Social Fund - Proposed Option for Replacement

HERTFORDSHIRE COUNTY COUNCIL

CABINET

MONDAY, 24 SEPTEMBER 2012AT 2.00PM

SOCIAL FUND - PROPOSED OPTION FOR REPLACEMENT

Report of the Director Health & Community Services

Author:Baldish McGurrin, Business Improvement Manager – Business Improvement Team (Tel: 01438 844548)

Executive Member: Colette Wyatt-Lowe, Health and Adult Care Services

1.Purpose of Report

1.1.To enable Cabinet to consider whether to set up local partnership arrangements to manage and administer a new devolved responsibility for a welfare assistance scheme, replacing elements of the Department for Work and Pensions ‘Social Fund’, as from 1 April 2013.

2.Summary

2.1.The Department for Work and Pensions (DWP) Social Fund is a scheme to help people with needs which are difficult to meet from regular income. It is made up of two distinct parts:

• a regulated scheme which provides entitlement to maternity, funeral, cold weather and winter fuel payments for people who satisfy certain qualifying conditions;
• a discretionary scheme under which people may be eligible in certain circumstances for a Community Care Grant to meet, or help to meet, a need for community care; a Budgeting Loan to meet, or help to meet, an intermittent expense; and a Crisis Loan to meet, or help to meet, an immediate short term need.

2.2.Changes that will be brought in by the Welfare Reform Act 2012 will mean some elements of the Social Fund that are currently administered by the DWP, specifically crisis loans and community care grants, are to be replaced by new locally based provision devised and delivered by top-tier authorities from April 2013. A budget settlement for the first two years has been announced.

2.3.Several options have been considered by both Health and Community Services and Children’s Services Management Boards with a consensus that developing new local partnerships would best meet the requirements of this responsibility and the needs of Hertfordshire citizens.

2.4.The new local welfare assistance arrangements are intended, by Government, to reflect local needs and there is wide discretion on how it can be delivered and by whom. The budget settlement is not ring-fenced and a decision to not make provision for a scheme in the area is possible. This recommendation has taken account of the Government’s expectation,having also considered the potential issues that could arise should the County Council make no provision.

2.5.Some of the benefits of using local partnerships are:

• existing local partnerships and resources are familiar to citizens;
• a service can be provided that is integrated with other local services;
• partnerships are independent of social services which may affect a family’s decision to apply for assistance;
• offering a local countywide option which is accessible in appropriate ways to all citizens;
• a personalised, flexible and holistic service can be offered that can match needs and lead to improved outcomes, increasing financial capability and decreasing dependency on formal support.

2.6.A key success measure would be a decrease in requests for support over time, increased use of existing local resources and universal services, and citizens becoming more financially capable by:

• Triaging requests for / signpost or refer to appropriate and existing resources in the community. Applicants would then be steered toward financial and budgeting advice. Where necessary loans and grants will still be available, subject to meeting specified eligibility criteria.
• Improve existing arrangements to deliver a more integrated scheme that meets immediate need and enables citizens to access further help and support.

3.Recommendation

3.1.The Health and Adult Care Cabinet Panel will consider a report on this item of business at its meeting on 13 September 2012. The Panel will be invited to “agree to recommend to Cabinet that the funding provided by Government is utilised within the partnership model proposed in Section 5 of the report, to deliver a welfare assistance scheme in Hertfordshire, and that the Director Health and Community Services takes forward the implementation in consultation with the Executive Member for Health and Adult Care”.

3.2The Panel’s recommendations to Cabinet will be reported orally at the meeting and circulated to Members in the Order of Business.

4.Background

4.1.Community care grants and crisisloans form part of the Social Fund and are discretionary payments made by the Department of Work and Pensions (DWP). The Social Fund, administered from regional DWP offices, provides one-off financial support for low income households for a number of emergency expenses.

4.2.As part of the implementation of the Welfare Reform Act 2012 and as part of the Government’s localism agenda; these are to end in April 2013. Community care grants and crisis loans are to be replaced by locally-based provision, devised and administered by local authorities. The DWP will retain responsibility for budgeting loans (payments of benefit in advance to buy non-priority items) and alignment payments (payments made at the start of a claim until ordinary benefit payments commence).

4.3.The DWP cite that the main drivers for the change are that currently decision making is too remote (at regional DWP office level), the scheme is expensive to administer, open to abuse and does not lead to improved outcomes for citizens as it does not link with local authority duties and responsibilities to broadly similar groups.

4.4.Local Authorities are being encouraged to think creatively and set up a locally based system that responds to the needs within its own area, setting its own eligibility criteria, fitting in with the localism agenda. The expectation is that local authorities will develop new services and/or align with existing services and partnerships.

4.5.There will be no new statutory duties on local authorities to spend the funding in any particular way but the Government has stated that “the funding is to be used to provide the new provision… to be concentrated on those facing greatest difficulty in managing their income, and to enable a more flexible response to unavoidable need, perhaps through a mix of cash or goods and aligning with the wider range of local support that local authorities… already offer.”

4.6.Currently community care grants are awarded to support vulnerable people to return or remain in the community or to ease exceptional pressure on families. Crisis loans are made to people who cannot meet their immediate short-term needs in an emergency or due to a disaster, where there is an immediate risk to their health or safety.

4.7.The DWP will review a cross section of fifty authorities in 2014/15 to see how any new provision is working. The DWP acknowledges that some data sharing with local authorities will be required to aid decision making. There is an agreement to share data but the details of this are still being worked through.

5.The Proposed Model

5.1.The model comprises four third sector organisations working together to achieve an effective triage function, provide finance and budgeting advice, administer grants and award and collect small crisis loans.

5.2.Triage:HertsHelp is a network of over 120 community organisations working together to help Hertfordshire citizens find and access practical support, guidance and information, through one number. The model proposes that HertsHelp will act as the “hub” and manage and administer access to crisis loans and grants, with clear referral routes to help and support people. The new scheme will be an extension to the current service provided to all Hertfordshire citizens, working to achieve better outcomes for people and working collaboratively with local partners.

5.3.Access to loans and grants will be a last resort after exploring all options and support currently available in the community.Where the person is eligible and immediate relief is required, HertsHelp will agree a loan or grant in principle and refer to the relevant provider. There will be an in-built assumption that any assistance will be accompanied by pro-active advice about budgeting/managing money better so as not to perpetuate requests.

5.4.HertsHelp is accessible to the whole community and will limit the impact on hard to reach groups and disadvantaged groups. This option permits a single set of consistent procedures including agreed performance measures and recording and reporting requirements.

5.5.Finance and budgetingadvice: The Citizens Advice Bureau (CAB) will increase their capacity to provide benefit and financial management advice of people signposted from HertsHelp and self referrals.

5.6.Crisis Loans:HertsSaversis Hertfordshire’s countywide credit union. It can assess risk and give manageable loans, usually at 12.7% APR, and/or transfer large high interest loans, with a view to reducing emergency support and reducing repeat requests for crisis type payments and allows considerable funds to be recouped. HertsSavers will offer loans accompanied by financial advice. Crisis loans are currently interest-free, making them attractive to some claimants. The charging of interest could reduce demand but the rate is one favourable to those of high interest commercial loans or “loan sharks”.

5.7.Grants: The Family Fundis a government backed charity already setup to deliver payment cards; gift vouchers; products and cash payments to parents of disabled children. They have indicated that they are willing to extend their service, at a reasonable cost, to any family or individual that the County Council recommends. Their support can be provided directly at reduced cost in a non-stigmatising, secure, auditable, timely and professional manner.

5.8.Awards:Based on previous use analysis the County Council could receive up to 18,000 requests for support. Approximately two thirds of the spending has been on crisis loans and one third on community care grants. Therefore the model assumes that, in the first year, 30% of applications will be administered by the Family Fund for grants and 70% as loans to be managed by HertsSavers. Costs for administration will be absorbed within the provision allocated by DWP.

5.9.In the second year the allocation for grants will be maintained as a percentage of the allocation based on spend in the first year. It will be similar for loans allowing for an amount of bad debt and minus money recouped from loan repayments. Procurement regulations have been discussed and will be applied as required and be completed within the given timescales.

5.10.Communication:Arrangements will be made to ensure a client reach beyond users of social care and ensure that information about the scheme is accessible and publicised across citizens and partners, using a variety of media, services and venues. It is proposed that the Council ensures that access points and options (including for cash) do not increase the risk of excluding groups of residents or cause further hardship.

5.11.Eligibility criteria:Whilst the DWP states there is neither obligation nor expectation that local authorities mirror the current system, some of the current priority groups detailed by the DWP and eligibility criteria used by them are a useful resource in setting the local authority’s criteria for support. These have been used when devising the suggested criteria for the new local scheme.

5.12.Complaints/Reviews:A review/complaints process will be required. The Council will make provision to decide what its policy is going to be, engaging with relevant stakeholders and partners. Current complaints policies will need to be revisited to ensure they can encompass complaints relating to the new scheme. Applicants will have recourse to the Local Government Ombudsman.

6.Financial Implications

6.1.The DWP has issued settlement figures to local authorities for the first two years of the scheme. Hertfordshire County Council will receive £1.75M for the replacement scheme per annum. In addition it will receive £373k in 2013/14 and £341k in 2014/15 for administration costs. The scheme will work within this cash envelope, be as efficient as possible and enforce the eligibility criteria set out for grants and crisis loans. Should the grant end after two years, the scheme would be reviewed and a decision taken on whether to continue in whole or part.

6.2.There will also be a one-off set-up allowance of £17.5k in 2013/14. The rationale for this low figure is that the new scheme will largely be absorbed into existing systems.

6.3.It is also proposed that Hertfordshire’s current provision for Home Support Grant (£92K) through Health and Community Services is incorporated into the new scheme from April 2013. The County Council may consider using part of the grant settlement for other schemes which provide welfare assistance.

7.Equality Implications

7.1.When considering proposals placed before Members, it is important that they are fully aware of, and have themselves actively considered, the Council’s statutory obligations in relation to equalities. This will include paying close attention to any equalities impact assessment produced by officers.

7.2.The Equality Act 2010 requires the Council when exercising its functions to have due regard to the need to (a) eliminate discrimination, harassment, victimisation and other conduct prohibited under the Act; (b) advance equality of opportunity between persons who share a relevant protected characteristic and persons who do not share it and (c) foster good relations between persons who share a relevant protected characteristic and persons who do not share it. The protected characteristics under the Equality Act 2010 are age; disability; gender reassignment; marriage and civil partnership; pregnancy and maternity; race; religion and belief; sex and sexual orientation.

7.3.An Equality Impact Assessment (EqIA) has been undertaken and this is annexed at Appendix A. This will be reviewed at each stage of the project to monitor impact. The EqIA has currently identified the following actions to mitigate the negative impact of proposals:

• Ensure accessibility by paying attention to specific needs, eg communication needs (sensory/physical/frailty/learning disability/language)
• Training for staff and monitoring of processes and full records to be kept.
• Clear eligibility criteria applied consistently and fairly.
• Explore all avenues to ensure all groups get appropriate support to promote uptake.
• Clear information in accessible places and formats. Work with partnership manager at Jobcentre plus to ensure knowledge of new scheme amongst staff.
• Target particular community groups and ensure awareness using a variety of media. Promote use of interpreting services as necessary and partnership working. Agencies to be aware of culturally specific support.
• Ensure groups with protected characteristics are aware of scheme and eligibility. Ensure formal channels of help are aware of scheme so can signpost, in particular, citizens who do not meet criteria for formal local authority support.

Appendices

A. Equality impact assessment

Background Information

None

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