Sefton residents ‘going to loan sharks’ as council pauses hardship scheme

Residents in Sefton say they have resorted to short term loans and loan sharks after the council “paused” a hardship scheme aimed at providing support amid the cost of living crisis.

One resident, who asked not to be named, said they had waited months to be eligible to apply for the scheme only to find it was closed to applications.  After contacting the council, they were told the scheme, the Open Access Hardship Support Fund, had been paused until November.

The resident, who is a lone parent, said the situation has left their family in severe financial hardship and they ended up resorting to borrowing money off a loan shark to “get through” until the time the fund reopens.

Another resident, who asked to be referred to only as Collette, said she had also been waiting months to apply, after becoming ineligible after previously applying for the council’s Emergency Limited Assistance scheme (ELAS).

She said this meant she had to wait months to apply for the hardship fund, also discovering the scheme was paused when she was finally eligible to apply.  Collette said she has had to seek out payday loans to cover the shortfall in her budget.

The funds for both ELAS and the hardship fund come from central government money set aside for local authorities to dispense to help people with the additional pressures faced by the cost of living crisis.

Collette said she was concerned the scheme had been paused due to a backlog in applications for other services at the council, for example for council tax and housing benefit applications.

Council response

Sefton Council was approached for comment and a spokesperson said the reason for pausing the fund was due to the council wishing to ensure enough money is available for residents at later stages and that eligible residents would still be able to apply for ELAS in the meantime.

The spokesperson said: “Sefton Council set up the Open Access Household Support Fund application scheme using funding from the Government’s Department for Work and Pensions and since it opened in April 2023 has awarded almost £745,000 to 3,455 applicants.

“Because the amount of funding provided by the Government is a fixed amount, the Council took the decision to suspend applications for a short period to ensure that later applicants do not receive less money.”

The fund is due to reopen for applications on November 1 and the spokesperson said that in the meantime “Sefton residents can still apply to our Emergency Limited Assistance Scheme (ELAS) which can provide help with funding for essential costs such as food, gas and electricity, winter clothing and emergency travel.

“People may also be able to find support with items such as furniture or essential domestic appliances through ELAS along with the costs of setting up home, moving from care, or a disaster like a fire or flood.