The spectre of poverty hangs over yesterday’s spring statement. Today, the Resolution Foundation warns that 1.3 million more people will be pushed into poverty as the cost of living crisis bites. As has been reported today, the squeeze on the standard of living will be the worst since the 1950s. With families across Scotland facing unprecedented difficulties every penny of support therefore needs to go towards those households which need it most.
A small side bar in yesterday’s spring statement is the extra £45 million that will go to the Scottish Government as a result of the Chancellor spending decisions yesterday. The Chancellor announced he would award an extra £500m on the England-only Household Support Fund. A Barnett share comes to the SNP government in Edinburgh to do as they wish.
The English Fund was set up last autumn to support those most in need over the winter months. The cash was given to Local Authorities with the expectation that money was give to support homes most in need with food, energy and water bills. When money came up after that announcement, the Scottish Government responded by using the money to set up its own Winter Support Fund. This ended up funding a series of different causes, including a one off payment of £100 for low income families for Christmas, support for children in care, as well as money to help older people with digital inclusion.
With another £45m to spend, the Scottish Government could now target this more directly at tackling the looming cost of living crisis. Rather than spreading it around as happened last year, one way to do this might be to hand it to Local Authorities for Discretionary Housing Payments. These are payments that councils can make to households who are claiming housing benefit or universal credit but can’t afford housing costs or rent. A good added reason for using DHPs is because a large number of people are living in poverty only because of high housing costs; this is what tips them below the poverty line.
The cash isn’t going to be enough given the vast hole that the cost of living crisis is going to blow in family finances over the coming weeks, and it won’t stop poverty getting worse. But handing more money to councils to make discretionary housing payments would at least make sure that those at the very sharp end of the cost of living crisis are getting extra support immediately.