HL Deb 04 April 2001 vol 624 cc809-12

2.38 p.m.

Baroness Gardner of Parkes asked Her Majesty's Government:

Whether there are delays in the payment of housing benefit; and, if so, what action they are taking to reduce such delays.

The Parliamentary Under-Secretary of State, Department of Social Security (Baroness Hollis of Heigham)

Are there delays? Yes, my Lords. There are 409 individual councils administering housing benefit. Some do their job well; others, frankly, fail to provide the service that the public rightly expect. Raising standards of administration is the biggest challenge that faces housing benefit today. That is why we are working with local authorities within a partnership framework.

Baroness Gardner of Parkes

My Lords, I thank the Minister for that reply. I do not believe that the blame can be laid solely at the door of local authorities. Is the noble Baroness aware that last year the Department of Social Security sent out over 70 circulars and that 14 have already been issued this year to amend council tax benefit and housing benefit? Councils simply cannot cope with constant administrative changes? Is the Minister also aware that the London Borough of Hackney has over 34,000 outstanding cases and that even the more efficient London boroughs have over 10,000 such cases? Does the noble Baroness agree that that is very unfair to those people who want to rent property but are denied access to it because they cannot get the money from the housing benefit system?

Baroness Hollis of Heigham

My Lords, I absolutely agree with the noble Baroness's final comment. It is deeply unfair on landlords and on tenants, who need housing benefit in order to have affordable and decent accommodation. But behind that exists a whole series of problems. I accept that there is what local authorities would regard as initiative overload in terms of circulars, but there are deeper problems.

First, housing benefit has not traditionally been a local authority priority, particularly in London, where there is a high turnover of staff matched by a high turnover of tenants. Those staff try to administer the complexities of four different parallel housing benefit schemes running at the same time because of transitional arrangements. The noble Baroness will understand the difficulties.

Secondly, there are problems of funding. Thirdly, there are problems of contracting out. Hackney's problems, which the noble Baroness identified, are associated with the failure of its external contractor which, as she will know, is the subject of litigation. As a result, Hackney has had to bring the housing benefit service in-house.

The Earl of Listowel

My Lords, is the Minister aware of the consequences of housing benefit delays for small charities such as the Single Homelessness Project which has a large exposure in Hackney and also in Islington? It has clients similar to the ones I met fairly recently—young men coming out of care, a young woman who had given up her addiction to crack cocaine, and a 40-year old woman who had spent much of her life in a mental institution. Is the noble Baroness aware of the impact of these delays on the service? Managers cannot concentrate on supporting those people because they are chasing up housing benefit. Hackney—just one borough—faces a £70,000 deficit for the coming year. Is the noble Baroness aware of those facts?

Baroness Hollis of Heigham

My Lords, I was not aware of that specific housing association but I am aware of the wider problems facing registered social landlords. There are around 2,000 registered social landlords, of whom about 500 have a housing stock of more than about 250 properties. Some do indeed face the problem of a backlog of housing benefit as a result of the inability of local authorities to deliver the service they should. However, to put that in proportion—I do not want to seem to minimise the problem—only 2 per cent of the rent-roll of registered social landlords is in arrears. It is a concern; it is not a crisis. It amounts to about £84 million out of the £2.5 billion they spend, much of that notional arrears because housing benefit is paid four weeks in arrears. Having said that, I am more than happy to follow up the point made by the noble Earl about the particular housing association to see whether there is any way we can help.

Lord Skelmersdale

My Lords, I am glad that the Minister mentioned contracting out. Is it not the case that where the service is contracted out, the managers of that contract are the local authorities themselves? What are the Government doing to help local authorities to manage their contracts better?

Baroness Hollis of Heigham

My Lords, around one in 10 housing benefit systems are administered under contracting out arrangements. As far as I can judge, most of them have not performed well and have performed less well on average than the local authorities themselves. Some of that may be due to an inadequacy of contract management. It may also be due to the fact that the private companies underestimated the complexity of the task. The DSS has recognised the problem identified by the noble Lord, Lord Skelmersdale, and has been developing a new strategic management plan for local authorities to use when developing contracted out services.

Baroness Carnegy of Lour

My Lords, in view of the long list of facts given by my noble friend Lady Gardner in her supplementary question, do the Minister and her department not accept any responsibility at all for these delays?

Baroness Hollis of Heigham

My Lords, what I do accept is that central government are asking local authorities to administer the exceedingly complicated system we inherited, consisting of four parallel schemes with high degrees of complexity. When we seek, in response to questions from your Lordships, to increase the checks on fraud and error—housing benefit is one of the biggest areas of fraud—that in turn has repercussions for the speed with which local authorities can deliver the benefit. To some extent one is trading speed against error and fraud. I accept that some of the pressures we are putting on local authorities to improve their performance in this area have temporary repercussions for local authorities in terms of extending the period of time. But, equally, we have increased the base funding of local authorities for housing benefit administration, which had not been raised since 1993–94. We are developing best value performance frameworks; we are developing expert help teams; we are developing IT systems; and, in our Social Security Fraud Bill, which has passed through your Lordships' House, we are developing ways of ensuring that local authorities have speedy access to accurate information in order to identify both fraud and error and effectively provide decent delivery systems for housing benefit.

Earl Russell

My Lords, I am pleased that the Minister has identified a problem of administration. It is a view which is fully shared on these Benches. Will the noble Baroness attempt to reduce delays by improving communication between the Benefits Agency and local authorities, in particular by cutting down the number of occasions on which the claimant has to supply the same information twice; once to each of them? If she is assured that the RATS system has alleviated this problem, will she keep a pinch of salt in hand?

Baroness Hollis of Heigham

My Lords, I am intrigued by that comment because, after all, the whole purpose of the Social Security Fraud Bill, which passed through your Lordships' House only recently, was precisely to have information sharing between central government and local authorities in order to eradicate delays, error and fraud. I have to say that it did not meet with the same enthusiasm on the Benches represented by the noble Earl, Lord Russell, as elsewhere in the House. I accept that we have to work with local authorities—and they with us—in delivering what is a very complicated system.

It is a difficult problem. In a London authority such as Hackney, one is dealing with 150,000 properties. There are probably housing benefit arrears— significant arrears—in respect of 50,000 of them. There is a seepage of staff and a rapid turnover of tenants. The staff are trying to administer a very complex system that could potentially become rife, if one were not careful, with error and fraud. Yes, we will do our best, and I hope that we can count on the full support of the noble Earl.