Welfare Reform Bill

I rise to support Amendment 49, tabled by my noble friend Lord Best. I understand the Government’s argument that they wish universal credit payments to mimic those of a wage or salary for paid employment. That sounds very sensible but in the world to be created by this legislation it really cannot work. I understand that clients officially recognised as vulnerable will be able to have direct payments to the landlord. As my noble friend said, pensioners would have that facility. Perhaps the Minister will expand a little more on the meaning of ““vulnerable”” in this context. My fear is always that anyone who can walk would not be categorised as vulnerable. How would people with mental health difficulties be assessed? If claimant income was in a steady state, there might be an argument in support of the Government’s position in terms of the transition to employment but, in the context of the changes and swingeing cuts envisaged in this legislation, including housing benefit payments in with universal credit payments to the claimants must surely be a hostage to fortune. The Government understandably do not want the prospect of losing direct rent payments to act as a disincentive to work. However, I imagine that most people who move into work will in fact continue to be entitled to some universal credit and housing benefit support. They would be able to continue receiving direct payments. Those who move into work on a wage level lifting them out of universal credit would of course be in a somewhat different position. I hope that they might be able to deal with their rent and even to organise a direct debit with sufficient funds in the bank on a regular basis to cover it. That is certainly not the case for anybody going through the benefit changes over the next five years. I understand the Government’s concern about the transition into work on various different levels of income but for claimants on the receiving end of benefit cuts—for example, due to reduced disability support, a move from ESA to JSA, housing penalties due to under-occupation or the rent being above the 30th percentile—the first priority must surely be to secure a roof over their heads. These people will be hit very hard whatever the transitional payments may achieve in the short term. If people get into serious rent arrears, which for the great majority seems inevitable, and they receive their housing benefit with their universal credit, they will be under threat of eviction or already homeless and in no position at all to find work. That is my biggest worry about this raft of reforms. It is very hard to imagine that claimants are going to cope at all, let alone have the confidence and emotional energy to apply for jobs. That is quite apart from the problems that they will have affording clothing and fares to go for an interview or to work. I remember some years ago talking to a group of unemployed people about why they were apparently unable to move into work. They raised practical problems, such as, ““I sold my trousers and my jacket; I no longer have a tie””, and they would have to go shopping. In future this sort of practical problem will be infinitely worse. The CAB service has sent me a case study that illustrates the point perfectly precisely. A client, again not surprisingly with a mental health condition and under the care of the community mental health team, had asked for her housing benefit to be paid directly to the landlord. This had been refused and the result was that she went into arrears and had all sorts of problems. Eventually, of course, it was agreed that her rent would be paid direct to the landlord but she cannot now deal with those arrears, even if her weekly rent is covered, and the result is that the landlord is pressing to evict her. I feel that this is going to apply to tens of thousands, if not hundreds of thousands of people all over the country, so I see this as a fundamentally important amendment to this Bill. In other cases sent to me by the CAB the same issues arise; vulnerability to debt, problems of budget management, often because of mental health problems and threats of eviction. The reality is that direct payments to landlords present the one amendment that really could ensure a roof over the head of claimants as no other amendment really can. Even if people lose their electricity and their gas, as one imagines will happen, if they can stay in their home that will be something. If we look at the perspective of the landlord, as my noble friend Lord Best did, direct payments are likely to be the only incentive for landlords to take on benefit claimants. A quick look through the advertisements for rental accommodation confirms the considerable percentage of affordable flats and houses for rent which simply state ““No DSS””. Everybody must be very familiar with that. Since direct payments to landlords were abolished tenants’ and landlords’ associations alike have consistently campaigned for their reinstatement. The Government have recently agreed to give local authorities greater discretion to allow direct payments when landlords are bringing rents down. I suppose that is something. However, more general availability of payments would increase the supply of rented accommodation and would therefore provide downward pressure on rents, which is of course what we all want. On the contrary, by reducing the supply of flats for claimants the chances are that rents for that particular group will in fact rise. The concern is that the claimant will be caught between these forces and find it impossible to cope, let alone to find work.