Welfare Reform Bill

My Lords, when we discussed the Social Fund last week, I hope I was able to offer reassurance in two key areas. First, I informed noble Lords that we would extend the 2014-15 review of a cross-section of local authorities to include information about the way they have used their funding for the new local provision. Perhaps I may return to that in a moment. I was also able to assure your Lordships that the settlement letter that noble Lords referred to today that will accompany the funding will set out what the funding is to be used for and will describe the outcome that must be achieved—although, for reasons I explained, not the method that should be used to achieve the outcome. After further consideration of the issue, and following questions from noble Lords, I am able to explain what the settlement letter will contain. The letter will set out what the funding is to be used for, the underlying principles, and describe the outcome that must be achieved. It will say that the funding is to concentrate resources on those facing greatest difficulty in managing their income, and to enable a more flexible response to unavoidable need. The letter will make explicit that the funding is to provide a replacement provision for community care grants and general living expenses crisis loans. The letter will go on to explain that community care grants were awarded for a range of expenses, including household equipment, and were intended to support vulnerable people to return to or remain in the community or to ease exceptional pressure on families. They were also intended to assist with certain travel expenses. It will also explain that crisis loans were made to meet immediate short-term needs in an emergency or as a consequence of a disaster when a person had insufficient resources to prevent a serious risk to the health and safety of themselves or their family. As I said in our discussion of Amendment 50 last week, I assure your Lordships that we are equally committed to ensuring that this funding goes to help the most vulnerable. Amendment 50ZA would require the Secretary of State to publish information on the amount of money given annually to each local authority. I can assure your Lordships that we already plan to publish this information on the DWP website. On community care grant budgets, noble Lords might like to be aware that work has been done since Committee to make the funding distribution fairer by changing the funding allocation methodology. It is each local authority’s responsibility to decide what type of support it provides with these funds. We have already been made aware of a variety of innovative ways in which local authorities plan to use this money, such as furniture re-use schemes, working with credit unions, investing in existing projects or joining up with other organisations in the area. For example, the fieldwork undertaken by the department shows that rural local authorities had very different ideas from those of urban authorities, and would embrace the freedom to design and establish local provision that suits the particular challenges they face. Some benefit recipients cannot even afford the delivery of free goods from support schemes. During the fieldwork, the department was made aware of the fact that a local authority in Yorkshire is considering using some of the new funding to pay the delivery fees charged by an existing provider for the delivery of free goods to benefit recipients and other low income groups. This demonstrates the benefit of tailoring support to the local area. This initiative is particularly useful in a rural area, as it would have been far more expensive for people to arrange their own deliveries than in an urban area. This service would help people on the lowest incomes to receive free household goods that they might otherwise be simply unable to access. Another example of innovative thinking came from a local authority in the Greater Manchester area, which said that it would use the funding to expand the local credit union, as this already provides household goods to people on low incomes. Expanding the scheme would increase access to affordable credit for those on low incomes and reduce the reliance on high-cost and illegal lenders. Yet another different approach to the new provision is that of a local authority in the south-west, which has been looking at how commissioning services would boost the local economy, providing new skills and routes back into employment and out of poverty. As I hope is evident from these examples, giving local authorities the responsibility for deciding what the new local provision will look like allows for innovative new schemes that are tailored to the local area.