Social Fund provides threadbare safety-net to the poor, says CAB service

PRESS RELEASE

The Government’s Social Fund - the welfare benefit of last resort for thousands of often desperate claimants - is failing people in financial need and in some cases even exacerbating poverty, claims Citizens Advice Scotland.

The fund’s discretionary loans and grants were introduced to help people on benefits and low income to manage financial emergencies, such as replacing essential items of furniture or funeral payments.

But in a written submission to the backbench Work & Pensions Committee at Westminster today, CAS says the fund is hard to access, inconsistent in its decisions, and inadequately resourced.  It points to a range of case-evidence from its member Citizens Advice Bureaux in support.

Chief executive Kaliani Lyle said: “Problems relating to the Social Fund remain a major concern for the CAB service.  We have long campaigned for it to provide better access to affordable credit for those on incomes which can’t stretch to sudden, unexpected expenses.

“But because the Social Fund is not meeting need, some people are forced to borrow from high-interest credit lenders.  Our bureaux have seen an increasing number of destitute clients for whom they have had to arrange emergency social work payments and even charitable food parcels. “

CAS says the crisis loan telephone-application system is frequently engaged for long periods of time and warns the 0800 numbers used can be prohibitively expensive from mobile phones.  Some clients – who have chosen specifically to have mobiles as a budgeting tool – have been forced to wait so long that they run out of credit.

These problems are exacerbated by the fact that some local Jobcentre Plus offices refuse to deal with paper applications, despite the fact that Social Fund regulations give people the right to make claims in person.

Delays in processing claims are another problem for claimants in immediate hardship.   One CAB client who had moved into a flat with no furniture or cooking facilities was told her application for a Community Care Grant would take ten days to process due to staff shortages.

Other impoverished clients have been required to repay loans at unrealistic levels, aggravating their financial hardship.  One CAB client, who had mental health problems and five children, had to repay a budgeting loan of £224 at £44 per week from his income support.

Another concern is inconsistencies that arise from the discretionary nature of the fund. A client with diabetes, arthritis and depression applied for a Community Care Grant for a cooker, washing machine and fridge as she was unable to do her laundry, store fresh food or cook hot food.  She was turned down for all items as they were not considered priority needs.  Another diabetic client in severe financial hardship had to eat regularly three times a day.  Her Crisis Loan application was turned down on the grounds that “food is not an emergency”.

Administrative errors, exacerbated in recent months during the transition to Jobcentre Plus, have also caused distress and financial hardship.  The closure of local offices, particularly in rural areas, means some clients have had to travel significant distances for Crisis Loan payments.

Kaliani Lyle said: “The Social Fund is an essential lifeline to those on low incomes who are unable to afford unplanned, one-off expenses and who cannot access affordable mainstream credit.

“Consequently, it is vital that the Social Fund is accessible, efficient and well-resourced, if it is to help contribute to the Government’s goals of combating poverty and social exclusion.”

Notes for News Editors

1. Each CAB is an independent charity, run by a committee of local people, and responsible for raising its own funding.
2. Around 80 per cent of CAB workers are trained volunteers – if you’d like to help your local community for just a few hours each week, contact your local bureau manager, or volunteer through the CAS website – www.cas.org.uk
3. The first bureaux in Scotland were established in 1939 as a wartime information service.  There are now 76 CAB offices across Scotland, which operate from over 200 service points, and which form the country’s largest independent advice network.
4. CAB advice services aim to be freely available and accessible to everyone in the community.
5. Consumer debt is now the single biggest issue that CABx deal with.  Last year, CABx in Scotland dealt with debt totalling over £211m.
6. Images and logos of the CAB service are available from the CAS press and communications officer (see contact above).
7. Practical and up-to-date information is available online from Adviceguide (www.adviceguide.org.uk), including factsheets you can print off.