LRD guides and handbook March 2014

State benefits and tax credits 2014

Chapter 2

Other financial help: the Social Fund

[ch 2: page 35]

The Social Fund is a special form of welfare benefit provision that is payable for emergency or intermittent needs in addition to regular payments such as Jobseeker’s Allowance or Income Support. There are two categories of Social Fund:

• the discretionary social fund intended to respond flexibly to meet exceptional and intermittent needs; and

• the regulated fund intended to cover maternity, funeral, winter fuel and heating expenses.

In England and Wales the Welfare Reform Act 2012 abolished certain elements of the discretionary Social Fund from April 2013:

Community Care Grants and Crisis Loans

Community Care Grants and Crisis Loans for general living expenses were abolished from April 2013 and replaced with locally-based provision administered by local authorities in England and the devolved administrations in Scotland and Wales. However, the £172 million Local Welfare Provision Grant which provides councils with funding will be scrapped from 2015. From April 2015, any support will have to come from local authorities’ general funds.

Crisis Loan Alignment Payments

From April 2013 Crisis Loan alignment payments and other Crisis Loans paid due to issues with benefit were replaced by a new national scheme of Short Term Advances administered by the Department for Work and Pensions.

Budgeting Loans

Budgeting Loans continue to be available until Universal Credit is fully rolled- out. As people migrate across to Universal Credit they will have access to a new system of Budgeting Advances that will replace Budgeting Loans for Universal Credit recipients.