219 per cent rise in demand for local welfare assistance in London

New analysis by London Councils has shown that coronavirus has led to an unprecedented spike in demand for London boroughs’ welfare support services.

Applications to boroughs’ local welfare assistance schemes saw a 219 per cent increase from March to June 2020 compared to the same period in 2019 – the highest jump in requests for financial help ever recorded by councils in the capital. Boroughs received 23,398 applications for local welfare assistance during the period. The figure was 8,005 the year before.

London Councils says the figures show the dramatic scale of the pandemic’s economic impact and why the government must boost support for struggling households. The capital sits under Tier 2 restrictions, as recently outlined by the government.

London boroughs paid out almost £2.3 million in local welfare assistance between March and June 2020. In March-June 2019, the figure was £857,500.

The cross-party organisation, representing all 32 boroughs, warns that universal credit does not provide enough support for many Londoners. London Councils is also concerned that the combination of a second wave of coronavirus and continuing job losses mean the situation will worsen in the coming months.

London Councils is calling on the government to restore national funding for local welfare, arguing that this emergency assistance helps households avoid worsening financial crises and homelessness – situations likely to incur higher costs to the public purse. The cross-party group is also urging changes to universal credit, including an end to the five-week wait through the introduction of a non-repayable grant. Boroughs believe that quicker access to welfare support will both improve outcomes for residents needing financial help and bring better value to taxpayers.  

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.    

“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.”