I beg to move,
That this House has considered the household support fund.
It is a pleasure to serve under your chairmanship, Sir Edward, and a pleasure to speak about what is one of the Government’s better-kept secrets: the household support fund. I thank the Minister for his time today—I am sure that he has better things to do than listen to me. I also thank the Trussell Trust and StepChange for their assistance in advance of the debate.
In US presidential elections, there is a phenomenon called the October surprise, when something occurs that transforms the election in an unprecedented way. Well, we had our own October surprise last year, when the Chancellor announced a £500 million household support fund, to be spent between 6 October last year and the end of March this year. However, it seems to be the Government support package that dare not speak its name, so rarely do I see it referred to in the media. Voluntary sector organisations in Blackpool have simply not heard of it, despite it offering some £1.7 million to households in need across the town, which has some of the most deprived communities in the country. I therefore very much want to talk about it. That is not because I am going to demand that the Chancellor spend £500 million every year—year in, year out—but because I want the Department for Work and Pensions to learn from the experience of the fund, and the previous temporary covid grant schemes, to better target existing crisis funding.
The Government have invested nearly £1 billion in this type of support in the last two years. It is now time to enable local authorities to plan for the long term and put in place strategies that can implement best practice around co-ordination. Specifically, the Government should review the Welfare Reform Act 2012, which localised significant welfare powers, including the delivery of council tax reduction schemes, discretionary housing payments and so on. A review one decade on, alongside a consideration of interventions during the pandemic, would allow for a proper consideration of how best to deliver crisis support in the future. We have to take the lessons from the household support fund and apply them to existing Government schemes, so that they work better, avoid duplication and empower local government to be a more effective delivery vehicle. Central Government will always pick up the tab if a local government response does not meet need.
However, although crisis support is delivered locally, too often it is not part of the local authority’s wider support network, which can boost incomes and prevent crises from happening in the first place. For example, someone who needs support with their housing might not be referred further to the local welfare assistance scheme in their area, as it might be located in a different department in the council. The provision of cash crisis support not only benefits the recipient but helps to prevent higher-cost interventions further down the line. Milton Keynes Council used a New Economy unit cost database to estimate the cost savings to other public services from its own local welfare scheme. It estimated that, over a full year, awards made by the authority worth £500,000 led to a total estimated combined saving for central Government and local government of almost £10 million.
We know that in the weeks and months to come we will see people struggle with energy costs, increasing inflation in food basics in the supermarkets—as the campaigner Jack Monroe has discovered—and other higher costs across the entire household budget. The need for this type of support is not going to dissipate. We have to maximise the effectiveness of what the Government already spend. The Government have a duty to focus on preventing destitution in the coming months. Many people have had an adverse life experience in the previous 12 months, such as becoming homeless, becoming sick or disabled, or facing a bereavement. Those experiences interact with the existence and persistence of poverty in our communities, and can tip people further into destitution. In those situations, locally run services have a vital role to play, from providing support with rental arrears to delivering cash-first support to people who are facing immediate financial shortfall.
We know that local policy interventions can make an important difference, preventing a short-term shock from turning into a long-term problem. However, local support is often not joined up effectively, with a lack of targeting and communication, and poor links between statutory and voluntary sector services. For example, someone who needs support with their housing might not be referred further. In some areas, local welfare assistance will not even exist.
Indeed, there is evidence that third sector delivery can be more effective than that provided by councils. The North East Child Poverty Commission’s recent report on local welfare assistance schemes highlighted Darlington Borough Council, and said
“it is felt the delivery of the service by Citizens Advice has been ‘much more effective in identifying and addressing the underlying reasons for people’s financial crises’”
than the council support.
Time and again, when I speak to third sector providers of emergency support, I hear how the slowness of the local government response through existing funds means that the charity uses its own funds to meet crisis needs, because the recipients simply cannot wait, when the state is already providing local government with the money to do just that. This seems wholly counter-productive to me.
The housing support fund has been a chance to fix this disjointed approach, but it is critical that the evaluation of how to reform both this scheme and existing schemes begins now. There was meant to have been a review of two previous covid grant schemes, announced back in February 2021, when I first introduced a ten-minute rule Bill to reform the local welfare assistance scheme. Can the Minister update me on the progress of that review? Is it complete? When will it be published?
The household support fund and local welfare assistance schemes are the safety net that exists beneath the safety net, but there have long been concerns about both the adequacy and, more importantly, the efficiency and coverage of local welfare assistance schemes. The household support fund is a chance to correct that.
One might think it too soon to publish a review on the household support fund when money will still be being disbursed in voucher form well into April. Yet we also know that an interim management information return was required by 21 January 2022 for spend between 6 October 2021 and 31 December 2021. This was presumably to make an assessment of progress so far, so I hope the Minister might be able to say a little more than some might anticipate by telling everybody how the fund has performed so far; otherwise, why collect the information?
I have some specific queries about how the Department for Work and Pensions intends to learn from this fund. What metrics will the household support fund be evaluated against? What would success for the fund look like? When it was announced, the fund pledged that
“everyone should be able to afford the essentials.”
Does the Minister agree that this is still the purpose of the fund? If so, how will he assess whether it has met this objective, which was set by the Chancellor? Indeed, how would he define “essentials”? It is a nebulous term. Do the Government intend to map how the household support fund has been delivered by each local authority and make that information publicly available?
One significant problem, pre pandemic, was the unwillingness of some councils to even operate a local welfare assistance scheme. The Government provided some £167 million to local authorities for these schemes. I know that was not ringfenced, but it was provided as a visible funding line. However, recent research by Liverpool-based charity End Furniture Poverty found that increasing numbers of upper-tier local authorities no longer run local welfare assistance schemes. This has got worse during the pandemic and there are now 32 such authorities, up from 23 in 2019, including authorities the size of Hampshire, Nottinghamshire, Nottingham, Stoke, Staffordshire and Wolverhampton. Many other councils spend less than 10% of what was allocated to them, and few operate the full wraparound service that represents best practice.
Research by End Furniture Poverty shows the situation has become worse during covid, despite funding for local welfare doubling, with money diverted to increasing free school meal provision, for example, despite a separate Government revenue stream precisely to fund that. Can the Minister answer these questions? Based on the interim management information I know he has available, how many local authorities have used the household support fund to improve and cross-subsidise their own local welfare assistance schemes?
In extreme cases, local authorities with limited capacity to deliver and spend this funding instead provided blanket grants to voluntary sector organisations, including food banks. The Trussell Trust itself thinks it is questionable whether this is an effective or intended use of Government funding, and that that risks entrenching emergency food aid as part of the local welfare system. What assessment has the Minister made of how much funding the voluntary and community sector has received through the household support fund?
The guidance for the fund lists a range of groups beyond just food banks, including GPs and schools. Will the Minister commit to publishing data on which third-sector groups the money has gone to, segmenting it by category, so that we can better understand best practice and different delivery models? Does he believe that local authority funding of food banks is an effective use of public funds? On what basis is that assessment being made? Do returns show that more or less was spent in the period to December? What impact will that have on the guidance that all moneys must be spent by the end of March? More fundamentally, given all the data now available, will the Government commit, as per my previous ten-minute rule Bill, to a review of all local support, including the household support fund, local welfare assistance schemes, discretionary housing payments and council tax support?
The North East Child Poverty Commission’s report, which I referred to earlier, details the tangled web of potential support across the north-east that many people would argue needs rationalising. I quote from the report as an example, not because I know the north-east particularly well. The commission writes:
“accessing the Gregg’s Foundation Hardship Fund; utilising stocks of second-hand furniture and white goods stored by some councils; providing support via Section 17 of the Children’s Act 1989; the use of Discretionary Housing Payments, Council Tax Support and Section 13a discretionary Council Tax reductions; accessing assistance from social housing providers; using ward member budgets; referring into Warm Homes teams; in the case of one authority, using a pot of funding bequeathed to them by a resident for local people facing financial hardship.”
So many pots, and so little co-ordination. I could easily add universal credit crisis loans, given how many are effectively written off; the availability of upcycling in the community these days; the British Heart Foundation furniture charity shops that I see across the north-west; domestic violence charities using public grants to provide emergency packages; council-funded food banks; and individual schools in my constituency topping up pupils’ prepayment meters. The list of publicly funded sources of short-term financial help is endless, but they can actually start to cancel each other out. All this public funding needs bringing together under one branded title that people know exists, with minimum standards of provision set out in statutory guidance. There should not be a differently named project in each council, with different criteria, different application processes and different types of assistance.
I should explain some salient background points to the Minister, whose predecessor, the hon. Member for Colchester (Will Quince), bore the brunt of my obsession with this topic. Low-income families have an average of only £95 in savings, and some 40% of those aged 20 to 29 have no savings at all. These sorts of situations reinforce what is called the poverty premium—a term that I heartily dislike—which is increasingly prevalent. For example, if someone has no cooker, it may mean that they spend more on costly takeaway meals, if they are time-poor. Having no washing machine might mean someone paying £4 down the launderette, and £3 for the dryer, rather than 25p for the average home wash. Local welfare assistance schemes offer timely support, but there should be a wider challenge to policy makers to find ways to incentivise small or even tiny amounts of savings, to improve financial resilience over time.
From professional bodies such as Perennial, which cares for those in the horticulture sector, to religious groups such as St Vincent de Paul or Quaker Social Action, there are myriad charitable providers out there. The Association of Charitable Organisations counts some 800 providing practical support alone. The overlapping tapestry of voluntary support is a credit to our nation’s sense of collective endeavour, but together these organisations can achieve so much more as part of a wrap-around, best practice model that reduces longer-term costs for councils and social housing providers. In discussions with them, however, I hear time and again that they do not know about local government schemes, or that they are too time-consuming or difficult to access. Speed matters, so they deploy their own funds, which might otherwise go on things that the Government already make provision for, but that councils do not always use for that purpose.
There are exceptional private sector providers out there that connect individuals in need of help with funding bodies. Charis Grants and Family Fund Business Services are just two examples of organisations that provide platforms through which public bodies can access goods and supply them to those in need. Pin4 Cash and Cash Perks can immediately deliver a “cash first” solution straight to those needing help. Why are these providers not playing a more salient role in how the Government seek to deliver help to the frontline? They offer greater efficiency and the help can be more precisely targeted.
We also welcome Toynbee Hall and Fair4All Finance’s piloting of no interest loans. That is modelled on what Good Shepherd does in Australia, and the pilot was commissioned by the Treasury, which I welcome. I recognise that this needs doing right. Will the Minister assure me that he will personally take an interest these schemes, which should reduce long-term demand for local welfare assistance schemes by creating financial resilience, and which will enable people to access some white goods without being pushed into a poor financial situation?
All of that would mean that what the Government spend would go that much further, and then we would not have the usual debate in this place in which Members, particularly Labour MPs, demand ever larger amounts of new money. How we spend matters as much as how much we spend. The household support fund has been the largest exercise in delivering emergency financial support since world war two. If we do not use this opportunity to ask key questions and reimagine how we provide this support, we are missing a crucial opportunity to bring the financially vulnerable back from the brink of destitution.
It is an honour to serve under your chairmanship, Sir Edward. I congratulate my hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard) on securing this debate on the household support fund. He is a thoughtful and dedicated constituency MP who has a lot of experience in this area. I take his comments and observations very seriously. I will try to answer some of his points—he has made quite a few, but that is good.
As Members will be aware, we introduced a £500 million support fund last October to help vulnerable households with essentials, running until 31 March this year. That was in recognition of the fact that some people required extra support over the year as we entered the final stages of the recovery from the pandemic. The household support fund has provided £421 million of support to local authorities to help vulnerable people in England with the cost of food, utilities and wider essentials. The Barnett formula has been applied in the usual way, meaning that the devolved Administrations also received almost £80 million.
The household support fund helps vulnerable households with food, energy and water costs, and many local authorities have used the funding to support vulnerable households with children by providing free school meal vouchers during the holidays. The support also covers any form of fuel that is used for domestic heating, cooking or lighting, as well as water for drinking, washing, cooking, or sewage and sanitary purposes. The household support fund can be used to support wider essential needs that are not linked to energy and water, and those may include, but are not limited to, support with other bills, including broadband, phone bills, clothing and essential transport-related costs.
In response to one of the concerns of my hon. Friend the Member for Blackpool North and Cleveleys, there is no prescriptive definition of essentials, although our guidance for the household support fund outlined how we felt the funding ought to be targeted. Authorities have discretion—that is an important word—to assess what is reasonable when it comes to assisting those in genuine need this winter. Local authorities also have discretion on exactly how this funding is used in their area. They can take a variety of routes: they can offer vouchers to households, directly provide food or other goods, or issue grants to third parties, who then distribute goods to vulnerable households on their behalf.
Local authorities set their own eligibility requirements, and they have been encouraged to use a wide range of data and sources of information at their disposal to identify and provide support to a broad cross-section of vulnerable households in their area. Assistance from the household support fund is not restricted to households in receipt of benefits. At least 50% of the funding is dedicated to vulnerable households with children, while up to 50% is available to vulnerable households without children, including individuals.
As my hon. Friend has set out, the household support fund is a form of local welfare assistance. Local welfare assistance is a local authority-delivered discretionary safety net beyond the national benefit system that can provide one-off or infrequent assistance for people in need. Funding for local welfare assistance is included in the local government finance settlement. This Government remain committed to supporting people on low incomes, and the household support fund is just one element of a wider package of support. We established several local welfare schemes during the pandemic, including the covid winter grant scheme, which ran from December 2020 to April 2021, and the covid local support grant, which ran from April 2021 to September 2021. The household support fund built on this support, and it means that we have provided nearly £1 billion in local welfare support since December 2020.
Those schemes offered quick, targeted support for families when they needed it most. Local authorities in England made six million awards through the covid winter grant scheme and a further 4.3 million through the covid local support grant. We will be internally reviewing the delivery of those schemes to learn lessons and inform policy making moving forward.
In order to support local authorities in implementing the covid winter support scheme, covid local support grant and household support fund by identifying those most in need, my Department has shared data on universal credit claimants on low incomes who are eligible for free school meals or free prescriptions, whether those are households with or without children. The data is shared with authorities through local welfare provision regulations. There are many examples of good practice delivery of the household support fund.
Blackpool, which includes the constituency of my hon. Friend, has done some good work in this space. Happily, it is a place I am familiar with, having recently attended a jobs fair at Blackpool Tower for the Kickstart scheme. I think that was back in September. Time flies. Blackpool has been allocated £1.7 million from the household support fund, which is being used to provide short-term financial support to vulnerable households in the area.
Indeed, Blackpool is demonstrating the value and the flexibility of the household support fund by prioritising costs relating to energy, water bills and items relating to keeping warm, including winter clothing, blankets, draught excluders and window sealants. The scheme is also providing funding for boiler repair services. That demonstrates just how responsive and diverse the support under this scheme can be. Another example of good practice can be found in Leicester. It is responding to an increase in the wholesale price of gas by issuing an energy grant of, on average, £340 per eligible household through the fund. It has been providing travelling communities with grants to refill bottle gas, and around 300 foster family households are receiving one-off grants of £500 towards the increased cost of utilities and fuel.
Likewise, Lambeth has made good use of the fund. It provided additional support to community organisations that provide food boxes to harder-to-reach communities; the food is tailored to reflect the diverse cultural make-up of those areas. It also encouraged residents to apply for further support by promoting the fund through the borough’s health and wellbeing bus, which visits high footfall areas and provides covid vaccinations and other health and wellbeing offers. It is a very creative approach, which is to be commended.
My hon. Friend highlighted the important role of third-party providers in delivering support locally. Local authorities have worked closely with third parties on delivery of the household support fund, and they have been an important part of how the scheme has been delivered in some areas.
Darlington Borough Council, which I think my hon. Friend mentioned, has a mature relationship with the charity Bread and Butter Thing. The charity’s core mission is to make affordable food available to struggling families. It already works with local community organisations in a well-established network, making it an ideal partner for the borough council to approach for help with distributing the household support fund. A partnership was agreed, whereby it would administer fuel voucher applications and provide free bags of shopping for those in greatest need, in addition to running weekly mobile food clubs.
The household support fund ends on 31 March, but other support for those on low incomes will continue to be available after this point. We understand that people are concerned about pressure on household budgets, and we are taking action to help. The household support fund is just one part of a £12 billion fund that the Government are spending this year and next on providing wider support, in order to ease cost of living pressures. Help is targeted at working families, low-income households and those in the most need and with vulnerable families.
We are cutting the universal credit taper rate to make sure that work pays, and are uplifting the work allowance, which will put an extra £1,000 a year into the pockets of two million low-income families. We are also freezing fuel and alcohol duties to keep costs down, and are increasing the national living wage to £9.50 per hour in April, providing an extra £1,000 in pay for a full-time worker. It has risen every year since it was introduced in 2016.
In addition, in response to the concern about increasing energy prices, the Government recently announced a three-part plan of support to help households with rising energy bills. That support is worth £9.1 billion in 2022-23. That includes a £200 discount on energy bills this autumn for domestic electricity customers in Great Britain, which will be paid back automatically over the next five years. There is also a £150 non-repayable rebate on council tax bills for households in bands A to D in England, as well as a £144 million discretionary fund for local authorities, so that they can support households that need assistance but are not eligible for the rebate.
There is also existing support to help people with the cost of fuel or energy, for example through the warm home discount and the winter fuel payment. That will help households with rising energy costs. Cold weather payments provide £25 a week extra for poorer households when temperatures are consistently below zero. We have increased the value of healthy start vouchers to £4.25, and we are also investing more than £200 million a year, from 2022, in continuing our holiday activities food programme. That is already providing enriching activities and healthy meals to children in English local authorities.
My hon. Friend mentioned local authority funding for food banks. He is well aware that they are independent and charitable organisations, and the Department for Work and Pensions does not have a role in their operation. There is no consistent and accurate measure of food bank usage at a constituency or national level. We understand the data limitations in that area, so in April 2021, we introduced a set of questions into the family resources survey to measure and track food bank usage. The first results of those questions, which will be subject to the usual quality assurance processes, are due to be published in March 2023. I am sure that the data will be of great interest to him, as it will be to me and Ministers in the Department.
To conclude, the household support fund is one of a number of ways the Government have supported those who need help most across the country. The household support fund has provided local authorities with the flexibility to tailor their provision to individual needs, and it allows them to target a broader cohort of households. We are unfortunately not yet able to discuss the interim management information collected from the household support fund so far. The information gathered from the scheme will be published once the scheme has closed and the data has been properly analysed and checked by our officials. That management information on the household support fund will provide helpful further details on how local authorities have been using this important funding. The covid winter grant scheme management information was published in June 2021, and the covid local support grant management information was published in September 2021.[Official Report, 8 March 2022, Vol. 710, c. 4MC.]
That information will inform future policy decisions in this area, as we look to learn lessons from the support we provided throughout the pandemic and beyond. I am sure that that information will be of interest to my hon. Friend, who has once again this afternoon demonstrated his expertise in this area of policy, and his commitment to improving the life chances of vulnerable people, not just in Blackpool but across the country. I am grateful for his interest and expertise.
Question put and agreed to.