Chamber and committees

I am really concerned about that. I have to say that I am genuinely astonished that the leader of Scottish Labour used the word “handouts”. Since the devolution of social security, I thought that we all agreed on the principles of social security. We had a near consensus, with the exception of the Scottish Conservatives, that social security is an investment in people. I said during the debate that I see the Scottish child payment, for example, as a lifeline for people. It is not just me saying that; that is what I hear when I speak to constituents. I would be surprised if any MSP did not hear that from their constituents.

Talk about handouts really plays into the stigma around people claiming what they are entitled to and what they should apply for. I am deeply disappointed that we no longer seem to have a near consensus that social security is an investment in people. I hope that the leader of Scottish Labour will reflect on the fact that that word does not help us. When we are trying to encourage people to come forward to get what they are entitled to, a discussion about handouts is not helpful; in fact, it is exceptionally detrimental.

I am concerned about that. I am concerned about many things when it comes to this issue, but one concern is that there seems to be confusion around disability benefits and employability. Disability benefits are paid to people with a disability or long-term condition, regardless of whether they are in employment, to cover the additional costs of disability and long-term conditions.

We must be really careful about how we discuss the increasing number of people coming forward to claim disability benefits. I am concerned about some of the tone and language in the overall debate. The UK Government is looking at that, and I am glad that it has distanced itself from some aspects of the previous Conservative Government’s attitude, but we must wait to see what happens.

The budget is key. Any changes to what happens within a UK benefit can have significant implications for the block grant adjustment for the Scottish Government. We had a stark example of that recently, when the UK Government made a very quick and, I still think, ill-judged decision about the winter fuel payment—what we call the pension-age winter heating payment—which made a difference to the Scottish Government’s budget. We must be cognisant that any change of heart, particularly one that happens in an exceptionally short time, could very well have budgetary implications that the Scottish Government would have to tackle.

The mitigation of the two-child cap does not change the trajectory of the closure of the programme, nor does the continuing need to devolve the industrial injuries benefit, which will change to become the employment injury assistance benefit in Scotland.

In essence, I am saying that we can move away from those being part of the social security directorate programme towards their becoming part of the social security agency. Even if we are at a steady state, we will never reach a point where nothing changes within social security.

One obvious big change that is still to come is the final devolution of employment injury assistance. The agency will always have the ability to flex and to develop the parts of the system that need to change. From the discussions about the mitigation of the two-child cap and about employment injury assistance, I am confident that the programme closure will continue as planned and that the change function, and the work that is going on within the agency, will seamlessly deliver any future social security changes that are required.

We were not in the same position in the past because we did not have the important Scottish child payment, which makes a key difference because we now have a legislative framework. We have done a great deal of work, but by no means all of it—we might need to come to the fact that a great deal of work still needs to be done to deliver mitigation of the two-child cap—but the fact that we now have the Scottish child payment makes the difference, compared with where we were previously. It is an important change that allows us to use the legislative framework that is the basis of the Scottish child payment to make it far easier to look at mitigating the two-child cap.

You asked earlier if we had looked at the matter. To be frank, I had high hopes that a Labour Government would actually deliver on that, as Labour promised for years, but it has not done that, so the Scottish Government has done so.

There are two aspects to that, so I will break down my answer into two sections.

First, we are seeing an increase across the UK in the number of people who are applying for disability benefits. That has been remarked upon not only in Scotland but elsewhere. That is one aspect.

The second aspect is that, because of the systems that we have put in place in Scotland, we are finding that people are applying for the benefits to which they were entitled under the previous Department for Work and Pensions system, but for which they perhaps did not apply because of their concerns about the system. In essence, we are seeing the system being more accessible, in that we are seeing people who were always entitled to benefits coming forward to claim that entitlement and going through the system.

I will be happy to provide further information in writing on, for example, the energy efficiency aspect of the question. However, it is important that, as we look at programmes across Government, we see how we can support low-income families as part of that work. There are some aspects and services that can be universal, and there are some aspects that should be targeted at low-income families.

I can give one example. Yesterday, we had a very interesting discussion on housing at a meeting of the housing to 2040 board. We sat with stakeholders to discuss the budget for next year and the priorities for how we should spend that to assist low-income families in the context of there being a housing emergency. There were discussions on targeting, on temporary accommodation and on all the aspects of how we could use capital, financial transactions and revenue differently.

We had an exceptionally good discussion with stakeholders on the need, as many of them suggested, for the Government to spend money in a way that would target those who are in greatest need, and areas of the country that have the greatest need. We are now reflecting on the feedback that we received yesterday on housing and on how we will use the housing budget to assist us to look at child poverty and low-income families.

I give that as one example, convener—I think that the other part of your question mentioned energy efficiency—but I am happy to provide some of that in writing, if that would assist the committee.

I will not attempt to forecast what a regulator will say, because that would get me, as a Government minister, into difficult territory. However, I will attempt to provide reassurance about the work that we are doing, because I recognise that the regulator has opined on the issue in the past.

You will be well aware of the different ways in which homelessness services can be funded. The majority of funding for homelessness services comes from councils. For 2025-26, we have provided record funding of more than £15 billion to councils to support the delivery of a range of services, including homelessness services. There are also lines in the Scottish Government’s budget that sit separately from the local government settlement. There is funding for homelessness prevention activity, there are rapid rehousing transition plans and there are the additional resources that we will provide to councils with the greatest temporary accommodation pressure. There are those lines in the budget.

In answer to the convener’s previous question, I spoke about the discussions that we had yesterday with stakeholders about how that money could be spent. We looked not just at those lines but at the overall housing budget. I appreciate that that is within another committee’s remit, but that funding very much has an impact on how we tackle homelessness and, in particular, the challenges with families in temporary accommodation.

In relation to how we spend the increase in capital funding, for example, we consulted stakeholders yesterday on how they wish us to spend that money, overall, to assist councils in alleviating the pressures relating to homelessness and the use of temporary accommodation, particularly by families. We are reflecting on yesterday’s discussions, and that will allow us to come to conclusions on how to use the money. There is also additional money in the budget for assistance with empty homes, which will help to tackle homelessness.

Various lines in the Scottish Government’s budget outwith the general funds for local authorities and the lines that relate specifically to homelessness all add up in providing assistance in tackling homelessness. As you pointed out, I am sure that many of those lines will be discussed when Mr McLennan appears before the Local Government, Housing and Planning Committee next week.

That is another of the points that we discussed yesterday when we were talking about the balance between how much should be spent on increasing the supply of new homes and of homes overall, and how much should be used to tackle voids and to look at acquisitions and empty homes. Acquisitions do not increase the overall supply of housing, but they are a quicker way of getting people out of temporary accommodation than building new homes is. The balance between spending on new supply and spending on voids, acquisitions and empty homes was part of the discussion.

We have been clear that the Government wants to ensure that we have a pipeline of new affordable homes—and of new homes in general—which will assist the construction sector and the overall delivery of homes. However, the point was made to me and the Minister for Housing yesterday that, in a housing emergency, we may wish to spend the money differently. That discussion focused on acquisitions, for example, as a quicker way to have stock available in the affordable housing supply.

The discussions are on-going, but the feedback that we received yesterday was helpful. Yesterday will not be stakeholders’ only opportunity to feed back us, but it was good to have around the table everybody with their different views having a discussion. We did not come to a consensus—as you may expect, given the number of people around the table—on how to balance the budget, but we are determined to ensure that we are delivering on the supply of new homes and also considering what needs to be done in a housing emergency.

I would not go as far as to suggest what the Auditor General will find in that report. However, if I can talk again about the assumptions on which the forecasting is based, I think that we can see an overall increase in the number of people who are coming forward for disability benefits in total, and also an increase in Scotland.

It is important to look at the assumptions on which the forecasts are based, and I am happy to provide further information on that. Our budgets are based on the Scottish Fiscal Commission’s forecasts; those assumptions are all laid out by the Fiscal Commission.

There might be recommendations, particularly in the review of the adult disability payment, that would not incur additional expenditure—they might be about improving the way in which the system works—but I absolutely take your point. You have raised two very important and significant pieces of work that could well come with significant price tags for certain aspects.

Inevitably, the Government will need to review the recommendations and consider the delivery requirements. We will also need to consider whether the Government agrees with the timescales for the recommendations, because, clearly, the more radical the recommendations, the more challenging they will be, given the fiscal environment in which the Scottish Government is working. Considering the affordability of changes will be an important next step in the process after the reviews are published.

As you alluded to in your question, the reviews are independent and will come to conclusions and make recommendations for the Government as they see fit. It will then be important for the Government to reflect on the recommendations and to look at their affordability and deliverability to ensure that, if we agree with them, we can analyse when they could be effected. That is the cold, hard reality.

Liz Smith talked about the investment in the mitigation of the two-child cap. We have decided to do that and it will have financial implications for the Government, which is why we will have to look very carefully at significant reviews such as those that we are discussing when we consider them.