September 30th, 2016

Crisis cash axe could push many into debt

Crisis cash axe could push many into debt Crisis cash axe could push many into debt
Updated: 10:08 am, May 07, 2015

EMERGENCY support which has helped thousands of people across Redditch in crisis could be axed by the Government.

The Children’s Society is warning the decision to withdraw funding for Local Welfare Assistance Schemes from April will plunge families into a debt trap and leave them facing a choice between heating and eating.

Worcestershire receives more than £940,000 to fund the schemes supporting people under threat of homelessness, victims of domestic abuse and those struggling to eat or afford household essentials.

Redditch Borough Council’s share is £203,000 and between April 2013 and this September it received 3,886 applications with £166,882 worth of support offered.

More than £7,500 was spent helping people with energy costs, over £15,000 on food products and vouchers, £19,188 on electrical or white goods and £26,729 on resettlement costs.

The biggest expense was more than £58,000 spent on financial support and advice. A council spokesman said in the current year they were expecting to spend the full fund as well as money left over from last year on additional financial support.

The Government argues councils have adequate funding through the general Revenue Support Grant to continue to provide welfare assistance schemes. But that is likely to be a tough ask for the council which is expecting to see its grant drop by another 10 per cent in 2015/16 and already has to plug a budget gap of £1.7million.

Matthew Reed, chief executive of The Children’s Society, called it a cut too far and urged ministers to reverse the decision.

“Without these schemes, families in the West Midlands will have to choose between going without basic essentials to keep their family safe and healthy – such as food or heating – and turning to high cost credit or payday loans, plunging them into a debt trap.”

The Child Poverty Action Group threatened legal action over the original decision to withdraw funding, which forced the Government to consult on the move which ended in November.

A decision is expected this month alongside the local government funding settlement.

Council leader Bill Hartnett said it would be devastating if the money was withdrawn.

“That money is desperately needed in Redditch, more so in Redditch than anywhere else in the county I would argue.

“Our government grant has been cut from over £13million in 2010/11 to just over £9million last year so it’s not enough for what we need.” he said.

“If it is withdrawn we will do whatever we can but it will depend on the settlement and next year’s budget.”