Welfare Funds (Scotland) Bill, Stage 1 Debate

Responding to Stage 1 report

We welcome the depth and detail in the Welfare Reform Committee’s consideration of the Bill. In this section we respond to some of the points made in the Stage 1 report.

Fraud/Trust

We are supportive of the Committee’s recommendation that the ethos underpinning the Fund must be one based on trust and respect for applicants. There should not be an assumption that people will be seeking to defraud the scheme. The guidance and regulations alone cannot achieve this ambition. The Bill must include a guiding principle which acknowledges the rights and dignity of applicants in order to drive a direction and tone within supporting statutory instruments. We would suggest wording along the following lines under a new subsection 2(1)(c):

“A local authority must use its welfare fund in ways which take account of the dignity of service users.”

We very much welcome the Committee commenting in depth on the issue of stigma. Sadly, the debate about social security remains deeply negative and political leadership is necessary to chart out a different approach.  Both stigma and the wider treatment of applicants is, we understand, being addressed in an ongoing improvement programme for the Fund. In this context, we urge the Scottish Government and CoSLA to continue working with the broadest range of third sector organisations to bring a deeper understanding of the circumstances in which applicants may find themselves and to challenge any stigma within the system.

Review process

The third sector has taken a particular interest in the development of the review process for the Fund. Various organisations have commented on this in detail, and in particular, have highlighted the low number of reviews to date.^{[i] [ii]} This latter point remains a concern. We are supportive of an independent second tier review. It is vital that the voices of applicants, including those who have worked through the existing review process, are used to shape the SPSO review role. Local authorities must do all they can to ensure that people are aware of the option to challenge decisions^[iii]. The Welfare Reform Committee acknowledged the “administrative workload” of local authorities within the review process. This applies equally to frontline, third sector organisations who may be supporting individuals and families as they seek to have decisions changed.

Accessibility

We agree with the Welfare Reform Committee that all service channels must be open to applicants.  The application process itself must be simple and proportionate. The accessibility of the review process must be maximised and must also take account of the needs of applicants e.g. the communication/support needs of some groups such as those on the autistic spectrum and people with hearing difficulties. Indeed, this last point can be applied to the Fund in its entirety.

Review Clause in Bill

SCVO is disappointed not to see a recommendation which supports a review clause amendment. We do not believe that the Committee’s rationale for rejecting this is robust. We agree that ongoing review is needed – and welcome the work currently underway to make this happen. However, we believe that the nature and focus of the Fund is such that further parliamentary scrutiny is necessary.  Ongoing review can support this. The environment in which the Fund operates is about to change substantially with the possibility of extended social security provision in Scotland.  Where the Fund fits in this context must be considered and reviewed by all interested parties and by the Parliament. We therefore suggest two options:

• Could the Scottish Government build in a review clause into this current bill which requires full scrutiny and review of the Fund inserting a new clause prior to the section on Guidance? (A timescale for review could be agreed at Stage 2.)

• Alternatively, a review could be linked to the existing duty to report to the parliament annually on welfare mitigation activity, in section 4 of the Welfare Reform (Further Provision) (Scotland) Act 2012.^[iv]

Our intention in suggesting these options is to ensure we continue to build on the open process of involvement that has been a mark of the development and implementation of the Fund to date.

Eligibility Criteria

We welcome the Committee’s recommendation in relation to widening out criteria to ensure no one is unintentionally excluded from seeking support from the Fund. We support members and partners who point out the specific needs of groups such as families under pressure, people with disabilities, carers and others.  The “managing down” of the Fund’s predecessor has left many thinking the Scottish Welfare Fund cannot help them.  Gatekeeping outlined in the Stage 1 report[v] may serve to confirm this impression. Whilst recognising that there will always be a limit to what the Fund can do, its’ provisions must be easily accessible for any group, individual or family who faces hardship. We must also ensure that the legislation enables recent changes in the Fund guidelines to continue in practice namely:

• Making it clear that people who are not on qualifying benefits can apply;
• Opening up applications to people who have faced DWP sanctions.

Grants and choice of award

Awards must meet the needs of individuals and families. Direct provision of goods will work well for some. For others equipment or goods may need to be specially purchased to meet e.g. accessibility needs. For many, having cash to buy what they need is by far the best option – not least because it gives people some semblance of control and dignity at a time when they cannot control the factors which have led them into hardship. We welcome the Committee’s emphasis on the Fund remaining grants based.[vi]

Outsourcing

There have been mixed views about the outsourcing of elements of the Scottish Welfare Fund. Poverty activists in particular have been vocal about the use of refurbished white goods and “standard” couches/carpets.  There is a strong feeling that this increases the stigma that many applicants will already feel^[vii].  Ensuring choice is essential to maintaining the dignity and respect of individuals who are unable to meet the most basic of needs, as outlined above. How the Fund is operated has local community and economic implications. SCVO recently completed research examining the impact of welfare reform on community organisations, often known and trusted in localities. One participant highlighted the loss of a local contract to provide goods to welfare fund recipients and what it meant for applicants and for local third sector organisations:

“Funding decisions have a knock-on effect. We have just lost our community care grant bid and it’s gone to a national company. The homeless we work with can’t move into properties straight away because they are now waiting for new goods to come through the Scottish Welfare Fund, whereas before we could provide used goods to them immediately.  Local employability schemes have been desperate to give clients work experience via our organisation, but as we are now struggling without the Scottish Welfare Fund clientele, it affects the number of volunteers we can take on.^[viii]”

Move to affirmative procedure  

We welcome indications that this is likely to be the case^[ix].

Responding to the Finance Committee Report

The Finance Committee focussed on the experience and concerns of local authorities in its Stage 1 examination of the Financial Memorandum (FM). Despite limited responses from the third sector, we are disappointed that the Finance Committee did not pick up on our concerns about what the Fund can mean for charities and voluntary organisations. In our initial Stage 1 briefing, we made specific comments on the FM.^[x] Firstly, we raised concerns about the lack of acknowledgement of the financial and capacity impact on the third sector as the Fund becomes better established.  The sector can face additional resource constraints when a new policy/scheme is introduced and the Welfare Fund is no exception.  As the Welfare Reform Committee outlines, referrals to the Fund and support for applicants come from the third sector^[xi] – and indeed many organisations will also signpost people to the Fund.  There is no acknowledgement of sectoral impact in the FM. The Welfare Reform Committee acknowledged the impact on the sector but offered no related recommendations. It should not be assumed that the sector can pick up additional costs which might arise as the Fund continues and demand potentially increases. We would urge the Scottish Government to consider how the sector is supported in its role as a referral point, in its provision of support to applicants and as it supports those who are seeking decision reviews.  How can local authorities better understand and support the range of organisations who are likely to form part of the “holistic support” which is meant to be a key feature of the Fund? Secondly, we raised the issue of training which has been focussed largely on local authorities. We need to ensure that there are opportunities and resources nationally and locally to continue to build up the networks and partnerships necessary to support successful delivery of the Fund. Where possible, opportunities for joint training with local and national third sector organisations should be explored and supported financially. Lastly, we turn to the administration costs attached to the scheme. We acknowledge the challenges faced by local authorities in getting the Fund set up in a short period of time. There is also a significant amount of work which is going on to ensure continuous improvement within the Fund.  However, we remain concerned about the running costs given that the Scottish Welfare Fund gives out (relatively) small grants to individuals and families. How bureaucratic does the scheme have to be and how proportionate are the application systems? Is it unnecessarily bureaucratic and therefore more costly?

Concluding issues

SCVO will continue to offer its support as part of the Welfare Fund reference group and is committed to continuing to ensure the sector is kept up to date with developments. In addition to the potential amendments outlined above (principles and review), SCVO is supportive of potential amendments likely to be sought by members and third sector partners covering:

• Support for families under exceptional pressure
• Ensuring that the scheme remains grants based, with no scope for loans
• Ensuring local authorities seek to record unmet needs, including inquiries made as well as recording applicant vulnerabilities.

Our recent research looking at the impact of welfare reform^[xii] and the All Party Group report on hunger^[xiii] indicate a scale of need for basic support that individual stakeholders cannot respond to effectively.  Collectively and across political divides, we must ensure that our planning and responses to likely, future welfare cuts involve all sectors and groups and more importantly, the families experiencing hardship and those organisations who are on the frontline with them. We can learn from the Poverty Truth Commission approach. Finally, we agree with the Welfare Reform Committee that there is an opportunity to create a different and more empowering system of support – if we can get this fund right, it sets the context for any further devolution of welfare powers, following the Smith Commission report.

Contact

Lynn Williams Policy Officer Scottish Council for Voluntary Organisations, Mansfield Traquair Centre, 15 Mansfield Place, Edinburgh EH3 6BB Email: lynn.williams@scvo.scot Tel: 0141 559 5036 Web: www.scvo.scot

References

[i] http://povertyalliance.org/userfiles/files/SWF%20consultation_PA_Resp_Sept14.pdf [ii] http://www.scvo.scot/long-form-posts/scvo-response-welfare-funds-scotland-bill-welfare-funds-scotland-bill/ [iii] http://www.cpag.org.uk/sites/default/files/CPAG-scotland-swf-call-for-evidence-response-Aug-14.pdf [iv] http://www.legislation.gov.uk/asp/2012/10/enacted [v] http://www.scottish.parliament.uk/parliamentarybusiness/CurrentCommittees/84508.aspx#w [vi] http://www.scottish.parliament.uk/parliamentarybusiness/CurrentCommittees/84508.aspx#r [vii] http://povertyalliance.org/userfiles/files/SWF%20consultation_PA_Resp_Sept14.pdf [viii] http://www.scvo.scot/news-campaigns-and-policy/research/third-sector-and-welfare-on-the-frontline/ [ix] http://www.scottish.parliament.uk/parliamentarybusiness/CurrentCommittees/84508.aspx#r [x] http://www.scvo.scot/long-form-posts/scvo-response-welfare-funds-scotland-bill-welfare-funds-scotland-bill/ [xi] http://www.scottish.parliament.uk/parliamentarybusiness/CurrentCommittees/84508.aspx#s [xii] http://www.scvo.scot/news-campaigns-and-policy/research/third-sector-and-welfare-on-the-frontline/ [xiii] https://foodpovertyinquiry.files.wordpress.com/2014/12/food-poverty-feeding-britain-final.pdf