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Discretionary Social Fund

Volume 491: debated on Thursday 30 April 2009

In order to offer further support to families on low incomes during the recession, the Chancellor’s Budget report on 22 April included the announcement that additional funding has been made available for social fund loans. In addition, to ensure that money is directed to those who are in the most need, the Secretary of State will be making changes to the discretionary social fund. The changes will take effect from 27 April 2009 for applications and awards made within the south-west region and from 8 June 2009 for the east midlands region. This is because of the introduction of a requirement for third and subsequent living expense crisis loan applications to be usually completed at a face to face interview at a Jobcentre Plus local office. In addition, a customer will usually be limited to three non-aligned living expenses crisis loans within a 12-month rolling period. This will be where the first and subsequent awards are made within the south-west region on or after 27 April 2009 (8 June 2009 for the east midlands region). Customers in these regions will be advised of the three non-aligned loan limit before taking out their first and second loans. Subsequent loans will still be available for customers who require assistance to meet living expenses:

A: as a consequence of a disaster.

B: in an emergency which—

1. is not a consequence of an act or omission for which applicant or his partner is responsible.

2. the applicant or his partner could not have taken reasonable steps to avoid (as in guidance), regardless of the number of loans already taken out in a given year.

As part of the third and subsequent application interview customers will be provided with a leaflet that gives customers local and national organisations that are available to provide money management advice. The leaflet has been placed in the Libraries of both Houses of Parliament.