Select Committee on Social Security Appendices to the Minutes of Evidence


Memorandum submitted by Sunderland Welfare Rights Service (SF 28)


  1.  We see the role of the Social Fund as a facility for meeting occasional, but ongoing, substantial costs for basic items. The rate of income related benefits is insufficient and those who are long-term claimants cannot live adequately due to regular, substantial costs for essential items. Currently, the Social Fund fails to meet the needs of single people. There is an emphasis on its role in relieving "exceptional pressure on families". There are many vulnerable people who are not members of a "family". Single people living with mental health conditions are excluded from criteria of "exceptional pressure on families". The criteria should be extended to include single people under exceptional pressure.

  2.  Turning to the operation of the Social Fund in practice, we see a fundamental problem in the exclusion of claimants on Jobseeker's Allowance (JSA) (contribution based) and Incapacity Benefit (short term higher rate) from being able to access the Budgeting Loans and Community Care Grants, despite their income often being very similar to Income Support (IS)/JSA (income based) levels.

  There has been a large amount of anecdotal evidence in Sunderland of the frontline staff in the Benefits Agency offices discouraging claimants from making applications to the Social Fund. If there are people seeking to make so called "frivolous" claims then it must only be a small number. Income Support claims are not subject to similar initial scrutiny by frontline staff. The Social Fund application forms are shorter and simpler than Income Support claim forms and "frivolous" claims can be dealt with very quickly.

  The high success rate of reviews witnessed by Welfare Rights Officers when providing representation suggests that the quality of original decisions is rather poor. It appears to be a waste of public money to have reviews of poor decisions. We believe that the initial inquiry into the claimants circumstances should be more thorough. The experience of a high success rate at review when representation is provided leads to the suggestion that there should be better facilities for representatives. It is the norm for representatives not to be notified in writing of the time and date of the review hearing. This should be changed.

  There is a belief that local officers display a lack of knowledge/application of social fund inspectorate decisions/guidance/precedents. This is more than a decade after the introduction of the Social Fund.

  The payments from the Social Fund are based on the purchase price of cheap appliances (eg cookers and refrigerators). This is a false economy for public finances. The cheaper cookers and refrigerators become obsolete more quickly.

  Also the energy efficiency of some of these appliances is poor. This may create more poverty due to increased fuel bills.

  The use of the term "Community Care" in relation to the Grants is seen as stigmatising and could deter some claimants who would not wish to be classed as recipients of "Community Care". The current emphasis on the Grant being to assist a person(s) "to remain in the community rather than enter institutional or residential accommodation" could discourage applications. Not many people will want to contemplate the possibility of entering institutional care, losing their children etc. There should be a less "stressful enquiry" regarding the need for a Grant. The criteria should be widened to include people who are not at definite risk of admission but who do have a risk to their health and well-being.

  Changes are needed to the way that prisoners due to be released are treated. Often they are refused a Grant because there is no evidence they will be on JSA/IS when released, even though the criteria is that they are likely to become entitled within six weeks. It would ease stress and pressure if the prisoner's application was processed and they were paid JSA/IS on release. If they could have furniture and clothing they are at much less risk of re-offending and will have a greater chance of resettling.

  The qualifying criteria for Budgeting Loans/Community Care Grants includes there being a current award of Income Support/JSA (income based) or an award expected within six weeks of the application. This is not reflected in the question contained within the application forms. "Are you or your partner currently getting Income Support or income based Job Seeker's Allowance?" should have the words "or do you expect to be in receipt of an award within the next six weeks?"

  3.  In future, there should be a number of changes to the Social Fund. Some are outlined above. People in receipt of JSA (contribution based) who have no capital above £3000 and no other income should be eligible for Grants and Budgeting Loans. The same should be true for people in receipt of Incapacity Benefit (short term rates).

  Budgeting Loans should be abolished and replaced with regular payments for claimants who have been in receipt of benefits for lengthy periods. We compare this to the situation of Winter Fuel Payments. It has been recognised that there is a recurrent need for a payment to cover essential and expected cost. These payments are made in addition to all other income.

  Ideally, Budgeting Loans should be replaced by Single Payments. Otherwise, the need of the applicant for a Loan should be given greater weight rather than the ability to repay the loan. Periods of repayment could be extended or the commencement of repayments could be postponed until an improvement in financial circumstances occurs. There could also be the option of "writing off" a loan debt after a period of time.

  If Loans are to remain, then an application for one component of the Social Fund should be treated as a general application (ie application for a Grant should be considered as also being for a Loan and vice-versa). There should also be a more transparent way of showing a person's "credit rating" for a Loan. The ability of a person to satisfy the criteria for a Loan changes from month to month and it is difficult for advisers to know when to advise that an application be made.

  The amount of payments should reflect a "value for money" purchase. The life expectancy and energy efficiency for an appliance should be taken into account. This should replace the current method of looking for the cheapest appliances.

January 2001

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