Select Committee on Social Security Appendices to the Minutes of Evidence


Letter to the Clerk of the Committee from Redcar and Cleveland Borough Council (SF 19)

  Dear Sir,

  I am writing on behalf of Redcar and Cleveland Council's Welfare Rights Unit, to comment upon the application of the Social Fund, and its operation.

  This Unit assists residents of the borough with applications to the Fund and with challenging decisions both at local level and the Social Fund Inspectorate. We also provide support to Social Work teams, whose majority of users are in receipt of benefits. We therefore have knowledge of how the Fund operates in practice and how it impacts upon the most vulnerable members of the community.

  We believe that the Fund, in many circumstances, is unfair, discriminatory and causes undue hardship.

  We wish you to consider the following points:

1.   Community Care Grants (CCGs)—Direction 4

  1.1  CCGs are only available to a minority of benefit recipients, and discriminate against, in particular, single claimants. We have numerous examples of single applicants who, although under "exceptional pressure" can only access the Fund if they are coming out of "care" or at risk of going into "care".

  1.2  Two of the most recent examples are:

    1.2.1  A single man in his fifties suffering from depression and living in a rural village devastated by floods last year. The ground floor of his home was ruined by flood water and sewerage but unfortunately he was uninsured. Families whose homes were similarly affected accessed the Fund through Direction 4(a)(iii) to ease "exceptional pressures", but he could only qualify for a CCG if his stressed condition were sufficient to risk admission to "care". A much more severe test, which he found difficult to argue.

    1.2.2   A single claimant who cared for his wife until her death, claimed for a funeral payment from the regulated Fund. There was a shortfall between the grant and the actual cost of the funeral, which he was unable to pay, because he was already repaying the shortfall from his mother's funeral 6 months earlier. He was deeply distressed but could not satisfy 4(a)(ii). Had he been a family, his "exceptional pressure" could have been considered. As a result, repaying both debts from the funeral account is bringing his income well below Income Support levels and causing acute distress.

  1.3  Direction 4 is limited and severe in its eligibility. It denies access to single claimants who are as prone to "exceptional pressure" as any other group.

2.   Repayment of loans

  2.1   Repaying loans can cause hardship and anxiety by bringing basic levels of income to well below Income Support levels.

  2.2   Two recent examples to illustrate this are:

    2.2.1  An 18 year old pregnant girl, estranged from her parents and living in a rented flat. She receives Housing Benefit up to the "single room" rate of £35 per week and therefore has to pay the shortfall to her landlord. She also repays a Budgeting Loan for basic furniture at the rate of £5.35 per week leaving her £36 per week for food, clothing and rent. She had no money to buy food or to heat her home, after paying her landlord.

    2.2.2  A young man under 25 claiming Income Support on the grounds of ill health. He received a Budgeting Loan to assist with furnishing a new flat but the repayments were causing extreme hardship. He had no money for food after paying his bills.

3.   Crisis Loans

  3.1  The "last resort" of many vulnerable people who are unable to access funds from any source, find this fund fails them if they cannot show the ability to repay any loans. So although they can establish their eligibility for the loan, if they cannot repay, they will be refused, leaving many people in a severe situation.

4.   Budgeting Loans

  4.1  The relaxation of rules to allow claims for general needs does away with the pedantic need to specify each individual item, but the advantage is offset by determining a set minimum figure which in many cases will not meet the need.

Val Hudson

Senior Welfare Rights Officer

15 January 2001

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2001
Prepared 4 April 2001