Families facing financial crisis
Many families in this country will at some time find themselves facing a ‘financial crisis’ point – a financial problem which puts the immediate health and well-being of family members at risk. Examples include running out of money for food or for fuel during a period of cold weather, or a key household item such as a fridge or boiler breaking down. If these immediate crises are not rectified quickly, then the impact could be severe, even in the short term.
In some cases, crises may be a one-off caused by an event which would have been impossible to predict, such as the sudden onset of a disability or benefit income going unpaid due to an administrative error.
However, in other cases a crisis may be predictable and/or repeated, as a result of a chronic vulnerability like ongoing ill-health or a regular shortfall in income compared to outgoings. While crisis support may be effective in delaying the impacts of the problem, additional support may be needed to address the underlying difficulties that led to the crisis point.
The impact on families with children
Alongside the immediate financial strain and practical struggles of finding and applying for support during a crisis, our in-depth interviews highlighted the common emotional impacts on families with children.
One was stigma. Walking into a food bank, or applying for support to buy basic essentials for children like beds, were not things parents wanted to be regularly reminded about.
Our other research has shown that stigma associated with not being able to afford essentials can also affect children themselves. For example, one child told our Children’s Commission on Poverty:
‘If your shirt, like mine, has got tags with a different name…they automatically know that it’s like handed down from someone else. And like you notice if someone’s sleeves are too small or their top rides up or they’ve got trousers that are too short for them and if they’ve got really tattered shoes. It’s really noticeable.’
‘I’m nervous about getting bullied and getting lost [at secondary school]. There is a girl, she thinks I’m acting like a boy – but I’m not – ‘cause I wore trousers…I wanted a skirt for ages. My mum couldn’t afford a skirt so I wore trousers.’
The Children’s Commission found that struggling with school costs often led to embarrassment and bullying. Nearly two-thirds of children in families who said they were ‘not well off at all’ reported being embarrassed because they couldn’t afford a cost of school, such as the right uniform or a school meal. More than a quarter said they had been bullied as a result.
Parents interviewed for Not Making Ends Meet also expressed a feeling that they were failing their children. They said things such as:
We managed but I just felt at that time that I couldn’t really provide for my children.
Often these feelings were exacerbated by the crisis support itself. Poor administration of schemes made parents anxious about how long they had to wait and if they would ever receive any support. Some parents felt that professionals were judgmental and critical.
When I asked the social worker for help it made me feel worthless as a parent.
Many of the parents we talked to discussed how the crisis situation had affected their children’s well-being or mental health. They spoke about how their children’s behaviour had changed and become withdrawn, anxious, or angry.
Even for those families who had not experienced a traumatic crisis, having to ask for financial support could be a challenge for children’s well-being. Often this was related to the process – the long forms and waiting periods meant that children often knew their parents had asked for help and were keen to know when they would receive an answer.
Of course, not all parents were comfortable sharing the details of the family’s financial situation with their children. One mother explained how whilst she knew her eldest child was aware that she wasn’t working, she had not told any of the children that she had needed to use a food bank.
However, in other research, we have found that children often know much more than their families think. Despite parents trying to protect them, children were often well aware of their family’s financial difficulties. Our recent Fair Shares and Families research showed that children in lower income households were actively involved in helping the family cope with material hardship. This included engaging in a range of ‘economising’ behaviours to help their families:
- 55% of children in poverty said that in the last six months they had pretended to their family that they didn’t need something which they really did need – compared to 37% of those not in poverty.
- 53% of children in poverty said that in the last six months they had worn clothes or shoes that were old and worn out, or didn’t fit any more – compared to 28% of those not in poverty.
The strong desire of children to help their families with financial strain also came through clearly in our longitudinal study of children living in poverty, Understanding Childhoods. Some of the children in the study talked about holding back from asking family for money or material items:
‘If my friends say “can I stop at yours tonight?” and my mum says yes but then they say “will you ask your mum if you can buy loads of munchies for us so we can have like a proper munch out” and then I say “yes of course I’ll ask her, I’ll go ask her” and then I’ll just walk downstairs, sit downstairs, watch TV for five minutes then come back and tell them that I've asked her and she said no…because I don’t really want to ask her for loads of things because if she says no, I'm going to feel bad.’
We also found this in research looking at families facing problem debt, with one child telling us:
‘I’ve sort of stopped asking for my art supplies as well now. Because it’s like as much as I like to do my arts and crafts, we can’t really afford it now so…I would rather the family get the food and necessities rather than me get my own things for my benefit. Because I feel like I’m being selfish then.’
Areas that no longer have a Local Welfare Assistance Scheme
We found that 23 out of the 152 ‘upper tier’ councils in England no longer have a LWAS.33 Therefore 1 in 7 local authority areas in England now have no local welfare support provided by their council.
This is despite central government indicating that across these areas a total of £18.2 million per year for this purpose is available.
Passing of responsibility down to district level
Three counties told us that they had passed responsibility for their schemes down to the district councils in their areas.
In one of these counties, we found that no districts provide a scheme – so we counted this as one local authority area with no scheme. Similarly, we treated another county as one area with no scheme because only one of eight districts in the county provides a scheme, and that scheme is minimal in size. In the final county, all districts provide a scheme so we treat this county as one area with a scheme.
Six of the councils that told us they still provide a scheme indicated that these have been wholly or substantially outsourced to other providers. These may not, therefore, be recognisable as coherent local authority schemes.
For example, one council provides £650,000 per year to a range of charities to provide assistance with emergency food, furniture and white goods, as well as advice and support. This is not a scheme that is open to direct applications from residents but support is accessible via these charities.
Levels of LWAS provision in areas that still have a scheme
Spending as a proportion of available funding
Aggregating the results from the 122 councils that both still have a LWAS and provided us with spending data, we find that a total of £40.8 million was spent on local welfare provision in England in 2017/18.
However, in theory, these councils have total funding of £107.3 million available for this purpose.34 This means that between them these councils spent just 38% of their allocated local welfare funding on their LWAS.
Conclusions and recommendations
Local Welfare Assistance Schemes should provide a cornerstone for the local support offer to families facing financial crisis. However, a significant funding squeeze and lack of guidance or leadership has meant that in too many parts of the country, inadequate or even non-existent provision is hampering efforts to provide an effective safety net.
In the absence of an effective LWAS, other statutory and voluntary sector organisations are piecing together their own crisis support networks to try to fill the gaps. They have become the first port of call for people in crisis and for the professionals and volunteers who support them in many areas. A lack of coordination between and within the statutory and voluntary sectors has contributed to fragmented services. As a consequence, crisis support is patchy and the help families receive depends on the organisations they happen to come into contact with.
There is no consensus at present on who should be taking the lead in the provision of crisis support. Central government has devolved responsibility to local authorities with little or no support or guidance. In turn local authorities are increasingly looking to voluntary sector organisations to meet this need, without the necessary resources or structures to do so effectively.
Crisis support must be able to see and respond holistically to families. Given the fragmentation of the system, only by working together around the family in question will crisis provision be at its most effective.
Families find the system of support exhausting. Their experiences demonstrate the feeling of fatigue and powerlessness, and the effect on relationships and well-being. Reform of crisis provision must be designed to reduce the amount of time and effort it takes for families to access support. Services could be more proactive – it is not enough to just signpost. Councils have a leading role to play in ensuring that families in their area quickly and seamlessly get the help and support they need in a crisis.
If you'd like more information about the findings and recommendations, read the full report.