Consultation on the future of Camden’s Local Welfare Assistance Scheme

Overview

The Local Welfare Assistance Scheme was set up in 2013 when the Government announced that it was transferring responsibility for what was then called the Social Fund to local authorities.  After three years the Government removed its funding for the scheme.  Due to careful budgeting, the Council has managed to continue the scheme using the original Government funding until March 2018 but thereafter there is no further external funding available.  Therefore the Council needs to decide whether to fund the scheme as it currently stands, stop the scheme now that Government funding has run out or fund a different scheme. 

The current scheme provides two types of grant –

• Crisis awards - to help with essential costs after an emergency or disaster where people are facing immediate destitution
• Community support awards – to help people return to the community after being in care or long stay institutions or create sustainable and successful tenancies for vulnerable homeless people.  These usually consist of furniture and white goods such as cooker, fridge, bed and bedlinen.

Both elements of the scheme are designed to cover the essentials only – crisis payments are to cover costs of food and fuel and awards are not more than £100 over 2 weeks.  Community support awards cover basic requirements only and have a maximum of £1000 for an individual, £1100 for a couple and £1850 for a couple with 1 child (additional amounts are awarded for each additional child).

Currently the Council pays for a third party company to administer the scheme and applications can be made over the phone or online.

Following a review of the scheme, the Council identified that Camden’s scheme has helped nearly 4000 people since its launch in 2013, providing 1100 of community support awards and 2800 crisis awards.  It has helped to sustain tenancies by turning an empty shell into a home for some of the most vulnerable people and provided people with essential financial support at times of crisis.

However, the review found that the scheme works in isolation from other support and therefore whilst the scheme undoubtedly has helped people in crisis, it does not address underlying causes of the crisis/destitution. 

Therefore the Council is proposing to continue to fund support for an amended scheme for a further two years and to bring administration back into the council. 

The proposed scheme would see both elements of the current scheme continuing.  In particular:

• The Council’s Floating Support and Landlord Services would be able to provide basic furniture and households goods for those households the Council is placing into either council or private rented sector tenancies as part of moving out of temporary accommodation, hostels or long stay institutions where it will aid transition and the likelihood of a sustainable tenancy.  The fund would not provide replacement goods except in exceptional cases. 
• The Council will work with approved referral partners, including those in the voluntary sector, to accept applications for crisis awards where someone is facing imminent financial destitution with a risk to their health and wellbeing – the existing eligibility for crisis awards remain the same.
• The main difference will be there will no longer be the opportunity to apply direct to the scheme – applicants will need to be already working with Floating Support, Landlord Services or an approved referral partner to access support.
• As such administration costs will be substantially reduced and administration of the scheme will be brought into the council.
• A third party will be procured to supply new affordable furniture, household and white goods. 
• The Council will work with a range of organisations and services to communicate the scheme, develop a range of approved referral partners and promote the alternatives offered by local grant giving charities.

The scheme would be provided with the following funding for a period of two years from April 2018: £100,000 for new council tenancies, £100,000 for private tenancies coming through floating support and £40,000 for crisis awards.  The longer term future of scheme will be considered as part of the Council’s wider medium term financial strategy which will be consulted on in 2018.  This period provides certainty for the next two years, the ability to trial the new approach and improved opportunity for cost reductions in procurement whilst enabling the Council to consider how it can support residents covered by the current scheme in the context of the other financial pressures facing the council over the next five years. 

Alternatives that have been considered include:

• Ceasing the scheme completely and referring people to foodbanks and local charities for assistance.  However, tenancy failure costs the council over £10,000 per case so an investment case can be made to invest in tenancy sustainment. 
• Continuing the current scheme.  This would cost substantially more than the proposed scheme and would not address the weaknesses in the current scheme regarding addressing the wider causes of applicants’ crisis and destitution.
• Offering loans rather than grants.  However this would add to vulnerable people’s indebtedness and the council would not be able to attach repayments to future benefit payments.  Therefore the cost of collection will often exceed the original grant.