Advice NI Consultation Response: Cuts to the Discretionary Support Scheme Draft Equality Impact Assessment

Background

Advice NI

Advice NI is a membership organisation and service provider that exists to provide leadership, representation, support and services for the Independent Advice Network and people in Northern Ireland. We support 65 members across NI, providing advice on benefits, debt, housing, employment and consumer related issues.

Advice NI also delivers a range of advice services to the public via a Freephone helpline which includes Debt & Money, Benefits, Tax Credits & HMRC products/services, EU Settlement Scheme and Business Debt. See www.adviceni.net for more on the work of the independent advice network.

Introduction

Due to an inadequate budget allocation, creating a Departmental budget shortfall of £111.2m, the Department for Communities has, as part of a range of measures, scaled back funding for the Discretionary Support scheme which provides emergency grants and loans for people on a low income who are in an extreme, exceptional or crisis situation.

Compared to a Discretionary Support final grant spend of £40.3m in 2022-23, the Department has allocated £20m for 2023-24, and as a result has decided to restrict grant awards to only those items deemed absolutely essential and to extend the exclusion period in which an item can be re-awarded to a period of 24 months except in the event of a disaster or a ‘setting up’ home situation.

The £111.2m Departmental budget shortfall is integral to maintaining the safe delivery of existing social security services, including our unique ‘Evason’ welfare mitigations scheme; safely delivering new initiatives such as ‘Move to UC’; and bolstering the Discretionary Support Scheme for people in extreme need. The Discretionary Support Scheme is especially important in the midst of a Cost of Living Crisis which is hitting the poorest hardest.

Given this is a DfC consultation in relation to the Discretionary Support scheme, we are restricted in terms of directing our response towards the Department. However, we recognise that the real problem does not rest with the Department. It is having to deal with an inadequate budget settlement which means that any decision to increase funding towards the Discretionary Support scheme for those in crisis means that other vital services across the Department being cut to make up the shortfall.

A solution, perhaps the only solution, to the cut to Discretionary Support is an increased budget allocation to ensure our most vulnerable people are protected.

Poverty in Northern Ireland

The following information comes from the Department’s own “The Northern Ireland Poverty and Income Inequality report (2021/22)” published in March 2023:

“Whole population – Poverty (Before Housing Costs):

• In 2021/22, 16% of individuals (approx. 300,000 people) were estimated to be living in relative poverty; compared to 17% in 2020/21. The percentage of individuals in absolute poverty in 2021/22 stood at 13% (approx. 249,000 people); compared to 12% in 2020/21.

“Children – Poverty (Before Housing Costs):

• The long-term trend shows that children have a higher risk of living in poverty than the other population groups (all individuals, working-age adults and pensioners).

“Working-age adults – Poverty (Before Housing Costs):

• The risk of being in relative poverty is much higher for households where no one is in work (53%); compared to households where at least one adult is in work (8%).  However, because there are a greater number of working households in general, it is estimated that of all working age adults living in poverty, over half (53%) live in a working household.

“Pensioners – Poverty (After Housing Costs):

• In 2021/22 the proportion of pensioners in relative poverty was 16%; compared to 13% in 2019/20. Over the same period, absolute poverty for pensioners increased from 10% to 12%.

“Food Poverty

• In 2021/22 most individuals lived in households that are food secure (96%), with 4% (approximately 74,000 individuals) in households said to be food insecure.

When we then look at the Discretionary Support EQIA we see for 2022/23:

“The final grant spend in 2022-23 was £40.3m.

“51,148 claimants received a Discretionary Support grant for an item(s).

At a time of acute need in Northern Ireland, the question must be asked: ‘how is it acceptable to take away crisis support grants from over 25,000 claimants?’

EQIA Response

1. Are there any data, needs or issues in relation to any of the Section 75 equality categories that have not been identified in Section 3 of the EQIA consultation document? If so, what are they and can you provide details?

The nine equality categories as defined in Section 75 of the Act: religious belief, political opinion, racial group, age, marital status, sexual orientation, gender, disability and dependency.

Age

To qualify for DS support, you must be over 18 or at least 16 if you do not have any parental support.

In Part 4 ‘Assessment of Impacts’ in the Draft Equality Impact Assessment, there is a table listing various age groups, who were awarded DS grants in financial year 2022-23. It does not identify any number of claimants between 16-20. The age at which the table starts is 20+.

While only 58% of claimants submitted a Section 75 questionnaire, it is surprising that none of these respondents were under 20. It would have been interesting to see how many claimants there were in this age group. Advice NI agrees that there should be exceptions to proposed cuts [cuts such as, one cannot get a DS grant for the same item more than once in a 24-month period]. These will apply to those ‘setting up’ home, upon leaving care, custody or a domestic violence situation.  These exceptions could well apply to those between 16-20, depending on their circumstances.

The department states it has taken action to mitigate against specific adverse impacts on the most vulnerable.  Arguably a young person under 20, whose only income is UC, could be seen as vulnerable, especially considering the rigid conditions for Housing costs:

‘If you are single, don't have any dependent children and are aged under 35, you will only be able to get the Shared Accommodation rate of Local Housing Allowance (LHA).  You will only be able to access the 1-Bedroom rate if you are leaving care or receiving certain levels of DLA/PIP’.

2. Are there any adverse impacts in relation to any of the Section 75 equality groups that have not been identified in Section 4 of the EQIA Consultation document? If so, what are they?

             n/a

3. Please state what action you think could be taken to reduce or       eliminate any adverse impacts in the allocation of the Department’s Discretionary Support grant budget.

n/a

4. Are there any other comments you would like to make in regard to this proforma or the consultation process generally?

Debt

The Discretionary Support Independent Review Panel noted in 2022:

‘Discretionary Support is intended to meet needs arising from an extreme, exceptional or crisis situation. …the reality is that there remains an adequacy gap between physical and social needs and income replacement benefit levels, while income from work can also create the same income inadequacy…. The levels of debt in Northern Ireland indicate that low incomes are often dangerously supplemented by high cost and high risk borrowing’

The budget for DS grants is being cut by £20 million – a near-inevitable conclusion is that this decision will inevitably drive some destitute claimants into high cost and high risk borrowing, merely in an attempt to acquire basic amenities. In 2021-22, our Debt Service assisted 3353 clients and dealt with nearly £27.1m of debt.  This figure is likely to rise in the next financial year, following the draconian cut of £20 million from the DS Grant budget.

The Draft Equality Impact Assessment identifies that certain Section 75 groups will be more affected by cuts to the Discretionary Support fund, such as women, those with disabilities and those with dependents. 

Women, People with Disabilities and Those with Dependants

It is very likely that individuals most affected will be disabled women with dependents. Scope states:

On average, disabled households (with at least one disabled adult or child) need an additional £975 a month to have the same standard of living as non-disabled households.

On average, the extra cost of disability is equivalent to 63% of household income after housing costs.

Individuals with disabilities already have a higher Cost of Living than those without.  The cuts and new guidance will have a negative affect on disabled members of N.I. society.

It is frustrating that women will, once again, be more affected by cuts than men, as 67% of those awarded a DS grant [22-23] were women. The Women’s Budget Group says that women are “more likely to be poor”. They argue that, because women tend to have responsibility for the purchase of food and the management of “budgets of poor households”, they are the “shock absorbers of poverty”

Women on a low income [and with disabilities] are arguably more vulnerable than men, as the WRDA state:

‘Disabled single mothers are losing out the most from tax and benefit changes since 2010. By 2021, they will have lost 21% of their net income if they do not have a disabled child and 32% if they do have a disabled child….By 2020, men will have borne just 14% of the total burden of welfare cuts, compared with 86% for women’[9].

On one level, Option 2 [Restricting awards to basic needs, and extend repeat item exclusion period] is more appropriate than Option 1 [do nothing], as Option 1 would mean zero resources to provide even a basic service especially during the winter months. However, Advice NI does not endorse the approach taken by the Department.

We know that the Chancellor has bolstered the GB Household Support Fund, the GB equivalent of the Discretionary Support scheme, to the tune of an additional £1bn acknowledging the cost of living crisis which is hitting everyone but hitting the poorest hardest. Therefore, we believe that the Secretary of State and those in authority have failed to properly recognise the support needs of our most vulnerable people and should act to allocate increased funding to the Department to strengthen as opposed to weaken the Discretionary Support scheme.

Contact Details

Advice NI Policy Team
Kevin Higgins (Head of Policy)
Advice NI
Forestview
Purdys Lane
Belfast
BT8 7AR
Tel: 028 9064 5919

Advice NI Policy & Information Team

• Kevin Higgins; kevin@adviceni.net
• Matt Cole; matt@adviceni.net
• Bridget Meehan; bridget@adviceni.net
• Charlotte Ahmed; charlotte@adviceni.net