Government's 'bedroom tax' could cost more money than it saves, Labour warns

The bedroom tax could eventually cost more than it saves, Labour says as it forces a vote on whether the measure should be scrapped (Getty Images)

The bedroom tax could eventually cost more than it saves, Labour will claim on Tuesday as it forces a Commons vote on whether the controversial measure should be scrapped.

The Labour Opposition will try to flush out doubts among Liberal Democrat MPs about the Government’s “spare room subsidy”. Labour will argue that, the vast majority of the 660,000 people affected have nowhere smaller to move to, hitting vulnerable people with an average bill of £720 a year. They include more than 400,000 disabled people.

Labour will claim there is growing evidence of “perverse consequences” in which families leaving council or housing association properties end up in private rented accommodation, giving taxpayers a higher housing benefit bill.

Rachel Reeves, the shadow Work and Pensions Secretary, said: “This out-of-touch Government is hitting hard-pressed families at the sharp end of the cost-of-living crisis with the bedroom tax at the same time as cutting taxes for millionaires. And there is mounting evidence it isn’t even saving the money the government said it would.”

She added: “It’s time to repeal this unjust and unworkable policy – and this vote gives MPs a chance to show where they stand. But if Tory and Lib Dem MPs vote against repeal, we won’t let them forget it – and we’ll step up our campaign to elect a Labour government that will.”

Labour has pledged to abolish the bedroom tax. The Government insists the measure has proved a success and is not a “tax,” but a way of making the best possible use of public housing.