Help For Scotland's Poorest Under Threat

16th September 2012

Scotland's poorest and most vulnerable groups will suffer if the UK Government progresses with its proposed welfare reform agenda, Deputy First Minister, Nicola Sturgeon, warned again yesterday.

Measures being brought in by the UK Government will see spend in Scotland on the equivalent of Community Care Grants and Crisis Loans fall by almost £10 million in 2013/14 in comparison to previous years.

As part of its reforms - due to come into force in April 2013 - Westminster will abolish Community Care Grants and Crisis Loans for Living Expenses and transfer what they would have spent here to the Scottish Government, to do the same job.

But the UK Government has been changing how the budget is calculated. The effect of these decisions, taken at UK level, is that just under £10 million less will be spent in Scotland than if Community Care Grants had kept pace with inflation and the DWP had not been cutting back on Crisis Loans.

Crisis Loans - which will become Crisis Grants from April 2013 - are small sums - on average around £65 - given to people such as lone parents and the unemployed to help them out in times of crisis. Community Care Grants help families, the disabled and older people live as independently as possible and stay out of institutional care.

Deputy First Minister and Cabinet Secretary for Infrastructure, Investment and Cities, Nicola Sturgeon said:"These drastic cuts to Scotland's welfare budgets are extremely worrying, not least because we expect demand for Community Care Grants to continue at high levels as the tough economic times and the broader impact of the UK Government's welfare reforms continue to bite.

"Welfare is, unfortunately, a reserved matter, but it is a reserved matter that has serious implications for some of the most vulnerable members of our society.

"We know that the only way we can fully rectify this issue is to have full powers over welfare and benefits. The Scottish Government will consider how it may respond, but I urge the UK government to urgently reconsider its attack on the welfare state.

"If Scotland were to become independent, we would have the powers needed to ensure that our most vulnerable families and groups are protected."

Budgets for Community Care Grants have not risen in line with inflation since 2005/6. In addition, in 20012/13 there was a seven per cent cut in DWP's budget for spend in Scotland on Community Care Grants. The combined impact of this on spend in Scotland in 2013/14 is £4.49m.

Before transferring funds to Scotland, DWP has been "managing back demand" for Crisis Loans (making it more difficult to qualify) leading to a cut of £5.4 million or 53 per cent from 2009-10.

DWP will also transfer funding for running the service from April 2013 onwards.
The DWP has indicated that it plans to give £237,952 in set-up costs for the service that will replace Community Care Grants and Crisis Loans for Living Expenses. The Scottish Government had bid for £5m.

Community Care Grants are primarily intended to help vulnerable people live as independent a life as possible in the community. They were awarded to households receiving means-tested benefits such as Jobseekers Allowance. The prime objectives were to:

help people to establish themselves in the community following a stay in institutional or residential care;
help people remain in the community rather than enter institutional or residential care;
help with the care of a prisoner or young offender on release on temporary licence;
ease exceptional pressures on families e.g. the breakdown of a relationship (especially if involving domestic violence) or onset of a disability, or a calamity such as fire or flooding;
help people setting up home as a part of a resettlement programme following e.g. time in a homeless hostel or temporary accommodation; or
assist with certain travelling expenses e.g. for funerals of a family member or hospital visiting.
Crisis Loans are intended for applicants who are unable to meet their immediate short term needs in an emergency or as a consequence of a disaster. They were awarded for immediate living expenses in order to avoid serious damage or risk to the health or safety of the applicant or a member of the family.

See more about the welfare changes at
http://www.housing.org.uk/policy/social_inclusion_and_welfare/welfare_reform.aspx