The Department for Work and Pensions (DWP) has unveiled a major new support package for households grappling with the ongoing cost of living pressures. The Labour government is launching a £1 billion Crisis and Resilience Fund in April 2026, which will fund two distinct types of direct financial assistance.
A New Approach to Local Crisis Support
This significant multi-year fund replaces the previous, short-term Household Support Fund. The core £1 billion will be allocated to local authorities across the UK, who will then be responsible for designing and distributing the aid to best meet local needs. A government spokesperson emphasised the long-term strategy, stating the fund provides councils with the certainty needed to offer emergency financial support and help prevent households from falling into crisis.
Sabine Goodwin, director of the Independent Food Aid Network (IFAN), welcomed the move, highlighting its potential to be "transformative for local communities." She stressed that delivering support through cash payments, combined with advice to maximise income, is proven to make a real difference and help build financial resilience.
The Two Key Payments Explained
The fund will facilitate two primary streams of support:
1. The Crisis Payment: This is designed to offer direct payments to individuals facing an immediate crisis. Crucially, government guidance specifies it should not be limited only to those receiving DWP benefits. Local councils will set their own precise eligibility criteria, allowing for flexibility to help a broader range of struggling residents.
2. The Housing Payment: Aimed at providing financial support for housing costs, this payment will replace the Discretionary Housing Payment for claimants from April 2026. It targets those in need of help to keep a roof over their heads.
Addressing Need Beyond the Benefits System
The announcement recognises that financial hardship extends far beyond those on means-tested benefits. Lucy Schonegevel, director of influencing at Action for Children, noted that millions of families are struggling to afford basics, with the social security system failing to protect children from severe hardship. She pointed out that families across the income spectrum, including those not claiming benefits, are presenting to charities and food banks for emergency help.
Sabine Goodwin of IFAN expressed hope that local authorities will create clear pathways for residents to find "immediate cash-first crisis support" combined with help to access existing entitlements. The goal is that by prioritising direct financial aid within community support networks, far fewer people will be forced to turn to food banks to eat.
