Social Justice and Social Security Committee
Gordon MacDonald (Deputy Convener) and Miles Briggs were Members of the Committee until 29 June 2023. Bob Doris and Roz McCall joined the Committee on 29 June 2023. Bob Doris became Deputy Convener on 7 September 2023. James Dornan was a Member of the Committee until 30 October 2023. John Mason joined the Committee on 31 October 2023.
Every year the Scottish Government plans how it will spend money by creating a budget.
The process for committees to scrutinise the budget is set out in the Budget Process Review Group’s 2017 report. It helps committees to focus on four core objectives to:
Have greater influence on the formulation of the Scottish Government’s budget proposals,
Improve transparency and raise public understanding and awareness of the budget,
Respond effectively to new fiscal and wider policy challenges, and
Lead to better outputs and outcomes, as measured against benchmarks and stated objectives.
The Social Justice and Social Security Committee looks at how the Scottish Government has spent money and the impact of that spending on social justice and social security issues in Scotland. It also considers where the Government needs to spend money in the future and how it will fund those choices.
The Committee took evidence on 14 September 2023 from Shirley-Anne Somerville, Cabinet Secretary for Social Justice (the Cabinet Secretary), about her social justice priorities.
Following this, the Committee heard from a range of stakeholders on 21 September , 28 September and 5 October 2023 covering the main aspects of its remit. Copies of the individual written submissions of evidence are available online.
The Committee thanks all of those who have taken the time to provide their views.
In addition to this, the Committee worked with the Equalities and Human Rights Committee in relation to public participation in the budget process. More can be found in the Public Participation section of this report.
The Committee has a wide ranging remit including social security, social justice, child poverty, homelessness, third sector, kinship carers, violence against women and girls and domestic violence, refugees and asylum seekers and the Office of the Scottish Charity Regulator.
In 2023-24, the largest area of identifiable spend relevant to the Committee’s remit is the approximate £5 billion on social security.
There are some other areas where spend has been easily identifiable, for example other budget lines related to the Third Sector (£22 million), Office for the Scottish Charities Regulator (£3m), Social Justice (£40.9 million) and Discretionary Housing Payments (£83.1 million).
Other areas of spend are more difficult to scrutinise, for example cross cutting policies, such as tackling poverty, do not have specific budget lines.
The Scottish Government’s Medium-Term Financial Strategy (MTFS), published in May 2023, and the Scottish Fiscal Commission’s Economic and Fiscal Forecasts May 2023 set out the financial pressures ahead.
The Scottish Fiscal Commission noted that social security spending is forecast to increase from £5.3 billion in 2023-24 to £7.8 billion in 2028-29. By 2027-28, it expects the Scottish Government to spend £1.3 billion more on social security than the funding received from the UK Government through the Block Grant Adjustment.
The MTFS also raised the theme of tough choices noting that “tough and decisive action must […] be taken to ensure the sustainability of public finances and that future budgets can be balanced”.i
On 5 September 2023, Humza Yousaf, the First Minister, announced the Vision for Scotland, Equality, opportunity, community: New leadership – A fresh start. This set out three critical, and, interdependent, missions for the government to be underpinned by refreshed national outcomes:
Tackling poverty and protecting people from harm
A fair, green and growing economy
Prioritising our public services.
Like the MTFS, this document also emphasises the challenging context including the recovery from the COVID pandemic and the cost of living crisis and that this would “mean taking some tough decisions to ensure that we target every pound we spend and invest in order to get the maximum value, ensuring it reaches those that need it the most.”i
In relation to the Committee’s budget areas, the Cabinet Secretary for Social Justice confirmed in "Equality, opportunity, community: New Leadership", what the Scottish Government hoped to achieve by 2026. The Scottish Government's aims include:
Reduced child poverty rates through delivery of our tackling child poverty plan Best Start, Bright Futures, using all available levers.
Investment of a further £1.3 billion in our game-changing Scottish Child Payment – which is forecast this financial year to lift 50,000 children out of poverty.
Building on the successful establishment of our social security system and delivered Scottish Government benefits worth £18 billion to over two million people, treating them with dignity, fairness and respect.
Given the economic challenges in which the 2024-25 Budget is being set, it will be fundamental to the process to prioritise spending and reprioritise existing funding to create maximum benefit.
Some witnesses focused their contributions on how the Scottish Government should prioritise funding for the 2024-25 Budget, while others suggested specific reallocation of existing funding for policies to give extra momentum the Scottish Government’s priorities.
In the current cost of living crisis, the Scottish Human Rights Commission said it is important to be flexible and constantly prioritise using a human rights framework, however, the Commission said that “is not our starting point at the moment” referring to the Scottish Government approach to budget setting.i The Commission pointed to the opportunity presented through the Scottish Government’s proposed Human Rights Bill to reconsider this with a human rights-based approach.ii
The Fraser of Allander Institute said that it was important for the Government to be clear about the reasoning behind spending decisions—
We are looking for a clear articulation of that through the announcements, with supporting analysis that shows why decisions have been taken and why more money has been put into some areas—that could be additional cost of living payments or increases to benefits—as well as an explanation of what impact the Government expects that to have on the people whom it is trying to target.i
In a letter to the Committee, the Cabinet Secretary explained how cost of living impacts are being monitored. She said that an analytical group, chaired by the Chief Social Policy Adviser, Professor Linda Bauld was established in April 2022 to appraise the policy options and support government decision making to address the cost of living crisis. The group published an analytical report in November 2022. She stressed—
The cost of living crisis has evolved quickly and at times its trajectory and impacts have been difficult to predict.iv
In recognition of this, the cost of living analytical group has continued to review key indicators and wider evidence relating to the cost of living on a monthly basis.
Alongside this work, the Cabinet Secretary also explained that the Scottish Government has commissioned regular surveys on attitudes, knowledge and behaviours directly related to the cost of living. The latest survey data in September 2023 shows “61% agree that the cost of living crisis will have a long term negative impact on me and my family”.
With reference to tackling child poverty, the Poverty and Inequality Commission suggested the Scottish Government should look at its existing polices and consider how it can target them more effectively. For example, the Commission explained that lots of people do not use concessionary travel so spending in this area could be redirected and used to extend the offer to low income workers.i
The Fraser of Allander Institute said that there is still a lack of robust evaluation of evidence “to really assess the effectiveness of policies in areas such as childcare and employability” – key strands of tackling child poverty.i On moving people out of poverty, the Institute said, “it will be the cumulative impact of different policies that will have the overall impact of getting people with complex circumstances above the poverty line”. i The Institute argued against small allocations of funding with no modelling, as there is no examination of how effective this funding would be. It reinforced the time has come for the Scottish Government to undertake a focused options appraisal exercise to meet the 2030-31 child poverty targets.iv
On 14 September, at the evidence session on social justice priorities, the Cabinet Secretary described “the work that goes on in Government to ensure that we analyse how we are using the finances that we have in the right way through the best start, bright futures programme board, the ministerial group and so on to constantly check that we are using the money in the most effective way possible”. v
The Cabinet Secretary set out further detail on the Scottish Government’s approach given the current pressures on public finances and its fixed and limited budget in her letter of 5 October—
We are reviewing opportunities for more effective targeting of spending in the 2024-25 Budget, whilst prioritising programmes of work which have the greatest impact on the delivery of our three core missions. Targeting our funding can have a huge impact, as we have seen with the projected reduction in the rate of relative child poverty through the Scottish Child Payment this year.
Witnesses had views on which specific policy areas should be de-prioritised and what policies this funding should be redirected to.
During the Committee’s session on its parental employment inquiry on 14 September, the Cabinet Secretary for Wellbeing Economy, Fair Work and Energy confirmed some of the funding for the Parental Transition Fund had been redeployed to the Fuel Insecurity Fund.i iIn her letter of 5 October to the Committee, the Cabinet Secretary for Social Justice told the Committee that this reprioritisation of funds is due to issues around reserved tax and benefits making it not possible to deliver the Fund as originally envisaged.
Although the Joseph Rowntree Foundation welcomed more funds for the Fuel Insecurity Fund as the cost of living crisis is ongoing, the Foundation questioned why parental employment and energy support should be seen as “competing priorities”.i
Inclusion Scotland called for a reprioritisation of the Scottish Government’s spending plans to continue to deal with the cost of living crisis. It argued that prioritising social care spending will take the pressure off the National Health Service rather than it “treating people for things such as hypothermia because they are not eating properly and not using the heating”.i
The commitment from the Scottish Government to increase the wages of those delivering care services was welcomed by Inclusion Scotland. This, it stated, has implications for those utilising Self-Directed Support option 1i as their choice for the delivery of self-directed support. It called for the increase in wages for those staff directly employed by disabled people to be fully funded.ii
According to last year’s SCOPEi figures, the additional costs of disability are £900 per month. Inclusion Scotland said due to inflation this is now likely to be around £1,100.i
Inclusion Scotland highlighted additional health related energy costs that disabled people can incur from equipment such as hoists, beds and breathing equipment. The use of these machines can keep people out of hospital. Inclusion Scotland believed that the NHS should be paying these health-related costs and not disabled people and urged the Scottish Government to make funding available in the budget to allow local NHS boards to provide this support.ii
On maintaining existing services and programmes, the Poverty and Inequality Commission noted that while funding is needed for new commitments to tackle child poverty, budgetary challenges mean that there are significant risks to existing services and programmes to support people experiencing poverty. Funding for local government and health and social care services, in particular, is crucial to enable them to provide the foundation services that people are relying on. The Commission stated—
It is important that new programmes and services are not layered on top of disintegrating foundations.i
SCVO believed there should be a greater focus on the reform of the public sector to get the most out of the money that is already in the system. For example, despite the introduction of the sustainable procurement duty, SCVO said “there is very little focus on impact and outcomes” particularly given £1.8 billion worth of contracts have gone to the voluntary sector in the past year. In this respect, SCVO underlined that the focus of any reform should be real improvements in efficiencies, not cost cutting. ii
Saheylia agreed and emphasised that the focus has to be on consistency, delivery of quality services and genuine impact assessment. ii
Saheliya suggested the Scottish Government could “step back” from spending money on large interpreting contracts for the police and national health service as its view was that these contracts do not work for the most vulnerable of people. It explained that funding from the Poverty Alliance enabled women, amongst other things, to access health services and learn English—
If the Saheliya model was used, Saheliya would not need to exist. i
The Committee recognises that the Scottish Government has some difficult choices to make. Due to its constrained budget and significant economic challenges, such as the cost of living crisis, the Scottish Government will need to have a “laser focus” on the prioritisation of spending. One of the key aspects raised with the Committee is the need to meet people’s essential needs. The cost of living crisis makes this an immediate priority for the Scottish and UK Governments to tackle.
In relation to the Scottish Government’s key mission to tackle poverty including child poverty, it will be the combination of policies and funding priorities across the budget which contribute to reducing poverty.
The Committee welcomes the frankness of the Scottish Government in advising that it has reallocated funding from the Transitional Employability Fund to the Fuel Insecurity Fund. This has been helpful in understanding budget decisions and the movement between funds. It has also allowed stakeholders to contribute to the debate on this decision.
In relation to the extra cost of disability in Scotland, the Committee has commissioned research on this topic to inform its work this session and would be happy to share this with the Scottish Government to inform its ongoing consideration of this area.
The Committee has found it helpful to hear from stakeholders where they feel funding could be reprioritised. We draw these suggestions to the Scottish Government’s attention to assist its consideration of funding priorities for the 2024-24 Budget.
The cost of living crisis is continuing to have a negative impact for low income households and the organisations that support them. Witnesses reported that the effects are worsening, and more financial assistance is needed, whether this is through direct payments to people or policies which would alleviate pressure from public and other services.
Shelter Scotland described the impact of the cost of living crisis as “devastating”. It said, the crisis has exacerbated the issues with a broken homelessness system.i
The Joseph Rowntree Foundation’s analysis from earlier this year showed about a third of low income familiesi have skipped meals or cut down on meals while about 15% have visited a foodbank. It stated that these are the choices being forced on families in Scotland.
The situation for disabled people was regarded by Inclusion Scotland as “serious”. It referred to the Research Institute for Disabled Consumers research, whose panel of 3,800 disabled people, which is representative of disabled people across the UK, found 27% were in serious financial difficulties, while a further 23% were struggling.iInclusion Scotland explained that energy costs tend to be higher for households containing disabled people for several reasons including: the need to stay warm (or cool) to manage pain; charging or powering independent living equipment such as stairlifts and powerchairs; additional laundry and higher use of home appliances. Furthermore, a recent Trussell Trust report, highlighted by Inclusion Scotland stated that , “three out of four food bank users in Scotland are disabled people and their families”.ii
On the impact on people in the asylum system, the Scottish Refugee Council said the UK asylum system has “been in a cost of living crisis and searing insecurity for about 20 years, and the situation has worsened as inflation has increased during the past few years”.i The Council said that sometimes people in asylum-seeking families are going without food for days. It also noted that refugees in institutional ex-hotel accommodation or barracks accommodation get £1.40 a day.i Those in dispersal or community-based accommodation get about £6.80 per day. ii
The Poverty and Inequality Commission said that as people continue to face financial pressure, front-line advice services are facing increasing demand, sometimes assisting people who are “suicidal with worry”.i On top of this added demand, the Commission explained that organisations are facing higher costs to deliver those services.ii
These organisational pressures were also picked up by the Scottish Council for Voluntary Organisations (SCVO), which stated that inflation and rising living and operational costs are straining the sector and the communities it works with. Although inflation is falling, this still means organisations and individuals are facing significantly higher prices now. The Poverty and Inequality Commission gave an example of energy prices saying they “are still nearly twice as high as they were two years ago”.i
SCVO said that 10% of the voluntary organisations that responded in November-December 2022 to wave five of the Scottish Third Sector Tracker are uncertain about their future viability, and 39% are struggling with long-term planning.iv SCVO also referred to recent figures showing the situation is not getting better—
In May, nearly all voluntary organisations—around 94 per cent—reported rising overheads. That is usually down to staffing and energy costs. Also in May, 71 per cent of organisations said that they are experiencing financial challenges. That was up from 67 per cent at the time of the last Scottish budget, so things have worsened.i
Some witnesses referred to groups they considered received less support than families, such as young single people and disabled people. According to the Poverty and Inequality Commission they “face not just the choice between heating and eating but difficulty in continuing to live. That is what the calls to helplines are telling us”. i
In terms of the level of funding that would be available to address cost of living pressures in the 2024-25 Budget, the Poverty and Inequality Commission said the Programme for Government is “relatively quiet” on what support might be forthcoming. The Commission said it would be interested to see how the Scottish Government would prioritise its budget to address these concerns.i
In her response of 14 July 2023 to the Committee’s Scrutinising Social Justice: Barriers and Opportunities report, the Cabinet Secretary estimated that over the financial year 2022-23 £3 billion was invested across a range of programmes targeted at low income households, with £1.25 billion directly benefiting children.
Over and above the Scottish Child Payment, the Cabinet Secretary stated that the Scottish Government has “also raised the incomes of thousands of families hardest hit by UK Government welfare changes and cuts. Working with local authorities, we invested around £84 million in Discretionary Housing Payments to support people with housing costs and mitigate the UK Government’s bedroom tax, this included £2.6 million to mitigate the UK Government’s Benefit Cap as fully as is possible within the scope of devolved powers”. iii
Also, the Cabinet Secretary stated this included “taking decisive action to double investment in our Fuel Insecurity Fund to £20 million in 2022-23 and tripling investment to £30 million this year”.iv
The Committee acknowledges the actions the Scottish Government has already taken to mitigate the effects of the cost of living crisis on low income households. However, from the evidence the Committee has gathered, more help is needed for priority groups (lone parent families, minority ethnic families, families with a disabled person, families with younger mothers, families with a child under one, families with three or more children) but also for younger people who live on their own, older people and disabled people, particularly as some people would struggle to withstand much more.
On 27 April and 4 May 2023 the Committee held two cost of living roundtables focusing on disabled people and carers, and lone parents, respectively. At that time, the Committee heard that “while temporary crisis support is necessary, stakeholders emphasised the need to also recognise the structural causes and take a longer-term approach to solutions”.i After these sessions the Committee wrote to the House of Commons Work and Pensions Committee on its inquiry into cost of living support payments sharing the evidence gathered. The Committee reiterates the need to continue to address structural issues in the 2024-25 Budget alongside specific cost of living crisis support payments.
As the Committee heard from its pre-budget evidence, this winter will also be a critical time for households, particularly those with a disabled adult or child. Inclusion Scotland’s submission stated that at a UK level excess winter deaths due to cold, damp housing increased by about half from 3,186 in 2021/22 to 4,706 in winter 2022/23, “indicating that people are literally freezing to death”. v
The Committee asks the Scottish Government to set out exactly how it will prioritise funding to mitigate the cost of living crisis. What will the balance be between targeted support and making long term structural changes to support low income households?
One of the Scottish Government’s Programme for Government key missions is to tackling poverty.
In terms of social security, tackling poverty is mostly to be achieved by continuing existing policies. As with last year, the flagship policy is the Scottish Child Payment (SCP). The Poverty and Inequality Commission, the Joseph Rowntree Foundation and Inclusion Scotland considered SCP to be working well to significantly reduce poverty. Inclusion Scotland said SCP has been a “lifeline” to many families.i The Joseph Rowntree Foundation said the SCP "is significantly reducing child poverty. People will give you different numbers, but the figure is probably 4 or 5 per cent at the moment".i
According to the Joseph Rowntree Foundation, the Scottish Government's stated mission to tackle child poverty cannot be seen as sitting solely with the budget lines of the Social Justice portfolio. Although the social justice portfolio includes areas that must be addressed such as affordable housing, the Scottish Welfare Fund, uprating social security benefits and the Scottish Child Payment broader priorities sitting in other portfolios must also be considered such as childcare and employability.
The Scottish Refugee Council wanted refugee and asylum poverty as a clear and adequately resourced part of Scotland’s national plans against poverty, including but not limited to child poverty. In terms of child poverty, this should include the Scottish Government requesting that local child poverty action plans include refugee and asylum poverty.i
Aii new development within the Programme For Government is the introduction of “mandate letters”. These, from the First Minister to Cabinet Secretaries, set out “the outcomes they will achieve in the months ahead.” All of these new letters are published on the Government’s website. There is a lot of detail around what Cabinet Secretaries are expected to deliver by end of March 2024 (i.e. in the 2023-24 Financial Year) and to the end of the parliamentary session.
The Committee understands acutely the difficulties of maintaining a scrutiny focus on poverty in other portfolio areas, as can be seen from its Scrutinising Social Justice report and its work on parental employment, which spanned other portfolio areas such as childcare, employment and transport. Having this level of focus on the cross-cutting issue of poverty requires strong leadership and a commitment across other portfolios to prioritise tackling poverty.
The Committee notes the First Minister’s ‘mandate letters’ to Cabinet Secretaries and asks the Cabinet Secretary how she and other Cabinet Secretaries are reporting progress on tackling poverty, so the overall cumulative impact on poverty can be assessed.
The Scottish Human Rights Commission provided an example of a human rights-based approach to child poverty in its written evidence. It also acknowledged—
Providing direct payments is known to be one of the most dignified ways of providing support, but, in and of itself, that will not solve child poverty, because the structural deficits in children’s lives are much deeper and wider than can be solved by just financial support.i
The Joseph Rowntree Foundation agreed there is a need to also look at other areas, for example, investment in affordable housing. The Foundation referred to its “Poverty in Scotland 2019” report which showed that affordable housing keeps poverty levels lower than in the rest of the UK.i
Employability was also highlighted as a key approach. The Poverty and Inequality Commission explained that by moving people into well-paid work they can escape poverty in the long term.i The Commission welcomed the recent Programme for Government commitments to develop infrastructure for childcare and increase pay for early learning and childcare workers, which would support employment, adding that “it will be important that sufficient funding is available in the budget to deliver them". Even so, the Commission added, these actions are still not of sufficient scale to make the progress needed to meet the 2030 child poverty targets.iv
It was noted by witnesses that the wider economic situation has affected existing investment and policies to address child poverty. The Poverty and Inequality Commission believed the current financial situation means it is not clear how the 2030 targets will be achieved.i
This view was shared by the Joseph Rowntree Foundation, which emphasised “the time for action, and at scale, is now”. It also argued that the recent Programme for Government made little additional spending efforts to reduce child poverty.ii
In order to stand a realistic chance of meeting the child poverty targets, the Poverty and Inequality Commission asserted the Scottish Government will need to raise additional revenue, “because there is no way that it can even meet its current service commitments with the budget that it has”.iii
Over the past year, the Committee has been conducting an inquiry into parental employment, one of the central policies within the Scottish Government’s Best Start Bright Futures delivery plan. The report will be published after this report.
The Committee aims to publish its Adressing child poverty through parental employment inquiry report in the coming weeks. The Committee asks the Scottish Government to have regard to any recommendations relevant to the budget when responding to the Committees 2024-25 Pre-Budget report.
The Committee is concerned that economic challenges are hampering the Scottish Government’s mission to tackle child poverty. Witnesses noted that the Programme for Government sets out the steps but there appears to be no new funding. The Cabinet Secretary states that progress can be made by targeting funding, but the Scottish Government has not given any clarity about how this will be achieved. The consistent message given in evidence to the Committee is the need for spending at scale and pace. As time runs out to meet the child poverty targets, it is clear to the Committee the urgency of every action taken and, that every pound counts.
Given the financial context, the Committee asks the Scottish Government what consideration it has given to the right balance between universal and targeted policies to tackle child poverty. The Committee would also welcome the Scottish Government’s views on the Fraser of Allander Institute’s suggestion to undertake a focused options appraisal exercise to meet the 2030-31 child poverty targets.
Shelter Scotland and the Scottish Refugee Council considered housing should be made a priority for the Scottish Government in its forthcoming Budget. Both organisations described a “housing emergency”. Shelter Scotland stated, “Scotland is in the grip of a devastating housing emergency which damages lives every single day”.i It emphasised it is an emergency because it “is not just one crisis. It is an affordability crisis, an accessibility crisis, a crisis for children and a crisis of cost, and all those crises have come together as an emergency”.ii
The Scottish Refugee Council described frontline workers being increasingly traumatised by the “scale of human need” dealing with inappropriate temporary accommodation, so much so that it is becoming “normalised”.ii
Shelter Scotland explained that due to the competition for housing, there are limited lets available for homeless households and so they are trapped in temporary accommodation. There are record numbers of households in the homelessness system and a record 9,595 children in temporary accommodation, up 130% since 2014, and in the view of Shelter Scotland “with no immediate plan, no new money and no new interventions to deal with that”.ii
In terms of the 2024-25 Budget, Shelter Scotland argued “it is difficult to justify a year-on-year 16 per cent cut to the social housing budget”.i Although this was planned, Shelter Scotland stressed circumstances have changed, “every six months, there is an announcement of a new record-high level of homelessness and a new record-high level of breaches of legal duties. Local authorities are acting unlawfully, and they are announcing that they are acting unlawfully because they are unable to meet their statutory obligations”.ii
The Scottish Government’s target is to deliver 110,000 affordable homes by 2031. This parliamentary term, the Scottish Government has committed to spend £3.5 billion on its affordable housing supply programme. Shelter Scotland called for the Scottish Government to set a target for how many new homes are to be built for £3.5 billion.ii
The affordable housing supply outturn report for 2021-22, the latest year available, notes the Budget was underspent by just under a fifth, attributed to COVID impacts and construction and workforce issues. According to the latest data available between 23 March 2022 and 30 June 23 13,354 affordable homes have been delivered, representing 12% of the 110,000 target. The latest data also shows that in the year to end June 2022, the number of affordable homes approved has decreased by 22%.
To address the issues of temporary accommodation, Shelter Scotland commended the Temporary Accommodation Task and Finish Group report published on 30 March 2023 which “sets a template for what can be done in the immediate term” but warned “that takes resource and additional resource is not currently on the table”.ii
With regard to the £60 million national acquisition plan, which the Scottish Government announced at the beginning of the summer in response to the Task and Finish Group report, Shelter Scotland said this “is not new money; it focuses existing allocation on acquisition, which is something that we very much welcome”.ii
Though Shelter Scotland appreciated the Scottish Government has to balance decisions, it believed “the current response in Scotland is insufficient to reduce harm”.ii The Scottish Refugee Council agreed and said, “there has to be a laser focus on capital spending on social housing”.ii
Shelter Scotland highlighted recent homelessness statistics that show the majority of homeless households have at least one identified support need while minority ethnic households spend longer in temporary accommodation that people from other backgrounds.i Shelter Scotland also referred to recent commissioned research i into the role of race in housing in Scotland. The report made a number of recommendations and called on the Scottish Government to use the budget to make progress on these recommendations.ii
Also, Inclusion Scotland highlighted a disproportionate number of disabled people live in social housing because, in many cases, they cannot afford their own home. Housing for disabled people needs to be affordable and accessible. Therefore, Inclusion Scotland said, “the less housing there is in the supply chain, the more it means that disabled people will often be stuck in inappropriate housing”.iii
Shelter Scotland also called for significant investment in frontline services, so they have the resources they need to deliver on existing housing rights and are prepared to deliver the suite of new housing rights such as the UN right to adequate housing.i
In response to the Committee Convener’s question concerning child poverty and temporary accommodation when the First Minister appeared before the Conveners Group on 27 September 2023, Humza Yousaf, said—
We are committed, without any exception, to acting on the recommendations of that group [temporary accommodation task and finish group]. That includes investing at least £60 million for councils and social landlords to acquire properties to use as social homes; asking social landlords to increase allocations to homeless households; and supporting councils that are facing the greatest temporary accommodation pressures to develop targeted plans. We will not rest until we have made progress in reducing significantly the use of temporary accommodation because, as I said, I am afraid that the latest statistics show a worrying trend and a worrying number of families and children in temporary accommodation, which is not acceptable.v
Further to this, the Cabinet Secretary’s letter of 5 October advised progress against the £60 million spend will be available in the annual out-turn report for 2023-24, as well as through Affordable Housing Supply Programme quarterly statistics, which includes the numbers of homes which are purchased “off the shelf”.
It is clear to the Committee from Shelter Scotland and the Scottish Refugee Council's evidence that there is severe pressure on housing supply and homelessness services. Eradication of homelessness needs to be seen as a priority if tackling poverty is going to be addressed as having a home is pivotal to having a stable life, to enter employment, access childcare or education, amongst other aspects of life.
The Committee acknowledges the affordable housing supply programme budget in 2021-22 was underspent and it seems that current levels of affordable home approvals have dropped.
The number of families in temporary accommodation is worrying and cannot be allowed to increase. The right to adequate housing has a significant impact on many other rights under the UN Convention on the Rights of the Child, such as their rights to health, safety, education and play. The Scottish Government will be aware there are downstream benefits to positive outcomes for children and their families and so preventative action taken now should ultimately result in savings to public services in the future.
The Committee asks the Scottish Government what action it is taking to ensure local services have the resources they need to deliver on existing housing rights, as well as ensuring that funding is in place and staff are prepared to deliver the suite of new housing rights, such as the UN right to adequate housing.
The Committee considers the £60 million funding for the acquisition of property to reduce the use of temporary accommodation and, making better progress with improving the supply of affordable homes, are both essential to make real and lasting progress on homelessness. The Committee asks the Scottish Government what action it is taking to ensure its housing budget is fully spent, including addressing any ‘blockages’ to spending.
It is unacceptable to the Committee that families, such as families with identified support needs (mental or physical ill-health, disability or medical condition) and minority ethnic households remain in temporary accommodation longer than others whether that is due to lack of suitable housing options or racial inequality.
The Scottish Government has a leadership role in delivering social homes that meet the needs of Scotland’s diverse population and to help build capacity within social landlords to ensure staff have the training and resources they need to better meet the needs of their tenants. The Committee asks the Scottish Government how it will exercise this role.
Private companies have contracts with the Home Office to provide asylum accommodation. Regarding the specifics of the housing situation in the asylum system, the Scottish Refugee Council described it as “a gross waste of public money—none of it goes to local communities or local authorities, and it certainly does not go to refugees”.i The Council likened this to the situation happening with homelessness and temporary accommodation where private landlords are benefiting from the shortage of social housing.
Although the Scottish Government’s Ukraine response was seen as positive by the Scottish Refugee Council, the Council said it “has exposed a fragility with regard to wider homelessness issues that we have been seeing in asylum for a while”.i Shelter Scotland agreed the homelessness system did not have capacity to absorb displaced Ukrainians and deal with the existing crisis and warned—
We need to be cautious about layering more and more expectation on to a diminishing capacity within service providers across the country.i
The Scottish Refugee Council considered there would be a heightened demand for housing in the immediate future because the rate at which the UK Government is taking asylum decisions is increasing, resulting in an estimated 2,500 asylum decisions between now and Christmas this year. It approximates that three quarters of claims would be granted refugee status.i The Council warned this has the potential to exacerbate the housing crisis, as refugees living in asylum accommodation must leave their asylum accommodation and find a place to live. If there is a shortage of housing, this increases the likelihood of them being at acute risk of destitution. The Scottish Refugee Council pointed out that Glasgow City Council is already struggling to meet its homelessness duties.i
The Scottish Government wrote to the UK Government on 29 October regarding, amongst other issues, requesting funding for local authorities to deal with the fast-track processing of asylum claims.vi
The Scottish Refugee Council considered the refugee integration policy in Scotland has been “positive and progressive, but the Scottish Government’s New Scots Refugee Integration Strategy (New Scots strategy), which is currently out for consultation, has not had teeth”, adding that the Strategy has not permeated Government policy on child poverty, transport or housing and called for the New Scots strategy to be mainstreamed.i
A more formal approach to refugee integration was requested by the Scottish Refugee Council. The Council suggested the Scottish Government needs to consider integration standards and integration services as currently these are short-term interventions for people when they move from the UK system to the Scottish system.i It was highlighted by the Council that around £15 million of asylum migration integration funds were awarded over the past five years. The Scottish Government had used this funding for various integration projects through the New Scots strategy, which the Council said is welcome. However, as a result of Brexit and European Union withdrawal, that funding will not exist from January 2024.iii
Rather than replacing the funds, the Scottish Refugee Council advocated taking a more proactive approach to integration. Central to this is the opportunity to be employed. The Council believed as refugees are spread across Scotland, the Government could encourage better joined up working between local authorities, the refugee sector, and employers on a national scale.iii
The Scottish Refugee Council also made a plea to maintain support for people who have been trafficked and for the Scottish guardianship service, so it can meet demand for its services.
Regarding support for people who have been trafficked, the Scottish Refugee Council stated the Illegal Migration Act 2023 would end access to support for trafficking survivors, including support that is provided for in sections 9 and 10 of the Human Trafficking and Exploitation (Scotland) Act 2015. The Council is not convinced that continuing support would be ultra vires as a joint legal opinioni was sought from Kay Springham KC by JustRight Scotland and the Children and Young People's Commissioner Scotland. The Council suggests this now rests on how the Scottish Government would defend itself if legal action was taken by a trafficked person against the Scottish Government for not providing support.i
In relation to the Scottish Guardianship service, the Scottish Refugee Council explained the independent advocacy service for unaccompanied refugee and trafficked children, is under huge pressure. It said there has been a massive increase in its work in the past few years, particularly since it became a statutory service on 1 April 2023. The Council said this pressure raises “huge child protection issues” as the service does not currently have the resources to meet demand.i
The Committee has discussed the priority of increasing housing supply earlier in this report, but it notes the specific case for ensuring there is sufficient housing for refugees. The Committee understands that for refugees, many of whom have been through traumatic experiences, a home to start their new lives, is an essential part of their journey and integration. The Committee acknowledges the potential difficulties arising from the increased speed at which people are moving through the system and the additional pressure this will bring to an already stretched homelessness system, particularly in specific local authority areas such as Glasgow.
The Committee notes the letter to the UK Government requesting funding to meet the impact on local authorities of the increasing speed of asylum decisions and asks what planning the Scottish Government has undertaken to estimate the impact of the number of claims being processed on the need for housing. Further to this, what action will the Scottish Government take to ensure there is sufficient resourcing for local authorities to meet this demand?
Trafficked people are one of the most vulnerable groups of people. The Committee notes from the Scottish Refugee Council 's evidence that the Illegal Migration Act 2023 would mean the Scottish Government can no longer provide support to trafficking survivors in accordance with sections 9 and 10 of the Human Trafficking and Exploitation (Scotland) Act 2015, without being open to legal challenge.
The Committee asks the Scottish Government for its views on providing financial support to people that are identified as being trafficked.
The Committee asks what analysis the Scottish Government has undertaken to identify the budgetary consequences of the UK Government's Illegal Migration Act 2023 and the reported plans of the UK Home Office to fast-track asylum claims.
The Committee recommends the Scottish Government provides sufficient funding to the Scottish Guardianship Service to continue to meet the demand for its services.
The Committee understands that the Scottish Refugee Council has been discussing refugee integration with the Scottish Government. The Committee asks what work it has undertaken to develop a more formal integration route for refugees, which includes national standards and the timescales for this work.
Kinship care is where a child who cannot be looked after by their parents is looked after by extended family or someone known to them. The Committee looked into the challenges faced by kinship carers and reported on 22 September 2022. One of the key issues raised was the financial support available to kinship carers, including the amount of financial assistance provided and the variation of assistance levels provided by local authorities across Scotland.
The Scottish Government announced on 29 August 2023 that there would be a new national allowance for foster and kinship carers. This is a commitment set out in response to the 2020 Independent Care Review and supported by the Scottish Government's Keeping the Promise Implementation Plani. The weekly allowances, which will be backdated to 1 April 2023, are:
0 to 4 year-olds: £168.31
5 to 10 year-olds: £195.81
11 to 15 year-olds: £195.81
16-years-old and over: £268.41.
The Scottish Government has announced £16 million funding for the new Scottish Recommended Allowance, which it estimates will benefit more than 9,000 children.ii
The Committee welcomes the creation of a Scottish Recommended Allowance, which fulfils one of the Scottish Government’s commitments in the Promise. As part of its follow-up actions to the Committee's report, the Committee will be hearing from the Minister for Children, Young People and Keeping the Promise soon to examine the level of funding for the Scottish Recommended Allowance, amongst other aspects. The Committee asks whether the Scottish Government considers the financial support being provided is sufficient to cover the rising costs of caring for children, particularly given the continuing cost pressures households are experiencing.
The Committee also asks the Scottish Government to provide further information about when local authorities will be provided with the £16 million funding to deliver the Scottish Recommended Allowance and how that funding will be distributed between local authorities.
SCVO emphasised the crucial role voluntary organisations play in communities, whether this is delivering care or employability programmes or maintaining community assets like village halls and museums. It also underlined that voluntary organisations “often become the voice of the forgotten—the people who are less able to act but who are most impacted by the decisions that this Parliament and the Scottish Government take”.i
Saheliya, which works with ethnic minority women experiencing gendered abuse, spoke about the specialist skills organisations have, such as itself, and their ability to bridge the trust gap between communities, marginalised groups and public authorities—
Carers allowance is not being applied for, support services are not being accessed, diagnoses are not being made, and people are not being registered as disabled. That process takes a lot of time, explanations and support in first languages, but we have sporadic funding for it.i
In terms of the sector’s contribution to a wellbeing economy, recent statistics from the Bank of England for the UK showed an estimated value benefit of “around £200 billion, but in national accounts it is £20 billion”.i SCVO also pointed to Volunteer Scotland’s work which states that 1.2 million formal volunteers equate to around £2.8 billion to the economy.iv
SCVO argued years of underfunding and poor funding practices coupled with the COVID-19 pandemic have left the sector facing financial challenges and pointed to the Equalities and Human Rights Committee report of 2019: Valuing the Third Sector, which stated “there is a clear need to investigate how the third sector is coping under tougher financial conditions”.i Showing the scale of the issue, SCVO said in May this year “a third of organisations reported that they are now using their reserves to top up services and pay staff decent wages” and added this is unsustainable, as 60% of organisations have reserves of only six months.ii
To address this SCVO called for “progress on funding and on seeing the voluntary sector as a true partner in the delivery of public services”.ii
SCVO notes that there are opportunities for the Scottish Government to address existing funding challenges. For example, it argued that the Scottish Government needs to align funding priorities and take immediate action to review and improve the grant making process and make progress on multi-year funding. Without action SCVO considered the sector’s efforts to offer fair work, support volunteerism and continue to provide the services and support communities rely on, are undermined.
Demonstrating the need for fair funding, Saheliya argued strongly that it is the only organisation representing women from racialised communities who have mental health issues resulting from gendered abuses and who are unable to access mainstream services. For Saheliya “funding is absolutely critical, and it must be predictable and consistent. We provide heavy-end services, but we do not know whether we will have funding for next year or the year after. We now have no long-term funding”.i
On the need for consistent funding, Saheliya stressed if the organisation has long-term funding for 5-10 years then for every £1 of statutory funding they can raise £3-5 from other sources—
If statutory funders give us some stability, we can demonstrate business continuity and other funders will go along with that—they will match fund that. That is critical.i
SCVO said there are organisations, that have been advised of an intention to fund, but are waiting for confirmation of their funding “five months into the financial year and have received no communication from the Scottish Government about it”, so can’t commit to spendingi—
Most of the organisations we have heard from have received an indicative funding letter which usually includes a line similar to ‘we expect your funding to be around X amount.’ This is not the formal confirmation of funding that organisations need to satisfy boards and auditors, to plan and deliver vital services.iv
In relation to non-statutory funding, SCVO said the Accounts Commission for Scotland said, “that local authorities and communities face a stark future, and if it is going to be grim for local authorities, it will probably be grimmer for voluntary organisations, particularly those that work on preventative services.”i This is because non-statutory services are usually the first to go, however, SCVO explained making cuts to those services has a knock-on effect on statutory services, as more people need to access emergency support.vi
Regarding whether the Verity House Agreementi (the Agreement) might help, SCVO was unsure, from its discussions with the sector, “there is a lack of optimism about the possibility of improved funding, better funding arrangements and better relationships with contracting authorities”. Although the Agreement would reduce ring fencing, SCVO believed unless the development of services changed to “outcomes, impacts and the services that are going to deliver the most benefit” there would still be an issue.i
SCVO explained several organisations had raised issues across pre-budget scrutiny sessions with different committees that echo many of the calls that SCVO is making through its ‘Fair Funding’ campaign, ‘Fair Funding for the voluntary sector’.i
SCVO welcomed the Scottish Government talking to it and other organisations about fair funding, however, there is no definition as to what that means in practice. in these discussions, SCVO noted mentions of multi-year funding and processes, but advocated the Scottish Government adopts SCVO’s fairer funding package.ii
SCVO stated it has been six months since the Scottish Government gave the commitment to develop a fair funding plan, meanwhile organisations are saying “this is their worst year in terms of their funding relationship with the Scottish Government, that is six months wasted”.ii SCVO further commented “there is a feeling that commitments and policies are announced with no thought as to how they will be implemented”.ii
SCVO asked for a new indicator in the 2028 National Performance Framework (as it understood it would not be possible in the current review) that measures the sector’s economic contribution. Currently, SCVO said there is no mention of the voluntary or third sector apart from volunteering in the Framework.ii
The Committee was concerned to hear robust evidence from SCVO regarding the financial pressures on the voluntary sector and its funding relationship with the Scottish Government, described by SCVO as the ‘worst year’. The Committee recommends a fair funding framework is developed and agreed as a matter of urgency; and would ask the Scottish Government what steps it is taking to secure this and what the timescale for delivery is likely to be. SCVO has been asking for multi-year funding for a number of years and the Scottish Government has previously committed to this. It is crucial this matter is resolved to ensure the vital work of the third sector is recognised and supported. i
The Committee asks what plans the Scottish Government has to investigate the financial pressures the voluntary sector is under and what other actions it can take to support the sector, given its valuable role in providing support and services to communities.
The Committee recommends that the Scottish Government investigates what is causing the delay within the Government’s funding system to voluntary organisations with the aim to rectify this as a matter of urgency. For the next financial year, the Committee expects the Scottish Government to issue timely formal confirmations and payments, to ensure crucial funds can be spent and organisations can seek match funding at the earliest opportunity.
The Scottish Council for Voluntary Organisations (SCVO) has set out its fair funding framework. The Committee asks the Scottish Government what its definition of fair funding is and where this differs from SCVO’s framework.
Regarding the uprating of devolved benefits, the Programme for Government stated the Scottish Government will "support people with the cost of living by increasing the Scottish Child Payment, Funeral Support Payment and all disability and carers benefits in line with inflation."i
The Poverty and Inequality Commission called for all benefits, “at the very least” to be uprated in line with inflation. Specifically, the Commission wanted the UK Government to address the adequacy of Universal Credit as a matter of urgency. The Commission noted the removal of the £20 uplift provided during the pandemic, plunged many families back into deep poverty and pointed to Joseph Rowntree Foundation research which showed that the number and proportion of children living in households in deep poverty, where they cannot afford essentials, is growing. Universal Credit, the Commission argued, should be at a level to “enable people to have those essentials, such as food, energy and a roof over your head”.ii
The Joseph Rowntree Foundation explained that disability benefits are the biggest cost in the devolved social security budget. The Foundation stated if the UK Government fails to uprate disability benefits in “real terms” this will cause a big problem for the Scottish Government as “the Scottish Government is already spending more per head than the UK Government on those payments”.iii
The cost of living crisis impacts disproportionately on low income households and particularly on disabled people. Inclusion Scotland stated that disabled people need more financial support to cope with increased energy costs and recommends that the winter heating payment should increase from £50 to at least £100.i It said that 800 people were hospitalised over three weeks last winter due to hypothermia.ii Inclusion Scotland estimates increasing the payment would cost £20 million, but it would help the poorest households and half of those households have a disabled adult or child.ii
When asked about the level of payment when the Committee considered the regulations that give effect to the Winter Heating Payment, the former Minister for Social Security and Local Government said that, on average, a £50 payment is more than most would have received from the cold weather payment and although higher amounts had been considered by the Scottish Government, it decided the budget was too constrained to deliver more. The Minister added that decisions related to uprating were part of the budget process and could not be commented on.iv
Inclusion Scotland discussed the impact of potential changes to UK social security benefits, which could impact on the funding Scotland receives. For example, it noted that changes were currently being made to the work capability assessment regime and “that will indirectly impact on Adult Disability Payment [ADP] in Scotland”.i Inclusion Scotland speculated that if the assessment regime for Personal Independence Payment (PIP), was similarly changed then far fewer people would be eligible for PIP. If the Scottish Government kept its existing criteria the funding gap would grow and it would have less money to fund ADP, meaning it would need to decide whether to make the same cuts or fund the difference.
The Committee sees social security as an investment in people, and it is therefore crucial that the Scottish Government ensures it prioritises funding for this. To do this it should set out medium to long term solutions to close the forecast funding gap between social security Block Grant Adjustment and social security forecast spend. It also needs to be prepared for how it will meet its funding commitments on social security if and when Scottish and UK social security policies diverge further over the coming years.
In terms of uprating, the Committee notes that there is a legislative requirement under section 86B Social Security (Scotland) Act 2018 to uprate certain benefits. There are other benefits such as Best Start Grant, Best Start Foods, Job Start Payment, Winter Heating Payment which are not required by legislation to be uprated.
Regarding Winter Heating Payment, the Committee notes that the former Minister said last year that the budget was “too constrained” to deliver a higher payment. Also, the Committee recognises the Scottish Government has increased its investment in the Fuel Insecurity Fund to £30 million.ii (Letter of 14 July)
The new Consumer Prices Index (CPI) was announced on 18 October and rose by 6.7% in the 12 months to September 2023, the same rate as August.iii We recognise the importance of maintaining the real-terms value of benefits. Therefore, we expect the Scottish Government to uprate all Scottish benefits by the September CPI of 6.7% and if this does not happen, we require detailed justification as to why not. We look forward to scrutinising the annual uprating report when it is published later this year.
In addition, we ask the Scottish Government what consideration it gave to the decision to invest in the Fuel Insecurity Fund against increasing the Winter Heating Payment.
The Committee is very much sighted on the impact that changes to UK benefits can have on the effectiveness of Scottish Government policies, such as the removal of the Universal Credit £20 uplift, on for example policies to tackle child poverty. The Committee’s previous budget reports have covered this in some detail. In relation to the divergence of UK and Scottish benefits, the Committee is continuing to keep a watching brief on the potential impact on the Block Grant Adjustment (BGA). In this respect, the Committee notes the Scottish Fiscal Commission’s May 2023 forecast states that the difference between PIP BGA, and Scottish spend on ADP is -£569 million in 2027-28.iv This is a smaller gap than had been forecast in December 2022, when the Commission estimated the gap would be -£659 million.v The Committee notes the figures will be updated again in December by the Commission and it intends to take evidence from them early in the new year.
In addition to reprioritisation of spending, witnesses considered the Scottish Government would also need to raise revenue to meet its commitments and the funding gap.
The Joseph Rowntree Foundation asserted the need to take a longer term view to funding, stating that “by failing to tackle child poverty we are perpetuating the issues that our society faces. Creating a vicious circle that we choose to maintain. As a result it is incumbent on the Scottish Government and each of the opposition parties and MSPs to move the debate from single budget lines to more fundamental questions about how we raise and spend public money”.i
When asked about when the Scottish Government should address the increasing social security spending gap, the Fraser of Allander Institute said it is “risky to push it down the road and hope that more beneficial economic news will come out” and added the Scottish Government will be aware action has to be taken to close the gap, however, the Institute underlined the Government must now carefully think about whether it has the right processes and contingencies in place.ii
The Scottish Human Rights Commission and the Poverty and Inequality Commission considered the Scottish Government will need to raise additional revenue by making full use of its devolved tax powers. The Poverty and Inequality Commission advised it is due to make specific recommendations when its tax working group reports this monthiii, and shared its broad conclusion—
Our conclusion is that, largely, the Scottish Government’s tax policies are progressive and are making a difference, because the additional revenue that is being raised and the spending choices that have been made have tended to benefit lower-income households. They are therefore redistributive.iv
SCVO directed the Committee to the new joint briefing paper, The Case for Fair Tax Reform. published in September 2023 which seeks to add momentum to the Scottish Government’s Tax Advisory Group’s work and suggests changes to tax policy.ii
Looking at fiscal sustainability, and the scale of the Scottish Government’s ambition to reduce child poverty by 2030-31, the Poverty and Inequality Commission said the Government will need to focus on not just tweaks to the current tax system, but a “redesign for the short and long term, including local taxation”. The Commission favoured an urgent revaluation of properties, which has not happened since 1991.i
Similarly, the Fraser of Allander Institute considered there is a need for revaluation, stating “not having one starts to undermine the whole purpose of the system” and added that the Institute is involved with the Scottish Government’s tax advisory group.i
After the Committee had concluded taking evidence, the First Minister announced on 17 October that council tax rates will be frozen in the next financial year to support people struggling with the effects of high inflation. It will apply to all council tax payers. The First Minister further stated this would be fully funded.iii
The Poverty and Inequality Commission believed “some devolution of further powers, through agreement with the UK Government” is necessary and highlighted specifically power over savings and dividend income to stop people avoiding paying income tax on earnings.i
The Committee acknowledges that the Scottish Government is working with a constrained budget, a challenging economic situation and a demand led social security budget, as such there are very limited options available to the Scottish Government beyond reprioritising funding to where it will have the greatest impact. Therefore, the Committee recognises raising additional revenue will require some serious and detailed consideration as to how the Scottish Government will do this to meet its existing commitments and future budgets. It is clear to the Committee the Scottish Government will have to work with its partners, for example, local authorities and others, including political parties, to set a clear path towards fiscal sustainability. The Finance and Public Administration Committee is leading on this aspect.
The Committee acknowledges the ongoing debate in relation to council tax reform and replacement of council tax in the context of a wider review of local government funding more generally. The Committee asks the Scottish Government for its latest consideration of these matters and how this may impact on funding budget settlements.
Given the Committee’s remit and its principal focus on social security and inequality, the Committee expects to see detailed analysis of how the tax measures in the budget will impact on different income groups, including on the six priority family types for the child poverty targets.
A number of committees have been working on improving transparency, accountability, and participation in the budget process.
Most of the witnesses noted there has been progress towards a more transparent budget.
The Scottish Human Rights Commission said it was repeating the open budget survey it carried out four years ago, with a view to publishing results in May 2024. The Commission noted the Scottish Government has committed to engaging with the process showing a willingness to participate and to take fiscal transparency seriously.i
Witnesses were, however, looking for more to be done to make the budget more transparent for their needs.
Fraser of Allander Institute pointed to work being done “to look at modelling and presenting the distributional impact of tax, social security and spend”, which it hoped would be implemented for this, and future budgets.i
Also, the Institute commented—
It can be quite difficult to navigate through the budget documents and understand what is new spending and what is existing spending that is continuing or is simply being re-announced.i
An example of the difficulty in tracking funding decisions was highlighted by SCVO. It said social enterprise is moving to the Business and Economy directorate, which means there will be a difference to the third sector support budget line. SCVO asserted this change, along with any other cuts or increases, will make it difficult to know whether it is a good budget announcement for the sector.i
SCVO added the Scottish Government could also be transparent about how it spends consequentials to help the sector understand why it has not been prioritised. This, SCVO said, would also help to build trust between the sector and the Government.iv
To address this type of issue the Fraser of Allander Institute asked for a more concise budget document that concentrates on new decisions made for that financial year. On the ability of the Scottish Government to deliver this when the detail of the UK’s autumn budget is only available a few weeks prior, the Institute explained a lot of the issues could be dealt with in advance leaving only the final decisions to the weeks before publication, stating “it is not a time issue, but the approach taken to writing and preparing the budget”.i
In terms of funding cuts, the Fraser of Allander Institute said it would “expect to see robust analysis of the impact of reducing expenditure and an explanation of the process taken to decide where reductions in spending are being made alongside impact assessments for new spend.”vi
The Scottish Human Rights Commission emphasised budgetary allocations have to be underpinned by “looking at the minimum core, defining and measuring it, and seeing who is and who is not receiving that minimum level of service provision”.i
Regarding child poverty, the Poverty and Inequality Commission said there is a clear way of identifying those in need by using the six priority groupsi – 90% of children in poverty are living in those families.ii
Saheliya was concerned about how a human rights-based approach to funding could be delivered, particularly given the reliance on census data, which is 10 years out of date and the census is not accessed by most of its service users as they are scared of authority and are “often illiterate in any language” and have low-level English skills.i
Inclusion Scotland said after the incorporation of UN human rights legislation into Scots law everything will be assessed for its human rights impact. However, it commented on the quality of current equality impact assessments, stating that they are carried out by people who have no insight into the needs of the various characteristic groups and so the assessment concludes there will be no impact.i
SCVO recognised that improving data infrastructure is complex but wanted the Scottish Government to commit to ongoing improvements such as adopting the 360Giving data standardi and tracking fair funding metrics.i
It also drew attention to the information SCVO collects from charities’ accounts and publishes. As the Scottish Government does not have the resource to gather this information, SCVO said the Government often relies on SCVO’s estimated data to understand the number of organisations the Government is funding and what the funds are.ii
The Scottish Human Rights Commission gave an example from the UN Committee on the Rights of the Child, which was reviewed recently and suggested the Committee should question the Scottish Government about, “What is it going to fundamentally change about the way it is currently budgeting to tackle child poverty and to demonstrate that it will have an impact on that statutory duty?”.i
On this point, the Poverty and Inequality Commission noted it is hard to determine or compare the budget for child poverty commitments.ii
SCVO supports the Scottish Government’s vision to transition to a wellbeing economy. However, it argues a crucial gap remains in that “the significant contributions of the voluntary sector to this vision remain largely unacknowledged there is a widely held misconception that the voluntary sector is outside rather than part of the economy”.i
Witnesses called for a greater focus on gaining a better insight into the Scottish Government’s decisions and who would benefit from them most. The Committee notes that spending on tackling child poverty is difficult to present in the budget given the cross-cutting nature of policies that impact on child poverty. However, the Committee is aware the Scottish Government’s Best Start Bright Futures progress report does include estimates.ii
From the evidence received it is clear to the Committee that witnesses were looking for a lot of different information to inform their understanding of the budget, for example:
setting out clearly any new spending
noting where funding has been reprioritised or cuts have been made in allocated funding
explain how consequentials from the UK Government are allocated
the distributional impact of tax, social security and spending
defining, setting and measuring the minimum core needs
engagement on Government spending priorities
spending on cross-cutting policies, such as, tackling child poverty
total spend in a specific sector, for example, the third sector
information on the economic value of a specific sector, e.g. the third sector
improved data on spend, including for grant funding and for hard to reach communities
The Committee asks the Scottish Government to consider the suggestions listed above through the annual budget documents or by some other means and if this is not feasible, explain why not. For example, SCVO finds it difficult to understand whether the budget announcement is positive for the third sector, so the Scottish Government could set out the total Government funding for the voluntary sector and the sector’s contribution to the economy could be a separate exercise. Similarly, the Scottish Government could undertake engagement with the voluntary sector on Government spending priorities, which could be a separate piece of work to inform the general direction of budgets.
There are real challenges for public participation, including how to involve the public in setting the overall priorities for spending and how public participation can be done in a meaningful way, particularly as many witnesses have said budget documents are difficult to understand.
The Scottish Refugee Council found the term ‘lived experience’ indirect in itself and stated, “we just want to understand what life is like for people” it added—
We want to privilege that evidence—not in a charitable way but in a way that recognises what it is that they are sharing, which is insights that, often, the people who are asking the questions do not have.i
To help organisations work with lived experience groups on contributing to the budget process, the Poverty and Inequality Commission said people needed to be involved “right at the start in developing and designing solutions to the poverty that they face” adding that the budget is one of the key areas in which they should be involved but recognised the challenges as some of the budget documents are still “very opaque”.i
Inclusion Scotland shared a best practice example of participation, referring to the people-led policy panel on social care policy held with Scottish Government officials and local authorities amongst others.i It said involvement needs to happen way before even pre-budget scrutiny, throughout policy development as well as in the final decisions.i
Shelter Scotland considered engagement needs to be over a period of time, though for example, participatory panels or sector-based engagement. It believed using the human rights approach to budgeting would “give a framework for how we can involve people in the decisions about where money goes in their communities”.i
As part of its work on human rights budgeting and increasing public participation in the budget process, the Equalities, Human Rights and Civil Justice Committee gathered information through a survey to reach a wider audience, particularly individuals.
The Committee notes for the 2023-24 budget the Scottish Government published a ‘public facing’ summary, 'Scottish Budget 2023-24: Your Scotland, Your Finances - guide'. The Committee welcomes this positive step, though from the evidence the Committee has received there is a need to have greater involvement of the public in all parts of the process and for this involvement to be over a longer period of time. We draw the Scottish Government and other committees' attention to the evidence gathered on involving the public in the budget process.
The Committee has been following with interest the work of the Equalities, Human Rights and Civil Justice (EHRCJ) Committee, and had some involvement with, the Committee’s 2024-25 Pre-Budget engagement 'The impact of the Scottish Budget on the public'.
There is significant crossover between the stakeholder groups of the two Committees. The Committee thanks the EHRCJ Committee for working collaboratively and sharing the results of its call for views to see what issues are important to people. Also, the Committee is grateful to the EHRCJ Committee for inviting members of the Committee to participate in the sessions it held with the Whole Family Equality Project Citizen Panel. This has been extremely helpful in informing the Committee’s approach to its future pre-budget scrutiny.
You can read minutes of the Committee's meetings at the Scottish Parliament website: Social Justice and Social Security Committee - Meetings
Extracts from the minutes of meetings of the Social Justice and Social Security Committee:
Decision on taking business in private—
The Committee agreed to take items 4, 5 and 6 in private.
6 Budget Scrutiny 2024-25 (In Private)—
The Committee considered and agreed its approach to Budget Scrutiny 2024-25.
The Committee also agreed that any further approach papers, consideration of evidence received, and any draft letters or reports should be considered in private at future meetings.
19th Meeting, 7 September 2023
Decision on taking business in private—
The Committee agreed to take items 5 and 6 in private.
6 Budget Scrutiny 2024-25 (In Private)—
The Committee considered and agreed its approach to Budget Scrutiny 2024-25.
21st Meeting, 21 September 2023
Decision on taking business in private—
The Committee agreed to take items 4, 5 and 6 in private.
Pre-Budget Scrutiny 2024-25—
The Committee took evidence as part of its Pre-Budget Scrutiny 2024-25 from—
Chris Birt, Deputy Director for Scotland, Joseph Rowntree Foundation;
Emma Congreve, Deputy Director, Senior Knowledge Exchange Fellow, Fraser of Allander Institute;
Dr Alison Hosie, Researcher, Scottish Human Rights Commission;
Bill Scott, Chair, Poverty and Inequality Commission.
4 Consideration of evidence (In Private)—
The Committee considered the evidence heard earlier in the meeting.
23rd Meeting, 28 September 2023
Decision on taking business in private—
The Committee agreed to take item 6 in private.
Pre-Budget Scrutiny 2024-25—
5 The Committee took evidence as part of its Pre-Budget Scrutiny 2024-25 from—
Paul Bradley, Policy and Public Affairs Manager, Scottish Council for Voluntary Organisations (SCVO);
Alison Davis, Business Manager, Saheliya.
6 Pre-Budget Scrutiny 2024-25 (In Private)—
The Committees considered the evidence heard earlier under agenda item 5.
Decision on taking business in private—
The Committee agreed to take items 3, 4 and 5 in private.
2 Pre-Budget Scrutiny 2024-25—
The Committee took evidence as part of its Pre-Budget Scrutiny 2024-25 from—
Bill Scott, Director of Policy, Inclusion Scotland;
Graham O'Neill, Policy Manager, Scottish Refugee Council;
Gordon MacRae, Assistant Director (Communications & Advocacy), Shelter Scotland.
3 Pre-Budget Scrutiny 2024-25 (In Private)—
The Committees considered the evidence heard earlier under agenda item 2.
Pre-Budget Scrutiny 2024-25 (In Private)—
The Committee considered a draft report on its Pre-Budget Scrutiny 2024-25. Various changes were agreed to, and the Committee agreed to consider a revised draft, in private, at its next meeting.
26th Meeting, 02 November 2023
Pre-Budget Scrutiny (In Private)—
The Committee considered a draft report on its Pre-Budget Scrutiny 2024-25. Various changes were agreed to, and the report was agreed for publication.