Short Term Benefit Advances

11 February 2013

 

The abolition of Social Fund Crisis Loans from 1 April 2013 means that Crisis Loan alignment payments will also end. Claimants making a new claim to benefit, and who cannot manage until their first payday will, from April onwards, have to apply for a Short Term Benefit Advance (STBA) instead.

Conditions

DWP does not intend to advertise the availability of STBAs to the public. They will be only offered to a claimant if they indicate to the member of staff taking their claim that they cannot manage financially. The availability of a STBA will not be immediately obvious to those claiming on line.

STBAs are subject to three criteria:

  • There is an underlying benefit entitlement or reasonable expectation that there is entitlement to benefit;
  • The claimant can afford to repay – other debt and loan repayments will be taken into account;
  • There is financial need – there is serious risk to the health and safety of a family member.

Decisions on STBAs will not be subject to review or appeal. Those who do not qualify will be ‘sign-posted’ by staff to their Local Authority’s Local Welfare Provision. The nature of this provision will vary from local authority to local authority and in many cases may not be in the form of a cash payment.

Staffing

Management estimate that 1,069 full time equivalent staff will be required to deliver STBAs in April 2013. These staff will in the main be staff previously working on Social Fund or Crisis Loans and will be located in both CCS and BD. This number is expected to decrease to 787 by August 2013 as the new system becomes established and the public become more aware of the changes and of the alternative support provided by Local Authorities. This fall in staffing will mainly be in the contact centres. It is not clear at this stage how this will be managed. Numbers in Benefit Delivery Centres should remain static.

Impact

Training will be provided for all staff likely to be engaged in the administration of STBAs. Information gathering will be conducted primarily at AO level with decisions being made by EOs.

Conclusion

The STBA system has been devised at the very last minute. It remains to be seen if management’s staffing projections are correct and PCS will continue to press management to ensure the STBA work is fully staffed. The abolition of Crisis Loans is a big gamble by the department. PCS fear the reactions of angry claimants when they realise Crisis Loans no longer exist and they see that the local authority provision meant to replace them is hopelessly inadequate. PCS will continue to raise these concerns with management to ensure that all necessary safeguards are in place to ensure members’ safety. The introduction of STBAs are welcome as a partial mitigation to the abolition of Crisis loans and also as a way of absorbing potentially surplus Social Fund staff. It remains to be seen how adequate the new system is as a means of supporting claimants in acute financial need.

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