Welfare Reform (Further Provision) (Scotland) Bill
The next item of business is a debate on motion S4M-03406, in the name of Nicola Sturgeon, on the Welfare Reform (Further Provision) (Scotland) Bill. I call the cabinet secretary to speak to and move the motion. You have a generous 10 minutes. I am sure that interventions will be welcome.
15:44
I welcome all interventions. I think that I welcome all interventions. [Laughter.] There may be one or two exceptions to that general rule.
Thank you, Presiding Officer, for your generosity in telling me that I have a flexible 10 minutes.
As we reach the final stage of the bill, it is worth reflecting that it has been an unusual bill. Although I did not agree with him about amendments 1 and 2, Michael McMahon was right to talk about the unique nature of the bill. It came about as a result of an unprecedented partial refusal of legislative consent by the Parliament, it has had to be progressed to a United Kingdom Government timetable that is not of our making, and of course it concerns welfare—a matter that, under the current constitutional arrangement, is almost entirely reserved to Westminster.
The bill has presented the Government and the Parliament with some unusual challenges. We have had to struggle to articulate the financial impacts of the bill because its effects are so dependent on the impact of a set of United Kingdom Government regulations, the details of which were not clear or fully known during the course of the bill process. I am grateful to the convener and members of the Finance Committee for their understanding and forbearance in deferring the more detailed consideration of the financial implications until the subordinate legislation stage.
It is also fair to say that this Parliament has traditionally and rightly been suspicious of legislation that is entirely enabling and hands sweeping powers to ministers without properly explaining how they will be used. I understand those concerns, which were well articulated by the Subordinate Legislation Committee. However, as I have said all along, I remain of the opinion that we have simply had to take account of the reality of the situation that we face. The approach that we have adopted to the bill has been appropriate and proportionate in those unusual circumstances.
I want to offer my sincere thanks to the members of the Welfare Reform Committee and to the many individuals and stakeholder groups who have contributed to the progress of the bill. I am sure that nobody in the chamber would underestimate the task that the members of the Welfare Reform Committee took on when they agreed to join the committee. I hope that they do not think that I am being in any way condescending when I say that all of them would acknowledge that they had a steep learning curve, as did I, in coming to grips with the subject matter. That had to be done in a short time, and I think that the members of the Welfare Reform Committee are to be commended for their enthusiasm and the sense of commitment that they brought to the task.
I think that the work has been interesting, and I hope that the members of the Welfare Reform Committee will agree. The committee has shown a desire to get under the skin of the impacts of the UK Government’s reforms, to the extent that we have the detail that would enable it to do so, and has been successful in that regard. It was particularly good that the committee brought together representatives of the banking sector and credit unions to talk about some of the difficulties that people might experience in managing income and household bills. That is particularly important in light of the UK Government’s proposals to pay monthly in arrears and directly to tenants—something that, as I have said previously, I have considerable concerns about.
I agree with the cabinet secretary about the potential damage that that could do to families. It might also encourage people to go to payday lenders. She will know that the Scottish Parliament cannot regulate that area, but I have put forward a proposal for the Government to use its advertising budget better to warn against the dangers of payday loans—a sort of wealth warning rather than a health warning.
I hope that there is widespread consensus in the Parliament on that issue. I am happy to consider Kezia Dugdale’s proposals and ensure that she gets a Government response. We would all take the opportunity to condemn some of the worst practices of the payday loan operations.
The committee also heard from the British Medical Association about some of their concerns about the implications of the reforms for the mental and physical health of patients and the ability of the profession more generally to continue to maintain the high standard of care that its members expect to be able to provide.
I have mentioned those impacts because they are examples of some of the less obvious impacts and they demonstrate the intelligent approach that the committee took to its work to shine a light into some of the darker corners of what we are dealing with and get to the bottom of what the reforms will mean in practical terms.
I am sure that the members of the committee will agree with me when I say that, in making the headway that they have made, they have been entirely dependent on the experience and knowledge of the stakeholders who have spoken to them and submitted evidence, and I want to put on record our heartfelt thanks for the work that they have done and will continue to do on behalf of the people they represent.
The work and involvement of stakeholders is at the heart of the bill process. Going back to the earlier debate on one of the amendments, I want to put on record the fact that it is the intention of the Government to ensure that stakeholders continue to be involved and consulted and come with us every step of the way. That is a sincere commitment.
Does the cabinet secretary believe that there might still be a place for draft regulations as part of that consultation?
We will look at every way in which we can consult, but we must be mindful of the timescales. It has been said before, and I say it again, that we have no control over the timescales on when we have to make regulations or over what information will or will not be available to us. It would be wrong of me to commit to things that cannot be delivered consistent with our commitment to ensuring continuity of payment of passported benefits. With that caveat, we will do everything in our power to consult stakeholders in an open and meaningful way in order that we get things right. That is in all our interests, and that is what we all want to achieve.
I will move on to some things that came out of the bill process. In the evidence that the committee took, we started to see some of the human stories that perhaps get lost when we talk in overall terms about cuts and reforms of such a scale. We are all aware, for example, that disabled people who live in Scotland will see the budget for their support cut by £250 million as a result of the United Kingdom Government’s changes, but the Lothian Centre for Inclusive Living told us about a young lady who has been confined to a wheelchair for most of her adult life and stands to lose her entitlement to the higher rate mobility component of £51.40 per week if she fails the reassessment because she can self-propel her wheelchair for more than 50m. That is a possible impact of the reforms that really brings the human impact to bear.
We are all aware that it has been estimated that there will be a £100 million annual reduction in the level of housing benefit that is paid out. Thanks to Citizens Advice Scotland, we are also aware that the changes mean that a 30-year-old woman who claims local housing allowance for a one-bedroom private tenancy in Edinburgh might have to choose between moving into a shared tenancy or losing around £47 every week in local housing allowance payments. Again, that is a real example of the potential impact of the reforms.
There was a commitment in the Scottish National Party’s 2011 manifesto to try to devolve housing benefit to Scotland. What progress has been made on that? Is that still a commitment, given that a recent discussion paper that has been issued says that that is no longer one of the Government’s six main priorities?
I have a great deal of respect for Siobhan McMahon’s genuine and heartfelt contributions to these debates. However, SNP and Labour members in particular should not look to divide on welfare reform issues. We have an obligation to stand up for the people of Scotland and ensure that we are doing everything in our power.
It may have escaped Siobhan McMahon’s notice that the SNP wants all such powers to be devolved to the Scottish Parliament because we want Scotland to be independent. One of the real reasons why I will so enthusiastically and passionately campaign for independence over the next couple of years is that I do not want welfare and our welfare system to be in the hands of the right-wing Tory Government that is currently in office in London. I cannot understand why people such as Siobhan McMahon would prefer the Tories to run welfare rather than the Scottish Parliament. She will have to explain that.
We know that 170,000 households in Scotland could lose out as a result of the introduction of the universal credit. Save the Children shared the example of a single parent with two kids who currently works for 25 hours a week. It explained that she will be £52 a week worse off, which will push her and her children below the poverty line.
Those are just some of the stories behind the numbers. It is important that we remember the human stories behind the big numbers and the big arguments, as we represent those people and have a duty to protect them to the best of our ability. The Government will do everything that we can to protect people in Scotland from the worst impacts of the welfare reforms.
I make no apology for saying that the only way in which we can protect Scotland from not only the reforms that are going through Westminster but those that David Cameron set out earlier this week, is to ensure that powers over welfare pass to the Scottish Parliament so that we can design a welfare system that reflects the values of this Parliament and the Scottish people.
It is with pleasure that I move,
That the Parliament agrees that the Welfare Reform (Further Provision) (Scotland) Bill be passed.
15:55
In its stage 1 report on the bill, the Welfare Reform Committee referred to the evidence that it had considered as “unrelentingly depressing”. As we come to the conclusion of the Parliament’s consideration of the bill, we start to look towards the future and, as the Scottish Council for Voluntary Organisations has said, we begin to think about moving from process to principle.
In the three debates that we have had on the subject of welfare reform in this session so far, beginning with the issue of the legislative consent motion and then consideration of the Scottish Government’s legislative proposals, Labour and Scottish National Party members have been largely united in our opposition to many aspects of the reforms to our welfare state that the coalition Government has embarked on.
At each stage, however, we have been at pains to point out that elements of the changes could have been an opportunity to make the welfare system fairer rather than more draconian. People across the United Kingdom and here in Scotland want a system of benefits that ensures that support is provided to those who need it when they are unable to work or unable to find work. At the heart of our welfare state should be a contributory principle that makes clear our duties to pay in when and if we can in order that we receive assistance when it is needed. Too many of the changes seem to be based solely on a desire to bring down the benefits bill, rather than seek the right balance between support that is affordable and support that is there when anyone needs it.
In the stage 1 debate, I quoted Ian Galloway of the Church of Scotland church and society council, who said at the General Assembly of the Church of Scotland this year:
“If austerity means that we all have to tighten our belts, and perhaps especially those who can most afford it, then so be it. But what is really happening is that the most vulnerable are being punished out of all proportion.”
That concern, which has been highlighted by groups representing disabled people, social landlords, children’s charities and many others, was one of the major influences on Scottish Labour when we argued that the LCM on welfare reform should not be nodded through and that distinct Scottish legislation should be brought forward if required. The resulting bill is, of course, as the cabinet secretary said, enabling legislation that is concerned with putting in place a framework for how regulations will be brought forward that connect both devolved and reserved benefits.
So-called passported benefits are rightly at the heart of the issue. Capability Scotland, for example, has pointed to the blue badge parking permits, bus passes, leisure cards and energy assistance programmes, because eligibility for each is assessed through receipt of a UK welfare benefit. However, the truth is that the impact of welfare reform could be so large that even at this point we still do not know the true extent of the problems or the opportunities that it may create for the Scottish Government, local councils and others. The Welfare Reform Committee suggested that some £2.5 billion could be taken out of the pockets of poorer people in Scotland. In Glasgow, which the cabinet secretary and I represent, as well as in many other areas, it will also mean that money will be taken from shop tills and from social housing providers.
Labour supported the general principles of the bill at stage 1. Throughout stage 2 and in our amendments today we sought to improve it by advocating the concerns of those most closely involved with the delivery of services and the representation of those groups most affected. It has been a good process and the Government has engaged with the issues. We did not seek to lodge amendments that did not have the support of people in the sector. For example, there were concerns about the wide-ranging nature of the regulatory powers that ministers were taking without there being any sunset clause. However, we decided not to lodge amendments on that or on other possibly contentious issues.
The member referred to powers for ministers. Does he agree with me and many others that, rather than just muck about, it would be best for the Scottish Parliament to have full powers over the benefits system in order to protect vulnerable people, particularly given that the Tories have said that they will bring in regional benefits, which in fact even Labour proposed?
I am grateful to Sandra White for that intervention. Of course, the Prime Minister removed a reference to regional benefits from a speech this week. It seems that the SNP is the primary proponent of regional benefits and, indeed, regional pay across Britain.
Notwithstanding my disappointment that the cabinet secretary did not accept my amendments earlier, I am grateful to her for the work that we have done together to ensure that the choices that will be made are based on evidence, modelling and reporting on the impact—despite the objections of SNP members of the committee at stage 2. For the avoidance of doubt I should make it clear that the Scottish Labour Party will support the bill at decision time.
In the earlier debate I said that we should remember that this will be a unique piece of legislation and the cabinet secretary has outlined that that is her view too. The legislation began life with a partial—but unprecedented—rejection of an LCM, which Labour pushed for. It resulted in the establishment of a special committee, which was pushed for by the voluntary sector. There has been a wide-ranging and vital engagement in the issues—despite the sense of urgency hanging over us to get the legislation right and to get it in place quickly.
The work of the Welfare Reform Committee will no doubt go on. In many respects the detail of what will happen next will have to be worked out over the summer and considered when the Parliament returns. Indeed the cabinet secretary indicated that there will be further consultation into the autumn.
For their part, many of the charities with a close interest in the bill have turned their attention towards implementation. There has already been some debate about what that might mean, including in the pages of Third Force News.
Labour considers that receipt of universal credit or personal independent—sorry, independence—payments should become a passport to devolved benefits. I have obviously been listening to the psychologist too much and I cannot say that word now either. We also believe that all those who are currently eligible for a devolved benefit should remain so.
In the stage 1 debate I asked the cabinet secretary to consider the position of advice services and to right the wrong that the Scottish Government has been involved in by pocketing the money for advice services that arises from the UK welfare reform changes. I pointed to the example of the Welsh Assembly Government, which has invested considerably in its citizens advice bureaux to help them to cope with the huge increase in demand that welfare reform will no doubt create.
There will be difficult choices ahead in this process and the test, in my view and in the view of Labour, will be whether those choices are made fairly and not arbitrarily.
The bill is not one that either the Government or the Opposition would wish to be necessary, but it is necessary. When passed, it will mark the beginning of a new phase of considerations when we should look for opportunities to improve what we do, rather than just shore up our own parts of the system in the face of cuts coming from elsewhere.
16:03
I begin with a few words to my fellow committee members. Thank you for putting up with me. As the only member representing a party from the Westminster Government sitting on the committee, I suspect that I was chosen not for my background in welfare issues, but for being the person least likely to go native.
It has been my responsibility to ensure that an alternative view has been put. I thank my fellow committee members for their forbearance. It has been done with good humour and with a degree of understanding on both sides.
The Conservative Party will vote in favour of the bill. However, we do so feeling disappointed that it has become necessary. It has become necessary only because the Parliament decided partially to reject the legislative consent motion on the UK bill. As a result, we have no alternative but to plough our own furrow here in Scotland and find alternative ways to deal with a number of issues—particularly that of passported benefits, which has been discussed at some length already. For those reasons, we will support the bill, but we will continue to take the same position on welfare reform as we have taken for a number of years.
The welfare reform process is absolutely essential to the long-term welfare of many people in this country. When a bill was first mooted and we began to discuss the issue, everybody took the view that welfare reform was necessary yet, as the process has gone on, I have begun to doubt whether many members of the Parliament see reform as necessary. As we have discussed the issues, I have begun to believe that many members think that welfare reform should be resisted at all costs. That is unacceptable to me and it should be unacceptable to the huge number of people who currently depend on welfare in Scotland.
Welfare dependency should not be the preferred route to support young men and women in particular, but also disabled people and others. If there is an opportunity to promote employment, we should take it. Scotland’s economy creates more jobs than many of us are willing to admit. When we consider the number of people who have come here from eastern Europe to do jobs that could have been done by our unemployed people, we realise that there is a problem with the dependency culture.
Will the member take an intervention?
No. The member can press his request-to-speak button and speak later if he wants.
It is already pressed.
We need to ensure that we get a few more people working and a few less people claiming in the next few years. The dependency culture is a life sentence to those who are left in it, but there is a balancing effect. There are those in Scotland, including many of those who came before the committee to give evidence, who are on the opposite or balancing side of the dependency culture in that they believe that it is necessary to shout about the need for welfare because that is their responsibility.
Will the member take an intervention?
No—I will continue.
The expectations for those who live on housing benefit are excessive compared with the expectations for those who make their way without that benefit.
Will the member take an intervention on that specific point?
No. The member can push her button and come in later. I will be finished in a moment.
There are people who, through living on benefits, suffer the mental and physical health problems that are traditionally associated with being workless. Getting people back into work is not only an economic priority, but a priority for improving the health of people in Scotland. That is a major part of the welfare reform process that is being initiated in Westminster.
Various people, including the cabinet secretary in this debate, have talked about the dangers of cuts to welfare payments, yet the process has so far not delivered any cuts at all, so that is simply speculation. I believe that much of that speculation will be proved to be inaccurate.
If we are to succeed in the vital process of getting Scotland working again, reducing the cost of welfare and making our economy strong, the key element is that Scotland’s two Governments must work together. We need co-operation and understanding on both sides. If we do not get that, we will have a contest that will be woven round the arguments for and against independence and that will fail to deliver for the victims, who are the people who are on welfare today and who need a better level of support in the long term. We need to get Scotland working again. The answer lies in the welfare reform process, but the Scottish Government is turning its back on that opportunity.
We come to the open debate. We are slightly tighter for time than we were at the beginning of the debate, so we will have speeches of four minutes, with a bit of leeway for interventions.
16:09
As a member of the Welfare Reform Committee, I can say that it is no problem to put up with Alex Johnstone, because he is far more consensual when in the committee than he has been in the chamber today. I note that we are losing Drew Smith as a member of the committee, so I wish him well in pastures new.
The cabinet secretary suggested that there has been a steep learning curve for those of us on the committee, which is absolutely true. I thank the stakeholders who have engaged with the committee. I am sure that the steep learning curve will continue and that those stakeholders will assist us in the process.
This process has not been instigated by the Scottish Government or the Scottish Parliament—it was begun by the UK Government—but we can be proud that the Parliament has acted swiftly to put in place a mechanism to ensure that those receiving passported benefits contingent on entitlement criteria through the former welfare system can continue to receive the support to which they are entitled.
The bill is not large; it is enabling legislation. Given that, the debate so far has been technical and procedural in nature. However, I think that we need to move on from that. Yesterday, I met the SCVO and was interested to find that its main request was not that all secondary legislation be subject to affirmative procedure but that we move beyond debating the process to debating the substance of the issues. It is time that we do so.
To begin that process, I will quote from Anne Johnstone’s column in today’s Herald, in which she poses the question
“What is the welfare state for?”
and goes on to say:
“For William Beveridge, architect of the British welfare state, it was about eradicating ‘want, disease, ignorance, squalor and idleness’.”
That is indeed the founding principle of the modern welfare state and I agree with it, but it is no exaggeration to say that it is now under assault from the UK Government. In recent days, the Prime Minister has suggested the removal of housing support from the under-25s, a move that he called challenging
“the something-for-nothing culture”.
In taking that view, he fundamentally fails to understand the number of people in employment who will be affected by such a policy and the message that is being sent out to them. That is not to mention the effect on housing policy which, although devolved, is already under pressure from some of the changes to the benefits system that have already been announced.
Will the member give way?
Very briefly.
Does the member share my concern that the removal of housing benefit as proposed by the UK Prime Minister could have a devastating impact on armed forces veterans who are under 25?
Absolutely. It will have a devastating effect on anyone who is entitled to the benefit and certainly on veterans who are under 25.
Although the UK Government uses deficit reduction as a mask, its welfare reforms, which have necessitated the action that has been taken in the bill, are ideologically driven. I do not have much time left, but I wish to point out that, although this Government and Parliament have acted to ensure that people continue to receive their devolved passported benefits, we should be able to act more comprehensively. The Parliament should have more comprehensive powers over welfare.
I will close by quoting again from Anne Johnstone, who says:
“nearly two-thirds of the poorest people in Britain are in work but can’t earn enough to live on. Cutting their housing benefit and tax credits, when rents are rising and nursery costs are astronomical, is more likely to drive them out of work than into it.”
That is the reality of welfare policy in the Tories’ hands and gives the lie to any suggestion that we are better together. I commend the bill but look forward to the day we can act more comprehensively on this matter.
16:13
First of all, I thank Simon Watkins and the rest of the clerking team for their work in getting us to this point. I know that we will have to rely heavily on them as we begin to scrutinise the impact of the welfare changes.
It is worth remembering what scrutiny of this legislation is all about. We might well criticise the Westminster Welfare Reform Act 2012—and there are very good reasons for doing so—but, as we move forward, we must remember that the job of the Welfare Reform Committee and the Parliament is to hold the Scottish Government to account.
I also thank the voluntary sector for the work that it has carried out and the abundance of information that it has provided. All of that and the other details that it has supplied have been greatly appreciated by everyone involved in the scrutiny process so far and the sector’s continued involvement and assistance will be invaluable as we move forward.
If we are to be a truly representative Parliament, we must ensure that measures to safeguard entitlements do the job that civic Scotland wants them to do. As a result of contact with the stakeholders who represent the interests of those affected by this legislation, unanimity on the view that the bill was necessary and welcome was easy to reach. Moreover, in spite of arguments that we had over the piece—at stage 1, at stage 2 and today—we should not forget that those stakeholders held a uniform view on the need for scrutiny of the subsequent subordinate legislation. Unfortunately, that unanimity was not shared among committee members. However, we will move on, as others have said. I am confident that today we will rightly unite on the bill, but it remains to be seen whether we will be able to stay unified as we scrutinise the subordinate legislation that will follow. Alex Johnstone has made it clear that, even in good humour, we may not always be able to agree.
It was utterly apparent to me from the feedback received from stakeholders that the transparency of the legislative process is as much a matter for general concern as the detail. Numerous groups strongly advocated the view that the affirmative procedure should be used, among them the Child Poverty Action Group in Scotland, which urged MSPs to ensure that
“the first regulations made under the new powers in the Bill that amend existing regulations”
are
“subject to the affirmative procedure.”
Despite what was said during previous debates, including the earlier debate on amendments, CPAG and others are not naive. They knew exactly what they were asking for, and why. It may be the case that the affirmative procedure will not always be used, but it would be wrong for the cabinet secretary to dismiss the intent behind those requests. We should have the maximum possible scrutiny so that we can ensure that the legislation that we bring forward reflects the concerns that were expressed by stakeholders such as Inclusion Scotland, which said:
“Any small error in the regulations could incur unintended and further damaging consequences to people who will already be suffering cuts to their income. It is crucial that the secondary legislation proceeds with the fullest scrutiny possible to guarantee that it provides positive outcomes for those affected.”
That has been the Labour Party’s motivation in the discussions that we have taken forward.
I am pleased that the cabinet secretary did not follow the lead of her party colleagues on the committee on the subject of reporting and instead lodged a very good amendment today to address that issue. Groups such as Citizen’s Advice Scotland recognised the importance of that issue, as did Children 1st. I agree whole-heartedly that we should ensure that
“everyone with an interest in welfare reform and in particular, the impact of particular measures on individuals, families and households, has access to the fullest possible information about the Scottish Government’s work in this area”.
The Welfare Reform Committee has to ensure that the concerns raised by various organisations are taken forward. Passing the buck and trying to apportion blame will cut no ice with those in Scotland who are damaged by the Westminster coalition legislation. Where this Government has responsibility, it can and will be held to account for any failings that materialise. Let us work together constructively to ensure that there are no such failings, so that the bill helps the people of Scotland whom we wish to serve.
16:18
I, too, am a member of the Welfare Reform Committee and I thank all the stakeholders who contributed to and informed our discussions. I have been in a stakeholder voluntary organisation, and I know exactly where they are coming from. I also know that we must get the legislation through in time, because the impact on those stakeholders’ work will be worse if we do not get it through. Michael McMahon said that the affirmative procedure would not always have to be used. However, the amendments that Labour lodged would have made the affirmative procedure the only one that could be used, which is where the problem would have lain. The debate on that is over—those amendments have been rejected, so we should move on.
I take issue with some of the things that Alex Johnstone said. I do not think that it was ever said in the Welfare Reform Committee or the chamber that we do not want to have a better welfare state, reformed in a better way. What we do not want is for it to go the way that it is going under the Tory Government. At the moment, we are getting to grips with the current changes in welfare reform, which have not even bedded in yet, but we heard about further changes this week that will be much worse. Those changes are not about getting people into work; they are about saving money. My concern is that, as we take people off the unemployment books, more will go on them because of the Tories’ policy.
Jamie Hepburn pointed out that the Tories seem to think that everyone who is on welfare is not working or has never worked. A huge proportion of people who get help from the state are in work. They are in low-paid work, and their working tax credits and child support have been cut. Everything has been cut for people in work. People on housing benefit work; they just do not earn enough to be able to pay the full rent, yet we are taking that benefit from them. It is shocking that the Tories have not got to grips with that.
As I have said in the chamber before, I believe that the Tories want to wreck the welfare state. I am concerned that Labour members think that that is better than this Parliament being in charge of its own welfare system—I just do not get that. The Future of Scotland survey that was published this week shows that 67 per cent of people in Scotland want welfare benefits to be devolved, because they know what is happening to them. Labour should reflect on that.
The reforms are driven by the wish to save money, and that is all. A report from Sheffield Hallam University on incapacity benefit reform that might interest Alex Johnstone came out in November last year. It tells us that there are more people on incapacity benefit than there are claiming unemployment benefit. Alex Johnstone might say, “Well, they should be off it and working,” but the reforms mean that all those people—in Scotland, it will be 36,000—will, at the stroke of a pen, be put on to the unemployment register. Those people are in the industrial areas where unemployment is already high.
We should not forget that many of the people on long-term incapacity and invalidity benefit were encouraged on to those benefits by a Tory Government and successive Labour Governments that were trying to hide the true level of unemployment in the industrial areas. That is why so many people in those areas are on sickness benefit and have been left there.
Our problem now is that we cannot take all those people off benefit at once and put them on to jobseekers allowance—that just will not work. I welcome the steps that the Scottish Government has taken to mitigate the reforms as far as it can. Those include the provision of funding—along with local authorities—to cover the 10 per cent cut in council tax benefit; the proposals that are before us today to protect passported benefits; and the social fund successor arrangements that the Government has made. Those measures, along with the council tax freeze, free prescriptions, free eye tests, free childcare and promoting the living wage will help our vulnerable citizens within the existing powers of the Parliament.
The mark of a civilised society and a civilised country is how it cares for its vulnerable citizens. I believe passionately in a welfare system that is fair and compassionate: a system that makes work pay, which supports and encourages people into work, which helps the low paid and which provides a reasonable standard of living for those who are unable to work because of illness, disability or caring responsibilities.
I am afraid that the member must close.
Like many members in the chamber, I believe that that can be achieved only when we are in charge of our own destiny and Scotland is an independent country.
16:22
We welcome the bill. The Parliament is taking a sensible approach in seeking to adapt the welfare reforms to Scottish circumstances so that they can be made more appropriate to local situations.
This debate is not easy for the Liberal Democrats. The welfare reform changes are substantial, and there is no doubt that some people will lose out. I disagree with Alex Johnstone’s view that there will not be people who will lose out from the changes, because there will.
Our job in government at a UK level is to ensure that the changes are introduced in a sensitive way and that we can adapt them to circumstances as those become clearer over time—
Will the member give way?
Not just now.
In that way, we can ensure that the vulnerable do not suffer. However, reform is an overriding necessity. If the welfare budget continues to grow as it is doing, it will be £192 billion by 2015. No society, even one as wealthy as the United Kingdom, can afford such a welfare bill.
In recent years, even with the growth in the economy, the welfare budget has gone up by 40 per cent. We now have 5 million people who are trapped on out-of-work benefits. I say “trapped”, as I have met many of those people in my advice surgeries—
Will the member take an intervention?
Not just now.
Those people tell me that they are not going to take certain jobs because they do not know whether they will be able to keep them, and they are not confident that they would get their benefits back in time. In many cases, they would face a five-week wait before they could get their benefits back on stream. They tell me that they will not take those jobs. I am not saying that the same is true of everyone, but there are some people who are trapped by the benefits system. We need to make the necessary changes so that those people have an escape from benefits. People who deny that that is the case have not studied the issue.
Will the member give way?
Not just now.
I have a huge amount of respect for Margaret Burgess, because she has seen many of these issues close at hand through her work with citizens advice bureaux. I fully respect what she says, but it is an exaggeration to claim that we are wrecking the welfare state. We will continue to spend billions of pounds on the welfare state. It will be a genuine safety net, and it will make work pay.
Will the member take an intervention?
Not just now.
The new system will make things simpler. The universal credit is a sensible way to proceed. It will involve one source of payment and receipt, and a tapering system that will ensure that people do not lose all their benefits at the same time. As people go into work, a taper will apply. Those are sensible changes that everyone should welcome. We should not try to scare people into believing that everyone will lose out, because that is not the case. Some people will benefit. About 230,000 people will be about £30 a week up. Those who do not believe me need to check out the facts. More childcare support—£300 million-worth of it—will be available. Those are good changes.
It is uncomfortable for us to make changes to a budget of such a size. That will be difficult, but the Liberal Democrats in the coalition ensure that the changes that are made are as fair as we can make them.
Members: Oh!
Those members who groan have not looked at the facts. Substantial changes have been made to the work capability test.
Will the member give way?
I do not have much time left.
Changes have been made on the waiting time for the personal independence payment and the mobility element of disability living allowance for those in residential care. The new system is not about punishing people who are on benefits—that is not our motivation. It is about enabling them to get back into work. Those who say that there is an alternative to reform are letting people down. We need to create a welfare system that enables rather than one that punishes.
16:27
When I spoke in the stage 1 debate, I described the Welfare Reform Act 2012 as
“a missile that is aimed at the heart of the welfare state”.—[Official Report, 23 May 2012; c 9240.]
Judging by this week’s announcement, I think that that was putting it mildly. It seems that, when it comes to the poor, the disenfranchised and the voiceless in our society, the malign intent of Messrs Cameron and Osborne knows no bounds.
While the Tories refuse to pass legislation that would close tax avoidance loopholes and are happy to reduce the top rate of tax, the disabled, the unemployed and those on low incomes are viewed as fair game. We should forget about compassionate conservatism; the Tories are the typical playground bullies, who pick on those who cannot defend themselves while cosying up to the big boys who run the tuck shop and scoff all the sweets.
In recent weeks, the Equal Opportunities Committee has been conducting an inquiry into homelessness among young people. During the evidence sessions, the devastating consequences of the Welfare Reform Act 2012 for the prospects of homeless young people have been a recurring theme. A witness from one local authority stated:
“Welfare reform is terrifying because of the impact that it will have on young people’s lives.”
She said that, because of the cuts,
“we will no longer be able to deliver some of the projects that have been really successful.”—[Official Report, Equal Opportunities Committee, 19 June 2012; c 557.]
The really pernicious aspect of this legislation, apart from the impact that it will have on people’s lives, is that it caters to people’s worst instincts: it pits the badly off against the really badly off and the vulnerable against the desperate.
Mr Cameron says that there is nothing compassionate about allowing people to live their lives on benefits. What he fails to mention is that, according to research by the Smith Institute, 95 per cent of those who accounted for the recent £1 billion rise in housing benefit are in work.
What can we do in Scotland to offset the worst excesses of the Tory Government? I have already mentioned the inquiry that the Equal Opportunities Committee is conducting. I would like to say a little more about that, with specific reference to the community care grant, which is being devolved to Holyrood. One witness described the devolution of the grant as one of the rare positive measures in the Welfare Reform Act 2012. Therefore, it is imperative that we take advantage of the opportunity to make the grant more efficient and effective than it currently is.
I have stated previously that crisis loans and care grants should be amalgamated, that the grant should be available to applicants when they receive the keys to their property and not seven weeks later, and that the application process should be clear and transparent.
I have been contacted by a number of organisations with regard to the interim arrangements for the grant, which are being developed by the Scottish Government and the Department for Work and Pensions. Although there is support in principle for the creation of a national grant fund that specifically recognises the needs of young people who leave care, concerns have been raised that the proposed allocation of £25 million is completely insufficient to service demand, especially given the adverse economic climate. That could lead to the fund running dry before the end of the year and applicants being left in crisis. There are fears that, in order to avoid that scenario, the eligibility criteria will be tailored to the budget as opposed to vice versa, thus tightening the criteria rather than making them more flexible. The most important concern is that we ensure that the new scheme prioritises need and does not exclude those in receipt of other benefits.
I would appreciate the cabinet secretary’s reassurance on those points, as would local authorities, charities and potential applicants. It would be immensely sad if we threw away the opportunity to reform the grant and ensure that it is fair, transparent and available to those who most need it.
I close with a brief comment on the debate about subordinate legislation. Given the necessity of ensuring that people retain access to passported benefits, I understand the need to move swiftly. However, I am disappointed that SNP members chose to reject Labour’s stage 2 amendments that favoured the use of the affirmative procedure to allow the appropriate level of parliamentary scrutiny.
Will the member give way?
I am just closing. Sorry.
As my colleague Jackie Bailie pointed out in the Welfare Reform Committee, there was an overwhelming desire for that among charities and other external organisations. The amendments were not party political. They were intended to ensure that the opinion of those on the front line was heeded and that the subordinate legislation was presented before Parliament and not slipped in by the back door. It is therefore a pity that the SNP members voted with the sole Tory on the committee to ensure that the amendments were blocked, and that the SNP continued to vote with the Tories today.
Will the member give way?
The member is just finishing.
I hope for their sakes that those whom they represent do not suffer as a result.
16:31
I, too, start by thanking all the stakeholders who gave evidence to the Welfare Reform Committee. Beyond them, I thank all the organisations and individuals in Aberdeen who have contacted me on the issue. I have had many meetings to discuss aspects of the impact of the bill.
Today, again, we seem to be concentrating on process rather than on people. Siobhan McMahon’s speech showed clearly that some folk are more interested in that process than in the people. I say to her that, if we had gone with the affirmative procedure, as was suggested, it might have led to unnecessary delays. We should be clear that there is a huge difference between the use of the negative procedure and the use of the affirmative procedure in being able to implement things at an early date. I do not believe that any organisation thought about the process to any huge degree until they were asked leading questions by certain members of the committee. I see Mr Johnstone nodding in agreement, and I am about to turn to him and the reforms that are being put in place by the Conservative and Liberal coalition.
We are about to see £2.5 billion ripped out of Scotland, and George Osborne has said that there will be another £10 billion of welfare cuts before 2016. We might hope that the Liberal Democrats will do something to try to stop that, but I sincerely doubt that they will achieve it. However, it is good to see Mr Rennie in his place here today. He failed to appear at the stage 1 debate, instead choosing to appear on television. I am pleased to see that he is in the chamber to listen to the debate this afternoon.
I turn to the subject of housing. With the housing benefit changes, some 95,000 social tenants in Scotland will be affected by the legislation. As my colleague Margaret Burgess rightly pointed out, many of those people are in work but require that benefit because they are not paid enough by their employers.
It is far too easy for Tories to say that an attack is being made on workshy folk. Unfortunately, folk who are in work are also being affected, as are folk who cannot work. Let us be honest and tell people out there that the reality is that many folk who are affected by the changes have jobs.
Will the member take a brief intervention?
I do not have time; I need to plough on.
On the day when the better together campaign was launched, Cameron made a speech that has gone largely unnoticed. I was really scared by the attack on housing benefit for young people and by the fact that under-25s might not qualify for that benefit in the future. That would undermine the Scottish Government’s ability to reduce homelessness, on which we have done well of late.
What can I say? How does Mr Cameron know the circumstances of each person who is under 25? Does he expect an abused child to stay at home with the parents who abused them until they are over 25? Does he expect kids who have been in care homes to get no housing support whatever? Is that right? Does that really show that we are better together?
Maybe we should be completely and utterly honest. The reality is that there is not much disagreement between Labour and SNP members. However, what we could do with the powers of an independent Parliament is so much greater that we would be talking about not mitigation but having a fair welfare state.
16:36
Alex Johnstone talks about getting people into work. Most of my colleagues have covered the notion that the changes will affect not just people who are not in work, but even in relation to people who are not in work, perhaps he should consider talking to his Conservative colleagues in London and getting them to put capital investment into the shovel-ready projects that would help to stimulate the economy and create the jobs that are not available. To be frank, strangling our nation’s economic growth while widening the holes in the safety net into which people are expected to fall is nothing short of abhorrent.
I direct Mr Johnstone to the comments of 17-year-old Dylan Munro in tonight’s Evening Express about the impact that the Cameron proposals on housing benefit for the under-25s would have on him. He has been through an employment programme at Station House Media Unit. He states clearly that if he lost his housing subsidy, which helps him as a minimum-wage earner, he would become homeless. That is not the kind of future to which we should aspire for young Scots such as Dylan Munro.
The housing benefit changes in relation to occupancy will have a massive impact on local authorities and housing associations. As a Finance Committee member, I have heard evidence to that effect from local authorities and the Scottish Federation of Housing Associations. The changes fly in the face of housing policy, because they anticipate that we will somehow start throwing up one-bedroom properties again, when the drive must be to provide more family-sized accommodation. They also take no consideration of individuals who might be separated and who might require additional bedrooms for children who visit them at weekends or for other periods, for example. A ridiculous approach is being taken.
We hear about the notion of £2.2 billion a year; would that we were not spending £3.5 billion a year on a Trident replacement—I am sure that the people of Scotland would be more than happy to see the back of that in order to help the most vulnerable.
We in the Parliament are dealing with mitigation; that is all that we can do. At the Finance Committee’s meeting on Tuesday, John Swinney said that he could not say that he could protect everyone from the impacts of welfare reform. Given the Parliament’s fixed budget, it would be wrong of us to claim that we can protect everyone. Protecting everybody from the impacts of the welfare reform changes at Westminster simply will not be possible.
If the route that David Cameron has described is followed, while the UK Government continues to attack this Parliament’s budgets, the situation will become even more difficult for us to deal with. It is not credible for anyone to look at the wrecking ball that is being taken to the welfare state and claim with any sincerity that a progressive, open and socially just future for Scotland is better served by remaining part of the UK. I heard talk about Scotland as an independent country being an uncertain future for our people. Frankly, I agree with Ian Bell of The Herald, who said clearly that the future is an uncertain place, but it is far more uncertain for our people as part of the United Kingdom than it is as an independent Scotland.
Presiding Officer, the mace that sits in front of you is inscribed with the values that this Parliament and this nation hold true. One of those is compassion, and I see precious little compassion in the Con-Dem welfare reforms that are currently taking place or in those that are being mooted by David Cameron for the future. Scotland could and will do better for our most vulnerable.
16:40
When the coalition Government was formed in 2010, it recognised—as did the previous Government—that for many people on benefits the work incentives were poor and the system was too complex. The aims of welfare reform are to help people to move into and progress in work while protecting and supporting the most vulnerable. As Willie Rennie said, the UK’s welfare bill is currently more than £165 billion a year, so scrutiny and reform should be on-going.
We have heard a great deal from the SNP and Labour about opposition to the plans. Not being a member of the Welfare Reform Committee, I have listened carefully to hear of any firm alternatives, but I am struggling to remember any. As Alex Johnstone said in the stage 1 debate last month:
“everyone believes that welfare reform is needed, but no one is willing to say how it might be achieved other than to look at the UK Welfare Reform Bill and say, ‘Not that way.’”—[Official Report, 23 May 2012; c 9235-6.]
I am also disappointed that not a single member has mentioned the fact that 44 per cent of people on benefits in Scotland have a mental health problem. Instead, they have all railed at David Cameron and the UK Government. I would have liked a bit more talk about people being supported to access mental health services instead of being consigned to a lifetime on benefits. Many people with a mental health problem are on benefits not because they want to be and not because they do not want to work, but because they did not receive an early diagnosis or the treatment or drugs that they wanted.
Will the member take an intervention?
Mark McDonald had four minutes and no one has mentioned mental health. I am the only one who has mentioned it. I would have thought that if anyone cares about people on benefits, we should start with the 44 per cent who have a mental health issue.
The benefit cap that is proposed in the Welfare Reform Bill is an important aspect. The cap will impose an upper limit of £26,000 a year, which equates to a salary of £35,000 a year. That is 75 per cent higher than the average salary in the Highlands and an even greater percentage higher than the average salary in the Western Isles. However, as I mentioned in the stage 1 debate—it is worth repeating today—many benefits such as war widows allowance, attendance allowance and DLA will remain exempt from the cap.
Another area to highlight is reassessment, which has been portrayed by all SNP and Labour members today as a way of reducing benefit and support. What if someone’s benefit has stayed the same for years while their condition has seriously deteriorated? It cannot be right that people on DLA are left for years or decades—as they are—without reassessment although their condition may have worsened and they may be in need of a far higher level of support and financial assistance? It is immoral not to help those who are most in need.
The cabinet secretary mentioned human stories. In my previous employment as a lecturer in further and higher education, I saw many lives transformed through training and education, some after years in prison, some after drug or alcohol addiction and many after years on benefits—women and men at a crossroads in their lives. Those students were not incapable, but many had lost confidence, had low self-esteem or had been put down by teachers at school. The welfare reform measures will bring better support to many people in work for up to two years. This is absolutely essential and I regret that it has had so little support today.
16:44
Clearly, we are faced with a difficult set of circumstances and massive change to the welfare system. It is a challenge that the Parliament has risen to and, apart from the amendments about scrutiny and the policy context, the debate was largely consensual, at least between the SNP and Labour. Indeed, as Drew Smith said, we welcome the joint working with the cabinet secretary and her officials in at least one area.
Many members have acknowledged the challenge and the steep learning curve in dealing with welfare reform, and—as was also acknowledged—we have been helped by many stakeholders and the input that they have made. Welfare reform was required—that was agreed—and universal credit might be a valuable simplification.
A UK Government that repeatedly states, “We are all in it together,” has, as Siobhan McMahon made clear, meant tax cuts for the wealthiest, increased VAT, and cuts in benefits for the least well-off. It caters for many of the worst instincts in our society. A Government that is determined to cut the deficit is going off course when it is failing to produce the growth that is necessary to create the work that Alex Johnstone said is vital to allow people to move into jobs.
Making work attractive is important, but much of the growth that has been achieved in the private sector is part-time work. That has to be matched by benefits; as Jamie Hepburn, Siobhan McMahon and others have said, the people who are in work with an income that does not provide a living wage without benefit support must also be supported. The Tory Government’s curtailment of the rise in the minimum wage—under Labour, it always rose above the rate of inflation—is also not welcome, because it contrasts with exactly the situation that Alex Johnstone was talking about.
We are agreed that people who do not need support should not get benefits but, as we have heard, the cuts will affect many vulnerable people. As Margaret Burgess outlined in a detailed and passionate speech, the effects of, for example, moving people off DLA into PIP or UC—which in fact is designed to create a saving of 20 per cent—is not being handled at all sensitively. I do not doubt Mary Scanlon’s commitment to people with mental health problems, but I say to her gently that, notwithstanding the reviews of the process that her UK Government colleagues have undertaken, many with mental health problems are being devastated by the current application of the benefits reassessment process that they must go through.
I support what Dr Simpson is saying, which is exactly what the Scottish Association for Mental Health has told the Welfare Reform Committee.
I have been a member of SAMH since 1976, and I am making the point for exactly that reason.
One of my main concerns arises from conversations with a housing association in my constituency. It has already begun to advise tenants of the effects of the rule changes that are about to come in—an issue that Mark McDonald referred to—and it will be particularly difficult to manage the changes in any sensitive way.
The Welfare Reform Act 2012 provides for a wide range of measures that are being introduced at great speed not to modernise the system but to cut the welfare bill. As Kevin Stewart reminded us, £2.5 billion will be, as he put it, “ripped out of Scotland”. I add to and redefine that by saying that that money has been ripped out of our most vulnerable communities, whose economies will become even more fragile as a result.
The only areas of real dispute between us are on the questions of transparency, accountability and affirmative procedures. It is regrettable that, although our amendments were supported by so many different organisations, the cabinet secretary’s one piece of intemperate language was to suggest that we were in some way playing “fast and loose” with the most vulnerable in our society. I say to her that that is not the case. Our duty is to make representations on behalf of groups such as Children 1st and Families First, which are among the six or seven significant front-line players—to be honest, they are far more engaged at the front line than the cabinet secretary is—and therefore required representation.
Without wishing to question the intent of the Labour Party, I wonder what Dr Simpson would say to the mother who wants to know whether her child will get a free school meal or the pensioner who wants to know whether they will get a bus pass if they had to wait until a Scottish Parliament committee had considered such matters. That is the danger that opens up if every instrument is required to be affirmative.
I served on the Subordinate Legislation Committee as well and both procedures would require 40 days. If a move is made to annul a negative instrument, that would delay the whole process. The right to scrutinise is crucial, and all that those organisations were looking for was the time to enter into debate.
We have had some welcome reassurances from the cabinet secretary on the policy context, although another amendment of ours was defeated. We look forward to her fulfilling those promises and giving us as much time for debate and scrutiny as she said she would. We will hold her to that.
The challenge of the bill has been met and it has been supported by all parties, so it will be voted for by all parties later today. The challenge now is to improve on what we can do within the powers that we have. The SNP members have repeatedly said that an independent Scotland will provide us with a glorious situation but, before the referendum, the SNP must be absolutely clear about the benefits system that we will have in an independent Scotland and how it will be funded. That is critical.
16:51
In response to Richard Simpson, I say that we are perfectly clear about the kind of welfare that Labour wants—one that is run by the Tories. That is abundantly clear.
In my opening speech, I thanked a number of people. In my closing speech, I take the opportunity to give heartfelt thanks to my officials and the bill team. They, more than anyone, have borne the burden of the tight timescale that we have had to get the bill through. They have done a fantastic job and I thank them for that.
This has been a reasonably good debate. Like Kevin Stewart, I am slightly disappointed that so many members chose to focus on process rather than people. Michael McMahon asked me to give a commitment that there would be maximum scrutiny. I have given that commitment at every stage of the process and I have no hesitation in doing so again today. However, what I have never been prepared to do at any stage is expose vulnerable people to the risk of not getting their passported benefits, and I am glad that Parliament agrees with that position today.
The obligation on all of us now is to get on with the substance, to work together within the heavy constraints that we face of a policy direction that we do not agree with, and a timetable that has been set by the UK Government. Nevertheless, we need to get on with the work of getting the regulations right. Jamie Hepburn encapsulated the desires of organisations such as the SCVO extremely well. They want to be part of the process from the point of view of protecting the people they care about. Let us get on with working together.
Drew Smith made some legitimate points about what the substance should focus on, as did Jackie Baillie at stage 1 when she talked about addressing the challenge that will arise with new claimants in the future, ensuring that we do not end up with a postcode lottery, and developing a system that works well. That is what we should focus on.
The joint briefing from Children 1st, Barnardo’s, Citizens Advice Scotland and One Parent Families Scotland that was issued ahead of today’s debate sums it up well when it says that it is vital that, as we head into the almost uncharted waters of the impact of welfare reform, we continue to work together in the interests of some of Scotland’s most vulnerable citizens. That should be our absolute priority as we leave the chamber tonight.
My second point is about the substance of the debate. Because it suits their purposes, the Tories continually—and Alex Johnstone and Mary Scanlon were at it again today—present the debate as being all about incentivising work and getting at the feckless workshy. I am sure that we can all agree about the importance of incentivising work but, as Margaret Burgess said when she nailed the point, the fact is that many people who interact with the benefits system are already in work. I mentioned the evidence that Save the Children gave about the single mother who is in work but believes that she will be worse off after the introduction of universal credit.
One Parent Families Scotland has suggested that many single parents who are working more than 16 hours a week could be worse off under the new system. These are people who are working hard, trying to scrape out a living to support their kids and make a better life for their families. The reforms threaten to take the feet from under them. To Willie Rennie, I would say that that is not trying to scare people; it is simply pointing out the reality of the Tory welfare reforms that he and his Liberal Democrat colleagues, to their shame, are prepared to support.
My third substantive point is about the future. We did not ask to have to take a bill through Parliament on this issue, but it was right that we did so. As we pass the bill today, it is important that we look to the future. In the immediate future for the legislation, we will embark on the consultation exercise that launched today and we will hold a series of stakeholder meetings and policy events during the summer.
Over the same period, we will look at the UK Government’s regulations, as those are published and made available to us. A lot is said about what detail is available and what is not. However, until the UK Government sets out the rate at which universal credit will be paid, we will have only part of the picture. Once we have the full picture, we will come back to Parliament and lay our own regulations. I expect that all of that work will be carried out in good time to meet the deadlines that we face.
The other sense in which I want to look to the future is about the longer-term future for vulnerable people in Scotland. As Margaret Burgess said, we had a rather frightening insight into that earlier this week in David Cameron’s speech. According to him, the Conservative future for anyone under the age of 25, unless they can afford to pay their own rent, could be to live with their parents, because they will no longer receive a penny in housing benefit. In future, families with three kids, on income support, could lose their child-related benefit entitlements for their third child. The future for anyone found guilty—for whatever reason—of being out of work for longer than a fixed period could be full-time community service.
The most staggering thing of all is that that frightening speech about what might lie ahead was given on the same day that Labour linked arms with the Tories and said, “We are better together.” Let me say this: on welfare, we are most certainly not better together. I will never understand why Labour members—many of whom, such as Siobhan McMahon, I believe care about vulnerable people—are prepared to argue for a position that leaves the Tories with carte blanche to do their worst to the most vulnerable people in our society.
These changes do not reflect Scottish values. I want to be in a Parliament that has the power to do so much more than to mitigate the worst impact of bad Tory policies. I want to be in a Parliament that has the ability and the powers to design a welfare system that reflects the values that we hold dear in Scotland—a welfare system that lets us hold our heads high and say that it incentivises people into work but protects the vulnerable. I want to be in a Parliament that has the powers to create the jobs that are needed to get people into work. That is the kind of Scotland that I want to live in. It is the kind of welfare system that I want to have and it is the kind of Scotland that does not come from Labour and the Tories saying that we are better together. It comes from this Parliament and this country being independent and equal, like countries abroad in this world.
That concludes the debate on the Welfare Reform (Further Provisions) (Scotland) Bill.