COVID-19 sparks 219% rise in demand for welfare support in London

London's councils saw an unprecedented spike in demand for their welfare support services between March and June 2020, London Councils has said.
A man opening his empty wallet.
Applications for local welfare assistance schemes jumped by 219% in London between March and June 2020, London Councils found. Credit: Pixabay

Local authorities in London saw an unprecedented spike in demand for their welfare support services at the start of the COVID-19 pandemic, according to new analysis by London Councils.

Between March and June 2020, boroughs’ local welfare assistance schemes saw a 219% increase in applications compared to the same period in 2019 – the highest jump in requests ever recorded, the capital’s local government association found.

The cross-party organisation, which represents all of London’s 32 boroughs and the City of London, has urged the government to tweak the welfare system, warning that Universal Credit does not provide enough support to households and a potential second wave of the virus could exacerbate the problem.

Cllr Muhammed Butt, London Councils’ executive member for welfare, empowerment and inclusion, said: “The ongoing COVID-19 crisis has brought severe financial hardship to many Londoners and an enormous surge in people approaching their local borough for help.

“A second wave of the virus means that economic pressures are bound to get worse. London boroughs will continue helping our residents as best we can and local welfare assistance schemes are a real lifeline.

“Even a modest amount of financial aid provided by a council can help a resident avoid spiralling debts, homelessness, and other situations likely to lead to larger costs to the public purse.”

London Councils’ analysis found that London boroughs received 23,398 applications for welfare assistance between March and June this year, paying out almost £2.3 million.

During the same period last year, local authorities received just 8,005 applications for assistance, paying out £857,500.

While the exact support given varied from borough to borough, most of the support offered by councils was one-off payments to help people tackle emergencies such as reconnecting their fuel supply or travel expenses for people returning from hospital.

London boroughs have topped up their welfare assistance budgets by £4.3 million so far to meet the increased level of demand, the organisation added.

London Councils has urged the government to end the five-week wait for Universal Credit by introducing a non-repayable grant, saying this will improve outcomes for residents and taxpayers.

It has also called on the government to restore its £178 million annual funding for local welfare assistance, which it scrapped in 2015/16.

Cllr Butt added: “These figures demonstrate that councils are an essential part of the welfare safety net – but they also show that Universal Credit isn’t enough to support households facing financial crisis.

“We urgently need the government to improve Universal Credit and to restore councils’ funding for local welfare assistance. These measures are crucial for helping struggling Londoners.

“Without a more effective welfare response to the pandemic, boroughs fear the coming months will only bring an increase in financial hardship and further spikes in poverty and homelessness.”     

A government spokesperson commented: “We have responded to the extraordinary challenges presented by the pandemic with an enormous package of support, including the unprecedented furlough and self-employment schemes – at a cost of £53 billion – to protect more than 12 million jobs and injected an extra £9.3billlion into the welfare safety net.

“We are also providing councils in England with a total of £6.4 billion in support, including £4.6 billion of un-ringfenced grants recognising councils are best placed to decide how to meet the major COVID-19 service pressures in their local area. We’ve also given councils an additional £63 million to help families in financial difficulties with targeted interventions.

“Anyone worried about losing their home and not having anywhere else to go should speak to their local council, which has a duty in law to help prevent homelessness.”

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