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24.02.14

Government scrapping crisis fund will ‘harm the most vulnerable’

The LGA is urging the government to re-think its decision to scrap the £347m Local Welfare Assistance fund, brought in just last year to replace the crisis loans system.

This year's Local Government Finance Settlement revealed that government funding would not be renewed in 2015, after ministers went back on an earlier promise to consult on the effectiveness of the scheme before making a decision about its future.

LGA chairman Sir Merrick Cockell said: “This fund has been used by councils to provide crucial support to people facing personal crises in their lives, from help paying the rent to putting food on the table. By helping people at an early stage and targeting support at where it is needed most, we have been able to give essential support in people's time of need and prevent short-term problems escalating.

“It is extremely disappointing that Government has removed the funding for this safety net without first honouring it promise to discuss with councils what the consequence of such a move might be.

“Early indications suggest that this scheme is working well, and has been far more effective at getting support to those most in need than the Government crisis loans scheme which it replaced.

“Local authorities are working hard to support the most vulnerable in society while managing the biggest cuts in living memory to funding for services. For some councils, providing crisis payments to those in need from local service budgets is likely to be a stretch too far. We urge Government to work with the LGA and councils to review the fund with an open mind about its future.”

Money from the fund is used by councils to give emergency help to people facing crisis situations, such as families threatened by homelessness or domestic violence. Others have used the money as a short-term solution to prevent longer-term problems, such as working with those recently released from prison to cut re-offending. 

The LGA provided these case studies about how the money has been used in various local authority areas:

  • In Portsmouth the LWA scheme made 533 awards from 2 April 2013 to 17 January 2014. About 75% of awards have been made to improve living conditions to enable someone to remain in their home; resettle them into more suitable accommodation; or meet needs caused by domestic abuse.
  • The Surrey LWA scheme has helped more than 1,500 Surrey residents, including families forced out of their homes during the winter 2014 floods who were assisted with food, clothing and utilities as well as new bedding.
  • In Lambeth the LWA scheme has allowed the council to support people with the process and costs of moving house in response to the benefit cap and spare room subsidy, which has affected around 4,400 households in Lambeth. They say that the LWA funding has been invaluable in supporting their efforts to prevent families becoming homeless.
  • Brighton and Hove City Council operates a scheme of payment for prisoners at the point of release to provide some initial support for basic needs and minimise the risk of reoffending. The scheme was designed with HMP Lewes and has been standardised and coordinated with neighbouring authorities so prisoners are treated the same even if they return to different local authorities.

Matthew Reed, chief executive of the Children's Society, earlier called the decision “yet another blow to what was once a critical safety net”.

The DWP, which used to administer the fund, says money was ineffectively targeted, while the DCLG now says that it is councils’ responsibility to provide emergency crisis funding from their own general funds.

(Image: Trowbridge Estate)

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