Chamber and committees

Thank you, convener, and good morning, colleagues. I welcome this opportunity to assist the committee in its consideration of the draft Social Security (Up-rating) Order 2023 and the draft Social Security (Up-rating) (Miscellaneous Amendments) (Scotland) Regulations 2023.

The draft Social Security (Up-rating) Order 2023 provides for the uprating of benefits administered in Scotland by the Department for Work and Pensions, while the draft Social Security (Up-rating) (Miscellaneous Amendments) (Scotland) Regulations 2023 provide for the uprating of devolved benefits administered by the Scottish Government. The laid instruments provide a 10.1 per cent increase in support covering all devolved benefits, excluding the Scottish child payment, for which uprating was included in the 25 per cent in-year increase. That means that we are uprating all those benefits where there is a statutory requirement for us to do so and have additionally chosen to uprate those for which there is no statutory requirement for ministers to do so.

As the committee is aware, we took the decision to increase the Scottish child payment from £20 to £25 per week in November 2022, which was a 25 per cent increase. Now that eligibility has been extended to under-16-year-olds, that will benefit more than 300,000 children across Scotland in the financial year 2023-24. The Scottish Government estimates that the payment could reduce the relative child poverty rates in Scotland by 5 percentage points in 2023-24, lifting around 50,000 children out of relative poverty.

We have taken the decisions on uprating in recognition of the difficulties facing people in Scotland during the on-going cost of living crisis, which has seen inflation rates reach a 40-year high over recent months. Subject to parliamentary approval, the new rates in the regulations before us will come into force in April 2023. I thank the committee for its scrutiny and consideration of the uprating instruments and urge colleagues to welcome and support them.

That is certainly an important issue, although a question not directly related to the instruments before us. Of course, the carers allowance supplement will be uprated through the instruments by 10.1 per cent overall, in line with other benefits.

The question around doubling the carers allowance supplement in the next financial year and considerations once we get to that juncture in the next period—sorry, Pam Duncan-Glancy, I thought that you were talking about the additional carers allowance supplement, so please excuse me. Of course, there is relevancy and I apologise for that misspeaking.

I know that the member is interested in this area. It is important to consider how we go forward from the pandemic and the cost of living crisis. How is the Scottish Government most effectively equipped to respond to issues that require additional financial support for people and to situations in which it needs extra capacity in its financial armoury to help people? That is more specifically a consideration for the finance committee and finance ministers, but it has an impact across—

Of course. I appreciate the costs that face those households. I hope that the delivery of child winter heating assistance and the changes that we made last year in increasing the number of people who were eligible for that has helped, but I appreciate the challenges for those households.

Just to correct the record, I should have said that there was also one payment in 2014-15, so that is another £25. I apologise to the committee, but, again, the amount of support that would have been paid through the winter heating payment system would have been £50 reliably per year, which would have accumulated to significantly more.

If I may, convener, I will bring in Owen Allen in a minute to talk about the engagement with stakeholders and others. The Scottish Government consulted more widely, and we really appreciated the feedback and contributions from all those who engaged with that consultation. From that and through our experience panels, which Social Security Scotland consults consistently regarding our work, there was a clear view that breaking the link with the cold weather payment was much preferred because of the unreliability of not knowing whether support would be available.

Under the cold weather payment system, the requirement for seven consecutive days of cold weather often means that, because there may be temperatures of 0°C or below for six days but not for a seventh, people do not get the extra support. There are also issues because the reliance on and geographical placement of the weather stations mean that some places cannot get the cold weather payment even when the weather feels—and is—cold. The way in which that is organised logistically feels unjust to people, and it is unjust, which is why we are seeking to make the change to a reliable payment.

Owen, do you want to say a bit more about the engagement that we undertook?

Those important points get to the heart of the weakness of the cold weather payment system: it is unreliable and, as I said in my opening statement, it is dependent on the weather dropping below 0°C for seven consecutive days. That is combined with the fact that the weather stations do not necessarily capture the feelings of cold and the experience of cold weather that many communities are subject to. For example, wind chill is not factored into the considerations.

In the past 10 years, Lerwick, in Shetland, has had only three triggers for the cold weather payment. You mentioned other areas in your region, and Wick has had only two triggers since 2010-11. That shows the weakness of the current system.

In moving away from the cold weather payment and towards winter heating assistance, we seek to provide support to areas in a reliable way. Particularly for the communities that you represent, that will be an improved position. However, other areas of Scotland experience fuel poverty, although the weather is perhaps not quite as cold—albeit that it is still cold.

We have sought to make a change that will help low-income households in a more comprehensive way. It will increase the number of people who, on average, will benefit from support from that winter benefit from around 185,000 to 400,000, as I said. That is an increase of more than 200,000 people who will receive that support. The payment will also be reliable. That is the key change that we are making today.

I ask the member to be mindful of the turmoil that the UK Government has been in through the winter months and the challenging circumstances that that created for intergovernmental engagement, and in relation to new ministers being appointed and then brought up to speed in their departments. I assure you that my officials regularly pressed the point that we would have preferred to have the data earlier and that we needed it to deliver the benefit. However, we have also been sensitive to and mindful of the pressures on the DWP in delivering its cost of living support.

I want to be absolutely clear that the Scottish Government has made the case strongly that we would have preferred to get the data at an earlier juncture, but we were respectful of the demands on our DWP colleagues and we have come to an agreement. We are grateful to them for their strong commitment that they will give us the data that we need on 31 January.

I appreciate the questions, and I listened to Frazer Scott’s evidence last week. We have deliberately built into these regulations the capacity to pay a higher sum in future years if the Government is financially able to do that. That would require a change to the regulations—another set of amending regulations. The ability to pay two payments, or more, in the winter, if that were the determination of the Government at that time, would require two scans from DWP of the data available in order to implement that. I have deliberately built in flexibility to pay more—and more often—in the future if that is feasible and financially possible. Members are aware of the challenge for all of Government in this financial year, given the two statements that have been made by the Deputy First Minister and acting finance secretary about how challenging the budget is this year. The budget for the next financial year will be announced to Parliament this afternoon, and members will know that I cannot comment on that at this point.

The Government has a very strong record of seeking to do more with Scottish social security where and when it can. Unfortunately, we have not been able to pay an additional carers allowance supplement this year, but we have, of course, continued to pay the carers allowance supplement, which is not available anywhere else in the UK. We have increased the Scottish child payment by 150 per cent. We are delivering child winter heating assistance—that has been paid. There are a range of supports from the Scottish Government that are over and above what people receive elsewhere in the UK, utilising the social security system to provide additional support to people who need it. We are always looking at ways in which we can do more, but that is, to a very large extent, within the restricted budget that we have to operate within. That is the reality of the situation that we face in these financial times and with the limited powers and resources of the Scottish Government.

Would I like winter heating assistance to be a higher amount? Of course I would. However, we have to operate within the budget that we have. As I said, £50 is more than many individuals would have received under the cold weather payment system, and we are pleased to be able to give them that additional support. We appreciate the challenging times that people are experiencing.

We do not know about this year, Mr Balfour. I do not mean to be flippant about that. This week would have initiated a cold weather payment in certain places in Scotland, because there have been seven consecutive days of weather at 0°C or below, but we do not know whether there will be another two weeks of that this winter in Scotland, even in those places. I appreciate, from last week’s evidence and the stats, that there are places that have, historically, in some past years—not all years—received more than £50, but there is no guarantee that that would happen this year or in the years after that, even in those places, although, looking at the weather and analysis, it could be likely, and I accept that. Overall, however, as I said, tens of thousands more people will benefit from the winter heating payment than did under the cold weather payment system.