Welfare Assistance Schemes

Lord Bishop of Truro Excerpts

Tuesday 10th February 2015 Lords Chamber

Asked by

[The Lord Bishop of Truro]

To ask Her Majesty’s Government what steps they are taking to ensure that local welfare assistance schemes provide effective support to people in crisis and will continue to be able to do so.

[The Lord Bishop of Truro]

My Lords, I am very grateful indeed for this opportunity to raise a very important issue by putting some questions to the Government on, and raising matters relating to, local welfare assistance schemes. In doing so, I declare my interest that I am chair of the Children’s Society, a national charity which has conducted quite a lot of research in this area and to which I shall refer.

I begin by welcoming the government decision to make visible within the local government settlement £129.6 million for funding for local welfare provision. This funding provides a vital safety net for families and children, and vulnerable residents, in a crisis. The additional allocation of £74 million to local authorities, coming on the back of campaigns run by the Children’s Society and others and announced last week by the Government, is also a welcome, necessary and vital step in ensuring that all local authorities up and down the country have the resources available to put in place local welfare schemes.

The level of public support for the reinstatement of funding for local welfare provision has been significant. I am sorry that I was not in the Chamber earlier to hear the Question asked on this matter. More than 5,000 campaigners from the Children’s Society and Shelter responded to the government consultation in November on the future of local welfare provision, calling for funding to be provided in addition to the core grant funding made available to local authorities. The consultation on the provisional settlement, held in January, received an even greater number of responses, with more than 12,500 answering the specific question on local welfare provision—and all calling for the funding to be reinstated at the level available for the current financial year. In fact, since 2010, spending on the discretionary Social Fund has been reduced by £150 million in real terms, so this emergency support has faced significant funding cuts in the last five years.

The need for an effective safety net of last resort is vital to provide emergency help to very vulnerable families and children in crisis situations. This is especially necessary given the growing struggles that many families are facing, as evidenced in particular through the growing use of food banks and other emergency food aid provisions. The growth in these also shows the growing need for such crisis support. In addition, the combined proportion of household incomes spent on food, housing and utilities for households in the bottom income decile rose from 31% in 2003 to 40% in 2012, as we made clear in the report Feeding Britain, produced in December. On the back of this public support and calls from councils and the voluntary sector, I am pleased with the announcement that a visible funding line will be available for local welfare provision and that additional money will be made available to local authorities to ensure that these schemes are in place.

The vulnerability of claimants to local welfare schemes, and previously to community care grants and crisis loans through the discretionary Social Fund, is clear. Over half of community care grants awarded in the final year of the discretionary Social Fund, prior to localisation, were made to families in a crisis. Research shortly to be published from the Children’s Society found that over a third of local authorities used their local welfare assistance schemes as one of the only ways in which they could support young homeless people aged between 16 and 20. Many local authorities up and down the country have put in place innovative local schemes to help vulnerable residents, while evidence from local authority returns to the Department for Work and Pensions review found that 86% of funding allocated to local authorities was projected to be spent in 2014-15.

The Children’s Society has worked closely with a number of councils seeking to improve and continually evaluate their local schemes. However, there is undoubtedly a mixed picture up and down the country; the quality of schemes varies enormously. Following additional money being made available by central government to support local authorities with local welfare provision, there is the opportunity to provide guidance—or a clear steer from Ministers—that this funding should be spent protecting the most vulnerable. It would be really useful to hear tonight from the Government their plans in this regard.

We know from the information currently available that information gathered about local schemes varies hugely. Monitoring the effectiveness of local schemes is therefore a significant challenge for local charities, service providers and central government departments in taking decisions on the future funding of such schemes. I point the Minister to the Children’s Society’s report Nowhere to Turn?, which has recommendations for local schemes. These include, first, ensuring that low-income working families are able to access local schemes by ensuring that eligibility criteria are not restricted to those in receipt of out-of-work benefits. Evidence has found that a quarter of schemes require claimants to be in receipt of out-of-work benefits, with only 9% of schemes explicitly stating that they allow claimants in receipt of working tax credits or work benefits to apply for emergency support. We know that approximately six in 10 children in poverty now live in low-income working families, making this requirement extremely important to ensure that families have somewhere to turn in an emergency.

Secondly, not requiring applicants to the scheme to access other sources of consumer credit before applying to their local welfare scheme is another suggestion from the report. Forcing families further into a debt trap will not help those who are struggling. This should not be a requirement for accessing your local scheme in an emergency. Thirdly, the report recommends ensuring that local schemes do not have restrictive and overly long residency criteria, prohibiting many families in a crisis from accessing their local schemes. Half of all schemes require claimants to be resident; a further 13% require claimants to have lived in the area for more than six months.

If local schemes are cut and vulnerable people have nowhere to turn, we are likely to see a number of additional and more expensive costs to the public purse. This will motivate councils to maintain schemes but central government will also bear costs, and so should be motivated to ensure that local schemes are maintained.

Since the provisional local government settlement for 2015-16 was published in December 2013, schemes up and down the country have been hampered by uncertainty over funding. This uncertainty has caused some councils to restrict access to schemes, in the hope of being able to roll over underspend to future years and ensure that they do not have to cut back a service which they are no longer able to fund. I therefore suggest that greater certainty over funding going into 2016-17 would enable councils to design schemes to meet the needs of residents now, and in the longer term. There has also been a lack of clarity on how funding levels are decided. Even if it is not currently possible to commit to levels of future funding, which I would of course understand, the Government should be able to provide clarity on the process that they will undertake to make this decision.

I believe that it is possible to monitor local schemes effectively. The Scottish Welfare Fund, for example, is administered locally with information gathered centrally. This includes information about whether the applicant has children or a disability, and the reason for the application. People with disabilities are particularly likely to be overrepresented among recipients. In the last year of the Social Fund, 32% of community care grants expenditure and 19% of crisis loan expenditure was for people with disabilities. In Scotland, where we can still see a clear picture of the characteristics of recipients, two out of every five recipients of the Scottish scheme claimed ESA.

Alongside the more effective monitoring and evaluation of local schemes, putting funding on a more sustainable future footing is required, as I have said, to ensure that this vital safety net continues into the future. As I end my speech, I will therefore ask some questions of the Minister and I hope that other people will support the idea that we need to find ways to ensure that these local welfare schemes are firmly put within local authorities and used for the purposes for which they are set.

Will the Minister consider issuing guidance or best practice on local welfare assistance schemes to help local authorities implement effective schemes in their local area? Children are a key beneficiary of local welfare schemes. Will the Minister explain where families will be able to turn in an emergency should their local authority not provide a local welfare assistance scheme?

What steps, I wonder, will the Minister take should schemes be completely abolished in a minority of local authority areas, and how will he address this circumstance? Will he outline how the additional funding amount of £74 million was decided upon and why the full allocation for 2014-15 was not provided in addition to the core government grants, as called for by many members of the public, charities and local authorities? Does the Minister agree that the next comprehensive spending review will provide an ideal opportunity to ensure that longer-term funding for local welfare provision is available over the course of the next Parliament? I look forward to answers to some of these questions.