence Leighton, Ronald
Cunningham, Dr John Lewis, Ron (Carlisle)
Dalyell, Tarn Lewis, Terence (Worsley)
Davies, Rt Hon Denzil (L'lli) Litherland, Robert
Davies, Ronald (Caerphilly) Lloyd, Tony (Stretford)
Davis, Terry (B'ham, H'ge H'l) Lofthouse, Geoffrey
Deakins, Eric Loyden, Edward
Dewar, Donald McCartney, Hugh
Dixon, Donald McCrea, Rev William
Dormand, Jack McDonald, Dr Oonagh
Dubs, Alfred McKay, Allen (Penistone)
Dunwoody, Hon Mrs G. McKelvey, William
Mackenzie, Rt Hon Gregor Ross, Ernest (Dundee W)
McTaggart, Robert Rowlands, Ted
McWilliam, John Sedgemore, Brian
Madden, Max Sheerman, Barry
Marek, Dr John Sheldon, Rt Hon R.
Marshall, David (Shettleston) Shore, Rt Hon Peter
Mason, Rt Hon Roy Short, Ms Clare(Ladywood)
Maxton, John Short, Mrs R.(W'hampt'n NE)
Maynard, Miss Joan Silkin, Rt Hon J.
Meacher, Michael Smith, C.(Isl'ton S & F'bury)
Meadowcroft, Michael Snape, Peter
Mikardo, Ian Soley, Clive
Millan, Rt Hon Bruce Spearing, Nigel
Miller, Dr M. S. (E Kilbride) Stewart, Rt Hon D. (W Isles)
Mitchell, Austin (G't Grimsby) Strang, Gavin
Morris, Rt Hon A. (W'shawe) Straw, Jack
Morris, Rt Hon J. (Aberavon) Thompson, J. (Wansbeck)
Nellist, David Thorne, Stan (Preston)
Oakes, Rt Hon Gordon Tinn, James
O'Brien, William Torney, Tom
Orme, Rt Hon Stanley Warden, Gareth (Gower)
Park, George Wareing, Robert
Parry, Robert Weetch, Ken
Patchett, Terry Welsh, Michael
Pavitt, Laurie White, James
Pike, Peter Wilson, Gordon
Powell, Raymond (Ogmore) Winnick, David
Prescott, John Woodall, Alec
Redmond, M. Wrigglesworth, Ian
Rees, Rt Hon M. (Leeds S) Young, David (Bolton SE)
Roberts, Ernest (Hackney N)
Robertson, George Tellers for the Ayes:
Rogers, Allan Mr. Frank Haynes and Mr. James Hamilton.
Rooker, J. W.
Aitken, Jonathan Forth, Eric
Alexander, Richard Fox, Marcus
Alison, Rt Hon Michael Franks, Cecil
Amery, Rt Hon Julian Fraser, Peter (Angus East)
Atkins, Rt Hon Sir H. Freeman, Roger
Atkins, Robert (South Ribble) Fry, Peter
Baker, Rt Hon K. (Mole Vall'y) Gale, Roger
Benyon, William Galley, Roy
Berry, Sir Anthony Gardiner, George (Reigate)
Biggs-Davison, Sir John Gardner, Sir Edward (Fylde)
Boscawen, Hon Robert Glyn, Dr Alan
Bottomley, Peter Goodhart, Sir Philip
Bottomley, Mrs Virginia Goodlad, Alastair
Bowden, Gerald (Dulwich) Gow, Ian
Boyson, Dr Rhodes Grant, Sir Anthony
Brandon-Bravo, Martin Greenway, Harry
Brittan, Rt Hon Leon Gregory, Conal
Brooke, Hon Peter Griffiths, E. (B'y St Edm'ds)
Brown, M. (Brigg & Cl'thpes) Griffiths, Peter (Portsm'th N)
Browne, John Grist, Ian
Bruinvels, Peter Ground, Patrick
Bryan, Sir Paul Grylls, Michael
Buck, Sir Antony Gummer, John Selwyn
Butcher, John Hamilton, Hon A. (Epsom)
Carlisle, Rt Hon M. (W'ton S) Hamilton, Neil (Tatton)
Chapman, Sydney Hanley, Jeremy
Clark, Dr Michael (Rochford) Hannam, John
Clark, Sir W. (Croydon S) Hargreaves, Kenneth
Clegg, Sir Walter Harris, David
Colvin, Michael Harvey, Robert
Coombs, Simon Haselhurst, Alan
Cope, John Havers, Rt Hon Sir Michael
Couchman, James Hawkins, Sir Paul (SW N'folk)
Crouch, David Hawksley, Warren
Dorrell, Stephen Hayhoe, Barney
Douglas-Hamilton, Lord J. Haynes, Frank
Dykes, Hugh Hayward, Robert
Farr, Sir John Heathcoat-Amory, David
Favell, Anthony Heddle, John
Fenner, Mrs Peggy Hickmet, Richard
Fletcher, Alexander Hicks, Robert
Fookes, Miss Janet Higgins, Rt Hon Terence L.
Forman, Nigel Hind, Kenneth
Forsyth, Michael (Stirling) Hirst, Michael
Hogg, Hon Douglas (Gr'th'm) Newton, Tony
Holland, Sir Philip (Gedling) Nicholls, Patrick
Holt, Richard Normanton, Tom
Hooson, Tom Norris, Steven
Hordern, Peter Onslow, Cranley
Howard, Michael Oppenheim, Rt Hon Mrs S.
Howarth, Gerald (Cannock) Ottaway, Richard
Howell, Rt Hon D. (G'ldford) Page, Sir John (Harrow W)
Howell, Ralph (N Norfolk) Page, Richard (Herts SW)
Hubbard-Miles, Peter Parkinson, Rt Hon Cecil
Hunt, David (Wirral) Parris, Matthew
Hunt, John (Ravensbourne) Patten, John (Oxford)
Hunter, Andrew Pawsey, James
Hurd, Rt Hon Douglas Peacock, Mrs Elizabeth
Jackson, Robert Pollock, Alexander
Jenkin, Rt Hon Patrick Powell, William (Corby)
Jessel, Toby Powley, John
Johnson Smith, Sir Geoffrey Prentice, Rt Hon Reg
Jones, Robert (W Herts) Price, Sir David
Jopling, Rt Hon Michael Proctor, K. Harvey
Joseph, Rt Hon Sir Keith Raffan, Keith
Kershaw, Sir Anthony Rathbone, Tim
Kilfedder, James A. Rees, Rt Hon Peter (Dover)
King, Roger (B'ham N'field) Renton, Tim
King, Rt Hon Tom Rhodes James, Robert
Knight, Gregory (Derby N) Ridley, Rt Hon Nicholas
Knight, Mrs Jill (Edgbaston) Ftidsdale, Sir Julian
Knowles, Michael Roberts, Wyn (Conwy)
Knox, David Robinson, Mark (N'port W)
Lang, Ian Floe, Mrs Marion
Lawler, Geoffrey Ross, Stephen (Isle of Wight)
Lawrence, Ivan Rost, Peter
Lawson, Rt Hon Nigel Rowe, Andrew
Lee, John (Pendle) Ryder, Richard
Leigh, Edward (Gainsbor'gh) Sainsbury, Hon Timothy
Lennox-Boyd, Hon Mark St. John-Stevas, Rt Hon N.
Lewis, Sir Kenneth (Stamf'd) Sayeed, Jonathan
Lightbown, David Scott, Nicholas
Lilley, Peter Shaw, Sir Michael (Scarb')
Lloyd, Ian (Havant) Shelton, William (Streatham)
Lloyd, Peter, (Fareham) Shepherd, Colin (Hereford)
Lord, Michael Shepherd, Richard (Aldridge)
Luce, Richard Silvester, Fred
McCrindle, Robert Sims, Roger
McCurley, Mrs Anna Skeet, T. H. H.
Macfarlane, Neil Smith, Sir Dudley (Warwick)
MacGregor, John Smith, Tim (Beaconsfield)
MacKay, Andrew (Berkshire) Soames, Hon Nicholas
MacKay, John (Argyll & Bute) Spencer, Derek
Maclean, David John Spicer, Jim (W Dorset)
McNair-Wilson, P. (New F'st) Spicer, Michael (S Worcs)
McQuarrie, Albert Squire, Robin
Madel, David Stanley, John
Major, John Steen, Anthony
Malone, Gerald Stern, Michael
Maples, John Stevens, Lewis (Nuneaton)
Marland, Paul Stewart, Allan (Eastwood)
Marlow, Antony Stewart, Andrew (Sherwood)
Mates, Michael Stokes, John
Mather, Carol Stradling Thomas, J.
Maude, Hon Francis Sumberg, David
Mawhinney, Dr Brian Tapsell, Peter
Maxwell-Hyslop, Robin Taylor, John (Solihull)
Mayhew, Sir Patrick Taylor, Teddy (S'end E)
Mellor, David Temple-Morris, Peter
Merchant, Piers Thompson, Donald (Calder V)
Meyer, Sir Anthony Thompson, Patrick (N'ich N)
Miller, Hal (B'grove) Thorne, Neil (Ilford S)
Mills, lain (Meriden) Thornton, Malcolm
Mills, Sir Peter (West Devon) Thurnham, Peter
Miscampbell, Norman Townend, John (Bridlington)
Mitchell, David (NW Hants) Townsend, Cyril D. (B'heath)
Moate, Roger Tracey, Richard
Montgomery, Fergus Trippier, David
Morris, M. (N'hampton, S) Trotter, Neville
Morrison, Hon C. (Devizes) Twinn, Dr Ian
Morrison, Hon P. (Chester) van Straubenzee, Sir W.
Murphy, Christopher Vaughan, Sir Gerard
Needham, Richard Viggers, Peter
Nelson, Anthony Waddington, David
Wakeham, Rt Hon John Whitfield, John
Waldegrave, Mon William Whitney, Raymond
Walden, George Wiggin, Jerry
Wall, Sir Patrick Winterton, Nicholas
Waller, Gary Wolfson, Mark
Walters, Dennis Wood, Timothy
Ward, John Yeo, Tim
Wardle, C. (Bexhill) Young, Sir George (Acton)
Warren, Kenneth Younger, Rt Hon George
Watson, John
Watts, John Tellers for the Noes:
Wells, Bowen (Hertford) Mr. Michael Neubert and Mr. Tristan Garel-Jones.
Wells, Sir John (Maidstone)
Wheeler, John

Question accordingly negatived.