Topic 2 Continued Flashcards
Q: What was the purpose of the government-funded Social Fund from the late 1980s until April 2013?
A: It provided additional grants and interest-free loans to claimants in ‘exceptional circumstances.’
Q: What types of assistance did the Social Fund offer?
A: Community Care Grants, Crisis Loans, and Budgeting Loans.
Why were the Social Fund provisions abolished?
A: They were largely abolished under the Welfare Reform Act 2012.
Q: What did the government do after abolishing the Social Fund?
A: It gave some money to local councils to provide grants, loans, or practical assistance to people who would have been eligible for a Community Care Grant or Crisis Loan.
Q: Who decides how the money given to local councils is used?
A: Each local council has the discretion to decide how to use the money in its local area.
Q: What is replacing Budgeting Loans under Universal Credit?
A: A provision for advance benefit payments that claimants can use for occasional ‘big ticket’ items, such as furniture or kitchen appliances.
Q: What were Community Care Grants intended for?
A: To provide one-off assistance in emergency situations.
Q: What key change occurred in the provision of emergency financial assistance post-Social Fund?
A: The responsibility shifted from the central government to local councils, with greater discretion for councils on how to allocate funds.
Q: What are examples of “big ticket” items that the Universal Credit advance payments can cover?
A: Furniture or kitchen appliances.
Personal Independence Payment (PIP)
This benefit replaced Disability Living Allowance (DLA) from April 2013 from those aged 16-64. The rate pairs depends on how a claimant’s conditions affects them, not the condition itself. This is assessed by a health professional
After April 1, 2013, why did some households see their Housing Benefit reduced?
The benefit was cut for households renting council or housing association properties larger than their needs
What were the rules for bedroom allocation under the changes to Housing Benefit after April 2013?
• One bedroom per adult or couple.
• Up to two children under 10 had to share a bedroom.
• Same-sex children aged 10-16 also had to share a bedroom
Under the Housing Benefit rules, why would a family with a boy over 10 and a girl qualify for a three-bedroom property?
Because opposite-sex children over 10 were not required to share a bedroom.
What was the government’s term for the policy that reduced Housing Benefit for larger properties, and what was its common nickname?
The government called it the “spare room subsidy,” but it was more commonly known as the “bedroom tax.”
What benefit is replacing Housing Benefit?
Universal credit
What is Universal Credit?
A:
a benefit introduced in the UK in 2013, aiming to simplify the benefits system by combining six existing benefits into a single monthly payment for those on a low income
Which benefits does Universal Credit replace?
A:
Income Support
Housing Benefit
Child Tax Credit
Working Tax Credit
income-related Employment and Support Allowance (ESA)
income-based Jobseeker’s Allowance (JSA)
How often is Universal Credit paid?
once a month, which could be paid weekly, bi-weekly, or every four weeks
What challenges might claimants face with monthly Universal Credit payments?
A: Some claimants might struggle to budget over a month, potentially running out of money towards the end of each month
What issue do social housing tenants face with Universal Credit?
They used to receive Housing Benefit directly to pay rent but now receive the money themselves, which they must manage and pay to the landlord, leading to potential rent arrears
What are some of the reported problems with Universal Credit’s implementation?
payment delays, technical problems with the IT systems, and significant delays due to poor planning
Why is Universal Credit considered a “means-tested” benefit?
A: Universal Credit is income-related, so as the claimant’s income increases the amount received decreases. unlike a universal benefit given equally regardless of income.
What prompted the creation of MoneyHelper?
A: The 2007–08 financial crisis highlighted the need to improve public knowledge of personal finance and reduce financial illiteracy
How is MoneyHelper funded?
A: Through a levy on financial service companies and pension schemes
What specific advice does MoneyHelper NOT provide?
A: Detailed financial advice or recommendations on individual products, which can only be offered by qualified financial advisers
What additional features does MoneyHelper offer on its website?
A: Step-by-step guides, interactive tools, budgeting calculators, and comparisons for financial products
What organization oversees MoneyHelper?
A: The Money and Pensions Service (MaPS)
What is the main purpose of MoneyHelper?
A: To provide information and advice enabling people to make better financial decisions and improve their knowledge of personal finance
When was MoneyHelper introduced as a single brand?
A: In 2021, combining all brands under the Money and Pensions Service (MaPS)
What significant legislation led to the establishment of the Consumer Financial Education Body (CFEB), later renamed the Money Advice Service?
A: The Financial Services Act 2010
What organization funds Citizens Advice?
A: The UK government and financial contributions from banks, energy suppliers, and other organizations
What is the role of Citizens Advice?
A: To offer free, impartial advice on financial, legal, housing, and other personal issues
When was the first local Citizens Advice Bureau (CAB) set up?
A: In 1939, during the Second World War
What online resource does Citizens Advice provide for people dealing with financial problems?
A: Calculators, interactive tools, and information on legal rights, housing, tax, and benefits
What are Citizens Advice Bureaux (CABs)?
A: Independent charities at the local level that offer free and impartial advice on financial and personal issues.
How many community locations does Citizens Advice operate in?
A: Over 2,500.
How does Citizens Advice assist those who cannot resolve financial problems independently?
A: By offering one-on-one help from trained advisers to create debt management plans and realistic budgets
What type of issues does Citizens Advice cover?
A: Financial problems, benefits, legal rights, housing, tax, health care, education, and personal relationships
Q: How many people does Citizens Advice help annually?
A: Over 2 million.
What is the Money Advice Trust’s primary service?
A: Operating the National Debtline to help people address debt issues and manage their money
Since when has the Money Advice Trust operated the National Debtline?
A: Since 2000.
What service does the Money Advice Trust operate?
A: The National Debtline, providing online and telephone advice
What kind of help does the National Debtline offer?
A: Financial information, debt management advice, and tools to help individuals resolve their debt problems
What examples does the National Debtline provide to guide users?
A: Case studies that show how their services help people manage debt issues
How does Citizens Advice educate its clients?
A: Through education, support, and influencing policies and services that impact their clients
What is the relationship between MoneyHelper and Citizens Advice?
A: Both provide online resources and individual support to those in financial difficulties
What additional support does the Money Advice Trust receive beyond government funding?
A: Financial contributions from private-sector organizations such as banks and energy companies
What services do local councils provide for debt counselling?
A: Local councils (like Birmingham City Council) provide face-to-face debt advice, help with creating budgets and cash-flow forecasts, and assistance in preparing debt management plans
Does StepChange Debt Charity charge for its services?
A: No, StepChange is a national charity that offers free debt advice and debt management services
How does StepChange Debt Charity get its funding?
is funded by contributions from banks and building societies, not the government
What are some features of StepChange’s debt management service?
A: StepChange provides personal debt advice, helps create debt management plans, and negotiates payment schedules with creditors to stop charges like interest and late fees
What is Payplan, and how does it differ from StepChange?
A: is a free online debt management service that is not a charity. It receives fees from lenders rather than charging clients
What does the Money Charity focus on?
A: The Money Charity provides educational resources, advice, and workshops on personal finance but does not offer individual debt management programs
What makes StepChange similar to National Debtline?
A: Both provide free debt advice and management services online or via telephone
What is the primary difference between private debt management companies and services like StepChange and Payplan?
A: Private companies usually charge a fee, while StepChange and Payplan offer free services or are funded through other means
What organizations are funded by banks to provide debt advice?
A: MoneyHelper, Citizens Advice, and the Money Advice Trust (MAT)
Name four banks that provide their own debt advice services.
A: Barclays, Nationwide, Bank of Scotland, and Lloyds Bank.
What features do bank debt advice sections typically include?
A: Step-by-step guidance on managing debts and links to free debt management services
Why do financial providers offer debt advice services?
A: To help borrowers repay their loans and avoid costly processes like pursuing defaults through the court system
What is Corporate Social Responsibility (CSR)?
refers to businesses demonstrating a social conscience by acting ethically and caring about customers as much as profits
What does CSR reporting typically include?
A: Information on donations to debt and money advice charities and how the business helps customers in financial difficulties
Which banking group publishes detailed CSR information online?
A: Lloyds Banking Group.
Why is CSR important for businesses?
A: To meet public expectations of ethical behavior and to balance customer care with shareholder profits
Support for mortgage interest (SMI)
If already claiming certain other benefits
Helps pay interest on mortgage or other loans in order to make improvements or repairs to home
Paid as a loan
Repays with interest
