Written by Beccy Wardle, Director of Client Partnerships

With the launch of the Crisis and Resilience Fund (CRF) just under two months away, the concept of a cash-first approach for crisis support is sparking debate across the country. A handful of local authorities have already been delivering in this way, but for the majority this represents a significant  change.

The shift towards cash is intended to protect dignity and offer choice to people, while also reducing reliance on emergency aid, such as food banks. The CRF is just one part of a wider approach to reducing poverty, with the government estimating that wider policy changes could lift 450,000 children out of poverty during the final year of parliament. Welcome changes heading in the right direction, but certainly just the beginning of the journey.

The CRF delivery, if we get it right, will empower individuals during a point of crisis, allowing them to prioritise what they need most. The key will be then linking seamlessly into support that builds longer term resilience, reducing the likelihood of further crisis escalation.

Why cash-first support is essential to CRF

The big driver of financial crises is poverty, so a sticking plaster approach alone will not be the complete solution. As part of a wider framework of policy change, crisis support that integrates with resilience building help when and where it is needed, can be incredibly impactful. Sudden changes in income, life events, and unexpected circumstances can all create financial shocks. This creates a huge need for crisis support. To address the causes, solutions must be needs-based and depend on an individual’s circumstances as outlined in the DWP guidance.

Without any nationally prescribed eligibility criteria, local authorities can tailor support to their own communities. This allows targeted prioritisation based on the demography or nuance within any given community. A cash-first approach has the potential to offer better value for money, ensuring funds are directed exactly where they are needed. Flexibility and choice can also encourage the uptake of support, leading to a more effective crisis solution with better outcomes and impact.

Crucially, the CRF guidance recognises that cash first is not cash only. This concept is one that councils are grappling with across the country. CRF reframes the way that assistance is delivered; where it makes sense, support can still be provided through the likes of emergency vouchers and goods in kind. Local authorities are able to use discretion to provide the best form of support in each case. In some circumstances, providing goods or emergency vouchers may be a better solution to meet the specific needs of an individual or household. The central point is that this should be needs led and person centred – a common-sense approach can be taken.

Our learning tells us that delivering effective crisis support relies on a strong network of partners. There should be no wrong door. This involves coordination between public bodies and the voluntary sector, with both large and micro-organisations, to ensure people receive a joined-up support journey, regardless of the initial point of contact. Establishing relationships is particularly important, leveraging local knowledge and networks to connect individuals to the right support promptly. Addressing the initial crisis quickly and effectively allows people to move forward and engage with wider resilience services, helping to reduce the risk of repeat crises.

Spend tracking and meaningful outcomes

The Leeds City Council cash grant pilot found that people experiencing financial hardship preferred to receive cash support rather than emergency food aid. The outcomes from the pilot highlighted that cash was preferred due to offering flexibility, reduced stigma, and allowing the person to get the specific thing that they need. There is also good evidence that combining a crisis intervention with resilience building advice is effective. Where food provision was combined with access to advice and financial support, it was found that 1 in 5 recipients no longer needed to rely on food banks.

The cash-first approach is a huge strength but also presents its own challenges. Voucher or goods in-kind based models lend themselves more easily to tracking the specific outputs. This is less straightforward with cash.

It is important to recognise that tracking how funds are spent within any model is not sufficient on its own. We welcome that the guidance highlights the need to report outcomes, such as how a situation has been stabilised, whether escalation of a greater crisis has been avoided, and if individuals were able to successfully access further help. The impact is not so much about focusing on how the money was spent, but more around whether the intervention made a meaningful and lasting difference at a point of crisis or crisis prevention.

Impact measurement for any model brings challenges – but there are good practice examples to draw upon. It is certainly the case that implementing this model successfully will require a new and considered approach to reporting. We wait in anticipation for DWP guidance on this, expected later this month.

Managing risk and prioritising dignity

The provision of direct financial support carries risks that councils must manage. Talking to council colleagues around the country, we are hearing concerns about fraud, misuse, and limited visibility once support payments are made. It is important not to cloud our vision of what the CRF is aiming to achieve within these conversations. Most people who will be accessing this support are doing so because they are impacted by poverty or by a financial shock. However, the risks do need consideration and mitigation. This will require local authorities to ensure strong processes and protocols, checks, and governance are in place. Within all of this, the objective of ensuring dignity, choice and meeting individual needs must be prioritised throughout.

Continued engagement following crisis support is another important factor for consideration. Building financial resilience is a core objective, which can’t be achieved through one off payments alone. Quickly accessed and integrated follow up support will help enable councils to have a greater understanding of the impact and long-term outcomes for people, including analysing the effectiveness of reducing future crises.

Approaching cash-first delivery

The cash first support model gives a huge opportunity to develop pathways for people that lead to better outcomes, alongside offering dignity and choice.

If the right processes and partnerships are put in place that truly focus on outcome-based impact, cash-first crisis support that is integrated with rapid access wrap around help has the potential to make a real difference.