Miliband pledges that a Labour government will scrap the bedroom tax

Labour leader announces: "We’ll scrap the bedroom tax by abolishing the shady schemes of tax loopholes for the privileged few which the Tories keep inventing."

Last month, I revealed that one of Labour's "policy goodies" for conference was likely to be a pledge to scrap the bedroom tax - and Ed Miliband hasn't disappointed.

The party has announced tonight that a Labour government will repeal the measure, which has already forced around half of those tenants affected into rent arrears, a quarter of those for the first time ever. Significantly, rather than merely another policy that Labour would enact "were it in government now", this is a manifesto commitment. 

The National Housing Federation and the National Audit Office have predicted that the measure could end up costing more than it saves by forcing social housing tenants into the more expensive private sector (due to the lack of one-bedroom council properties available) and by increasing rent arrears (which deprives councils of revenue). But in order to demonstrate their commitment to fiscal discipline, Miliband and Ed Balls have still outlined how they will raise the £470m the Treasury claims the measure will save this year.

Labour has said it will: 

- Reverse the £150m tax cut for hedge funds announced in the 2013 Budget.

- Abolish George Osborne's "shares for rights" scheme, which businesses have been using to avoid capital gains tax (shares sold at a profit are exempt) and which the OBR has forecast could cost up to £1bn. 

- Prevent construction firms avoiding tax by falsely listing workers as self-employed. 

Miliband will say tomorrow: 

One Nation Labour is meeting here in Brighton talking about the most important issue facing families in Britain: the cost of living crisis.

Under David Cameron life is getting harder and harder with prices rising faster than wages in 38 of the 39 months that he has been in Downing Street. And working people are an average of almost £1,500 a year worse off under his government.

But we have a Tory-led Government which listens only to a privileged few. Tax cuts for millionaires and tax breaks for hedge funds.

I am leading a different Labour Party, a One Nation Labour Party, which listens to and will stand up for ordinary families like that of Danielle Heard, who I met this week.

We’ll fight for her like she has fought cancer heroically for 14 years. She is disabled and battling cancer again. But now her family must pay £80 a month they can’t afford under this government’s hated bedroom tax.

The bedroom tax – not what the Tories call the spare room subsidy – the bedroom tax: a symbol of an out of touch, uncaring Tory government that stands up for the privileged few – but never for you.

So we will scrap that tax. And what’s more I can tell you how.

We’ll scrap the bedroom tax by abolishing the shady schemes of tax loopholes for the privileged few which the Tories keep inventing. Tax cuts for hedge funds, the billion pound black hole created with a scheme for workers to sell their rights for shares, and by tackling scams which cheat the taxpayer in construction.

That’s what a One Nation Labour government will do. That’s a party that will fight for you.

The Tories will respond by arguing that Labour has abandoned its commitment to fiscal responsibility and returned to its old spending ways. But unlike on other issues, such as the benefit cap, they find themselves on the wrong side of public opinion. A ComRes poll published today by the National Housing Federation (NHF) found that 59% of the public believe the policy should be abandoned, up from 51% when it was introduced in April. Four-fifths of Labour supporters (79%) favour its repeal, along with 65% of Lib Dems and 34% of Tories. 

And one doesn't have to look far for evidence why. As I noted, a survey by the NHF of 51 housing associations found that more than half of those residents affected by the measure (32,432 people), fell into rent arrears between April and June, a quarter of those for the first time ever. 

Ministers have defended the policy, which reduces housing benefit by 14% for those deemed to have one 'spare room" and by 25% for those with two or more, on the basis that it will encourage families to downsize to more "appropriately sized" accommodation. But they have ignored (or at least pretended to ignore) the lack of one bedroom houses available. In England, there are 180,000 social tenants "under-occupying" two bedroom houses but just 85,000 one bedroom properties available to move to. Rather than reducing overcrowding, the policy has largely become another welfare cut, further squeezing families already hit by the benefit cap, the 1% limit on benefit and tax credit increases (a real-terms cut) and the 10% reduction in council tax support. 

The measure is also coming under increasing fire from the Lib Dems. Shirley Williams described it as "a big mistake" at the party's conference and delegates passed a motion calling for "an immediate evaluation of the impact of the policy, establishing the extent to which larger homes are freed up, money saved, costs of implementation, the impact on vulnerable tenants, and the impact on the private rented sector." It also called for "a redrafting of clear housing needs guidelines in association with those representing vulnerable groups including the disabled, elderly and children." 

Whether or not the coalition eventually goes as far as scrapping the measure, to prevent Labour surfing a wave of public outrage, it is hard to see it surviving in its current form. 

Ed Miliband speaks at the TUC conference at the Bournemouth International Centre on September 10, 2013. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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Want to beat child poverty? End the freeze on working-age benefits

Freezing working-age benefits at a time of rising prices is both economically and morally unsound. 

We serve in politics to change lives. Yet for too long, many people and parts of Britain have felt ignored. Our response to Brexit must respond to their concerns and match their aspirations. By doing so, we can unite the country and build a fairer Britain.

Our future success as a country depends on making the most of all our talents. So we should begin with a simple goal – that child poverty must not be a feature of our country’s future.

The Institute for Fiscal Studies projects that relative child poverty will see the biggest increase in a generation in this Parliament. That is why it is so troubling that poverty has almost disappeared from the political agenda under David Cameron, and now Theresa May.

The last Labour Government’s record reminds us what can be achieved. Labour delivered the biggest improvement of any EU nation in lifting one million children out of poverty, transforming so many lives. Child poverty should scar our conscience as much as it does our children’s futures. So we have a duty to this generation to make progress once again.

In my Barnsley constituency, we have led a campaign bringing together Labour party members, community groups, and the local Labour Council to take action. My constituency party recently published its second child poverty report, which included contributions from across our community on addressing this challenge.

Ideas ranged from new requirements on developments for affordable housing, to expanding childcare, and the great example set by retired teachers lending their expertise to tutor local students. When more than 200 children in my constituency fall behind in language skills before they even start school, that local effort must be supported at the national level.

In order to build a consensus around renewed action, I will be introducing a private member’s bill in Parliament. It will set a new child poverty target, with requirements to regularly measure progress and report against the impact of policy choices.

I hope to work on a cross-party basis to share expertise and build pressure for action. In response, I hope that the Government will make this a priority in order to meet the Prime Minister’s commitment to make Britain a country that works for everyone.

The Autumn Statement in two months’ time is an opportunity to signal a new approach. Planned changes to tax and benefits over the next four years will take more than one pound in every ten pounds from the pockets of the poorest families. That is divisive and short-sighted, particularly with prices at the tills expected to rise.

Therefore the Chancellor should make a clear commitment to those who have been left behind by ending the freeze on working-age benefits. That would not only be morally right, but also sound economics.

It is estimated that one pound in every five pounds of public spending is associated with poverty. As well as redirecting public spending, poverty worsens the key economic challenges we face. It lowers productivity and limits spending power, which undermine the strong economy we need for the future.

Yet the human cost of child poverty is the greatest of all. When a Sure Start children’s centre is lost, it closes a door on opportunity. That is penny wise but pound foolish and it must end now.

The smarter approach is to recognise that a child’s earliest years are critical to their future life chances. The weight of expert opinion in favour of early intervention is overwhelming. So that must be our priority, because it is a smart investment for the future and it will change lives today.

This is the cause of our times. To end child poverty so that no-one is locked out of the opportunity for a better future. To stand in the way of a Government that seeks to pass by on the other side. Then to be in position to replace the Tories at the next election.

By doing so, we can answer that demand for change from people across our country. And we can provide security, opportunity, and hope to those who need it most.

That is how we can begin to build a fairer Britain.
 
 

Dan Jarvis is the Labour MP for Barnsley Central and a former Major in the Parachute Regiment.