It depends on airport.

Much more common in US and Europe than elsewhere. Where the facility is not available, you are likely to be asked to provide receipts if your claim is valid.

The amount depends on how long your bags are delayed and the circumstances you find yourself in.

If you live in London and have just returned to London from holiday and your bag will be late, you will likely get nothing. If you are from overseas and going on holiday to London in the middle of a UK winter and can show you are staying in a hotel etc so are clearly completely stuck till your bags arrive, you will likely get enough to buy enough suitable clothes till yours bags are reunited with you.

But BA won't be buying you a temporary designer wardrobe! Although I guess if you decide to spend your prepaid debit card on socks on Saville Row, that is your perogative.