Two cheers for mixed bag budget (with big commitment to public services)
Two cheers for people under pressure: extended household support and help with debt repayment. Also, more recognition (well overdue) for plight of local government.
Just last week we reported downbeat forecasts of independent economists at a pre-Budget briefing. They expected little extra help for millions of citizens and CA clients on low incomes. They were right but there were bright spots:
Household Support Fund
Particularly welcome was the chancellor’s decision to extend Household Support Fund and Discretionary Housing Payment for 2025/26. We really like that HSF is locally administered to take proper account of local circumstances and needs.
Indeed, such a crisis fund should be a long-term policy and permanent part of social security.
Universal Credit deductions
Equally worth a cheer is the decision to cut monthly maximum Universal Credit repayments from 25% to 15%. This will give families more breathing space and help stop the build-up of problem debt.
The next positive step is to address the causes of deductions. Two seem especially unfair: i) deductions for advance loans only necessary due to the required 5-week wait for first payment; ii) repayments of benefits overpaid due to government error.
(We also have to note that a major source of ‘third party’ debt repayments is for council tax arrears.)
Commitment to improve local public services
In addition to much-remarked-on new NHS funds, the chancellor has committed to new spending for local government and housing in 2025-26.
For many CAEE clients (and we guess many other residents) the standard of local public services really matters. Quality services depend on local government of course. But in our highly centralised country viability and performance depend crucially on grants from Westminster.
There are also welcome reforms to childcare, Right to Buy legislation and and affordable housing.
But…. Local Housing Allowance (LHA)
Housing Benefit – the LHA – will be frozen again in 2025/26. This is certain to harm tenants already struggling with rising rents and the cost-of-living; more will face eviction and homelessness; more family finances will move into negative budgets.
But…. Disablity Benefit Change
Big savings (£1.3bn) planned in the previous government’s Work Capability Assessment reform will go ahead though details are still unclear. Ministers will publish reforms to health and disability benefits in early 2025. This is important for many clients. Any reform of disability benefits must start by understanding the needs of disabled people themselves; there should be a whole-system approach, rather than a series of piecemeal changes.
But….Energy Bill Support
There were no new announcements about additional support for energy bills this winter. For most local Citizens Advice energy is still the biggest client debt issue. It’s important in Epsom & Ewell too, although council tax arrears is the most common. We will continue to ask for action to reduce the number of fuel-poor households.