Tories rule out ringfencing funds for Local Welfare provision

DWP minister says there are are “no plans” to ringfence funding for local welfare provision despite evidence of rising destitution.

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In the face of rising destitution, the government has no plans to ringfence the notional allocation for local welfare provision.

DWP minister Will Quince confirmed the ‘no ringfence’ stance in his answer to a written Commons question.

As reported by 24housing today (15th July), a report released by the poverty grants charity Buttle UK revealed destitution to be on rise – with families routinely unable to afford regular meals, wash clothes or provide their children with basic items such as beds and sheets.

The fourth annual Universal Credit (UC) survey from NFA and ARCH said councils were struggling to sustain cash-draining UC ‘subsidies’.

Local welfare assistance schemes is an umbrella term for local welfare provision. Councils decide what local provision to provide and at what cost.

The Local Government Finance Settlement for 2015-16 identifies a notional amount relating to local welfare provision in each upper-tier and unitary authority’s general grant, totalling £129.6m for England.

In his question, Frank Field, chair of the Work and Pensions committee had asked if funding allocated to councils for local welfare assistance schemes would be protected by ringfencing.

Quince said the notional allocation for local welfare provision remained at £129.6m in England in the Local Government Financial Settlement until 2019/20.

“There are no plans to ringfence this notional allocation,” he said.

Councils are increasingly concerned over the scope for – and even survival of – assistance schemes as cuts continue.

Just over a year ago, a joint report from The Children’s Society and the Church of England said schemes were failing to operate effectively, with increasing numbers of destitute people turning instead to food banks and other voluntary agencies for help.

The report stressed that the need for co-ordinated, consistent support was “increasingly urgent”.

A lack of publicity, bureaucratic hurdles, and restrictive eligibility criteria are all cited as deterrents to applying for Local Welfare Assistance schemes.

In September last year, FoI responses revealed nearly eight million people as living in council areas with no access to local welfare assistance schemes.

Of the 131 top tier councils who responded to an FoI request from the Greater Manchester Poverty Action Group (GMPA), 22 said they do not have a scheme providing payments such as care grants and crisis loans in place.

Provision was said to be under threat in 29 other areas.

This research revealed government funding for such payments totalled £178m in the first year of localisation in 2013-14, compared to an allocation of £330m in 2010-11.

Councils have continued to receive some reduced, un-ringfenced funding for local welfare since localisation in 2013-14, but there is no requirement for councils facing financial pressure to provide schemes.

The amount spent on crisis loans and care grants in 2017-18 was found to be 69% lower than in the final year before localisation, and the total budgeted for assistance fell from over £64m in 2015-16 to less than £47m in 2017-18.

Budgets for local welfare assistance schemes were found to have fallen by an average of 17% in the 25 most deprived local authority areas in the country.

And there is significant variation in the amount councils allocate to schemes across the country.

The largest fall in expenditure on schemes between 2010-11 and 2017-18 was in the East Midlands, where the outlay fell by 94% from £16.2m to £0.9m.

And the West Midlands saw the second biggest decrease – from £24.4m to £3m (88%) over the same period.

The decrease was 75% or more in all but one region, East of England, where there was a fall from £17.4m to £5.4m, or 69%.

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