Social Justice and Social Security Committee

Meeting date: Thursday, September 16, 2021

Official Report 572KB pdf

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Social Security (Up-rating of Benefits) Bill

Welcome back, everyone. We move to agenda item 4, which is consideration of a legislative consent memorandum on the Social Security (Up-rating of Benefits) Bill. It is a UK Government bill that was introduced in the House of Commons on 8 September. It is following an expedited timetable and is currently awaiting its second reading in the House of Commons. The bill will change the law on devolved matters, so legislative consent is being sought from the Scottish Parliament.

I welcome Ben Macpherson, the Minister for Social Security and Local Government, and Matthew Duff, who is a social security policy adviser with the Scottish Government. I invite the minister to make a brief statement on the LCM, then we will turn to questions from members.

Thank you. I am grateful for the opportunity to join you to discuss the legislative consent memorandum and the associated legislative consent motion, which was lodged in the Scottish Parliament on 10 September. I am grateful for your swift consideration of the issue at short notice.

As you know, the UK Government has introduced legislation to suspend the triple-lock formula for calculating the amount by which state pensions and benefits that are linked to earnings should be uprated for the year 2022-23. The Social Security (Up-rating of Benefits) Bill was introduced on 8 September. It gives UK ministers powers to uprate pensions and benefits that are linked to earnings by 2.5 per cent, or in line with the increase in prices, instead of in line with annual earnings.

It also proposes to give equivalent powers to the Scottish ministers to uprate industrial death benefit in Scotland. The provision will affect about 300 recipients of industrial death benefit in Scotland. IDB is devolved, but is currently administered by the Department for Work and Pensions under an agency agreement. Industrial death benefit is paid to the spouse or dependent of someone who died as the result of an industrial accident or disease. It was abolished in 1988 for deaths occurring after 1988, and new claims were abolished in 2012.

We were informed of the decision by the UK Government only on 6 September. In light of the tight timescales that have been afforded to us, the need to protect the payments of the 300 IDB clients, and our overriding commitment to safe and secure delivery of Scottish disability benefits, we have considered carefully how to proceed.

I consider an LCM to be the right course of action to enable uprating of IDB, which is required under the terms of our agency agreement with the UK Government. If the agency agreement with DWP were to be terminated, we would have, in a short space of time, to make arrangements to administer IDB, which would be very challenging.

Because industrial death benefit can be paid only when it relates to a death that occurred before 1988, many of the 300 cases are more than 30 years old and are all held on paper files. If the Scottish Government were to decide to administer IDB according to the timescale, it would need to identify relevant Scottish cases and transfer them from clerical files to a new system, which would be time consuming and would require significant resource. To build, in effect, a new benefit, and to progress primary legislation on an expedited basis within the timescale, when the benefit delivery programme is already operating close to capacity, with child disability payment, adult disability payment and Scottish child payment roll-out all happening this year and next, would not be achievable.

Designing, building, procuring, securing the necessary agreements and collecting the required data for a new system would require significant time and resource. For context—this is important—the legislation to introduce the Scottish child payment took 17 months, and the carers allowance supplement took two years from announcement to delivery. Therefore, for practical and delivery reasons, on balance I consider an LCM to be the right course of action.

Moreover, the only alternative legal mechanism to a legislative consent motion would be to introduce equivalent Scottish primary legislation. We would need to have primary legislation in place before the Secretary of State for Work and Pensions concludes her review of benefit rates by mid-November, in order to ensure that the 300 recipients of the benefit would not fall out of payment. That would mean that scrutiny would have to take place under an emergency timetable with all stages of the bill happening in one day after the October recess. The agreement of the UK law officers, the Lord Advocate and the Secretary of State for Scotland to expedited royal procedures would be required so that the Bill could be similarly enacted by 26 November. Even if that were feasible, I would not consider it to be good use of parliamentary time.

Overall, co-operation in this instance is therefore necessary to maintain the agency agreement for IDB, and to protect the delivery of our existing programme. I emphasise that we continue to support maintaining of the triple lock, and that we oppose the decision to suspend it by the UK Government. It is a decision that we have no control over, and of which we had very little notice.

I should also say for clarification that the committee will have noted the letter from the Delegated Powers and Law Reform Committee, which has considered the LCM and deems it to be acceptable in the circumstances. The DPLR Committee has also identified a minor error in the memorandum, at paragraphs 4 and 8, which refer to the current bill creating a discretionary power to uprate, whereas the bill places a duty to uprate on the secretary of state and—in devolved areas—on the Scottish ministers. Letters to this and the DPLR Committee will be forthcoming to clarify the point.

Thank you, convener. I look forward to questions.

Thank you very much. I am looking around the room to get an indication of whether members have questions.

Your statement throws open areas of concern that we have about the interaction and relationship between UK Government and Scottish Government, and underlines why we are so keen to have the Secretary of State for Work and Pensions come before us, at a time of her choosing, to discuss those areas and to ensure that the two Governments are working and communicating well together in order to ensure the best delivery of social security.

Thank you, minister, for drawing the matter to our attention. I see no reason why we should not support the LCM. In fact, I think that if we do not, we will deny payments to some individuals. I agree that a legislative consent motion is the right thing at this time.

We are constantly hearing about additional changes to benefits; this morning we heard from a number of poverty organisations strong evidence that we need to be doing things around eligibility for disability benefits and carers benefits sooner rather than later. We hear consistently that the system is almost at capacity in terms of safe and secure delivery of the benefits that we are already delivering. Is now the time to look at capacity in the system, and to consider what additional resources might be needed?

I thank Pam Duncan-Glancy for her support for the course of action, and for that important question.

You will be aware of the significant resource that has been invested in capacity building, structures, IT equipment and systems, and—of course—in the agency itself. There has been significant investment in staff, which is ongoing; the recruitment process continues at pace. Significant resources are going into Social Security Scotland.

I am not fully sighted on all the evidence that the committee heard this morning, due to having been on my way to the committee. I am, of course, aware of stakeholders’ various considerations in terms of what the wider social security programme looks like, and of what we are doing in the round.

The social security system is at a crucial point of delivery. Roll-out this year in the months ahead of the child disability payment will be a significant milestone, and the adult disability payment will come next year. We will undertake safe and secure transfer of existing cases as quickly, safely and securely as possible. We have to do that in a way that builds strong foundations for the system and—this is most important—delivers payments to people who are expecting them. We will need that capacity and strong foundation in the years ahead to ensure that we do not have a two-tier system in which some people in Scotland benefit more than others as a result of case transfer. There are all those considerations.

I feel that now is not the time to talk about disability benefits in the round, although I am sure that it is something that we will talk about collectively in the weeks ahead. The Cabinet Secretary for Social Justice, Housing and Local Government is coming to committee next week; I wonder whether the wider programme will be something that you wish to discuss with her.

I appreciate that response. Are there any other questions?

I reiterate your point about intergovernmental links, which must be improved. You mentioned records that are on paper. What percentage of records that are now within Social Security Scotland are in paper form?

In Social Security Scotland we are building an agile electronic system through which people can make paper-based applications if they wish. That is because we are committed to that through the Social Security (Scotland) Act 2018, in which there is the principle of inclusivity in order to ensure that people can apply in the way that is most suited to them. Such applications are appropriately processed into our wider IT infrastructure.

The 11 benefits that we are delivering, 7 of which are new, are electronically managed and organised. The paper-based cases are historical cases for which responsibility has been devolved under the Scotland Act 2016. We are administering them under an agency agreement for a number of reasons, among which are the practicalities that have been highlighted.

I will bring in officials in a minute. As I said in my opening remarks, the industrial death benefit was closed some time ago, which is why cases are in paper format.

Matthew Duff might want to say more.

I re-emphasise the point that industrial death benefit cases are almost entirely clerical. It is worth saying that there is a major challenge for us going forward in moving those clerical files on to a modern and updated system. It is important to say in this context that that will be a big challenge for the particular suite of benefits.

That is very helpful. Given that we have seen the cost double for the establishment of Social Security Scotland, has that work on case transfers been significantly underresourced?

No, because we are currently delivering that with the DWP under an agency agreement. The costs are to ensure that we have the appropriate staffing for a strong foundation, and so that we can deliver social security in Scotland proficiently through the period ahead, as we have done since 2018. We are on a trajectory to have similar costs to the DWP for administering social security. We are doing the work in an appropriately efficient and professional manner, as you would expect.

From looking at the original estimates, the Social Security Scotland staff requirement has doubled from the original estimate of 1,900 to more than 3,500, so what you have just said does not stack up against what has actually happened.

I do not think that the questions are fully relevant to the LCM, but I will be happy to follow up on that with Mr Briggs and the committee afterwards. I am aware that there has been correspondence or parliamentary questions on the matter from Mr Briggs.

The estimates have increased, but the delivery of social security in Scotland on the trajectory that we are on at the moment means that spend on the delivery of social security will be similar to that of the DWP.

Remember that we are recruiting staff to deliver benefits, as the people of Scotland asked for in elections, and which we committed to as parties through the 2018 act. We are creating good employment opportunities and wider macroeconomic benefits. There is significant benefit—from a client’s perspective and from the wider perspective of the communities of Scotland—from what we are doing in social security .

I have let the conversation go off at a slight tangent from the matter that is before us. I am sure we will have more opportunities to explore issues that have been raised beyond the LCM.

I thank the minister and Mr Duff for their time; it is very much appreciated.

10:59 Meeting continued in private until 11:19.