Crisis fund raised amid ‘tsunami of poverty’ warning

A hascrisis grant given to Dundee council tenants struggling to pay their bills had to be hiked by £50,000 to keep up with demand.

The hardship fund, administered by Dundee City Council, has been emptied every year since it was created in 2016.

Now, with more people struggling with benefit changes or freezes caused by welfare reform, the council has increased the fund from £450,000 to £500,000.

The money is used to support tenants when they are struggling to pay rent.

Neighbourhood services convener Anne Rendall said: “The hardship fund is specifically to assist council tenants who are struggling financially due to welfare reform, which is separate to the Scottish Government funding we manage.

“The level of demand means the fund has been used in full every year since it started.

“Given that demand and the ongoing impact of welfare reform and now Covid-19, we are proposing to increase the fund.”

Ms Rendall added the fund saves the council money in the long run as it reduces rent arrears which may ultimately be written off, costing the council more money.

“It has wider financial benefit to the housing fund as it avoids costs like bad debt write-offs and helps with terminating tenancies as a result of rent arrears,” she said.

“Ultimately it can stop people being kicked out of their homes.”

It comes after a warning last month that the city is facing a “tsunami of poverty” as coronavirus has made this year’s targets to reduce child poverty “virtually unachievable”.

At a council meeting in December, community planning manager Peter Allen said national targets, including reducing the number of children in relative poverty to less than 10% by 2023, are unlikely to be met due to pandemicrelated delays.

Now the council has proposed a 1.5% rent increase for tenants.

The rise will mean paying an average of £1.17 more per week.

Councillors will be asked to approve the increase on Monday.

The move follows eight weeks of consultation with tenants, most of whom backed the 1.5% increase, the lowest of three options.

Alan Ross, depute convener of the neighbourhood services committee, said: “With the effects of coronavirus at the front of our minds, this year more than ever we were fully aware of the delicate balancing act needed when setting the rent levels.”

The extra money will be used to support the hardship fund, as well as a £530,000 energy efficient improvement plan.