Councils facing cutbacks as not using all of their welfare funds

Councils across the UK are not spending all of their welfare funds that they have been allocated. In fact, almost 50% of the money is going unused according to a study from the Centre for Responsible Credit. While there are many reasons for this, the end result is that vulnerable families are not getting all of the help they may need.

With a total of £178m allocated to the local councils last year, almost one half of that money, or about £85m was not spent. This is now also leading to potential government cutbacks in these programmes, as they claim the funds are not being spent as is. In fact, the funding for the upcoming year will reduce the amount available to councils, if not eliminate it. That amount of financial help could have made a large difference in the plight of the vulnerable or those in an emergency situation.

It is also estimated that hundreds of thousands of applications from low income families were either denied or not processed. Also, the Centre for Responsible Credit shows almost a 75% reduction in the number of families that have been assisted from these schemes. So less people are being assisted, and even when they are given an award, the amounts are smaller than in the past.

Impact to councils

If the authorities make cutbacks to local councils, then dozens of them are stating they may just eliminate welfare payments. This will impact the poor. The reason is they say they can’t support these schemes on their own.

As many people know, the welfare schemes are being run by local councils and it uses central government funding. The intent was to help the vulnerable when they are faced with an exceptional hardship. So since councils are not allocating the funds they have, many people are not getting the food they need or maybe a utility bill is going unpaid.

With the final decision on funding for 2015 to be made in either January or February, the Centre for Responsible Credit data may support those who wish to eliminate the programme in its entirety. They will argue that since money is going unspent, that there is no use for the funding at all.

On the other hand, supporters of welfare are saying that not enough people know about where to apply for welfare these days, as some people still think the social fund is in place. Supporters say councils need to do more to education the public on where they can seek help for their bills and living expenses.

Experts also say that the unspent council funds are what continue to drive food bank usage, and fear that if the programmes are limited in their entirety, that families will turn to even worse alternatives, maybe even loan sharks.

So with the still very high poverty rates in the UK, if welfare is canceled, then families will have one less option available to them for receiving financial aid.