Charities and councils have sounded the alarm over the future of the Household Support Fund, which is due to end next month.
The Fund receives money from the Department of Work and Pensions (DWP) and distributes support, including grants and vouchers, via local councils to thousands of households in need.
Individual households can receive up to £290 to cover the cost of essentials, such as food.
However, the scheme in England is due to come to an end on September 30 with the result most council support schemes will close ahead of the winter.
Charities and councils are urging the government to extend the scheme for at least another six months before introducing a more long-term scheme in its place.
Any decision to close the scheme would effectively mean cutting off an estimated 17.8m people from crisis support.
Some 36 local authorities have already closed their local welfare schemes, which support people with food, fuel and essentials in times of crisis, according to the charity End Furniture Poverty.
If the DWP’s household support fund ends for good, more councils will close their schemes, meaning there will be no crisis support in 44 local authority areas. That is nearly one in three (29 percent) local authorities in England.
The fund was introduced by the previous government in 2021 to support families through the cost of living crisis, with £1bn distributed to local authorities and the devolved governments each year. It was extended for six months by the former chancellor Jeremy Hunt in his Spring Budget.
Claire Donovan, head of policy at the End Furniture Poverty, told the Big Issue: “We know the Household Support Fund is a sticking plaster, but we desperately need one last extension of funding while an urgent review of local authority crisis support is carried out.”
The charity has found that 65% of all local welfare assistance in England comes from the household support fund.
She added: “The government has much to do and we understand that funding is tight but investing in local authority crisis support is vital to save families from going under – and it is investment that saves the public purse across the NHS, social care and much more.”
Councils have spent 44 percent of the Fund on food vouchers to help families eligible for free school meals over the school holidays, equating to more than £370m.
If it is not extended, a minimum of 22 local authorities will stop providing free school meals over the holidays with an additional 20 saying they are unsure how they will be funded.
The Local Government Association (LGA) said councils are “deeply concerned” about the household support fund ending as winter approaches.
Councillor Pete Marland, chair of the LGA’s economy and resources board, said: “Councils want to see a shift away from short term, crisis support so they can instead invest in preventative services which improve people’s financial resilience and life chances.
“Crucially this must be underpinned by a sufficiently-resourced national welfare system.”
A government spokesperson said: “This government will tackle the scar of poverty by making sure work pays and improving support to help people into good work. More details on the household support fund will be set out in due course.”
On average, English local authorities spend just £1.34 per person on their local welfare assistance scheme, compared to £10.61 in Wales and £9.16 in Scotland.
Under the Household Support Fund each local authority gets a different sum which is based on population and a measure of the number of households that are considered vulnerable. Each council sets its own criteria for deciding who it will help and how much they receive.
