‘Councils must use government cash to support families in crisis – or face extra care costs’

While the £74m announced this week by ministers for local welfare services is insufficient, it sends council a message that helping poorer families is vital, says Megan Jarvie

By Megan Jarvie, Child Poverty Action Group

A low-income family cannot afford beds for their growing children – their kids are at risk of being taken into care. A disabled man’s washing machine has broken and he cannot afford to replace it – trudging to the laundrette with his load of washing worsens his condition and he then requires help from social care. And a mum leaving an abusive partner cannot afford to pay rent in advance on a flat – and ends up on the homelessness register.

In all these cases and many others like them, local welfare schemes have bridged the gap between low income and full-blown crisis over the last two years. So it was good news to hear the Department for Communities and Local Government announce this week that, contrary to its initial plans to end the central government funding line for these vital schemes, it will now make £74m available to councils in 2015-16 to help them continue to provide local welfare assistance. It expects councils to top this up from their core grant.

Help to meet unexpected costs 

Local welfare schemes – the successors to crisis loans and community care grants under the Social Fund – have been providing grants, goods and loans to people on low incomes for one-off or unexpected costs since April 2013. In their first two years of operation, the schemes have been funded by a Department for Work and Pensions grant of over £170 million a year. In January last year, however, local government leaders, charities and others working with vulnerable people were shocked to discover that central government planned to terminate this grant at the end of 2014-15. Councils were to be left with no choice but to close their schemes or fund them from their ever-shrinking revenue support grant.

The first sign that the government was reconsidering was when it settled a legal action, involving CPAG and Islington Council, before action, agreeing to make a fresh decision on funding  Described as a ‘cut too far’ by campaign groups, the issue has touched a chord both far and wide. MPs and councillors of all political stripes, an array of charities and a large number of the general public spoke out in support of local welfare provision. The ‘spend to save’ logic was patently clear: without effective schemes small crises in families’ lives could easily escalate, increasing pressure on other council services such as homelessness support and social care.

A message to councils

The new money goes only part way to providing local authorities with the £129 million that central government has indicated should be spent on local welfare, and there is, of course, no ring-fence or duty on local authorities to support local welfare schemes. But while councils are free to spend the money as they best see fit, by isolating a separate budget line in the settlement as well providing at least some new money, central government is sending a clear message to councils: local welfare is important.

The last year has been full of confusion about this funding, but at last we have some certainty. The final settlement may not include everything that we hoped for, but there is now a clear expectation on councils, and funding to help meet it. Given this, we hope to see councils all across the country offering schemes that truly meet the needs of vulnerable people. Details about every local scheme can be found on the Child Poverty Action Group website. 

Megan Jarvie is London campaign coordinator for the Child Poverty Action Group

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