Fears for vulnerable people as poverty payments axed

Vulnerable people will lose vital support from the government’s decision to press ahead with plans to scrap a national system of poverty payments, warn charities.

Ministers said yesterday they would take forward proposals in the Welfare Reform Bill to abolish national community care grants and crisis loans for families in need and give councils the power – but not a duty – to set up similar schemes locally.

Calls from anti-poverty groups to set minimum standards for council provision and ring-fence budgets devolved to councils had been rejected, the Department for Work and Pensions said in its response to a consultation on the plans.

Charities fear that without such safeguards families in need will lose out on support as councils cut the national level of provision, causing some families to turn to loan sharks.

The DWP said its policy was to lift “burdens” from councils, though it said it would set expectations of councils in a “settlement letter”, which would provide authorities with “sufficient clarity to act”.

“This may be supplemented with a requirement to report on how the funding has been used,” it added.

However, the refusal to introduce ring-fencing or minimum standards sparked anger among charities, which called on ministers to think again.

“Disadvantaged families will turn to high cost loans and loan sharks if this goes ahead,” said Family Action chief executive Helen Dent.

“We’ll continue to campaign on this issue as the Welfare Reform Bill moves to the House of Lords. Ministers still have time to think again, and think about how this decision will hit the most marginalised.”

Neil Coyle, director of policy at Disability Alliance, said: “Disabled people are twice as likely to live in poverty as other citizens and are more reliant on support of this nature.

“To fail to allow minimum standards across the country, or a ring-fenced and accountable system, inevitably risks vital support not reaching disadvantaged disabled people and their families at times of crisis and is deeply regrettable.”

The Association of Directors of Adult Social Services has also outlined concerns about the plans, including over potential administrative costs and over how funding will be allocated.

In its response to the consultation, it suggested that councils may struggle to ensure all funds transferred were spent as desired, because of “competing demands and priorities”.

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