The Autumn Budget represents a government’s opportunity to set outs plans for the coming year. This Budget was particularly important, being the first Budget of a new Labour government since 1997. In its run-up, the Labour Party talked extensively about its plans to ‘fix the foundations’ they said had been damaged by 14 years of Conservative government. From an economic perspective, Labour say it was a difficult inheritance, with rising foodbank use, levels of poverty and a social welfare safety net that at times has been at odds with the principles of helping all citizens to live with dignity. The Budget then was their chance to begin to fix these issues, but how effective is it when it comes to helping people needing what the Society Matters group call ‘crisis support?’
By crisis support we mean, for example, people who find themselves needing foodbanks or help with housing costs. To put that into perspective, in the year ending March 2024, the Trussell Trust issued 3.1 million emergency food parcels, representing a 94% increase over the last five years while National Citizens Advice own cost-of-living data shows we helped nearly 8000 people with homelessness issues in September 2024 alone.
The Budget did contain measures to help people needing this crisis support. For example, £1 billion pounds was announced for the continuation of the Household Support Fund; this is a welcome statement. The HSF was introduced in 2021 during the cost-of-living/energy crisis to provide crisis assistance to those facing hardship with councils given considerable discretion as to how the money could be spent such as in the forms of food/shopping vouchers, meals or other items required. The HSF fund was repeatedly renewed as its close drew near each time; currently this funding is allocated till March 2025 but was previously due to end in 2023 then 2024. We unequivocally welcome its continuation, but this repeated cliff-edge that the HSF faces, however many times its then extended, is not a substitute for a long term settlement on crisis assistance. It’s a sticking plaster for a system that, judging by the rising levels of poverty, cannot adequately support citizens.
Within that same £1 billion, funding was announced for the continuation of Discretionary Housing Payment’s (DHPs). DHPs are interim payments made to be people in receipt of Housing Benefit or the Housing Element of UC and can be used to help with housing costs for a time-limited period. This could be due to factors such as a shortfall in rent, rent deposits or rent in advance. Again this is welcome, but given the budget also announced a freeze from April 2025 for the rates of the Local Housing Allowance (the rates that determine how much a person receives in HB or the Housing Element depending on the makeup of their household), the simple fact is more people are likely to find themselves in need of a DHP. Again, this is a sticking plaster – it is not the fundamental reform needed to ensure that all people have access to a safe, secure home.
The government also announced that benefits would be uprated by 1.7% (with pensions/pension credit rising by even more). We will always welcome the news that those on the lowest incomes will get the chance to receive more, but what the government didn’t announce was an uprating of the benefit cap. The benefit cap limits the amount that families on state benefits can receive (the exact amount varies depending on the geographic area and makeup of the household) and hasn’t been uprated since 2023. Failure to uprate the cap in-line with benefit uprating means that families will not feel the full impact of the increase in benefit rates due to the cap. This is a particular risk, for larger families who may be more reliant on income from benefits and considered alongside the continuing ‘two-child limit’ on Universal Credit, risks exacerbating poverty levels around the country.
We commend the government for recognizing the dire situation households face and putting in place measures such as the continuation of the HSF/DHPs but crisis support is not addressing the root cause of why people find themselves needing crisis support, just the symptoms. A food voucher over the school holidays is no doubt welcome to a child or family finding themselves hungry, but when that food runs out they are still in that same situation that made them hungry. A discretionary housing payment is welcome when a family find themselves facing a shortfall in the rent but when time runs out on that DHP and the family cannot find cheaper or alternative accommodation (due, for instance, to the LHA freeze not keeping pace with rising rents) they still face the same issue. These are credible first steps to solving some deep-rooted issues in our society, but the wounds will never heal if all we have are sticking plasters.
