Tackling financial exclusion: A country that works for everyone? Contents

Appendix 6: Note on Committee visit to Toynbee Hall, London: Wednesday 30 November

On the morning of Wednesday 30 November the Committee travelled to the offices of Toynbee Hall, Old Castle Street, London, to meet with staff, volunteers and clients of Toynbee Hall.

The following members attended the visit:

Viscount Brookeborough, Lord Empey, Lord Fellowes, Lord Haskel, Lord Holmes of Richmond, Lord McKenzie of Luton, Lord Northbrook and Baroness Tyler of Enfield (Chairman).

This note summarises key points from the visit; it is not a verbatim record.

Introductory presentations and discussion

An introduction to Toynbee Hall was provided by Damian Brady, Director of Operations, and Sian Williams, Head of National Services. Mr Brady provided some oversight of the work of Toynbee Hall, explaining that the organisation operated with a £3.2 million central budget and provided support and advice to over 16,000 clients annually. Much of this work was reliant on volunteers. The charity operated a range of youth and older people’s projects, advice services and financial inclusion work, focused upon addressing poverty and social injustice.

Toynbee Hall had begun its work in 1884, seeking to address issues of deprivation in Tower Hamlets. Recent years had seen an increase in the number of clients drawn from outside the Borough of Tower Hamlets—around two-thirds of current service users were from outside the Borough. The original Toynbee Hall premises—which had been in use since 1884—were currently being redeveloped. This redevelopment would allow services to be adapted and expanded for the 21st century, while preserving important heritage features of the Hall. Support had been provided by the Big Lottery Fund and Heritage Lottery Fund.

Daniel Bunn, Information and Systems Manager, then provided an overview of recent research which had been carried out into the poverty premium. It was suggested that, in 2014, the poverty premium amounted to around £1,000 a year of extra payment for goods and services. This extra cost was largely a result of higher fees charged to service users who were, for example, on pre-payment meters or unable to arrange payments by direct debit. Gas, electricity and financial services payment methods were particularly common elements of the poverty premium.

Toynbee Hall research, which had been carried out with a limited sample size, had considered who was paying the poverty premium. This had shown that men were four times more likely to be paying extra for goods and services, although women were more likely to seek debt advice. This posed questions around the targeting of services. People in their 50s, people in black, Asian and minority ethnic communities and people who lived alone were all more likely to pay the poverty premium. One in two council tenants were likely to be paying the poverty premium in some form. The research would be used to inform future debt advice and financial inclusion work; in addition, it was likely that further research would be carried out to develop and supplement the findings of this initial work.

Small group discussions

The Committee then broke into small groups to meet with various clients who had used the services of Toynbee Hall. Key themes arising from these discussions are set out below:

Universal Credit payment delays were the cause of problems for a significant number of people. Delays which were ‘built-in’ to the operating system of universal credit meant that claimants sometimes went without payment for a number of weeks. Some people had had to resort to food banks as a result of this; others had been unable to pay utility or rent bills.

More generally, a lack of clarity around benefit payments was reported. Individuals who had taken up work, or taken on more hours, reported unexpected reductions in benefit payments which had not been clearly communicated in advance. It was suggested that Job Centre Plus and DWP staff were not always well versed in the intricacies of benefit payments, and were unable to provide definitive advice. One participant had been erroneously refused Jobseeker’s Allowance for taking part in study, resulting in multiple debts.

Universal Credit claims were made online—there was no paper application—and this was the cause of problems for people with limited online access or experience.

There was a general feeling that payment systems and processes—whether around benefit claims or utility bills—were complicated and overly complex. One mistake or error could lead to large amounts of letters and communication, some of which were overlapping or contradictory. Navigating through this required a great deal of time and aptitude, and was the cause of significant difficulties. It was suggested that, once an individual was ‘behind’ with this paperwork, it was very difficult to get back on an even keel.

Participants keenly felt the loss of previous income smoothing devices such as DWP crisis loans, which had previously enabled low-income families to withstand income shocks but which no longer existed.

It was suggested that agencies and service providers had a tendency to presume that claimants were ‘guilty’, and that processes were either designed or applied in a way that made people feel regretful about having to use them.

People leaving prison sometimes experienced significant problems with identification and address verification, limiting their ability to access financial services. Prisoners often left custody with no passport or driving licence, and sometimes with no fixed address. The resulting inability to access full financial services meant that specialist support was required to help them adapt successfully to life outside prison.

Some benefit was ascribed to financial education. Participants who had had financial education felt more confident about their finances and found themselves more able to avoid problem debt than they had before experiencing that education.

It was suggested that some banking customers had found themselves digitally excluded in areas where banks had increased the use of technology. Some everyday tasks had become more difficult for particular groups of customers since the introduction of online banking services.

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