Scottish Welfare Fund: statutory guidance - April 2025

2. Purpose Of The Scottish Welfare Fund

2.1 A local authority may only use its SWF to provide occasional assistance (financial or otherwise) to individuals, specifically by way of a Crisis Grant^[8] or a Community Care Grant^[9].Crisis Grants are provided where an individual is facing a disaster or emergency situation, and where there is an immediate threat to the health or safety of that individual or their family.

2.2 Community Care Grants are provided where a qualifying individual needs help to establish or maintain a settled home. A Community Care Grant may also be provided to support individuals and families facing exceptional pressure .

2.3 Grants should be made available to individuals who do not have alternative means of paying for what they need. The Act specifies that the scheme is not for the provision of loans and credit but grants that do not need to be paid back, and that are intended to meet one-off needs rather than on-going expenses.

Crisis Grants

2.4 A Crisis Grant can be awarded to meet expenses that have arisen as a result of an emergency or disaster where financial assistance is required in order to avoid serious damage or serious risk to the health or safety of the applicant or their family. In the case of an emergency, only living expenses should be awarded, and in the case of a disaster, both living expenses and household goods may be awarded. For travel costs in case of emergency see paragraph 6.7.

Community Care Grants

2.5 A Community Care Grant can be awarded to qualifying individuals^[10]. A qualifying individual is defined as those who otherwise, without assistance, may be:

• in prison, hospital, a residential care establishment or other institution; or
• homeless or otherwise living an unsettled way of life .

2.6 A Community Care Grant can be provided to qualifying individuals for the following reasons^[11]:

• to enable qualifying individuals who are leaving care or imprisonment^[12] to establish or maintain a settled home, where without a grant there is a risk that the individual will not be able to do so
• to enable qualifying individuals to establish or maintain a settled home after being homeless, or otherwise living an unsettled way of life
• to enable qualifying individuals to maintain a settled home, where without a grant there is a risk of the individual needing to go into a care institution
• to enable qualifying individuals to maintain a settled home in a situation where that individual, or another individual in the same household, is facing exceptional pressure
• to assist a person to care for a qualifying individual who has been released from prison or a young offenders’ institution on temporary release

Users of the Scottish Welfare Fund

2.7 From data collected about the SWF we know the following groups apply for assistance:

• people experiencing mental or physical health problems
• people with chronic and terminal illnesses
• people looking after children, including lone parents and kinship carers
• people experiencing eviction or re-possession
• people experiencing homelessness
• people experiencing addiction problems
• carers
• older people
• people with a conviction or history of offending
• families caring for a person on temporary release from prison
• people experiencing family breakdown
• people experiencing domestic abuse and leaving an abusive relationship/partner
• pregnant women, women who have recently given birth or people adopting a child
• unemployed people
• care leavers, including young people

2.8 Feedback from the Social Security Experience Panel and people living on low incomes suggests that potential applicants do not always hear about the SWF when they need it. SWF teams should take steps to promote the fund so that people in need know that their local authority can help them by making sure that other services which have contact with people in crisis have up to date information about the SWF to raise awareness of the Fund. Local Authorities should have clear instructions on how to apply for a grant on their websites and this should be checked regularly to ensure it is accurate.

A holistic approach

2.9 A holistic approach puts the person at the centre and considers all their needs. In the context of the SWF, this might include housing, health issues or money management. But it is important to note that Crisis and Community Care Grants should not duplicate other provisions. In particular, grants should not be substituted for support provided under established community care arrangements. Local authorities will need to consider how the grants fit with their existing services where these offer help to similar client groups. In particular they will need to consider social work services, including crisis payments made under section 12 of the Social Work (Scotland) Act 1968, support for young people leaving care; and throughcare and aftercare for people with a conviction, to ensure that the support provided is complementary. They will also need to ensure consistency with tackling homelessness, housing and housing adaptation services, and any support provided by registered social landlords. Local authorities, when considering rights, should also consider the rights that all children have to help fulfil their potential as laid out in the UNCRC (United Convention on the Rights of the Child).

2.10 It is crucial, therefore, that local authorities should ensure that they build and maintain relationships with a range of local partners, including NHS, third sector, advice agencies and money advice agencies, including credit unions. This will ensure where appropriate, people accessing the SWF can be signposted to other services which could address their wider needs. Active referrals have been shown to be more effective than signposting services. If possible, active referrals should be made to other services, wherever appropriate local networks or contacts exist and the applicant gives permission. This approach may help reduce future demand for the SWF and help local authorities manage their fund more effectively. More detail is in paragraphs 2.13 and 2.14.

Sharing best practice

2.11 Sharing best practice is a good way to improve performance, avoid reinventing the wheel, save costs and ensure consistency across Scotland. Local authorities must proactively share best practice, in particular, how to achieve best value when procuring goods for SWF awards and also how best to engage with people accessing the fund to make service improvements. Signposting applicants to wider support services or actively referring, where possible, is also a critical area of best practice for local authorities. The SWF Practitioners Forum and other appropriate Forums must be used to discuss and share best practice to create and encourage a learning environment. Improvements made to the delivery of the SWF must also be shared with the Scottish Government.

Local Authority responsibility as corporate parents

2.12 Local authorities must take account of their Corporate Parenting responsibilities in the delivery of their Welfare Funds, to uphold the rights and secure the wellbeing of looked after children and care leavers. Statutory guidance^[13], issued under the Children and Young People (Scotland) Act 2014, sets out the parameters in which Corporate Parents should develop their approach, informed by the needs, views and experiences of looked after children and care leavers. In the context of the SWF, this may mean:

• being aware of issues which could affect the wellbeing of care experienced young people (CEYP)
• being aware of the likelihood of how/ when CEYP might apply to the SWF
• promoting the interests of CEYP
• providing CEYP with opportunities
• participating in activities designed to promote the wellbeing of CEYP
• taking action to help CEYP access opportunities and make best use of the services and support it provides

Other agencies

2.13 Local authorities should make connections with other agencies and services on behalf of applicants to help offer additional assistance to people. This wider support may help to prevent repeat applications to the SWF and ensure people receive sustainable support to their circumstances, which the SWF is not set out to provide.

2.14 Applicants may benefit from the following services:

• Advice when applying for benefits they may be entitled to help maximise income. Claiming the benefits applicants are entitled to will help maximise incomes and can reduce levels of poverty, while reducing pressure on the Scottish Welfare Fund. Many people across Scotland may not be claiming the support they are entitled to receive. A change in someone’s life, such as having a child, a family bereavement or becoming a carer for a family member, can mean they are now entitled to support.
• The Scottish Government supports the Money Talk Team, delivered by the Citizens Advice Scotland network. The Money Talk Team can support an individual/family to maximise their household income by ensuring they are not paying more for essential goods and services than they need to and that they are getting all the benefits, grants and exemptions (council tax, energy) they are entitled to. They can also access impartial debt and money advice. More information is available at: Money Talk Team - Citizens Advice Scotland.
• Support for housing and tenancy issues including, but not limited to, housing support services for tenancy sustainment, advice on landlord/tenant disputes and home ownership issues.
• Signposting to other services such as information about fuel efficiency, loft insulation, safer homes and the value of home contents insurance.
• Financial advice including budgeting, financial education, advice on requirements to open a bank account for receipt of benefit payments, debt advice and ways of saving money. Although it may not be an immediate priority for people in crisis situations, taking time to learn how to budget, get advice on paying off debts, how to save for the future and accessing low-interest credit, for example via credit unions will have longer-term benefits.
• SWF advisors should be able to recognise and respond appropriately to support people to escape domestic abuse, this includes knowledge and understanding of what constitutes domestic abuse, including coercive control and financial abuse, and have developed good relationships and referral processes with specialist domestic abuse services such as Scottish Women’s Aid or other local organisations.
• Mediation and advocacy support (including citizens advice and welfare rights).
• Resilience support (including befriending, building local networks, education training and employability support).
• Healthcare support, including mental health and addiction services and advice on registering with GPs.
• The Scottish Government has released the following website which provides helpful information and support for those who are struggling in the current cost crisis. The website also details all of the benefits people may be entitled to: Cost of living crisis - Cost of Living Support Scotland.

2.15 The Department for Work and Pensions (DWP) also plays a key role for local communities, providing working age benefits, including advance payments for Universal Credit (UC), as well as the Flexible Support Fund for applicants to help them get a job e.g. interview expenses.

Pension Credit gives extra money to help with living costs if you’re over State Pension age and on a low income. Pension Credit can also help with housing costs such as ground rent or service charges and applicants may get extra help if they are a carer, severely disabled, or responsible for a child or young person. Applicants can claim at: Pension Credit: How to claim - GOV.UK.

2.16 Social Security Scotland administer the Social Security benefits devolved to Scotland. The following may provide valuable support for people on low incomes:

• Best Start Grant: Pregnancy and Baby Payment
• Best Start Grant: Early Learning Payment
• Best Start Grant: School Age Payment
• Best Start Foods
• Job Start Payment
• Funeral Support Payment
• Carer’s Allowance Supplement
• Young Carer Grant
• Carer Support Payment
• Winter Heating Payment
• Child Winter Heating Payment
• Scottish Child Payment
• Adult Disability Payment
• Child Disability Payment
• Pension Age Disability Payment
• Scottish Adult Disability Living Allowance
• Universal Pension Age Winter Heating Payment (from winter 2025/26)
• The Scottish Government are also developing the systems needed to effectively scrap the impact of the two-child cap in 2026.

2.17 SWF Teams might want to engage with the Social Security Scotland Local Delivery Lead for their area to discuss opportunities to make local connections. More information can be found at Local Delivery - mygov.scot.

2.18 More generally, local authorities should take steps to engage with organisations dealing with vulnerable or under-represented groups in their area, to raise awareness of the fund. Local authorities should also ensure that relevant organisations in their area are aware of their approach and authority website.

Links to DWP benefits and other payments

2.19 The DWP will continue to deliver a range of other support, depending on the circumstances of the individual, for example, Hardship Payments, Budgeting Loans, and Bereavement Support Payment. Being in receipt of a Community Care Grant or Crisis Grant has no impact on eligibility for any other benefit.

2.20 Local authorities will need to maintain a good working relationship with the DWP to avoid confusion, repeated cross referrals and poor service to applicants. Welfare Fund teams should maintain regular contact with their DWP single point of contact, highlighting issues as they arise. Local authorities may also wish to provide advertisement materials to local Job Centres, as well as the third sector, to ensure applicants are aware of who to contact.

2.21 Community Care Grants and Crisis Grants are disregarded for calculation of Council Tax Reduction and Legal Aid, and will be treated as not liable to income tax.

Where an applicant is seeking to make an application for a Crisis Grant and has an outstanding benefit claim

2.22 Local Authorities and local DWP offices should seek to make sure that entitlement to a DWP payment is checked before recommending an application for a Crisis Grant for living expenses, where this arises as a result of non-payment of benefits.

2.23 Applicants may be eligible for a UC advance payment if they are awaiting their first payment and are in urgent financial need. The amount of money awarded can go up to 100% of an estimated UC award. As of April 2021, an applicant will be required to pay back the advance within 24 months of receipt. Decision makers should be aware of the circumstances under which advanced payments of a benefit may or may not be awarded, and around potential delays in accessing such support. They should apply a flexible approach to ensure that applicants are not left in crisis when awaiting such support; or when they may not be able to access an advance. This may include awarding a payment to cover the period between applying for an advance of benefit and receiving funds.

2.24 Examples of situations that decision makers should take into account when deciding whether to require an applicant to apply for a benefit advance or hardship payment before awarding a crisis grant are:

• UC advances are not available until identity is verified, and there can be lengthy delays in verification. Some groups are particularly vulnerable to such delays – people leaving prison for example.
• Not everyone who applies for an advance will qualify for one. This can be the case for people who are having certain other deductions made from their benefit, or who are subject to a high level sanction.
• People who are eligible for an advance payment may be apprehensive about applying as it will leave them with debt and reduce the value of future benefit payments for up to 24 months. This could lead to longer term financial hardship.

2.25 Where the local authority considers the need is severe, it should make an exception and make a payment while an application to the DWP is still in progress. Decision makers should ensure that the award made meets the applicant’s needs.

2.26 Applicants are not required to have made an application for a Budgeting Loan before applying for a SWF grant. Budgeting Loans are not provided to cover living costs.

Sanctions and disallowances

2.27 Applicants subject to a suspension, disallowance or sanction by DWP can apply for Crisis Grants and Community Care Grants in the same way as any other applicant.

2.28 Local authorities should consider eligibility and prioritisation in the normal way, as set out in the decision making process at Section 5. The reason for the sanction, or the way it has been applied, should not be taken in to consideration in assessing the application.

2.29 The DWP target time for making a decision on a suspension is 48 hours therefore any award for a suspension should not extend beyond that timescale in the first instance. If an applicant is subsequently sanctioned or disallowed and make a further immediate application for assistance, this should be treated as being one application for the purposes of calculating the number of times an award has been made.

2.30 The SWF is a budget limited scheme. Grants are intended to meet occasional or short term needs and not to provide an alternative source of regular income. It is important to address any underlying issues as early as possible, by taking a holistic approach and referring to relevant sources of help as appropriate as detailed in paragraphs 2.13 - 2.26. For those subject to DWP sanctions or disallowances, applicants should be encouraged to engage with the DWP to find a sustainable longer term solution, for example, appealing the sanction, applying for a Hardship Payment or meeting the requirements attached to a sanction in order to resolve their financial difficulties. It should be noted however, that in some circumstances a Hardship Payment will need to be repaid, for example, if the applicant is in receipt of Universal Credit. If however, the applicant is in receipt of Jobseekers Allowance it does not need to be repaid but applicants may have to wait 15 days before they can reapply for Hardship Payments.

2.31 This section has set out the purpose of the Scottish Welfare Fund, the decision making process for making awards is set out from 5.4.