Cuts to the level and availability of crisis loans could drive thousands of vulnerable people into the hands of loan sharks, according to an MSP.

Fiona McLeod said disabled, pensioner and single parent households need access to Social Fund Crisis Loans, but the UK Government plans to put an annual cap on them.

The SNP MSP said the Westminster Government wants to put a limit of three crisis loan awards per household for general living expenses in a rolling 12-month period.

A recent parliamentary question revealed that more than 700,000 loans were approved for people who had already required four or more loans over the last year alone.

Ms McLeod, the MSP for Strathkelvin and Bearsden, said: “Cutting support for people at a moment of crisis must be the Tories’ cruellest cut yet.

“It will impact on the most vulnerable households, and could drive thousands into the hands of loan sharks, making their financial difficulties even worse.

“It is clear from the Government’s own figures that hundreds of thousands of people, who have been granted four or more loans in a 12-month period, would lose access to this lifeline support.

“These awards must be based on need, not an arbitrary cap set by ministers in Whitehall.

“By their nature, crisis loans are a last resort, and the fact that so many people have had to take out these loans should underline the difficulties that households are facing.

“Instead of trying to help, the Tory Government are making things much more painful. These are loans that people pay back, so these cuts are not about saving money.”