Government launches £500m Household Support Fund 

Money from the Household Support Fund will be distributed by councils in England, and will be shared through, for example, small grants to meet daily needs such as food, clothing and utilities, with the cash being made available to local authorities in October 2021. This fund will run over winter and those in need of support should contact their local council who will help them access the fund.

The Barnett formula - which is used by the treasury to calculate the annual block grants for the Scottish government, Welsh government and Northern Ireland executive - will apply in the usual way to additional funding in England. This means the devolved administrations will therefore receive up to £79m of the £500m fund.

Commenting on the news, Chancellor Rishi Sunak, said: “Our new Household Support Fund will provide a lifeline for those at risk of struggling to keep up with their bills over the winter, adding to the support the government is already providing to help people with the cost of living.”

In response to the news, StepChange Debt Charity’s director of external affairs Richard Lane, said that while this fund will provide financial relief for households who face a “perfect storm” to cuts in Universal Credit, energy bill increases and inflated food prices, the government must build on the announcement to help households who are already struggling.

He added: “This must come in the form of sustained financial support, which the government can begin to provide by reversing its decision to cut Universal Credit by £20 a week. For our clients who rely on it, this cut will see their average budget deficit triple from -£40 a month to -£126 a month.

“A locally delivered grant fund is important for helping with emergency and crisis spends, and we would like to see this type of support extended to help tackle the millions in rent debt private tenants have amassed during the pandemic. But it must be matched by nationally delivered support, and £500m in a discretionary fund won’t plug the ongoing holes in household budgets, particularly when £6bn of Universal Credit is due to be cut.”