Fears that “very vulnerable” people could be exposed to financial exploitation if a Lewisham department is axed

By Grainne Cuffe, Local Democracy Reporter

People who cannot manage their own finances could be left without a service to guide them on their spending if it is axed by a town hall.

Concerns have been raised over Lewisham Council’s plans to scrap a service that manages the finances of “very vulnerable people”. 

The service means that when residents are unable to manage their own financial affairs or lack the mental capacity to do so, the council can do it for them. 

It safeguards money for rent, makes sure bills are paid, and protects people from being taken advantage of.

Part of three-year draft proposals to make £40 million in cuts, the council plans to save £160,000 next year if the cut is approved in February.  

It plans to seek out external providers, which will result in clients paying “significantly more” for the service.  

Lewisham currently offers financial support and management to about 380 adult social-care clients. 

The council is only able to charge clients for managing their finances if it has power of attorney for them (about 100), but it says the charges do not cover the cost of the service.  

For the rest, those managed under appointeeship, there is no funding available to the council and clients are not charged for the service.  

“Although the council currently offers these services, they are doing so at their own cost,” according to council documents.  

The documents also outline the risks of the proposed cut. 

“Requiring vulnerable clients to pay for external providers to provide this service may pose a risk of financial abuse.  

“In the past, efforts have been made by external providers to maintain standards and maximise growth for clients but these may not always be successful.  

“For those clients we currently have power of attorney for, they will be required to pay significantly more for financial support compared to what we currently charge.  

“For those clients where we are appointees, the clients will be expected to pay for the first time and from very limited amounts of income (i.e. welfare benefits),” according to the council.  

At a meeting of the public accounts committee last week (December 3), chair Cllr Patrick Codd said he was “concerned about [the service] being withdrawn from very vulnerable people”.  

“What thought [has] been given to the fact that if we withdraw the service, how will people be looked after in that immediate need once the need is identified so that we can pass them on to somebody else at least?” he said, suggesting the corporate social responsibility arm of banks may be able to help.  

Director of corporate services, Kathy Freeman, said the council is in the stages of “looking at what this will mean for the residents and understanding fully the impact it will have on them”.  

“We’re also exploring the current service providers out there who are able to charge more than what we’re able to because we are restricted and confined in terms of the overall costs of the service that we provide.  

“This is something that we are having to put forward unfortunately as part of the cuts process, noting that it is very sensitive and very difficult because there is a duty for us to protect our vulnerable residents,” she said.  

Speaking to the local democracy service, a homeless charity manager warned that if people are left to manage their finances on their own, they may not pay their rent and could lose their homes.   

They could also be taken advantage of by others, or if they have addiction problems, they could overdose. 

It is unclear which organisation would provide the service and the council declined to name any.  

But Lewisham denied that clients could be left to manage their finances on their own. 

“Alternative arrangements are being considered but clients will not be left to their own devices.  

“This proposal would only be considered further where there are adequate and appropriate arrangements available through organisations that would continue to safeguard the client’s funds.   

“The council would seek to work with organisations with charitable status who already provide similar services,” a council spokesperson said.  


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