Speech – Residence Test on Supplementary Benefit


Residence Test on Supplementary Benefit


I will limit my speech to one main item. As Deputy Le Clerc indicated in her opening speech, Deputy Gollop and I have – in his words, I believe – gone rogue on Proposition 23 of this report. I can only apologise to my fellow Committee members for the hard time I have given them in several Committee meetings, and am now giving them – one last time – in this debate. There are few States Members I esteem more highly than my President and fellow Committee members at ESS. There are few whose integrity, generosity and dedication is so far beyond question. I cannot find a single logical or moral argument in favour of this proposition, as will no doubt become apparent — I find it intolerable. But logic is not the only reason to support a decision – nor is it the only right one. Sometimes you have to trust your instincts. If Members ever chose to place their votes on the basis of the character of those who are laying the propositions, they could not do better than to vote with Deputy Le Clerc, Deputy Langlois and Deputy Fallaize on this proposition. I say that sincerely, sir, and I will pause to let it sink in, because it is the single strongest factor, I believe, that must be weighed against anything I say in opposition.



Let me quickly revisit the context which Deputy Le Clerc outlined. In 2013, the States agreed to impose a restriction on people living in Part A of the Open Market, so that they could access Supplementary Benefit in times of need, but could not access rent allowance. As it happens, I think there is a certain amount of logic in that: certainly more so than in what we have on the table right now. For what it’s worth, if I understood correctly, both Deputy Le Clerc and I thought that the current Part A rules would fall away with this new change. It turns out that there will still be a very small number of people in Part A who could be affected by the old rules, from next year. Whatever happens – whether I am able to convince members to vote with me and throw out this proposition, or whether the proposition passes – we will have an inconsistency there, which I believe we as a Committee will have to sort out as soon as possible.

However, back to proposition 23. I looked up the Hansard for the 2013 debate. Only four people spoke on this part of the Uprating Report: Deputies Dorey and Trott, and former Deputies Ogier and Langlois. All four used the opportunity to express their concern that the Open Market – which was originally designed to attract wealthy individuals to our shores – had become a place where poor workers could be packed together in multiple-occupancy households. In other words, all four of them used the debate to criticise the Housing Control regime which was, at that time, just about to be redesigned. None of them really engaged with the principle of the benefit change. I am inviting them to do so now.

First, sir, let’s reflect on this. The States has redesigned housing control. In fact, it has replaced it with a Population Management regime, which will come into force from next year. The process of redesigning it has been a lengthy one, with at least six debates over the last four years. It is safe to assume that any Member of the last States, who is still with us, has had ample opportunity to amend the Population Management regime if they feared it would not achieve the right policy objectives. Are we now saying that it has failed before it has even started – that it is going to let in people who have no business being here, and who therefore should be cut off from any form of safety net? I think few Members would agree with that.

So let us assume that the Population Management regime which will come into force in April is – more or less – the regime that the former States, including half of those here today, thought was about right. Well, within that regime, there will be a part of the Open Market known as Part D. This is where all the households in multiple occupancy will be registered – including many in the old Part A. In Part D, people will be entitled to come and live with just a resident permit. They may or may not have guaranteed employment before they come to the island.

That may sound a bit too liberal for some, but it is designed into the structure of the new Population Management regime. It is not an accident. It was probably intended to help some of those industries who have been emailing us in recent weeks, concerned about how rapidly they need to manage staff turnover, and how cumbersome the new regime might be.

So that is the first point: everybody who is potentially affected by this amendment is living here legally and legitimately, under the Population Management regime which we designed. Our President has described the people living in this part of the Open Market as “people who our population management regime has not considered necessary.” From everything I know about her, I am sure she didn’t mean that somewhat unfortunate choice of words. But the reality is that this part of the Open Market is built in to the population management system. It is entirely in our gift to change the system, if we don’t like it. What we should not do is use the benefits system as a second form of population management, as this proposition will do. Deputy Lowe and her Committee are perfectly competent to run the Population Management regime, with our usual challenge and scrutiny – certainly, they do not need a parallel system.

Sir, second, we must consider the function of Supplementary Benefit: a matter we’ll no doubt hear much of in this debate, as we did to some extent during the Budget.

Supplementary Benefit is a hardship benefit. It is stringently means-tested. People can only access it when their income falls below the bare minimum necessary to ensure that they and their family do not face intolerable hardship. It is not easy to access in the first place, despite the popular myths, and when one is in receipt of it, it continues to be demanding. People receiving Supplementary Benefit are expected to work, and there are sanctions for those who refuse to engage. Many already do work, but need a top-up on a painfully low level of income. Those who do not work are in the hands of our very capable Job Centre, which – as para 17.1.6 of this report shows – placed 728 people into employment last year. Moreover, as Deputy Fallaize often reminds us, the amount of effort we spend detecting and bringing to justice people who defraud the benefits system seems disproportionate compared to that spent dealing with those whose relationship with the tax system is similarly disingenuous. Supplementary Benefit is not an easy ride. In bringing this proposition, the Committee implies that we are not capable of screening out people from Supplementary Benefit who are not in acute financial need. That was not their intention, and that is not the reality, but there it is.

I would remind Members that access to Supplementary Benefit is based on a clear, simple test of financial need. It is designed to protect against severe hardship. By introducing criteria for access to Supplementary Benefit which have nothing to do with financial need, we forget its fundamental purpose. People can be poor – can be exploited in work – can fall suddenly on ill-health or other hard times – no matter whether they have lived in Guernsey all their lives, or arrived here eighteen months ago. We discussed this at length yesterday. In the Minimum Wage debate our President said “we still see poverty in our island as a result of low pay”. If today we argue that restrictions on access to Supplementary Benefit has “no obvious impact on the welfare of guest workers”, I submit that’s because we are not looking. As soon as we start to look – as we all do, when we get involved with individual cases, raised with us by our parishioners – we know it’s messier than that. We owe it to ourselves as a civilised community to treat all our residents fairly, and to make sure that Guernsey is a place where no one experiences sustained deprivation because of the total lack of a financial safety net. We are better than that.

Thirdly, sir, let’s go back to the economics, and talk briefly about behaviours and market forces – for those whose politics is guided, perfectly reasonably, by the logic of the market. The argument here is simple. We know that Part D of the Open Market will be capped. There will be a maximum of around 170 houses in multiple occupancy on the register, maybe less. Those houses sleep about 800 people.

But here’s the important thing: right now, already, those houses are mostly full. My Committee have been told that, of the 800 or so people currently living here, about 50 of them are claiming Supplementary Benefit. Some of those 50 people are thought to be local people living in Open Market accommodation – so the true number of non-local, Part D residents who are receiving Supplementary Benefit is even lower. A fraction.

Yes, people come and go. But in April, we won’t see a rush of 800 people leaving and 800 new faces coming in to this sector. Change is gradual. It is dictated, to some extent, by market forces. If there is an empty room, someone will fill it. If there is not, they cannot. When supply is capped – as it is in Part D of the market, because this is now a closed register – demand cannot grow exponentially. So there will be no big onrush of incomers determined to make the most of our benefits system. That is just a bogeyman. It is a total fiction.

To really reinforce this argument, I should remind the Assembly that, in the 2012 report on welfare reform, brought by Deputy Dorey’s Social Security Department, the question of benefit restrictions on the Open Market was discussed, although the Department chose not to act on it. That report was written in 2011. That was before the States had even begun to redesign the Population Management regime. So the claim that this change is needed now, because we’re about to have a new Population Management regime, is not supported by the history. This idea has been around since before the birth of the new regime. It is a question of ideology, not timing. And it is a misguided ideology. There is no onrush of new immigration to worry about. Our population management regime, and the simple laws of market forces, won’t allow it. There is no problem to solve right now. There is no realistic prospect of a problem in the near future. And there is no doubt that if a problem did start to emerge, some time after the new regime began, we could take the necessary steps at that time to deal with it. Deputy Le Clerc said, quite rightly, that Deputy Gollop and I believe this to be a “low volume, low risk issue” and that we would “prefer to wait for an identified problem.” Well, quite. It is not good government to make rules to solve problems that do not exist. That is how we end up tied up in red tape.

Finally, sir, let’s talk about people. Let us talk about the people who live in those multiple-occupancy households in Part D of the Open Market.

They come here to work. They work in unrewarding jobs, for long hours, for wages many would turn their noses up at. They pay what they owe. They contribute to the welfare and wellbeing of our island in many ways, financial and non-financial. They are not always well-treated. My colleagues know this, from all the casework we do – especially since this Committee has become responsible for employment legislation as well as the social security system.

It is not the business of government to prop up inefficient employers. But the way to prevent that is to set decent minimum wage standards, as we agreed yesterday. It is certainly not to push the workers themselves into serious financial hardship, without recourse to any form of financial safety net.

I want to address briefly the comment made in yesterday’s debate by Deputy Brouard. He, with Deputy Dorey, was part of the Social Security Department which originally considered this issue and wisely decided to do nothing. And he is right, I believe – many migrant workers here are working for wages that, however low, are better than what might have been possible at home – although, as Deputy Kuttelwascher has said, “Brer Brexit” might change things somewhat. But the issue is not necessarily the wages, which are helpful while they are being paid. The issue is what happens when, by no fault of the worker – by illness or injury, for example – those wages stop being paid. The costs of living which that person is faced with are the costs of living in Guernsey, not at home – at least in the immediate term, until they can do something about it. Social protection – the whole history of social security – was about making sure that workers living on the edge of security were not cut loose and left to suffer when, through no fault of their own, they lost their only source of income. This proposition cuts against the heart of our Committee’s mandate.

Sir, the people who will be affected by this proposition are hard-working people and net contributors to our island – we cannot justify removing the very limited safety net available to them if everything goes wrong. Proposition 24 introduces some discretion for the Administrator, to soften the blow. But Members know well that any policy which relies on discretion to make it palatable is a badly-drawn policy in the first place.

Sir, I do not like Proposition 23 – that much is obvious. But, more to the point, I do not think it is necessary:

It is not necessary because we have a strong new Population Management regime. If we believe the rules allow people to live here, who have no business living here, then we can change the rules. But if we believe the rules are right, then let’s treat everybody who is living here – legally and legitimately – under those rules, equally and fairly.

It is not necessary because we have a robust and effective Supplementary Benefit system. We have tight criteria for access. We have stern jobseeking requirements – and we are good at making people seek and get into work, if they are not already employed – although a growing number of people in receipt of benefit are certainly working, but for paltry pay. We have a zealous approach to identifying and rooting out fraud. It is not an easy system to play.
Once again, the proposition is not necessary because of the way economic forces work. Part D is a capped register of multiple-occupancy households in the Open Market. They’re already mostly full; and very few of their occupants claim benefit. There won’t – there can’t – be a surge of new people at our door in the spring, just because of the change in regime.

And, finally, the proposition is not necessary because the people who will be affected by it are decent, hard-working people; net contributors to our society. Sure, there will be people everywhere who try to play the system – both locals and incomers – but we don’t make policy around those people; we design safeguards – like sanctions, like our fraud team – to remove them from the system instead.


Sir, Members have heard my dilemma. I am not habitually disloyal, nor do I enjoy it when I am. I have fought, cajoled, teased and pleaded with my colleagues to kill off this proposition – but there it is – and I would still tell you to take their judgment over mine any day. And yet. And yet. I cannot find the proposition anything other than unnecessary at best –tasteless at worst. I cannot support it – there is no business case, no ethical justification, no legal reason for doing so.

Sir, from those of us who were talking earlier this week about the need to strengthen the tax base, the message to the States was “pick on someone your own size.” This is something we would be wise to bear in mind in every part of government. This isn’t picking on someone our own size. This is kicking down at people who are, by definition, exceptionally vulnerable – who, for whatever reason, have been put into a situation that would ordinarily enable them to access Supplementary Benefit: the benefit which, we should well remember, is meant to lift people above an intolerable level of hardship.

My fellow Committee members felt this was a matter significant and important enough for the States as a whole to take a view on it. My view was that it never should have seen the light of day. However, it has been brought to the States, and it is an important and significant matter. I am not comfortable that challenging it means breaking ranks with my Committee – but my reasons for opposing this proposition have not changed since it was first presented to the Committee, and there was little merit in opposing it at all, if I was not prepared to follow it through to its conclusion. This is a policy which, at its simplest, is trying to solve a problem which does not exist, and which is not likely to exist. That is hardly good government. I would ask my Committee to forgive me, and I would ask all Members to vote against Proposition 23.

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