Welfare Reform Bill

My Lords, there has always been a tension within social security, as David Donnison spelled out many years ago when we had what was then called supplementary benefit, between standard, national, no-postcode-lottery funding and payments, and the need for discretion. The Social Fund as it has become has that element of discretion and flexibility, which is why it would be madness to go to a call centre and think that you can do the thing that most requires discretion by telephone. I entirely sympathise with the Government’s wish to move away from that procedure. My noble friend Lady Lister and the noble Lord, Lord Kirkwood, have eloquently explained the need for the Social Fund. I do not want to rehearse that, although if I had my way I would treble the money going into it because of its value to people. Indeed, the people who need it are not there because of financial mismanagement, let alone scrounging. They are there for the most part because of absolute, desperate, grinding poverty, having come out of care, prison or a refuge. They are the ones we seek to help. Instead, I want to talk about something more mundane: the process proposed for the handling of Social Fund moneys, particularly community care grants, in future. Where that money is going to a local authority that is a single-tier unitary authority, I have no reason to think that it will not be able to get its act together because housing, social services and advice services are integrated on one level. However, it will be catastrophic for the shire counties where there are two-tier structures. I shall explain. I come from Norfolk, a county which is about 60 miles by about 40 miles. When I was a county councillor representing Norwich I was closing schools that I had never visited and putting yellow lines on roads I did not drive on, and we called it ““local government””. I have to say that the Jobcentre in my district had more local knowledge than most county councillors had outside their immediate patch. Under this proposal the money will go to a county council that has no local experience or knowledge. I do not in any way mean to criticise social workers who are doing a heroic job, but the council has none of the local knowledge at councillor or policy-shaping level that is required. A second problem is that in a county council like Norfolk, there are a number of rural districts within which there may be small pockets of acute rural deprivation—even though they may contain thatched cottages covered with roses—but there is also the deprivation of Great Yarmouth, King’s Lynn, Thetford and some of the poorest estates in the eastern region, in Norwich. If the county council decides to go on a format allocation, it may send money to rural districts that do not need it as their pockets of rural deprivation have been resolved because those people have voted with their feet—I know this to be the case—and have come into the nearest urban city area. I have known good social workers give them the bus fare to do so, and quite right too; I would do the same in their situation. So the first problem with sending the money over to the county council is that they do not have local knowledge, but the second problem is that there is a huge variety of circumstance in an area as large as Norfolk, and I have no confidence that that will be recognised in the use of that money by the county council. The third issue is what we call ring-fencing. If I were a county councillor with this money and I was seriously worried, as most county councillors are in good faith and decency, about child abuse protection, I would regard this as a fund to plunder. I would regard other priorities as being of more urgent need. I am therefore not in any sense confident that that money will be spent where it should be. For several reasons, I want to see instead, and I hope that this will happen, the money in two-tier authorities going to the local district council. First, the local district council should have much more intimate knowledge of its locality and local needs. If localism means anything, it does not mean distributing down to a county council, half of whose councillors have never visited the village or the area where the deprivation is concentrated. You might just as well have the money coming from London or indeed from Scotland. It has to go down to the local district council. Secondly, over and beyond local knowledge, if we cannot have ring-fencing—I hope we do, but I will come back to that—then at least it should be integrated with the fact that it is those same lower-tier authorities, the housing authorities, that are going to be responsible for the discretionary housing allowance and for the development of this absurd structure of individualised council tax benefits. Okay, it is an absurd and foolish system but it looks as though we may be stuck with it for a while until better sense prevails and we can reintegrate council tax benefit into universal credit. This means, though, that district councils on the ground have to have the staff, the resources, the local knowledge and the detailed experience of those same client groups for discretionary housing awards and for council tax benefit. They should ally to that the grants and some of the loans of the Social Fund because often they are dealing with the same client group, and often for the same purpose. We have heard that a high proportion of community grants are spent in securing rent access to the private rented sector. It means that discretionary housing allowance—two funds, in future on two tiers—will be doing the same thing for a local community. This is absurd. If we cannot have a ring-fenced fund, then at least the money should go to a district council which can see the best way of meeting the needs of young people coming out of care or of ex-offenders. It may be that more money should go into discretionary housing and less should go elsewhere, but you can meet the service in different ways. However, I agree with the noble Lord, Lord Kirkwood, that you then need to make sure that there is an effective reporting and monitoring regime so that local authorities at the district level are accountable for how they have spent the money. There is more than one way to meet a need, and that is why I am not always supportive of ring-fencing. Local authorities can often meet a need in a better and more effective way—you only have to see the difference between residential care and domiciliary services to realise that there is not just one way—but they have to have retrospective, so to speak, supervision and control by virtue of inspection and monitoring. I am hoping that the Minister will respond positively to this and say that when dealing with two-tier authorities, the shire counties, where the document says that the money is going to the upper tier, he will give a commitment, as far as he can, that there will be a letter of guidance requiring county councils to distribute and allocate funds based on previous expenditure levels in the district council. Otherwise some rural districts may pocket the money to keep their council tax down while the urban areas that receive people from the rural districts who have voted with their feet will have an even heavier burden to bear on reduced funding. In addition, meeting need should be recognised as a part of a district council’s repertoire. If there is to be an assumption that a local connection should be required, I accept the need for special care, particularly for battered women. Actually, in practice that is the least of our problems because in my experience nearly all local authorities have a very decent arrangement of trading homes so that women coming out of a violent relationship can move on from a hostel to a half-way house and then into a permanent home in a different authority. That works pretty well on the ground, but there are many other groups that, if they can, rural authorities will encourage into urban areas so that their responsibilities are negated. I hope that in that case the money will follow the client. If it does, I have no problem with that at all. When the Minister deals with the big policy issues raised by my noble friend and by the noble Lord, Lord Kirkwood, I ask him also to comment on the process point and at least give some of us some comfort that this will simply not be exploited, manipulated and abused in good faith by upper-tier authorities to do things that, because of their lack of local knowledge, they regard as more important than this and, as a result, strengthen the capacity of lower-tier authorities which are going to be dealing with discretionary housing allowance and council tax benefit. They will have an additional resource in order to meet the local need that they are best placed to address.