Westminster Hall Debate, Household Support Fund, 31 January 2024

• The Local Government Association, along with partners across the voluntary and charity sector, is calling for the Household Support Fund (HSF) to urgently be extended for at least another year. The Government has not yet confirmed whether it will provide the HSF beyond 31 March 2024, when the current fund is set to end. 
• Through the pandemic and the cost-of-living crisis the HSF has allowed councils to significantly expand local support for households that are struggling to afford the essentials or facing severe hardship.
• Now is not the time to withdraw support for struggling households. Councils and other frontline services are reporting that they are seeing record demand for local welfare support. In a recent LGA survey, 84 percent of respondent councils said that hardship had increased in their area in the last year. 73 percent said they expected hardship to further increase in the next year, with 19 percent expecting it to remain the same. 
• We are deeply concerned that if the HSF comes to an end in March, or if the Government provides significantly reduced funding, it will result in a cliff-edge in support for vulnerable people that councils cannot fill. It would also coincide with the end of the Government’s Cost of Living payments, and some councils having to reduce their discretionary welfare services due to severe financial pressures. This risks a cumulative reduction in support for some vulnerable households.
• A significantly reduced local welfare offer risks more people falling into financial crisis, destitution and homelessness, and increasing pressure on wider public services, including the NHS, social care and temporary accommodation. Ultimately, councils want to shift the focus from providing crisis support to investment in prevention, to improve people’s long-term financial well-being and resilience. However, in the short-term, the need for an enhanced local welfare offer is not reducing. 
• Government must urgently extend the HSF for at least another year to allow councils to keep residents healthy, support them to engage in work and education, prevent escalating crises and reduce pressure on wider public services.  

The Government introduced the first HSF in October 2021, to support households who would otherwise struggle to buy food, pay essential utility bills, or meet other essential living costs or housing costs. The HSF has subsequently been extended several times. The current fund runs from 1 April 2023 to 31 March 2024 and totals £820 million.

Since 2021, the HSF has significantly boosted investment in local welfare support by over £2 billion. The LGA has always welcomed that the fund is locally delivered, allowing councils to target their offer to the needs of their community. We also welcome that the Government listened to feedback following previous rounds of the HSF and removed unhelpful restrictions on how it could be spent. Notably, since April 2023, councils have been able to use the HSF to provide advice services alongside crisis payments – a change that the LGA called for.

Councils are currently using the HSF to provide a variety of vital services and support including:

• Cash grants or vouchers to help people in crisis with energy, food and other essentials. 
• Targeted support for people in receipt of council tax support, free school meals or pension credit, such as energy vouchers for pensioners living in fuel poverty. 
• Helping with significant or unexpected costs, such as furniture, white goods or replacing broken boilers.
• Funding the voluntary sector to deliver support, like foodbanks, social supermarkets or schemes to deliver home energy efficiency improvements for low-income households.
• Providing vouchers to children eligible for free school meals to prevent holiday hunger.

Residents can either apply directly to their council for support from the HSF, or they can be referred by council services or voluntary and community sector organisations, such as foodbanks or Citizen’s Advice. 

Councils are united in the view that now is not the time to scale back support. Evidence shows that many households continue to face considerable challenges in meeting their essential living costs and that the demand for support is greater than when the HSF was first introduced.

Analysis by the Joseph Rowntree Foundation found that the number of people facing destitution in the UK has increased by 61 percent between 2019 and 2022, with 3.8 million people struggling to afford to meet their most basic physical needs to stay warm, dry, clean and fed at some point in 2022.

In a recent LGA survey (currently unpublished but available on request): 

• 84 percent of respondent councils said that hardship had increased in their area in the last year
• 73 percent said they expected hardship to further increase in the next year
• 19 percent expect it to remain the same. 

Councils also report that many households who may not have traditionally sought their help are now seeking support as they have run out of savings or have increased borrowing to cope with rising costs.

Supporting people facing severe hardship to improve their financial well-being can significantly improve individuals’ well-being and life chances. It also has wider socio-economic benefits for communities, including reducing pressure on public services.

Councils have long highlighted that the HSF has wider benefits for their communities beyond the initial crisis payment. Councils routinely refer residents in crisis to wider services, including benefits advice, debt advice and health, housing, and employment services, to help address residents’ underlying financial, social and health needs. HSF can therefore act as a gateway to provide wider wrap-around support that can lift people out of the cycle of poverty and crisis. 

Typically, people who apply to the HSF have exhausted all other support routes and have nowhere else to turn. Without help, many residents would be at risk of harm or escalating crisis, such as being forced to take on unsustainable debt, going without food, heating or other essentials, or becoming homeless. There are countless examples of how HSF-funded support has prevented people’s health from deteriorating, helped prevent homelessness, and helped people stay in education or start work.

For example: 

• In the Northwest, a family were referred for support from the HSF due to extreme hardship during a particularly cold spell this winter. The house had no central heating and only a coal fire. But as the family could not afford to buy more coal, he house was “freezing cold”. The family’s teenage son, Jake*, was enrolled in college but was not attending. Support workers initially thought this was due to low motivation but discovered that Jake was too cold at home to study. Through the HSF the family were given a £150 voucher for food and £100 to purchase coal, as well as being provided with electric blankets and warm clothing. This helped the family get through the colder months and Jake started attending college again.
• A council in the South used the HSF to support Jane*, a vulnerable woman with health difficulties living in sheltered housing. Due to financial abuse, Jane had not eaten in several days and had no access to food or other essentials. Her support worker applied to the HSF to purchase vouchers to meet Jane’s immediate needs, and Jane was referred to wider specialist support services to avoid a repeat of the situation. The intervention prevented Jane’s situation from worsening, putting her at risk of illness and requiring increased health and social care support.
• In the Northeast, the HSF was used to support Mary*, an elderly lady whose boiler had broken down and had no heating or hot water. Mary has a chronic health condition and had recently been in and out of hospital. But as her boiler was only 4 years old, she did not qualify for other national help. The council provided Mary with emergency temporary heaters and swiftly sent around an engineer to repair the boiler. Without help, Mary would have faced a winter without heating, which would have likely caused a deterioration in her health condition and resulted in further hospital stays.

*Names have been changed to protect residents’ privacy.

Councils are deeply concerned about the impact of the HSF ending on their ability to respond to hardship and support vulnerable residents.  

Ending the HSF in March would result in a significant reduction in welfare support at the same time other forms of support are set to be withdrawn. The Government’s Cost of Living payments for low-income households will come to an end in April. Given the severe financial pressures local government is facing, there is also a risk that some councils will have to scale back their discretionary welfare schemes from April, as they are forced to prioritise statutory services.

In a recent LGA survey of councils:

• 62 percent of respondent councils said that they would not be able to provide any additional funding for local welfare support if HSF ends in March
• just under a fifth of respondents (17 per cent) said that alongside the Household Support Fund ending, they will also have to reduce their own discretionary funding for local welfare due to financial pressures. 

Previous rounds of the Fund have been announced with little notice. The LGA has consistently warned the Government that last-minute announcements do not allow councils to strategically plan and resource effective schemes. More time would enable councils to plan and deliver a more consistent and cost-effective offer that has the potential to benefit more people.

The current uncertainty on the future of the HSF beyond 31 March is significantly constraining councils’ ability to plan initiatives in the next financial year. It is also impacting delivery partners in the voluntary and community sector, including foodbanks, as they do not know what level of funding they will receive from April or what services they might need to cut. Councils and their partners are in a difficult position of not knowing how or when to communicate with residents that the support they rely on might be withdrawn. This puts an already vulnerable group of people in the precarious state of not know when or if they will continue to receive support that has proved an essential lifeline in recent years.

The uncertainty will also impact councils’ capacity to deliver any future schemes. Councils are already having to issue redundancy notices to staff who deliver the scheme in anticipation of it ending. If an announcement is not made soon, and the Government extends the HSF at the last minute, councils’ ability to deliver the next tranche of funding and support residents will be compromised as many will have already lost experienced staff. 

Elliot Gregory, Public Affairs and Campaigns Advisor 

Mobile: 07766252833 | Phone: 020 7664 3059 Email: [email protected]