HC Deb 24 May 1999 vol 332 cc14-5
11. Mr. Chris Mullin (Sunderland, South)

What plans he has to increase local authority discretion in respect of the payment of housing benefit; and if he will make a statement. [84001]

The Parliamentary Under-Secretary of State for Social Security (Angela Eagle)

We have announced our intention to publish a housing Green Paper later in the year. A modern housing policy should ensure that everyone has the opportunity of a decent home. The Green Paper will discuss options to address weaknesses in the current system of housing and housing benefit within our overall objectives for welfare reform.

Mr. Mullin

Is the Minister aware that, in many areas, housing benefit has become a subsidy for some of the worst landlords? The interests of both taxpayer and tenant might be better served if local authorities were given some discretion over which kind of landlords were eligible to receive housing benefit. I appreciate that my hon. Friend may tell me that the benefit goes to the tenant, not the landlord, but she knows that, although that happens in theory, in practice the money often goes directly to the landlord without touching the tenant's pocket.

Angela Eagle

My hon. Friend makes an important point, and we will consider it in our overall review. In November 1997, we introduced more discretion for local authorities to stop direct payment to landlords who are not fit and proper. That allows local authorities to enter into dialogue with local private sector landlords to ensure that correct standards are maintained, and to raise standards in some cases.

I hope that local authorities will take the new power seriously and use it where necessary. I have visited some local authorities that respond proactively to the local private sector by holding meetings to ensure that standards are correct. My right hon. Friend the Minister for Local Government and Housing recently published a consultation document on the regulation of houses in multiple occupation. My hon. Friend is on to something, and we are aware of the improvements that need to be made.

Mr. John Wilkinson (Ruislip-Northwood)

When the hon. Lady says that her hon. Friend is on to something, it is the understatement of the year. Is he not on to one of the biggest frauds and rackets in the administration of public money? How can the public have confidence that action will be taken? The previous Secretary of State, the right hon. Member for Camberwell and Peckham (Ms Harman), said in the House that the Government

"will bring forward proposals … shortly"—[Official Report, 19 March 1998;Vol.308,c.1436.],

yet we will not necessarily get a Green Paper until the end of this year.

Ought not the Government to name and shame those local authorities in which there is maladministration of the system? The Audit Commission found clear evidence of fraud on the part of either elected representatives or officers in a quarter of the local authorities that it visited. That is a national disgrace.

Angela Eagle

I welcome the hon. Gentleman's realisation that the housing benefit system, which was created by the previous Conservative Administration, is in need of much improvement. I also note, although it was not quite an apology, his indirect admission that in creating housing benefit and ensuring that its administration was fragmented to 409 different local authorities, particular difficulties of administration were created. Some local authorities administer the housing benefit system superbly and some do it very badly indeed.

One question that we are considering is how we can raise the standard of the worst to the best. We have already done a lot with respect to fraud. We have set up a simplification and improvement project, which has reported to the Prime Minister, to find out how we can make a complex system easier to understand and administer. We will continue our drive to improve standards in that area.

Mr. Peter L. Pike (Burnley)

As my hon. Friend the Member for Sunderland, South (Mr. Mullin) said, the biggest ripper-off of public funds is the landlord who buys a cheap terraced property in a constituency such as mine for £5,000 and can pay for it with housing benefit within 18 months. That is an abuse of public money and it needs clamping down on and stopping.

Angela Eagle

It is that sort of matter that the review of housing policy and benefit will be considering. We will be publishing a Green Paper later in the year. We are as aware as anyone of some of the bad administration and the rip-offs that occur as a result of the system that we inherited. However, I caution hon. Members that we are talking about the roof over people's heads, so we have to be careful how we change a system on which many millions of people rely. We will do it, and there will be a lot of consultation around the Green Paper. We are serious about reform, but we must not underestimate the complexity or the seriousness of the issues that face us as we approach the publication of the Green Paper on housing policy later this year.