A Welsh Benefits System, how it can help solve poverty

Reports ResourcesSeptember 17th, 2020

In its efforts to solve poverty, the Welsh Government has designed a number of schemes to support families with their living costs, such as Free School Meals, the Council Tax Reduction Scheme and the Discretionary Assistance Fund.

The Bevan Foundation’s latest work on the Welsh Benefits System finds that these schemes can be reformed and improved to help more families out of poverty.

700,000 people are trapped in poverty in Wales. To assist these families and to seek to reduce the impact of poverty the Welsh Government spends more than £400m on various grants, allowances and in-kind provision for low-income households, such as the Council Tax Reduction Scheme, provision of Free School Meals and the help through the Discretionary Assistance Fund. These schemes complement the UK social security system.

Research undertaken by the Bevan Foundation over the past 18 months has found that whilst families appreciate the support provided by these schemes there are significant shortcomings with them. Too many families are currently missing out because of arbitrary eligibility criteria and complex application processes. Even if they do successfully apply, sometimes the value of the scheme is not always sufficient to meet people’s needs. For example, thousands of working families are missing out on Free School Meals despite living in poverty because they don’t satisfy the eligibility criteria. The value of the Education Maintenance Allowance on the other hand has not changed since the mid 2000s, meaning that young people from low income families who wish to continue in education are £15 a week worse off in real terms than if the benefit had kept up with inflation.

This report sets out how the plethora of schemes should be reformed and pulled together into a coherent Welsh Benefits System.

There are three key schemes in the Bevan Foundation’s proposals: An info-graphic setting how the schemes should operate

Help with housing costs: a new Welsh Housing Fund and reformed Council Tax Reduction Scheme would mean more people have an affordable home.
Help with education costs: a new School Start scheme would provide free meals and help with uniform and equipment costs for children from low-income families, while a new Learning Allowance for 16 year olds would provide enough cash to live on and help with travel, meals and equipment.
Help in emergencies: a new Welsh Emergency Fund would provide cash when disaster, such as flooding or bereavement, strikes.

The Bevan Foundation sets out 5 key features of its proposed Welsh Benefits System to ensure they reach people and make a difference:

Targeted on households on low incomes, defined as being eligible for Universal Credit.
Cash or in-kind help that makes a real difference to households’ incomes or costs.
Single point of access, using online, phone or postal methods.
Based on clear criteria, not discretion.
All applicants are treated with dignity and respect.

Establishing a Welsh Benefits System could help to lift thousands out of poverty, ensuring people have secure homes and enough to eat. The system could be set up quickly as it is mostly within the powers already devolved to the Welsh Parliament.