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Statement by Francis McGee in response to Local Government Authority’s announcement on the Local Welfare Assistance (LWA) fund

26 February, 2014

"Statement by Francis McGee, StepChange Debt Charity external affairs director, in response to Local Government Authority’s (LGA) announcement on the Local Welfare Assistance Programme.

"Tuesday’s call by the Local Government Authority (LGA) on the Government to rethink the scrapping of the Local Welfare Assistance Programme was a welcome move that brought prominence to a debate which until recently had gone strangely underreported.

"All too often people are thrown into dire financial situations through no fault of their own. The most often cited reasons for people seeking our help include unemployment, reduced income, illness and separation. If there is no support for those people in acute short-term financial difficulty, debt and further economic hardship is the inevitable consequence.

"The abolition of the Local Welfare Assistance Programme is clearly part of a wider debate. Many people are living on the financial edge, a sustained period of stagnant wage growth coupled with spiralling living costs has left many working households with no way to absorb financial shocks and no means by which to build up savings to protect themselves from those sudden changes in circumstances.

"What is clear is that the decision to scrap the Local Welfare Assistance Programme has been taken without any real explanation as to how councils are expected to support those in crisis. This now leaves those in short term financial difficulty vulnerable to an inconsistent mix of solutions as authorities struggle to provide adequate assistance to those people most in need. Sadly, it is to the payday lenders that these people will likely turn when there is no other support available.

"The government itself has admitted that the economic recovery is still not secure, but in the meantime government, business and charities need to think broadly about what safety nets and safeguards need to be put in place to protect those people who fall on hard times. "

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