In April 2013, discretionary elements of the Social Fund were abolished. Funding for community care grants and crisis loans was transferred to upper-tier local authorities who were asked to set up local welfare provision schemes.
However, nine months after boroughs began operating these schemes, the government abolished the £178m annual funding from 2015-16.
London Councils, along with a number of boroughs and charitable organisations, lobbied against the decision to cut funding for local schemes. A judicial review was also brought by a disabled resident from Cheshire, supported by the Child Poverty Action Group and Islington Borough Council.
In September 2014, the government undertook to reconsider the funding cut and ran a consultation on how local welfare schemes should be paid for. A decision was announced alongside the draft local government finance settlement to identify a notional amount of money in upper-tier local authorities’ general grants relating to local welfare provision.
London Councils criticised this approach and argued in its consultation response that a separate and identifiable funding stream should be maintained.
The final settlement, published in February, included an extra £74m for upper-tier authorities “to assist them in dealing with pressures on local welfare and health and social care”. Almost £14m of this extra funding went to London boroughs.
London Councils' work
London Councils has consistently argued that there is both a real and growing demand for local welfare schemes and that such schemes are able to better target support at those most in need.
In addition, London Councils has sought to demonstrate how investment in local welfare provision has saved money for, or reduced demand on, other government departments or public agencies.