Crisis loans for people desperately in need in Sheffield have been slashed
Funding for people desperately in need in Sheffield has been cut by more than half, according to new research.
Crisis loans or grants can be given to people in extreme hardship, for example after a flood, benefits delay or for those moving into a council home with no furniture.
But the funding, known as Local Welfare Assistance Schemes (LWAS), has been cut drastically since the Government started its austerity drive.
Sheffield Council is still offering LWAS, even though 28 other local authorities nationwide have had to scrap them, but its funding is 57 per cent lower than five years ago.
Senior councillors say it’s a “further damning indictment” of the Government’s austerity programme.
The council has had 25,878 applications in the past five years but because of budget cuts, has been forced to approve less requests.
Five years ago, the council approved 53 grants. This had fallen to 38 by 2017/18.
Church Action on Poverty, which released the figures, says thousands of people are being swept further into poverty or forced to turn to food banks, as a result of cuts to crisis support.
It said: “In 2013 the Government abolished the system of emergency grants and loans provided via the Social Fund and instead local authorities to set up its own LWAS.
“At the same time, central Government funding for this vital support fell from £330 million in 2010 to £178 million in 2014.
“Our new research reveals the steep decline in LWAS across England. Over the past five years, at least 28 local authorities have closed their schemes completely and almost all the remaining schemes have been drastically cut back.”
Five years ago, Sheffield Council received just over £2.5m. This fell to £1.1m last year – a reduction of almost 57 per cent. It received 4,225 applications last year and granted 1,605.
Coun Jim Steinke, cabinet member for neighbourhoods and community safety, said: “As a council we have done everything in our power to protect these schemes to support people and have maintained a local fund for Sheffield despite the Government scrapping their funding for this completely.
“This research is a further damning indictment of the Government’s austerity programme and the impact it has on people facing hardship. We have seen more and more children and families pushed into poverty in recent years from austerity.
“We have made it a priority when dealing with cuts to the council to make sure that services supporting the people who are most in need are given the greatest level of protection.
“However, like all councils, we have much less money available as our funding has been continuously reduced.”
Sheffield has continued with its LWAS and has also increased funding for its Council Tax Hardship Scheme which helps people hit by Government cuts to council tax support.
Coun Steinke added: “No council tenant will be evicted because of rent arrears caused as a direct result of delayed Universal Credit payments.
“However, this research shows another example of Government cuts being targeted at the poorest.
“This is a national disgrace. We need a drastic shift from the Government’s disastrous austerity policy and to see real investment in people and communities.”
Church Action on Poverty said there must be robust, well-funded support in place so that when people suddenly encounter crisis, a lifeline is available.
It said: “Just as the NHS is there to help us through medical emergencies, so the welfare system should be there to help us in moments of financial crisis or hardship. Yet for increasing numbers of people across the country, this is no longer the case.
“Thousands of people are being swept further into poverty or forced to turn to food banks and other charitable responses, as a result of cuts to crisis support.
“The Local Welfare system has become so fragmented and threadbare that thousands of people are now left struggling to stay afloat in times of need.
“People who need crisis support and cannot access it are at increased risk of hunger, debt and destitution. As a compassionate society, we need to ensure the system can prevent people being swept further into difficulty.
“Local Welfare is a very small proportion of the overall public budget but a vital emergency resource that any one of us could find ourselves needing without warning. It is an emergency lifebelt that must be retained.”