Government urged to renew welfare fund amid fears councils unable to plug gap

Six in 10 local councils will be unable to provide extra welfare support when the Household Support Fund ends later this year, the Local Government Association (LGA) has said.

More than four out of five councils in England expect demand for welfare support to increase over the winter, research suggests, as government funding for vulnerable households is due to run out.

The warning comes after the Chancellor Rachel Reeves announced last month that the winter fuel allowance for pensioners would be means-tested, among a series of measures aimed at filling what she said was a £22 billion black hole in the public finances.

The Household Support Fund (HSF), which was introduced by the previous Conservative government in 2021 aimed at helping people struggling to buy food, pay bills and cover other essentials, is expected to expire at the end of September, according to the LGA.

Some 94% of councils who responded to an LGA survey said the fund should continue, while nearly 60% said they would not be able to provide any additional funding for local welfare assistance if the fund came to an end in September and only 1% said they would be able to match the lost funding.

Over four-fifths of respondents (84%) expect demand for welfare assistance to increase over the winter months, while just over two-thirds (67%) reported that local welfare funding, which is administered by councils, would decrease if the HSF was withdrawn.

More than three-quarters of councils said that a successor scheme should replace HSF from March 2025.

According to the LGA, councils are concerned about the fund ending as winter approaches, at a time when many residents are most at risk of falling through the gaps into hardship and placing increased pressure on already overstretched public services, such as health and social care.

The most common requests from councils were longer-term funding settlements, a focus on crisis prevention and reducing dependency, and greater flexibility to decide how the funding is spent.

Councillor Pete Marland, chairman of the LGA’s Economy and Resources Board, said: “The Household Support Fund is a vital safety net for vulnerable residents struggling with the cost of living, which councils are using to target help to those most in need, but is currently due to run out in a matter of weeks.

“As our survey shows, services including grants for energy and food, supplying essential furniture and white goods, paying for energy efficiency improvements, funding food banks, offering food vouchers for children during school holidays and employment and financial advice are all at risk of being lost and irreplaceable.

“We are approaching another cliff-edge before the current fund runs out and we urge the Government to urgently extend this for at least another six months, to help support those most affected through the winter when energy bills in particular are expected to be higher.

“Ultimately, councils want to see a shift away from short-term, crisis support so they can instead invest in preventative services which improve people’s financial resilience and life chances. Crucially this must be underpinned by a sufficiently-resourced national welfare system.”

A Government spokesperson said: “This Government will tackle the scar of poverty by making sure work pays and improving support to help people into good work.

“More details on the Household Support Fund will be set out in due course.”