I have been involved in social security for 20 years and I've never known a more indecent policy which will cause more misery

Former Labour minister Baroness Hollis has warned peers that families in Norfolk coping with the so-called 'bedroom tax' are likely to run into arrears with their housing association by September.

In a House of Lords debate on housing benefit the former Great Yarmouth parliamentary candidate told members there was no housing stock in rural Norfolk for those facing the government's spare-room subsidy to move in an effort to avoid the change.

New housing benefit laws, which came into force last month, mean that social tenants deemed to have spare bedrooms will be given less money to cover their rent.

Baroness Hollis told the Lords a disabled couple with two children living in a house that has one double and two single bedrooms could not move because there was no stock in rural Norfolk for them to move into.

She said: 'They are applying for discretionary housing payments, but that will run out by about September. At that point they will run into severe arrears.'

She added: 'Would the minister advise me as chair of that housing association to evict that family at that point and to send them into bed-and-breakfast accommodation at a higher cost to us all as well as to them?'

Baroness Hollis said that while she was not talking about a specific family, two thirds of those hit by the bedroom tax nationally were disabled and that would be echoed in Norfolk. She told the EDP: 'I have been involved in social security for 20 years and I've never know a more indecent policy which will cause more misery.'

Lord Freud said the discretionary housing payment was to cover the costs of making a change and a transition and would also maintain the family in an appropriate home indefinitely.