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Crisis Loans

Volume 504: debated on Thursday 28 January 2010

To ask the Secretary of State for Work and Pensions what restrictions on the granting of crisis loans were introduced in 2009-10; what assessment has been made of the effects of those restrictions; and whether further restrictions are being considered. (313745)

Measures introduced during 2009 to ensure that Crisis Loans are targeted at those most in need of support from the cash-limited social fund budget have been to:

Prohibit a second Crisis Loan for living expenses for the same period, (not applied if a disaster or emergency not of customer’s own making has arisen since the first award).

Require customers to attend a face to face interview when making their third or subsequent application for a Crisis Loan for living expenses in a rolling 12 month period (excluding those awaiting a decision on their benefit claim). In exceptional circumstances Crisis Loan Decision Makers can waive the need for the customer to attend an interview.

Limit the number of Crisis Loans for living expenses a customer can receive to three in a rolling 12 month period (not applied if a disaster or emergency not of customer’s own making has arisen). This measure has been tested in the South West and East Midlands. There are no plans to roll it out nationally.

Following the national introduction of the measure to interview customers on their third and subsequent application on 30 October 2009, a formal evaluation into the effectiveness of this measure will be undertaken shortly.

No further changes are planned for this financial year.