Keeping the local safety net together

Is the grey area between the responsibilities of the state and charities getting wider?

This is a question the Researchers at DSC have been asking about local welfare provision during our research for The Guide to Grants for Individuals in Need 2016/17.

We have found that, as local authorities struggle with funding cuts, grant-making charities are having to anticipate the unknown in local welfare provision, making it harder to ensure that vulnerable individuals have somewhere to turn in a crisis.

Devolution of local welfare assistance

Following the scrapping of the Social Fund in 2013, which brought an end to community care grants and crisis loans previously awarded by local authorities, the responsibility to provide emergency help to those in need was devolved to the governments of Wales and Scotland and to local authorities in England – crucially, without ring-fenced funding. While Scotland and Wales took a more centralised approach to the provision of local welfare assistance, the variation and uncertainty between local authorities in England has been of great concern.

A transitionary Local Welfare Assistance programme was funded for a number of local authorities in England between 2013 and 2015. However, as shown in a report by the National Audit Office (NAO), many local authorities were cautious in offering this support, because they anticipated high demand as a result of national welfare reforms, and were concerned about the uncertain future of funding beyond 2015. In fact, some local authorities significantly reduced or even ceased local welfare provision.

Cuts in funding to local government

With core funding to local government cut by 40% over the previous Parliament, and further cuts anticipated during the next Parliament, many local authorities have stated that they simply cannot afford to continue welfare provision without specific funding for this purpose from central government1. While the government states that it has identified almost £130 million for local welfare provision in the 2016-17 local government funding settlement, this is part of the revenue support grant, not ring-fenced funding. With other services under pressure, and this money only committed for the coming year, the uncertainty for local authorities continues.

Where does this leave charities that support individuals in need?

The NAO report found that in areas where local welfare assistance had been reduced or stopped, charities saw increases in demand. This was reflected by several of the grant-makers in our research. One charity reported that the local ‘gap in resources’ was leading vulnerable individuals to turn to short term loan companies or loan sharks, while the charity tried to fill this gap by investing more resources in its grants programme for individuals. Other charities reported that cuts in local welfare provision had motivated them to campaign, in some cases for the first time in their existence, for the government to safeguard funding for local welfare provision in the future.

How is uncertainty of local government provision affecting charities?

Above all, it is the uncertainty of local government provision that directly affects charities supporting individuals in need. The assistance from local government can vary not only from area to area, but also from year to year in each place. As a recent Work and Pensions Select Committee report highlighted, a lack of co-ordination between national and local welfare provision can leave vulnerable individuals confused about where to turn in a crisis. The trustees of charities in our research, meanwhile, must be ready to respond to whatever happens in their particular local authority, and to deal with the unpredictable effects on demand for their own services.

The importance of grants for individuals in need

Of course, it is not just local emergency welfare provision that affects the environment in which these grant-makers operate – pressures on local services, such as social care, compound the problems of vulnerable individuals, and increase demand on the services of charities. One charity in our sample reported that they were increasingly dealing with a group of single adults with lower level, but still significant, mental and physical health problems and financial difficulties, who are not considered high enough priority to be eligible for stretched local statutory services, but are still in great need of support. Without this support, lower level problems could easily progress into serious issues which are more difficult and costly to resolve.

More beneficiaries with multiple or complex needs

Grant-makers typically offer short-term, immediate help, but in order to deal with more complex cases, some charities have reviewed the way that they support individuals, trying to respond to these needs and offer more comprehensive assistance. Several reported that they have hired new staff members to provide advice on welfare, mental health or debt. Although lots of grant-makers already work with local authorities, social services or other organisations to receive referrals, many reported that they had set up new partnerships with other organisations, joining forces to more effectively utilise limited resources and help vulnerable individuals access longer-term support.

Getting together to prevent severe hardship

Pressures on funding and services mean that greater co-ordination between central government, local government and the voluntary sector is more important than ever. Local welfare provision is often the ‘last line of defence’ (*4) to prevent severe hardship. Our research demonstrates that charities are trying to respond to uncertainty and change in local welfare provision, but they do not have a crystal ball, or infinite resources.  It is crucial to ensure that the ‘grey area’ between responsibilities becomes clearer, so that there are no gaps in the local safety net for individuals in need.