May 2013 Advance Payments of Benefit
There have been numerous reports in the last week that the DWP is failing to pay short term benefit advances and is instead redirecting claimants to local councils.
At least eight local authorities have complained that, instead of paying the advances - which were introduced from April 2013 to replace crisis loans for claimants waiting for a benefit claim to be determined - jobcentre staff have been advising claimants to seek emergency help from their council under the localised social fund provisions that also came into effect in April.
Although 150 councils in England have from April opened local welfare schemes to provide crisis support for vulnerable people following the abolition of the social fund, responsibility for providing short-term benefit advances still lies with the DWP. Short term advances can be made for a number of benefits including Income Support, Jobseekers Allowance, Employment Support Allowance, Universal Credit and Pension Credit. Housing Benefit has its own ‘payments on account’ provison with different rules. A short term advance is only payable to claimants who are in financial need defined as a ‘serious risk of damage to the health or safety’ of the claimant or the claimant’s partner or children. The loans are repayable from future benefit payments and are discretionary.
But councils are concerned that guidance issued by the department to jobcentre officials suggests that in principle loans should be discouraged because they "encourage dependency on the benefit system".