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Social Security Benefits

Volume 488: debated on Monday 23 February 2009

To ask the Secretary of State for Work and Pensions what steps he is taking to enable Jobcentre Plus customers to receive emergency assistance in addition to provision available under the Social Fund. (253451)

In terms of emergency assistance, the social fund provides financial support to vulnerable people in times of genuine need through crisis loans. This type of assistance has first call on the social fund loans budget and all crisis loan applicants who satisfy the eligibility conditions are given an award. Gross expenditure on crisis loans in Great Britain has increased by 31 per cent. between January and December 2007 and January to December 2008.

From January to December 2008, around 45 per cent. of crisis loan awards in Great Britain were made to people representing hardship before their first benefit payment. The current legal provisions do not specify that an advance payment of benefit can be made in such circumstances. The current Welfare Reform Bill contains powers that will address this point, allowing the consideration of advance payments for this group of people. This will reduce the need for such crisis loans.

To ask the Secretary of State for Work and Pensions if he will reduce the rate of national interest on savings taken into account when assessing a person's entitlement to means-tested benefits. (258045)

The first £6,000 of capital/savings (£10,000 for those in care homes) is fully disregarded in the income related benefits:

Income support;

Jobseeker's allowance (income-based);

Pension credit;

Housing benefit; and

Council tax benefit.

The formula for calculating the amount of income that can be generated from capital/savings above £6,000 in the income related benefits, known as tariff income, is not intended to represent any rate of return that could be obtained from investing capital. It provides a simple method of calculating the weekly contribution that people with capital in excess of the level of the disregard are expected to make from their resources to help meet their normal living costs.

As there is no link with actual market rates, the tariff income rates within the income-related benefits remain unaltered regardless of whether interest rates rise or fall.

The tariff income levels are kept under continual review but they can be increased only when priorities and resources allow.