Credit Unions to help people in Neath and Port Talbot deal with welfare reforms
DISCUSSIONS have been held between credit unions and housing providers to try to solve problems people may face as part of upcoming welfare reforms.
The Universal Credit, which is part of the coalition Government's shake-up of the welfare system, will replace most existing benefits and limit the total amount of benefit a person can claim.
The UK Government's Welfare Reform Act also introduces a so-called "bedroom tax" in the social rented sector, and replaces disability living allowance with a Personal Independence Payment.
Development team leader at Neath Port Talbot Credit Union, Brian Warlow, said there was currently a debt problem of "epidemic proportions in the UK" and things were only going to get worse.
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"There is no easy option to combat this epidemic, which is about to get worse this April for thousands of people, with changes to housing benefit due to the introduction of bedroom tax," he said.
Mr Warlow said they were working with housing providers to try to ease the budgeting burden.
"Credit unions have been in discussion with housing providers to help find a solution to the problems people will experience," he said. "People at present find it a struggle to live within their means and at the moment receive their benefit every two weeks, but are often absolutely broke for days before the next payment."
He said credit unions could act as a bank account for the person and receive all their benefits monthly.
"We will have met and agreed with the member which bills they would like us to pay each month, so for example we will pay their rent, electricity, gas, and council tax directly each month," he said.
"The member has an option to have a pre loaded debit card which has no overdraft facility."
Neath Port Talbot Credit Union welcomed 2,600 new members in 2012 and loaned almost half a million pounds in the last three months.