Councils plan delivery of £180m Social Fund

Prepaid cards are set to play a leading role in helping councils deliver nearly £180m-worth of crisis payments from next year (1).

The Government is devolving parts of the social fund to local authorities from April in replace of community care grants (CCG) and crisis loans which attracted nearly 600,000 and 2.5m applications respectively across Great Britain last year (2).

Local authority workshops held by the Department for Work and Pensions (DWP) earlier this year revealed that the overwhelming preference by councils was for a grant-based ‘cashless system’ based on vouchers, prepaid cards and arrangements with local companies.

This month London Borough of Croydon announced it would look, wherever possible, to ensure payments are made in a form that meets the need of the claimants, e.g. food vouchers or prepaid cards; while South Gloucestershire also announced this month it was planning to consult on prepaid cards for goods and heating as part of its Social Fund offering.

Payment specialist allpay is offering councils instant issue prepaid cards which can be handed out ‘on the spot’ to people in need – cutting down on the cost of administering cheques and the high insurance premiums that come with managing cash offices.

allpay has already seen interest from London boroughs and some of the country’s largest local authorities across Britain. They plan to use a framework agreement allpay has in place with the North East Procurement Organisation – available nationally to local authorities and other parts of the public sector through the Pro5 Group – removing the need to conduct full tender exercises or lengthy supplier evaluations for required schemes.

Business development director Nick Peplow said: “The councils we have spoken to also like the idea of being able to track the payments online. This data is good for councils to explore local discounts with stores where the money is being spent.”

The company already works with a number of councils who are using its prepaid offering. Derbyshire County Council, for example, is providing allpay’s prepaid cards to residents to pay for Children’s Services, while others are using it for a range of payments from housing benefit and adult social care payments to decorating allowances.

Reforms to the social fund affect councils across England, Wales and Scotland. However, the Northern Ireland Executive has also been consulting on proposals to replace CCGs and crisis loans with a new system of ‘discretionary support’.

For further information about how allpay’s prepaid cards can benefit your local authority, contact Ley Wilson, Prepaid Account Manager, on 07525 803 542 or book a demonstration here.

Additional notes:

1 – DWP settlement letter to local authorities.

2 - Annual report by the Secretary of State for Work and Pensions on the social fund 2011/12.

Prepaid cards are set to play a major role in the delivery of the Social Fund