HC Deb 27 June 1988 vol 136 cc114-21
Mr. Keith Bradley (Manchester, Withington)

I beg to move amendment No. 93, in page 70, line 17, at end insert— 'The functions prescribed by the Secretary of State shall not apply to any tenancy or licence granted by a local authority'.

Mr. Deputy Speaker

With this it will be convenient to consider the following amendments: No. 389, in page 70, line 22, after 'areas', insert— '(bb) shall make provision that the rent level for any accommodation determined by a rent officer as reasonable for the calculation of rent allowance subsidy shall be the maximum rent chargeable by a landlord for that accommodation;'.

No. 390, in page 70, line 22, after 'areas' insert— '(bc) shall make provision that the rent level determined by a rent officer as reasonable for a tenancy for the calculation of rent allowance subsidy shall not be lower than the rent level for that tenancy determined by a rent assessment committee under this Act or under the Rent Act 1977;'.

No. 92, in page 70, line 24, at end insert— '; and

  1. (d) shall not apply to a tenancy granted by a registered housing association.'.

No. 95, in page 70, line 24, at end insert— ', and

  1. (d) shall make provision that the Rent Officer, in determining the rent on an assured tenancy for the purpose of housing benefit subsidy shall, if he determines that the rent payable is above the proper market level, in every case provide the local authority in writing with such details as shall be prescribed in the order concerning the availability of suitable alternative properties in the authorities area at the rent level which he has determined.'.

No. 97, in page 70, line 24, at end insert— '; and

  1. (d) shall contain provisions such that the rent of an assured tenancy determined by a Rent Assessment Committee shall be the minimum rent eligible for rent allowance subsidy. The minimum eligible rent will be the rent payable after the deduction, in accordance with such provisions as may be prescribed, of any items ineligible for the purposes of calculating entitlement to benefit.'.

No. 98, in page 70, line 24, at end insert— '; and

  1. (d) shall make provisions for a local authority to have a right of appeal against a Rent Officer's determination in any particular case.'.

No. 96, in page 70, line 29, leave out subsection (4) and insert— '(4) In section 20 of that Act (income related benefits) at the end of subsection (8) there shall be added the words "or maximum payments eligible for a rent allowance.".'.

No. 94, in page 70, line 47, at end insert— '(8) In Section 51(t) of the Social Security Act 1986 shall be added:

  1. "(iv) Pending a determination by the Rent Officer under section 106 of the Housing Act 1988 the authority shall make payments calculated on the basis of the actual rent payable."
(9) No reduction in an authority's entitlement or subsidy shall take effect until the notice of a determination by the Rent Officer is received by the authority.'.

Mr. Bradley

I have been asked to move the amendments briefly. I am happy to do that, because in the past few hours we have witnessed the biggest shambles that I imagine the House has ever witnessed involving the Housing Bill. It would be a complete waste of time for me to contribute further to that shambles.

As a new Member of the House, I thought when I served on the Committee to consider the Housing Bill, that there would be some meaning to our discussions and thattoday we would be debating the consequences of those discussions. This evening, and particularly the Minister's response to the last set of amendments, has made it clear that that was an illusion. Therefore, we can move the rest of the amendments very briefly so that we do not contribute any more to the shambles of the Housing Bill, which is a complete mess between the Secretary of State and the Minister.

The amendments centre on the important provisions relating to housing benefit and rents in the private rented sector. They concern the powers of the rent officer and the rent assessment committee, and the particular power of the Secretary of State to set a rent stop to the new market rents that will be charged.

Throughout the discussions on the Housing Bill, we have argued, whether through social security or by the provisions of the Housing Bill, that the only way in which low-income families will be able to afford the new rent regime that will be set up by the Housing Bill is if housing benefit fully covers the new rents. [Interruption.]

I know that many Conservative Members are not interested in listening to the debate, as other discussions are taking place around the Chamber. They are not interested in the issues that we are debating and I am sure that you, Mr. Speaker, would prefer them to participate in the debate. [Interruption.]

Mr. Speaker


Mr. Bradley

If the hon. Member for Littleborough and Saddleworth (Mr. Dickens) wishes to contribute to the debate, I am happy to give way.

Mr. Geoffrey Dickens (Littleborough and Saddleworth)

I was saying that the noise was coming from places other than behind the Bar of the House. Other people were talking; the hon. Gentleman knows to whom I am referring.

9.30 pm
Mr. Bradley

That sums up the contribution of the hon. Member for Littleborough and Saddleworth (Mr. Dickens) to the debate on the Housing Bill. He has no interest in the topic or in the needs of the tenants of Littleborough and Saddleworth. I am sure that they will recognise that at the next general election.

We are talking about the rent stop that will be imposed by the Government and the way in which it will apply to many low-income families in desperate need of private rented accommodation. It could be summed up by a letter that I am sure will be received by many Members of Parliament in their advice surgeries after the Bill is enacted. Such a letter may be written to the Minister and it may say something like the following: I am a widow responsible for two children. I have always worked and have never had to claim means-tested benefits before now. I live in an assured tenancy and pay a rent of £67 per week, which I was able to meet until I was forced to give up work due to illness. I have claimed income support which goes part of the way to meeting the day-to-day needs of my family, but the local authority is only allowed to pay £55 towards my rent. The local authority tells me that it has no discretion and that the £55 is a rent stop imposed by central Government. I don't know if I will get better or how long it will take. I don't know how to meet the £12 a week that I am short for the rent. My only options appear to be as follows: (a) to go into rent arrears while I hunt for cheaper accommodation; (b) to go without food and other essentials so that I can meet the full rent commitment; (c) to give up my present accommodation and report as homeless to the local authority; or (d) to go into arrears, have possession proceedings taken against me and again end up homeless. Option (a) is a difficult and time-consuming process in this area at the best of times, but virtually impossible in my present state of health. Option (c) depends upon the local authority not finding me intentionally homeless. I hope it will have something more than a bed and breakfast hotel to offer. What should I do? That is a direct question to the Minister. He should explain what people in such circumstances should do. People at the top of the rented market will not be able to afford the accommodation that his new private sector regime will impose on many families desperately seeking accommodation.

For once I want the Minister to answer a question that has been posed. He would not give way to me during a previous debate when he again attacked local authorities which are trying to give information to their tenants about the Housing Bill and perhaps about this issue. He made that attack during an Opposition day debate on housing three or four weeks ago. He said that a local authority has issued misinformation about the Housing Bill. I asked him to supply me with a copy of the leaflet that Manchester city council had issued. He acknowledged receipt of my letter but has not supplied me with the leaflet. I should like to know when he will supply me with the leaflet.

I should also like to question the Minister on a concession he made in Committee. We have heard a lot about concessions and about the fact that he has reneged on many of the commitments he gave in Committee. He gave a concession on amendment No. 98 which gives a local authority a right to appeal against the rent level set by the rent officers' determination. He gave an undertaking that the regulations would provide "some form of appeal" by the local authority. What rights will that appeal give and where is his provision for the appeal? I should like him to say that the provision can be used by the authority in every case and that the Government do not restrict it to specific circumstances.

I have moved the amendments briefly. A large part of clause 109 will put decent housing, backed up by rent allowances through housing benefit, out of reach of many people. I should like the Minister to honour his earlier commitment that housing benefit will be available. Cut after cut in housing benefit has forced people out of decent housing. He should honour the commitments that he has given and, for once, answer the questions put to him.

Mr. Simon Hughes

I wish to speak especially to amendments Nos. 389 and 390. They are linked to the important point made by the hon. Member for Manchester, Withington (Mr. Bradley).

We have moved from debates about the way in which people can decide to part V of the Bill and how much a decision or lack of a decision will cost them. My hon. Friend the Member for Brecon and Radnor (Mr. Livsey) and I tabled the amendments to address the most fundamental defects of the new regime for the calculation of rent allowance subsidy and housing benefit. We want to ensure—it will be crucial to tenants—that there will be a guarantee that a rent assessment committee and a rent officer will not determine different levels of rent as suitable for the same accommodation. It is equally crucial that, once a rent officer has deemed a rent suitable for any accommodation—whether or not a decision has been made by a rent assessment committee—the tenant should not have to pay rent at a level higher than that used for calculating the housing benefit to which he or she is entitled.

In the amendments, we are trying to ensure that rent determined as reasonable by a rent officer shall be the maximum rent chargeable by a landlord. If not, a rent assessment officer may decide that a reasonable rent for a property should be about £80—that is the amount by which housing benefit is calculated—but the rent may be assessed at over £100, leading to a shortfall. As the system of subsidy will be through housing benefit, for someone on Government subsidy that shortfall will be unmanageable.

Amendment No. 390 provides that the rent level determined by a rent officer as reasonable for a tenancy for the calculation of rent allowance subsidy shall not be lower than the rent level for that tenancy determined by a rent assessment committee under this Act or under the Rent Act 1977". Instead of coming to the rescue of tenants on state or low incomes with a system of guaranteed affordable rents, the Government are saying that, through the DHSS housing benefit system, the taxpayer will subsidise any shortfall. That presumes, first, that the amount of rent paid is equal to the amount of subsidy, which clearly is not the case, and, secondly, that the Chancellor of the Exchequer and the Secretary of State for Social Services—if he is to be in charge of writing the cheques—will continue to meet the subsidy.

Since 1979, the Government have regularly cut housing benefit. When times get harder—today's economic news is not too encouraging—we do not trust the Government not to cut housing benefit again. The more housing benefit is cut, the more there will be prejudice against people who desperately need housing and do not have the personal income and capacity to go out into the market place to buy it.

We have tabled two straightforward amendments. They are crucial to the proper and just functioning of a system that says that housing will be available and that, no matter how low one's income, one will not be priced out of the market. The figures which the Under-Secretary of State revealed to me last week of the record numbers of homeless show that record numbers of people in England and Wales are being priced out of the market, in town and country, in the north and south. We are trying to ensure that the welfare state—part of whose legacy we are celebrating in the coming weeks—is not seen as an irrelevance in coping with the new jungle of the Government's market place. I hope that the Government will accept the principle and detail of the amendments.

Mr. Waldegrave

The reasons for the Government opposing amendment No. 93 are not as obvious as our reasons for opposing some other amendments. It would confine the rent officer procedure to benefit claims submitted by private sector tenants. The precise definition of cases to be referred to the rent officer is still under consideration, in consultation with local authority associations. It is important to ensure that the scope of the arrangements is sufficient to embrace all appropriate cases.

Although the rent officer procedure has been formulated with the intention that it should apply to private sector tenants—those who claim rent allowances—the question whether one small category of rent rebate cases might sensibly be referred to the rent officer is being discussed. If there were a desire to include the rent rebate cases, amendments to the Bill would be needed to include a reference to rent rebate subsidy.

Amendment No. 389, to which the hon. Member for Southwark and Bermondsey (Mr. Hughes) referred, would require the rent officer's assessment under the clause 109 procedure to become the maximum rent chargeable for the accommodation. I shall be more friendly about amendment No. 390, but amendment No. 389 would fly in the face of the principle of our scheme.

I hope that I can reassure the hon. Member for Manchester, Withington (Mr. Bradley), the first part of whose speech I did not hear completely—through no fault of his—but I got the general drift. He knows that the present system for housing benefit has a rent stop, to which he rightly referred. There is an interim system of regional rents and so on. I am not sure that the hon. Gentleman has fully recognised that the Bill does away with that system and improves the position for exactly those tenants to whom he referred.

The real market rent must be met by housing benefit for those eligible for it. Under the present interim system, there are circumstances in which that need not be so. The Bill makes it clear that in his new role the rent officer merely has to ensure against the possibility—as we discussed in Committee—of rents being led by a racket, so that housing benefits lead the rents ahead of the real market rent. That is all—no more and no less—that the scheme intends to do.

Amendment No. 390, providing that the rent officer's assessment shall not be lower than a rent determined by a rent assessment committee, is unnecessary. Where the rent assessment committee has determined the rent for a tenancy, the regulations will provide that that rent will automatically be accepted as a reasonable market rent. The point made by the hon. Member for Southwark and Bermondsey is therefore met. The rent assessment committee's assessment overrides the rent officer's assessment if there is a conflict. Amendment No. 97 is likewise unnecessary.

Amendment No. 92 would exclude registered housing association lettings. It is exceedingly unlikely that registered housing associations will be relevant in this respect. They receive large subsidies to keep their rents below market levels, but it seems wrong to exclude them, lest there is some isolated case in which the rent charged by an association is above market level and in which referral to the rent officer is appropriate. That is unlikely, but we have decided to leave in that provision.

Amendment No. 95 would require rent officers to consider the availability of suitable alternative accommodation. We do not believe that that is the role of the rent officer. His job will be to establish whether a particular rent that is being charged is reasonable in terms of the market and to assess the claimant's accommodation on the basis of the criteria prescribed by the Secretary of State.

Mr. Simon Hughes

How, in practice, will that be possible without carrying out a comparative exercise, which has traditionally been required during the last 20 years? That seems to me to be the logical action for rent officers to take.

9.45 pm
Mr. Waldegrave

Yes, in assessing the market the rent officer must look at a variety of comparable properties.

I return to the important point which was raised by the hon. Member for Withington and which is dealt with in amendment No. 98. I gave, and I repeat now, a firm undertaking in Committee that there will be a right of appeal against rent officer assessments. That is important. We have had complicated discussions with local authority interests about it and about the best way to deal with it. There is no dispute between us, but there are a variety of ways of dealing with the matter. Therefore, we are looking at it in detail. We want to devise a system that can operate quickly—it must not be too elaborate—and produce fair decisions. I assure the hon. Gentleman that we stand by our undertaking to introduce an appeals procedure. If an amendment is needed, we shall table such an amendment in the other place.

Amendment No. 96 is directed at our intention to place a limit in due course on housing benefit in circumstances where the claimant is occupying unreasonably expensive accommodation. That is what local authorities do already. It is a matter that we discussed in Committee. It is right that such a limit should be introduced. There is nothing new about that principle.

The power to limit benefit will not be used until adequate market evidence is available, but the need to make proper use of public funds makes it imperative that there should be some kind of restriction on such cases. That is no different from what local authorities do already.

Amendment No. 94 would provide for the making of interim payments, pending assessment of a benefit claimant's rent by the rent officer. We recognise that some provision for interim payments is likely to be needed and we are discussing with the local authority associations and rent officers what form it should take. We would certainly not accept the principle of the amendment that the payment should be based on whatever rent is currently being paid, however unreasonable that rent might be. An interim arrangement will be needed.

There is a difference of opinion about some of these matters but I hope that I have reassured hon. Members about others and that they will feel able not to press the amendment to a Division.

Mr. Bradley

In the light of the Minister's reply, and given his assurance that local authorities will have the right of appeal and that housing benefit will be paid on new market rents in full, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Mr. Soley

I beg to move amendment No. 99, in page 70, line 19, leave out paragraph (a) and insert— `(a) shall not be made in the first instance unless a draft of the order has been laid before and approved by an affirmative resolution of each House of Parliament.'.

Mr. Speaker

With this, it will be convenient to discuss Government amendments Nos. 58 and 59.

Mr. Soley

It may be convenient if I allow the Minister to respond, as he has gone some way towards meeting our point.

Mr. Waldegrave

The hon. Gentleman is right. There is little between us. When we discussed clause 109—it was clause 106 in Committee—Opposition Members argued that all orders made under the clause should be subject to the affirmative resolution. We took the view that that would be an unreasonably cumbersome procedure. However, we accepted that the initial order made under the clause, which will set out the new procedures for the first time, will attract particular interest and that Parliament might reasonably expect to have an automatic opportunity to debate it. Therefore, we propose as a compromise that the provision in the Bill should be modified to the extent of requiring that the affirmative resolution procedure should be applied to the first order made under clause 109. That is what amendments Nos. 58 and 59 are designed to do.

Amendment negatived.

Amendments made: No. 58, in page 70, line 19, after `instrument', insert— 'which except in the case of the first order to be made shall be'.

No. 59, in page 70, line 24, at end insert— `and the first order under this section shall not be made unless a draft of is has been laid before, and approved by a resolution of, each House of Parliament'.—[Mr. Waldegrave.]

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