Page last updated at 19:35 GMT, Wednesday, 15 June 2011 20:35 UK

Welfare Reform Bill part one

Opposition MPs have voiced strong criticism of new arrangements for making one-off emergency payments to vulnerable people.

On 15 June 2011, as MPs debated the Welfare Reform Bill at committee stage, Labour's Karen Buck said that a string of charities had warned about the impact of the government's planned changes to the way the Social Fund operates.

The Social Fund currently helps people suffering hardship pay for funerals or costs arising from a new baby. In future, local councils will decide on when and how to make such payments.

Ms Buck said that Oxfam had predicted that there would be a risk that vulnerable people would be driven to borrow money from loan sharks at times of crisis if local authorities failed to provide the same level of support as currently available under the Social Fund.

Refuge, a domestic abuse charity, foresaw women who were suffering from abuse being forced to delay their escape or return to live with their abusers, Ms Buck added.

Labour backbencher John McDonnell urged ministers "not to abolish or wind down the social fund without giving an absolutely clear commitment about what will replace it".

But Work and Pensions Minister Maria Miller argued that the current scheme was "open to widespread abuse, and some of that is driven by the remoteness of the administration of these elements of the discretionary social fund".

She said: "The number of crisis loans has tripled since 2006, but we do not believe that that increase reflects an underlying increase in genuine need as a result of the recession or anything else."

Ms Miller concluded that the new scheme would "make sure that we are supporting more effectively than is currently the case the vulnerable individuals we have discussed today".

MPs went on to approve the government's plans.

The majority of the bill applies to England, Wales and Scotland. Northern Ireland has its own social security legislation although there is a long-standing policy of parity in this area.

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