Public Petitions Committee

Meeting date: Tuesday, November 26, 2013

Official Report 514KB pdf

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New Petition

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Bedroom Tax Mitigation (PE1496)

We will now return to our consideration of new petitions. PE1496, from Alan Wyllie, on behalf of the no2bedroomtax campaign, concerns bedroom tax mitigation. Members have a note by the clerk, the Scottish Parliament information centre briefing and the petition. Jackie Baillie has expressed an interest in the petition, but I am not sure whether she is able to attend the meeting.

I welcome Mr Wyllie to the meeting. I understand that you have had some transport problems, Mr Wyllie, but I am glad that you are here. You may make a short presentation before we move to questions.

I represent the no2bedroomtax campaign, which is a modern, organic campaign that incorporates online stuff and traditional political activism. We have three main objectives, which can be split into two groups: political and civic. We help and support people who are affected by the bedroom tax and other welfare reforms. Because we are online, people can contact us directly and we function as a hub that can direct people to the experts who can help them. Our political aims are to mitigate the bedroom tax and, ultimately, to end it.

At present, we estimate that there is £35 million in the system to mitigate the bedroom tax, but there is a shortfall of £53 million. That shortfall has led to inconsistencies between local authorities when dealing with discretionary housing payments, which has meant that some of the most vulnerable tenants are left without any support. Shelter Scotland says that the money in the system will help seven out of 10 Scottish tenants. I am here on behalf of the three in 10 who are not getting support from the councils or other sources.

The money that is required would cover the extra rent that tenants must pay due to the bedroom tax. It would result in every tenant in Scotland being protected from the bedroom tax. It would also protect the budgets of housing associations and local authorities. For example, Renfrewshire Council estimates that it will lose £1.8 million in revenue as a result of the bedroom tax. That issue could be resolved by doing what the petition calls for.

In April, when the bedroom tax came in, there was a national uproar and a lot of people did not know what to do. There are a lot of scared people out there. Even now, when people on the street ask us for help and we ask whether they have applied for a discretionary housing payment, they say, “I don’t know—what’s that?” In Edinburgh, 50 per cent of those who are affected by the bedroom tax have not applied for any help. That shows that tenants are scared and, because they are scared, they are not interacting with their landlords. That can cause problems down the line.

When I speak to people, they talk about their fear of evictions, but the bigger issue is debt. Rent arrears can result in people being taken off the housing list—I know that that has been looked at. A lot of people are just scared that those debts will hang over them. This petition would get rid of those debts.

Thank you for your presentation. Do you have any figures for the level of rent arrears that are attributable to bedroom tax for all the local authorities in Scotland, and for social landlords?

The Convention of Scottish Local Authorities did some research and came up with a figure of £20 million for local authorities. I do not think that I have the figures on me. I apologise.

That is all right. I did not necessarily expect you to have chapter and verse for every local authority. If you have those figures, it would be useful if you could send them to the committee.

Your petition mentions that 79 per cent of affected households include a disabled person. I suppose that, at one level, that might be expected, but the number is extremely high. That suggests that many people who are very vulnerable will be adversely affected.

As you say, the bedroom tax affects some of the most vulnerable people. There is support out there but it is not enough to help everyone. The petition would result in support for every tenant.

The bedroom tax attacks the disabled community in particular. Citizens Advice Scotland research shows that 80 per cent of affected households have a disabled person in them. That is why a lot of people are saying that they are against it, even though it does not affect them directly. The people whom it affects are quite isolated and vulnerable. That is a vicious aspect of the bedroom tax.

You point out in the petition that some local authorities have a no-eviction policy. That is important, but the wider issue is that mitigation is required because local authorities have a general duty to reduce rent arrears—clearly, that policy was implemented before we had the bedroom tax. Do you agree that a comprehensive policy is required, not just a single-tier policy?

There needs to be uniformity across local authorities in how they deal with the whole shebang. Some local authorities regard the disability living allowance as income, but others do not, and that means that some people are barred from getting a discretionary housing payment because they are disabled. We need a uniform policy.

On the no-evictions policy, I am not a lawyer but I know that people are really scared of being evicted. That is what they fear.

We referred a similar petition that we received earlier this year to the Welfare Reform Committee because it is actively considering the bedroom tax. The Public Petitions Committee is not intended to be a simple referral organisation. As you probably know, we try to do as much as we can for each petition, except when another parliamentary committee is considering the issue as part of its work programme. Although that is a decision for the committee to take, and we are not quite at that stage yet, what is your view on the Welfare Reform Committee looking in more detail at your petition?

There is some urgency. We are getting to the time of the year when it gets cold, and energy and food prices are skyrocketing. The bedroom tax is a line in the sand—it is the straw that will break the camel’s back, as they say. People are struggling, so there needs to be some urgent action to help immediately.

Thank you. I now bring in my colleagues.

I have had the pleasure of sharing platforms with Mr Wyllie for six or seven months now, and very constructive that has been. We share the view that the bedroom, or underoccupancy, tax is iniquitous and should be removed—and it will be removed if we have the power to do so.

Mr Wyllie, after the last budget, you indicated to me that you were thrilled that we got the £20 million to mitigate the effects of the bedroom tax. You know that the Scottish Government is limited in what it can do in this case because of the powers that relate to welfare reform, which are reserved.

We live in a time when politics is quite dour and dire and sometimes outright poisonous, so good acts have to be applauded. Shelter Scotland asked for an increase in DHP and the Scottish Government increased it the next week. That should be applauded. At the time, I said that the Scottish Government had stepped up to the plate but, to extend that analogy, it did not hit a home run or get to third base. What the Scottish Government has done has been really good, and it has been proactive, but it has not helped everyone.

Do you accept that there is a limitation because of those reserved powers, and that anything beyond £20.1 million, which was how much was afforded in the budget, is not feasible under existing legislation?

11:00

I do not. If there is a will, there is a way. With any form of mitigation there will be positives and negatives. With financial mitigation, there is a legitimate argument that you are robbing Peter to pay Paul. However, I do not agree with that argument. This is about priorities, and that is what Governments do: they decide policies, cost them and fund them. I trust that the Scottish Government and Parliament will make the right choice, if it can be done.

That is the point—it cannot be done. There was a similar situation last year, in which the Government was instructed by Westminster to increase pension fees. The suggestion was that if we did not do that, moneys would be withheld by the Westminster Government. Therefore, there would be an impact on what, collectively—not just the Scottish National Party—we want to see in Scotland. As much as we regret it, there is a penalty if we do not follow the powers that exist in the Scotland Act 1998.

If there is a will, there is a way. If it cannot be done, I truly apologise for wasting the committee’s time.

I accept that. The £33 million Scottish welfare fund was made available. It was set up to administer community care grants and crisis grants. What is your understanding of the uptake of that fund?

I am not too sure. I believe that the Scottish Government has given £233 million to mitigate welfare reform over the next three years. That is a lot of money. It is a bit cheeky of me to come back and ask for more, but I am asking for more for the right reasons. There are people out there who need help and are not getting it.

Having shared a platform with you, I would be the last person not to understand your motivation, which is highly commendable. I am sure that we share that motivation. However, although there are restrictions, we have tried to make funds available. Are the local authorities doing enough to communicate what is available to those who are either suffering rent arrears or not taking up the welfare fund?

It would be unfair to have a blanket opinion of all local authorities. Some are very good and very proactive; others are not as proactive and could do more.

How should we persuade them to do more?

I have been emailing and lobbying councillors, asking them to do more. Sometimes, you get some success; at other times, you do not. You just keep chipping away and hoping to get somewhere.

Good morning, Mr Wyllie. It is fair to say that there are very few people in Parliament who do not have a great deal of sympathy with your petition. However, I will pick up on points that Chic Brodie made. As I understand it, your petition calls on the Scottish Parliament to urge the Scottish Government to do something that it legally cannot do.

As you are aware, and as Chic Brodie alluded to, there is a legal maximum to how much Scottish Government can top up the Scottish discretionary housing payment budget, hence the £20 million announced by John Swinney. Again as I understand it, the legal maximum is set by statutory instrument made under section 70 of the Child Support, Pensions and Social Security Act 2000, which was, incidentally, introduced by the Labour Government when Alistair Darling was the Secretary of State for Work and Pensions.

This is a case of “we would if we could”. Do you have any suggestions as to how the Scottish Government could get around the legal constraints? It is all very well to have priorities, as you mentioned, but if we have legal constraints on those priorities, how do we get around them? I qualify my remarks by saying that this is frustrating for everybody.

I totally appreciate that. I was advised that the Government could create a prevention of homelessness fund or direct the moneys to registered social landlords as a supplement to their income. There are other mechanisms to get the money into the system rather than just the through discretionary housing payment, which I appreciate is already at the maximum level.

Are you aware of whether Shelter, for example, has fed that suggestion to the Scottish Government?

I spoke to Shelter just after the budget, and it was quite happy about how things were then. It was going to see how things panned out and then decide what to do. I am not too sure whether it has done so, as I am not in deep contact with it.

I thank you for your presentation, Mr Wyllie, and whole-heartedly agree with what you are asking for. We do not normally stray into political territory, but on this occasion I will do so.

I fully agree that our present Government has other ways and means to address the situation. I will describe for some of my colleagues what I am talking about. We could pay local government and the housing associations the funding to do that, as you said. You are exactly right: where there is a will there is a way.

Thank you, Mr Wyllie, for coming along today. As other committee members have said, we have every sympathy with the petition; the question is how we deal with the shortfall. I would like some clarification from you on what the shortfall is.

My understanding is that the Scottish Government set aside £20 million, and the Department for Work and Pensions set aside £13.47 million. Taking those two figures together in relation to the shortfall of £50 million that was calculated previously, we are left with a gap of £16.3 million. Is that your estimate of the figure that is required?

That is the number, yes.

It is £16.3 million. I seek further clarification with regard to Anne McTaggart’s assertion that there are other ways in which the Scottish Government can get round the bedroom tax, which has been put in place by the Westminster Government. I am reminded of the debate about the tax-varying powers for which the people of Scotland voted in 1997 as part of setting up the Parliament. The then UK Government indicated to the Scottish people that, if the Scottish Parliament or Scottish Government decided to use those powers, the money—whether the decision was to raise or reduce tax by 3p in the pound—would be clawed back by the UK Treasury.

Do you not see, therefore, that if the Scottish Government tried to bypass the proposals that the UK Government has implemented, the UK Government could cut the Scottish Government’s block allocation, which would mean that expenditure in other areas may be affected, not by a decision of the Scottish Government, but by a decision of the UK Government?

That goes back to the point about the negative ramifications of financial mitigation. I see your point—that it would be robbing Peter to pay Paul, basically—but that is what Governments do. They decide on a budget and fund it, and they go for it. You are making a legitimate argument, but I do not agree with it.

It is fine to use the analogy of robbing Peter to pay Paul, but in this situation we are talking about paying Paul, and the Scottish Government being robbed of an allocation of resources from the UK Government if it took the decision to give the additional £13.6 million to local authorities or registered social landlords to try to bypass a piece of legislation that was introduced by a Westminster Government.

I appreciate your point. I trust that, if the Scottish Government found the money, whatever budget it came out of, it would take a commonsense approach to ensure that there were no negative ramifications. I trust that the Scottish Government would not take the money out of another budget if that would hurt another sector or stakeholder. I trust that politicians would make a sensible choice and follow a commonsense approach.

As I said, we are asking for mitigation of a policy direction that has been taken by Westminster. Given the fact that a universal credit pilot scheme was introduced in Inverness yesterday, I have no doubt that other demands will be made on the Scottish Government to offset the losses that will be incurred by many families throughout Scotland once the universal credit comes in. This could be the thin end of the wedge, as people ask the Scottish Government to implement measures to mitigate policies that have been pursued by a Westminster Government.

I am failing to grasp the difference between the UK Government imposing sanctions on the Scottish Government and the Scottish Government imposing sanctions on local authorities, which are trying to rectify the situation as best they can. Mr Wyllie is right to say that where there is a will there is a way.

I understand that the Scottish Government is not imposing sanctions. It is the UK Government that has imposed sanctions on individuals who have what the UK Government has determined is overcapacity in bedrooms. The Scottish Government is trying to mitigate the sanctions that are being imposed by Westminster; the Scottish Government has not imposed any sanctions in relation to the bedroom tax.

I will not draw Mr Wyllie into that argument.

As I said, Jackie Baillie has an interest in the petition. She was unable to attend the meeting earlier, but I am glad to say that she is now with us. I understand that she has drafted a member’s bill that may have an impact in the area.

As I explained to Mr Wyllie, we referred a previous petition to the Welfare Reform Committee because the convener of that committee was keen to consider it as part of its work cycle. It would therefore make sense for the committee to agree to refer this petition also to that committee. We are not normally just a referral committee and we want to give everyone a clear bit of time in which to put their case. Several members have asked quite detailed questions on the issues. That is where we are.

Does Jackie Baillie want to make some brief points?

Yes, if I might, convener. I apologise to the committee for arriving late. I arrived in time to hear John Wilson’s comments, and I would like to pick up some of those points with Alan Wyllie.

I am not sure that Mr Wyllie knows that Danny Alexander, the Chief Secretary to the Treasury, came before one of the Parliament’s committees and made it clear that it is up to the Scottish Government to decide what it does with its money to mitigate welfare reform and that there will be no clawback. Were you aware of that, Mr Wyllie, and does it offer you some comfort that the UK Government will not claw the money back from the Scottish Government?

I was aware of his saying that—I saw it in the press reports—and I am a bit more relaxed after hearing that.

My other observation is that, having spoken to some of our local government colleagues, I know that they are supportive of your petition. COSLA certainly supports it. However, I understand that the existing £20 million from the Scottish Government, which is very welcome, was not ring fenced. Therefore, local authorities that have already topped up could use that money for some other purpose. Does that not demonstrate that the Scottish Government has the power to provide the money and that local government has the power to make payments itself, through a housing sustainability fund, a homelessness fund or something of that order?

The mechanism is not really important—it is the money that is important. Different mechanisms are available. As you mentioned, perhaps because of the low take-up of DHP, it would be best if the money went to registered social landlords as some sort of supplement to their income. That would reduce the need for tenants to contact local authorities. I believe that there are different mechanisms that local authorities can use to help.

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In your view, is there anything to prevent the Scottish Government from making available £50 million to mitigate the bedroom tax, which I think we all agree is a quite horrendous tax?

That is the Government’s choice.

I will try to forget that selective rewriting in Ms Baillie’s understanding of section 70 of the Child Support, Pensions and Social Security Act 2000. It is always good to come and draw a picture, Ms Baillie, albeit very late.

Mr Wyllie, what analysis has been done of the cost of raising the bedroom tax against the amount of money that has been dispensed? Have you asked any of the local authorities, such as North Lanarkshire Council, for example, what would be involved in distributing the bedroom tax versus the amount of money that they have received?

No, I have not. I am sorry, but I do not particularly understand your question.

There was a report in the papers on Sunday that the cost of chasing or applying the bedroom tax is a lot more than the money that has been received by councils.

Yes. If councils go down the road of evictions, that will cost more. The money that we are talking about covers just the rent and not the additional administration costs of housing associations and local authorities.

It is worth our while asking the question, because we all agree that the tax is iniquitous, albeit that some of us have done so later than others. It makes a nonsense of it if it is actually generating more costs than the moneys that are available.

You are 100 per cent right. The tax does not save money, and most people knew that at the beginning. Initially, the Government said that it would save money, but it does not—it just moves responsibility from central Government to local government, housing associations and tenants. The Government said that the tax would improve the housing system, but it does not do that either. The bedroom tax makes no sense. It costs a lot of money and it costs our communities. It is hurting a lot of people. I realise that it does not emanate from the Scottish Parliament and that the only place where it can be stopped is Westminster. However, I am here to make a plea for help for the tenants who do not have any protection.

We are very short of time, but I will bring in John Wilson.

I just want to ask Mr Wyllie about a couple of points that Ms Baillie referred to. She referred to £50 million from the Scottish Government. In an earlier answer, Mr Wyllie agreed with me that the shortfall is really £13.3 million rather than the £30 million that Ms Baillie might be alluding to. I ask Mr Wyllie to confirm that the overall cost of offsetting the bedroom tax would be £50 million; that the Scottish Government has set aside £20 million to assist local authorities, albeit that that is not ring fenced, which might be an issue that we can take up later; and that the DWP has allocated £13.6 million to local authorities for discretionary housing payments, which gives us a working total of £37.6 million. Sorry, I need to get my figures right here—it is about £36 million, so the real shortfall is about £13 million.

As far as I am concerned, there is approximately £35 million available, and the original estimated shortfall was £53 million.

I am afraid that we have run out of time although I have the impression that we could keep this discussion going for another few hours. Thank you very much for coming along, Mr Wyllie. If you could just hold on for a couple of minutes, the committee will now go into summation mode, which means that we will discuss which options are open to us.

I still think that it was important for us to raise a whole series of questions rather than merely refer the petition on to the Welfare Reform Committee. Having said that, my view is that we should now refer the petition to the Welfare Reform Committee because it is actively considering the matter as we speak. Nevertheless, I found your contributions very helpful. We had a variety of questions from members and I think that it was important that we put those questions to you and that we got some answers.

Does the committee agree with my recommendation that we refer the petition to the Welfare Reform Committee?

Members indicated agreement.

Thank you for coming along, Mr Wyllie. Obviously, the Welfare Reform Committee will keep you up to date with developments. I also thank Jackie Baillie for coming along. I know that she has taken a great interest in these matters and I appreciate her comments as well.

I suspend the meeting for one minute to allow Mr Wyllie to leave.

11:20 Meeting suspended.

11:21 On resuming—