§ 2. Mr. Austin Mitchell (Great Grimsby)If he will end the system of paying housing benefit for council tenants out of housing revenue accounts. [39504]
§ The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Mr. Nick Raynsford)Removing the cost of rent rebates for council tenants from housing revenue accounts would cost the taxpayer an extra £1.3 billion this year. We are considering housing finance as part of our comprehensive spending review and we expect to announce conclusions from the review in the summer.
§ Mr. MitchellI am sure that my hon. Friend agrees that the system of paying the housing benefit of council tenants from housing revenue accounts is inherently and monstrously unfair. It means that the poor are subsidising the poorest, it costs every working council house tenant £1,000 a year and it prevents a reduction in rents, which are higher than they otherwise would, or should, be. 547 I am sure that my hon. Friend—who is a fair man—agrees with me, so why will he not give a date for abolishing that monstrosity?
§ Mr. RaynsfordI have answered my hon. Friend's question by saying that we are considering these matters in the context of the comprehensive spending review. I put it to him that a consequence of simply ending the current arrangement would be windfall gains to areas of relatively low need and no help for areas of high need. That is why his proposal is not on. Abolishing the current arrangement would provide a benefit of more than £1,000 per dwelling per year in Guildford, but no benefit whatsoever in Manchester. That cannot be right.
§ Mr. Simon Hughes (Southwark, North and Bermondsey)I support the hon. Member for Great Grimsby (Mr. Mitchell) and stress that this is not a party political matter. Council tenants are furious that the system penalises them and that they must subsidise an unrelated issue: housing benefit. It is not a matter of whether the subsidies differ between authorities; it is whether individuals pay for the services they receive or pay for others to receive services that are unrelated to them.
§ Mr. RaynsfordI am rather surprised that the hon. Gentleman has raised that issue because the suggestion made by my hon. Friend the Member for Great Grimsby (Mr. Mitchell)—which the hon. Gentleman supports—would not benefit his tenants in Southwark, but there would be an immediate benefit in Wokingham of £970 a year. That cannot be right or equitable.