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Social fund

Discretionary loans and grants

The discretionary Social Fund consists of grants and repayable interest-free loans that can help meet the costs that your weekly benefits can't cover. These costs may due to something unexpected or exceptional circumstances.

Three sources of support are available through the discretionary Social Fund:

Community Care Grant

To apply for a Community Care Grant, you must be on a qualifying benefit and need the grant because: 

  • you’re moving back into the community after a stay in care
  • you’re resettling into the community after an unsettled way of life (for example, after a period in a hostel or sleeping rough)
  • your family is under exceptional pressure (for example, essential repairs in the home need to be carried out to keep it liveable)
  • you need to avoid going into institutional or residential care
  • you need to care for an offender or prisoner on temporary release
  • you have certain essential travel costs you can’t meet, for example that will enable you to visit a sick relative, move accommodation or attend a relative's funeral

You don't need to repay any money you receive from a Community Care Grant.

Budgeting Loan

You can apply for a Budgeting Loan if you’ve been on a qualifying benefit for at least 26 weeks and have expenses you’ve been unable to budget or plan for. This fund can be used for:

  • household items
  • footwear
  • clothing
  • home improvements and security
  • costs associated with finding and gaining new employment (such as travel costs)

This is an interest-free loan that you need to repay.

Crisis Loan

You can claim a Crisis Loan even if you're not on benefits. However, it must be the sole means by which you can avoid serious damage or risk to your health and safety. If it's awarded, you'll need to repay this loan.

Discretionary Social Fund rules

Because this part of the Social Fund is discretionary, you have no legal entitlement to a payment or right to appeal, even if you meet the eligibility criteria. However, if you disagree with a decision, you can ask the Department for Work and Pensions (DWP) to carry out a review of its decision. You can also take the matter further to the Independent Review Service, who will reassess your claim.

Discretionary Social Fund payments are also subject to annual local and national budgets. If there's no money in the budget, you won't get a payment.

Social Fund loans are repayable through weekly deductions in your benefits. If you're no longer on benefits, you'll need to negotiate repayment terms with the DWP. The DWP must be satisfied that you're going to be able to repay a loan. If it doesn’t think you can, it could refuse your claim.

Social Fund payments are not considered as income and capital for other benefits and are not taxable.

The official online source of government information on benefits is

Click on the bars below for more detailed information on Social Fund loans and grants.

Excluded items

To claim a Budgeting Loan, you must claim for certain specific costs (see Budgeting Loans for details). Budgeting Loans don't have a list of excluded items.

You can't get a Community Care Grant or Crisis Loan for the following:

  • needs that occur outside the UK
  • educational or training needs
  • school travel, meals, uniforms, sports clothes and equipment
  • court costs and legal costs (such as fees and fines)
  • removal costs if you're being moved by a local authority or a government body (however, a Budgeting Loan may be possible)
  • domestic assistance or respite care
  • repairs to publicly owned housing
  • most medical needs (everyday items such as incontinence pads may be allowed)
  • work-related expenses
  • debts to government bodies, such as income tax or national insurance arrears
  • investments
  • needs arising when you've been disallowed Jobseeker’s Allowance or the benefit has been stopped, or when you're involved in a trade dispute (expenses as the result of a disaster or needs for heating or cooking may be considered)
  • purchasing and installing a telephone and the cost of calls
  • Council Tax arrears
  • maternity and funeral costs paid for by the regulated Social Fund

The following are also excluded from Community Care Grants:

  • any costs your local authority has a legal duty to meet
  • fuel bills and standing charges, housing costs including repairs (except some minor repairs), improvements, deposits, rent, mortgage and service charges
  • daily living expenses (such as food), unless it's for a prisoner or young offender on temporary release or where a Crisis Loan cannot be awarded because you already owe too much

The following are also excluded from Crisis Loans:

  • mobility needs
  • holidays
  • TV and radio costs including rental and license
  • cookers and beds (except following a disaster, such as flooding)
  • the costs of running, parking or buying a vehicle, unless this is cheaper than emergency travel expenses
  • housing costs (see above), unless this is rent in advance, board and lodging or hostel charges, minor repairs or improvements and housing costs not otherwise met by benefits


You don't have to repay Community Care Grants.

Budgeting Loans and Crisis Loans are interest-free loans that you need to repay. They're normally recovered through deductions from your or your partner’s Income Support, income-based Jobseeker’s Allowance, income-related Employment and Support Allowance or Pension Credit. If you don’t get any of these, payments can be recovered from other social security benefits. The weekly rate of repayment depends on your continuing weekly financial commitments and available income.

Continuing financial commitments can include hire purchase payments, catalogue debts, court fines, maintenance payments or other debts. If the Department for Work and Pensions (DWP) thinks that you have too many commitments or you already have too much Social Fund debt, you may be refused payment.

Available income includes Income Support, income-based Jobseeker’s Allowance, income-related Employment and Support Allowance or Pension Credit plus Child Benefit and Child Tax Credit. It does not include any help you get with housing costs.

Repayment rates

The repayment rates are:

  • 12% of your available income if you have no continuing commitments
  • 10% if you have continuing commitments of up to £8.87 a week
  • 5% if you have higher continuing commitments

This may affect the amount of loan you'll be offered. Loans must normally be repaid within two years.

If you have problems repaying the loan, you can ask for your payments to be rescheduled (repaid over a longer period than two years). You'll need to explain why you're having problems repaying, for example because the repayments are causing you more financial hardship. You'll have to give details of your income, outgoings and all other financial commitments. 

You may want to get independent help and advice to negotiate with the DWP. If you have other debts, a Citizens Advice Bureau or other advice agency may be able to help you negotiate with your creditors and reschedule other debts.

Challenging discretionary Social Fund decisions

Unlike with most benefits and the regulated Social Fund, you cannot appeal to an independent tribunal if you claim from the discretionary Social Fund and are not happy with the decision. You do, however, have a right to a review of the decision.

You need to request a review in writing within 28 days of the decision. You can request a review later than this, but you'll have to give reasons why your request was late.

The original decision is made by an officer at the Department for Work and Pensions (DWP) and a reviewing officer will look at your further request.

Explain why you think the original decision was wrong, why any payment that's offered isn't adequate, how pressing or urgent your need is and why it's a priority in your circumstances. Explain why you'll have problems without the payment you've requested and how the payment will benefit you.

If the original decision was based on a mistake by the DWP, point this out too. Also mention any new information that wasn't in your original claim but which is helpful or any changes in your circumstances, including your ability to repay a Social Fund loan.

Get together all the information and evidence you think will be helpful to your claim. This could include letters from people who are assisting you or who know the problems you're having.

A review can look at the amount of payment, refusal of payment, a decision to pay a third party or a decision to pay you in instalments. You cannot get a review of the rate of repayment of loans, but you may be able to request that your payments are rescheduled. 

You may wish to seek independent help and advice in making your argument.

A reviewing officer can claim a loan back from you (an overpayment) if you've misrepresented your situation or failed to give the DWP information that's relevant to your claim.

If a review decision is still not in your favour, you should be offered an interview. This is often carried out over the phone, but you can ask for an interview in person. The interview is a chance for the reviewing officer to explain the reasons for the decision, but also for you to explain the reasons for your claim and the nature of your needs. You should be given a decision in writing.

If your application is still not successful, you can ask for your claim to be looked at by the Independent Review Service. Further details of the review process and how to apply to the Independent Review Service are explained in the section below.

If you experience delays in getting your claim reviewed, make a complaint to the DWP.

Reviews of decisions

Unlike with the regulated Social Fund and most other benefits, it's not possible to appeal against a decision on a discretionary Social Fund payment.

The decision can be reviewed and you should request a review in writing within 28 days of the decision. A reviewing officer will deal with the review initially. If the decision cannot be changed in your favour, you should be offered an interview. This will usually be done over the phone, but you can ask to have an interview in person.

The reviewing officer should explain the reasons for the decision you've challenged, the relevant law and guidelines they've used and the facts that were taken into account. You should be asked questions to check the facts and you can discuss your reasons for claiming, the evidence you have in support of your claim and any new facts or evidence that may assist your claim.

The reviewing officer should keep a written record of your discussion, which must be agreed with you at the end of the interview. You should be given a copy. The decision on the review should be sent to you in writing.

If you still dispute the decision, you can request a further review by a Social Fund inspector. You have 28 days to do this, but late requests can be considered if you have special reasons for the delay. You can request the further review in a letter or on form IRS1 (PDF, 1.3Mb), which should accompany the Department for Work and Pensions’ (DWP) review decision. This form should be sent directly to the Independent Review Service.

The inspector should examine the facts of the case and your individual circumstances, and decide if the decision is fair, reasonable and consistent with natural justice.

If the inspector needs to interview you, this will be done over the phone, but the inspector will usually handle the matter by looking at the relevant papers. You'll also be sent copies of these and you'll have a chance to offer comments, send further evidence and information and point out anything you think is wrong.

The inspector may confirm the DWP’s decision or they may refer the decision back to the DWP with appropriate advice on looking at it again. They may replace the decision completely if they think this is necessary. You'll receive a written decision from the inspector.

If the DWP looks at its own decision again and you're still not happy with it, you can refer the matter back to the inspector.

If you're not satisfied with the inspector’s decision, you can ask them to look at it again. Your only other option is judicial review and only if you believe the inspector applied their discretion unreasonably or abused their power of discretion. You'll need legal advice to take such a serious step.

Getting support

If you would like to get the decision about your discretionary social fund claim changed, you may find it helpful to get advice about how to do this or find someone to represent you at an appeal tribunal. 

An advice worker or solicitor may be able to:

  • give you any information you need about the rules for the discretionary Social Fund payment you're claiming
  • advise you about tactics, deadlines and what evidence would be useful when challenging a discretionary social fund decision
  • help you with a Social Fund review before the Social Fund inspectors

Advice about the law

You may be able to argue your case on a common sense basis and provide evidence which shows the decision is wrong because it was based on inaccurate information.

Sometimes, there are more complex legal reasons for your benefit being refused. It's particularly important to get help if you don't fully understand the case papers or you don't know how to argue against the reasons given by the Department for Work and Pensions for refusing your claim.

The following organisations may be able to help:

  • Citizens Advice Bureau
  • a local Law Centre
  • a local authority welfare rights service (contact the local authority to see if there's a welfare rights service in the area)
  • specialist workers at advice centres who help claimants challenge decisions and sometimes also represent them at tribunals
  • a firm of solicitors which specialises in welfare benefits (you may qualify for legal aid, though this doesn't cover the cost of representing you at a tribunal)
  • a voluntary organisation such as a carers’ centre 
  • a trade union, if you're a member of one

Find contact details for your nearest local advice services as well as national advice organisations on the Carers Direct local carers' services directory.


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Page last reviewed: 29/03/2011

Next review due: 29/03/2013

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