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8.19 pm
Mr. Robert G. Hughes (Harrow, West): From listening to the debate, I believe that there is no doubt that the Opposition have moved on since the last time we debated the subject, in 1993. The trouble with such a subject--and, I suspect, one of the reasons why my right hon. Friend the Secretary of State was keen to have this debate--is that the more we hear from Labour Back Benchers, the less they seem to have moved on.Old Labour comes shining through. The party has not changed much.
From what the hon. Member for Islington, South and Finsbury (Mr. Smith) said--and from the rather partial defence of his own record by the hon. Member for Manchester, Withington (Mr. Bradley)--I take it that the hon. Gentleman repudiates what the hon. Member for Withington said in the 1993 debate. It is all very well to quote the odd bit saying that Labour is opposed to social security fraud but then spend the rest of the speech attacking any attack on social security fraud.
I have had the dubious pleasure of reading the two speeches of the hon. Member for Withington in that debate, and very boring they were, too. Nobody could read them, or could have been present at the debate, and come away without the impression that the hon. Gentleman did not believe that this was a serious issue worthy of investigation. It is pretty fatuous, in the language of a true plutocrat, to say,
It may be a tiny figure to him but it is not to me, to my constituents or to the Government.
I waited with bated breath for the eight policy announcements that the hon. Member for Islington, South and Finsbury promised us.
Mr. David Clelland (Tyne Bridge):
The hon. Gentleman was asleep.
Mr. Hughes:
It was boring, but I was not asleep.I wrote the policy announcements down for greater
The target set by my right hon. Friend the Secretary of State, welcome and sensible though it is, is quite modest when compared with what several companies have done. It is certainly achievable. In Opposition, it is easier to say that it is outrageous, unachievable and will destroy the present system. Scrapping self-assessment had to beNo. 1 on their list. It is safe for them to witter on about that without anyone attacking them.
The other seven promises were a lazy man's view of making policy. If that is as far as the hon. Member for Islington, South and Finsbury has got, now that he is halfway through his review of social security policy, it is not impressive stuff. I can tell the hon. Member for Glasgow, Rutherglen (Mr. McAvoy) that, as a member of the Social Security Select Committee, I am a member of the club that he mentioned.
The hon. Member for Islington, South and Finsbury has simply got a researcher to go through the transcripts of Social Security Committee hearings and glean anything that sounded like a reasonably good idea. He has strung all seven together and called it the Labour party's programme. That is not greatly impressive and does not amount to a policy platform. He is going to have to do a great deal better if he is to carry conviction and fight off the repeated rumours in the press that, were there to be a Labour Government, the hon. Member for Birkenhead (Mr. Field) would be Secretary of State.
We accept that the Labour party has moved, but it has not moved far. People will recognise that as time goes on.
Mr. Chris Smith:
The hon. Gentleman can do better than this.
Mr. Hughes:
The hon. Gentleman says that I can do better than this. If he does not think much of this speech, I might say that I am merely following his lead.
The Labour party has not been in favour of fighting fraud. That has been shown not only in the speech of thehon. Member for Withington two years ago but in the whole ethos whereby the Labour party argues that to attack fraud in the social security system is, by definition, to attack people who misrepresent their circumstances but who are poor. The Labour party argues that such fraud does not matter and that those people are just trying to get a bit of extra money to keep their families together. Those arguments are understandable.
As the hon. Member for South Antrim (Mr. Forsythe) pointed out, such fraud is often given folksy, acceptable names to make people think that it is not so bad. The hon. Member talked about the double--people who work on building sites and claim social security. That is one of the problems. People think that it is an acceptable crime.I believe that those days are ending. As one or two Opposition Members have said, people are concerned about the issue, whatever their circumstances, background or politics. However, the Labour party has never bothered to have a strategy on that.
There are Labour councils where fraud is endemic. The hon. Member for Vauxhall (Miss Hoey) talked about the fraud squad in Lambeth council. One is tempted to think that there are two fraud squads in Lambeth council: the majority of people carrying fraud out and the small team trying to stamp it out. One is reminded of the true story of when there was a flood in Lambeth. The mayor, rightly, went around the council estate that had been flooded to talk to the people who had been flooded out of their homes. As he went from house to house, one of his flunkeys had a list of tenants. After a while, it became a farce because they could not find anyone on the list of tenants that coincided with the names of the people who were living in the houses.
There are perhaps quite a few such Labour councils in London. I accept that it is not all councils, but that problem became endemic in central London. There was so much housing fraud that Lambeth had lost control of its housing stock. Despite having trawled the evidence to the Select Committee, Labour Members have not mentioned the evidence that we took from Bernard Crofton, who was treated disgracefully by Hackney council.
Mr. Jenkin:
It is a Labour council.
Mr. Hughes:
As my hon. Friend points out, it is a Labour council. Labour Members would prefer that people forgot that. Bernard Crofton, who I remember as a housing officer on Greater London council, has shown enormous bravery in battling against the people who wanted to stifle the facts that he was bringing out.In November 1994, The Guardian quoted someone in Hackney as saying:
The article continued:
In his evidence to the Select Committee, Bernard Crofton pointed out that it was clearly an organised fraud. When some of the flats were raided, mail order goods were found crated up to be returned to Nigeria. I make that not as a race point but to say that there is a considerable problem. [Interruption.] If the hon. Member for Withington wants to be silly, that is fine. If he has a serious point, I would be happy to give way.
There is a huge problem, which has been pointed out several times in the press and on television, of specially trained people coming to Britain to try to take advantage of our social security system. Although I shall return to this theme, it is a truism that every time my right hon. Friend the Secretary of State cracks down on the problems of benefit tourists or changes the asylum seekers benefit regulations, the Labour party opposes him every inch of the way. Therefore, it is very difficult to take the Labour party seriously.
The article in The Guardian continued:
Hackney council has never admitted that. There are other questions and claims that no one has ever denied--perhaps a Labour Member will deny them tonight. Where
do the proceeds of fraud go? There are stories about a political slush fund in Hackney that have never been denied. We have read those stories in the newspapers and they are very convincing. If they are wrong, someone should deny them. No one has denied that the slush fund exists. If it does, where is the money going?
I think that there is a cosy consensus within the Department of Social Security--it is certainly within the Labour party--dating back many years that somehow fraud is not an important issue. Every time a Minister tried to do something about it, people asked whether it was the right time and whether it was really an important issue. I pay tribute to my right hon. Friend the Secretary of State and my hon. Friend the Under-Secretary for taking up the important battle against fraud. It is all very well Labour Members banging on about 17 years of Conservative Government--one would think that 1979 was year zero and that nothing happened before then; certainly nothing was done to combat fraud before 1979. I commend my right hon. Friend and my hon. Friend for putting a strategy in place.
I shall mention a few of the measures that my right hon. and hon. Friend have introduced. First, as to the organisational structure, the fraud strategy group has been established to co-ordinate anti-fraud work across the DSS and its agencies, with a senior official appointed to develop the strategy. I have argued that that official should be of a higher grade--I am sure that the individual concerned believes that he should; who does not? That person must command great respect across the DSS.
Secondly, dedicated fraud teams have been established at local level, preventing staff from being diverted from fighting fraud to other work. That will inevitably occur if the work builds up. Thirdly, the central computer system, initially covering 24 London boroughs, has been piloted to cross-check multiple housing benefit claims. The Government have closed legal loopholes, such as those that permitted people who entered the United Kingdom on condition that they would not be a burden on public funds to claim income support and housing benefit.
I look forward to the time when the Labour party accepts publicly that that was a responsible and a reasonable move by my right hon. Friend the Secretary of State. We all know that many Labour Members believe privately that it was a reasonable and a responsible measure: I look forward to their having the guts to say so in public.
The Government have prevented benefit tourism and they have stopped the avoidance of national insurance contributions whereby people were paid in bullion and fine wines and through the other scams that went on.
Another part of the battle against fraud concerns investment. Fraudsters have become increasingly sophisticated so, if we are to be successful in the battle against them, the system must be sophisticated also. Girocheques and order books have been redesigned to make them harder to forge and the Government have invested in security training and information technology. Lastly, as my right hon. Friend the Secretary of State said in his speech, the Government have given incentives to local authorities which administer housing benefit to expose and stop fraudulent claims. That has proved a spur for local authorities to take the problem seriously. On a non-partisan basis, I pay tribute to the work of London boroughs in concert which have sought to save money in that way.
A secure payment strategy is an important part of the Government's approach and I shall mention some aspects of it. We have the world's biggest social security data-checking operation. The hon. Member for Rochdale (Ms Lynne) said that data checking was inadequate. However, until recently, powerful computers were not available. As my hon. Friend the Under-Secretary pointed out by way of intervention, we have the world's first and biggest data-checking operation which highlights fiddles and multiple claims. Of course, much more can be done and I shall return to that point later. However, we should not lose sight of the fact that the Government are taking the lead on that issue.
Post office staff are being rewarded for catching fraudsters, and benefit claimants in the south-east have their claim books scanned electronically to check whether they are forged or stolen. Five pilot helplines have been set up to make it easier to report benefit fraud, new guidance has been issued to staff to help them to make more rigorous identity checks and a central database is assisting local authorities in identifying fraudulent claims for housing benefit.
My hon. Friend the Member for Broxbourne (Mrs. Roe) referred to the organised fraud in housing benefit, and undoubtedly many people are involved in it. A number of private landlords--I do not know how many--are either conniving in that fraud or actively part of it. That is costing a great deal of money and there must be a crackdown.
However, there is a second type of fraud that is apparently acceptable and quite legal. I believe that it is right to move to financing individuals rather than bricks and mortar--I think that a much more mixed market in rented accommodation is the only way to solve Britain's housing problems. We heard the old canard from the hon. Member for Workington (Mr. Campbell-Savours)--who was in the Chamber briefly--about council house building.
I remember when blocks were built in Poplar in the late 1970s. Before they were completed, they were being described as "hard to let" blocks. It cannot be any sort of triumph to build blocks that one knows will be hard to let. That prophesy came true and some of the blocks were pulled down. If one accepts that one should subsidise individuals, that inevitably puts great strain on the housing benefit budget. Some of the changes made in the late 1980s and early 1990s have also added to that budget.
Councils, housing associations and private landlords are running what I believe is a scam. They work out the maximum rent that they can get for a flat in a particular area and that is what they charge. They know that almost all the people who will rent the property will not pay for it, as the money will come from the Government. Of course there are checks on rent, but we should treat that problem extremely seriously because I believe that it represents a fraud against the taxpayer.
"In terms of overall expenditure on benefits, £1 billion is barely more than 1 per cent.--a tiny figure."--[Official Report, 16 July 1993; Vol. 228, c. 1255.]
"The basic story is that Hackney has a huge fraud problem. Bernard Crofton wants it dealt with. Others at Hackney do not."
"During the inquiry, employees were found to be illegally letting council flats in "keys for cash schemes", others were fraudulently claiming housing benefit, and there were council properties stuffed with fraudulently obtained mail order goods."
"His enquiries revealed that employees were being appointed with phoney references, bogus employment histories and false qualifications. He also claims to have found a number of illegal immigrants among council staff".
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