Wednesday, 01 April 2015

Lords hand government new 'bedroom tax' defeat

The government has suffered a fresh defeat over its plans for a ‘bedroom tax’ for underoccupying social housing tenants.

Peers this evening voted by 236 votes to 226 to accept an amendment by crossbench peer Lord Richard Best which would exempt certain vulnerable groups from the penalty if they have a spare room and there is no other suitable alternative accommodation available.

The amendment would mean disabled people, war widows or widowers, foster carers and those not subject to work-related requirements would not have to pay the penalty until they have been offered suitable accommodation and refused it.

The amendment was a further compromise by Lord Best after the Commons overruled an earlier proposal which would have exempted all tenants with a spare room and nowhere to move to. That move was rejected by the Commons after the government said it would lead to an estimated £300 million of the £490 million savings from the policy being lost. The government used financial privilege to prevent a further discussion today on that particular amendment.

Lord Freud said that the latest amendment would cost the government around £100 million.

Lord Best had earlier told peers that the cost implications of the his latest amendment ‘are not that frightening’.

He said social landlords were concerned about the underoccupation penalty which will hit around 670,000 households and said he was concerned they would effectively be the ‘tax collectors’ monitoring who is eligible for the penalty.

He said: ‘Social landlords have expressed grave concerns not only on behalf of their tenants but also because of the administrative and financial problems this will pose for them.’ Lord Freud however said the government would be relying on claimants to report their household circumstances to them.

Responding to the latest defeat, David Orr, chief executive of the National Housing Federation, said: ‘Today’s result is a victory for common sense and fairness.

‘We are delighted that peers have stood firm and yet again voted to lessen the impact of the bedroom tax.

‘Together, we have shown that it is simply unfair to penalise some of the most vulnerable families for under-occupying their homes when they have nowhere else to move.’

Mr Orr said that given the opposition it was wrong for the government to use financial privilege in order to ‘shut down discussion.’

He said: ‘’We urge the government to listen to the clear message sent by peers by allowing this compromise to stand when the bill returns to the Commons.

‘For disabled people, war widows and foster carers, with nowhere else to go to, this could mean the difference between making ends meet and living in poverty.’

The government will now have to decide whether to try to overturn the amendment in the House of Commons.

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