Contents
- Attendance
- Decision on Taking Business in Private
- Subordinate Legislation
- Social Security Scotland
Subordinate Legislation
Carer’s Allowance Up-rating (Scotland) Order 2019 [Draft]
Carer’s Allowance Up-rating (Scotland) Regulations 2019 (SSI 2019/21)
We move on to agenda item 2. The committee will take evidence on the draft Carer’s Allowance Up-rating (Scotland) Order 2019, which is subject to the affirmative procedure, and the Carer’s Allowance Up-rating (Scotland) Regulations 2019, which are subject to the negative procedure.
I welcome the Cabinet Secretary for Social Security and Older People, Shirley-Anne Somerville MSP, and her officials from the Scottish Government: Veronica Smith, cross-cutting policy officer, and Colin Brown, solicitor. I thank all three of you for coming along this morning.
I invite the cabinet secretary to make an opening statement. We will then move on to questions.
Thank you, convener, and good morning. I welcome the opportunity to provide evidence on the draft Carer’s Allowance Up-rating (Scotland) Order 2019 and the Carer’s Allowance Up-rating (Scotland) Regulations 2019. This is the first time that the committee will hear evidence on social security uprating legislation. Hearing such evidence is to become an annual event.
As members know, through the Social Security (Scotland) Act 2018, we committed to uprating carers assistance, disability assistance, employment injury assistance and funeral expense assistance annually, and to reviewing all types of social security assistance annually. Members may recall that I wrote to the committee on 12 December last year setting out our approach to the uprating of the carers allowance and the carers allowance supplement, which will be uprated in line with the consumer prices index, or CPI.
I highlight that the instruments that we are discussing today are about the uprating of those benefits and how that is measured, and not about the level of the benefits. The place for that discussion was during the Scottish budget deliberations—a process that the Parliament completed a matter of weeks ago. The draft order and the regulations are about how we ensure that the benefit levels that we agree on as members of the Scottish Parliament retain their value.
The committee will be aware that we introduced the carers allowance supplement last summer to address the fact that the carers allowance is the lowest working-age benefit. The supplement has brought the carers allowance up to the level of the jobseekers allowance, and it can rightly be hailed as a success. It has put an extra £442 into over 77,000 carers’ pockets in 2018-19, which represents an increase of 13 per cent and an investment in Scotland’s carers of over £33 million.
As I have previously explained to the committee, getting that extra money into carers’ pockets as early as last summer was possible only because of the use of an agency agreement with the Department for Work and Pensions. Without that, additional payments would have been delayed while the policy was decided and a system was built to implement it. The agency agreement was drafted as it was to enable us to uprate the carers allowance using the CPI. As well as being the right mechanism to use in itself, it allows a consistent approach to be taken across the carers allowance and the supplement. That approach will continue until we have our own regulations in place for the Scottish form of the carers allowance.
We are committed to ensuring that benefits in Scotland keep pace with the cost of living. I turn to the detail of how we will achieve that.
We will uprate the carers allowance through powers in United Kingdom legislation. The draft order proposes that we uprate it according to the September 2018 consumer prices index rate, which was 2.4 per cent. That is also the rate at which the Department for Work and Pensions will uprate the carers allowance in England and Wales. The order will increase the weekly rate of the carers allowance from £64.60 to £66.15.
The order and the regulations will also make some adjustments to additional payments that are made to a few long-term recipients of the carers allowance: the adult dependency increase and the child dependency increase. For many years, both payments have been abolished for new claims, but they remain in place for a small number of carers.
The regulations will increase the carers allowance earnings threshold—the amount that a carer can earn in a given week and still be eligible for the benefit—from £120 to £123. There will also be changes to the earnings thresholds that relate to the historical payments that I have mentioned. The changes are set out in detail in the regulations, and they will mean that, for that small number of cases, the payments will increase by a few pounds.
I will now speak about the annual uprate of the carers allowance supplement. As agreed in the Social Security (Scotland) Act 2018, no new regulations are required to bring the uprate into effect. However, it is worth highlighting the uprate, because it demonstrates the commitment that the Government has made, through the 2018 act, that the carers allowance will match the rate at which the jobseekers allowance would be paid if it had been uprated.
Our approach to uprating means that the supplement will increase from the equivalent of £8.50 a week to £8.70 a week. That means that, in Scotland, we will provide carers with an extra £452.40 a year compared with what is being provided by our counterparts south of the border. That represents an additional investment in carers of about £37 million in the next financial year from the Scottish Government.
Taking into account social security in 2019-20 and what we are providing through the carers allowance and the supplement, we are investing a total of £320 million in carers. I am sure that the committee will agree that that investment is just and right for Scotland’s carers.
I am happy to take questions from the committee.
Thank you, cabinet secretary. I am sure that there will be a few questions.
Before I bring in fellow committee members, I would like to ask about the process. The affirmative statutory instrument relates to uprating. Yesterday, there was a debate about what mechanism should be used for that uprating. I wonder whether there will be a future opportunity to look at the inflationary pressures on uprating.
In your letter of 12 December 2018 to the committee, you explained the uprating mechanism that would be used. I will not go over that again, but I will read out a paragraph that refers to uprating in future years. It says:
“The process outlined above”—
that is what you have explained—
“for uprating CA and CAS will continue annually until we have made our own carer’s assistance regulations. However, when other benefits begin to be delivered, for example Funeral Expense Assistance ... and Young Carer’s Grant ... in 2019, there will be reporting requirements under section 77 of the 2018 Act to consider the effects of inflation and to report to the Scottish Parliament on what we intend to do. There will also be a duty under section 78 to uprate FEA and YCG which will apply in 2020/21.”
Please bear with me. The paragraph continues:
“Uprating in these circumstances will require regulations under the super-affirmative procedure involving scrutiny of the draft regulations by the Scottish Commission on Social Security ... and affirmative procedure in the Scottish Parliament.”
Will the Government, in partnership with the Scottish Commission on Social Security, look at what mechanism is used at that point? I think that, in the 2018 act, which underpins all this, there is a statutory duty to look at inflationary pressures when Scotland takes on full delivery, and then the payments will be uprated.
You raise an important point about how the process will progress over the years, as Social Security Scotland begins to deliver more benefits. The benefits will be dealt with in different ways, depending on what is said about them in the 2018 act.
You are quite right to point to the role of the commission in looking at every draft regulation that comes our way. There is a statutory obligation for us to ensure that we outline our plans to Parliament and to the committee, and to go through in detail how we come to decisions on uprating. Those decisions that require regulations will go through the commission, as well.
In yesterday’s debate, I made the commitment with reference to the Conservative amendment that the Government will look at different options. We have already done that during the process but, as with all aspects of the social security system, we are open to discussions with political parties and the committee to look at any different options that might be out there.
The approach is what the Government has determined is the correct way forward, and I hope that the committee will pass the motion. However, in the Parliament and within our statutory obligations, we will look to see whether other options are available in the future. I am still content that the approach is the correct one and, having looked at all the other options, I would be surprised if something changed my mind about that. However, I am open to discussions to see what can come out of them.
I have one more question. I will reserve additional comments for our debate under the next agenda item and will be more concise than I was in my previous question. By 2020-21, when the carers allowance becomes carers assistance, will there be statutory obligations on the Government to look at inflationary pressures in deciding on the uprating mechanism? That is my understanding of the situation.
Yes, we will have statutory obligations as we pass each piece of legislation, whether that is on carers assistance or any of the other payments that will be dealt with through regulations.
Okay. The reason for asking that question is that it allows the committee to return to that in a structured, process-driven and evidence-based way at a later date as statute dictates, whatever might happen this morning.
I have questions on each instrument. I will start on the earnings threshold. The paper that the Government has provided to the committee says:
“As the increase to Carer’s Allowance earning threshold ensures that the benefits people receive maintain the current situation, then it is considered that there is no significant impact on the private, voluntary or public sector.”
Do you still agree with the statement that that maintains the current situation, given the impact that the changes to the national living wage level will have on working carers?
Yes, I do. I appreciate that I have a difference of opinion with the Labour Party on how we should measure the uprating—that was demonstrated yesterday—but I am content that our approach is the correct way to uprate and that the measure is the best measure of inflation that we have to ensure that inflationary measures are taken into account.
My question is not really about our difference of opinion; it is about the factual situation. This year, a carer on the national living wage is able to work up to 15 hours and 20 minutes and maintain their eligibility but, under the new earnings threshold, they would be able to work for only up to 15 hours. They would have to go to their employer and ask for a reduction in their weekly working hours to maintain their eligibility for the carers allowance. As we all know, there is a significant cliff edge if someone goes over the threshold—even by one penny—and loses their entitlement. Will you reflect on that, and on the position that working carers would be in through no change of their own?
I absolutely appreciate the cliff edge that exists for carers assistance, and I appreciate the difficult conversations that carers might need to have. It comes down to whether we should have rules for carers in Scotland that are different from those that exist for the DWP’s carers allowance. If we wanted to change the thresholds to make them different from the DWP ones, we would have to renegotiate the agency agreement and so on to allow that change to take place.
10:00As I mentioned in my opening remarks, we put the agency agreement in place to get payments into carers’ pockets quickly after the Parliament passed the 2018 act. The Government took that decision to ensure that those payments were made. The other aspects of the rules, such as those on working-age carers, can be looked at as we move to a form of Scottish assistance to carers.
Do you not regret the fact that carers will have to ask for a reduction in their working hours as a result of the changes to the threshold combined with changes to the national living wage?
When the act was passed, we had a choice to either sign an agency agreement with the DWP that put £442 into the pockets of carers on the lowest incomes or take time to set up the policies and implement a system that would allow us to deliver Scottish carers assistance. The pure fact is that, by doing the latter, we would not have been able to deliver the money as quickly to carers. We chose the former and the then cabinet secretary, Angela Constance, made that clear to Parliament some time before it was implemented. Mr Griffin may think that that was the wrong choice and that we should have delayed the changes to carers allowance and introduced carers assistance more quickly in Scotland, but I disagree, and the fact that we have made that quick payment to carers has been warmly welcomed. It is the first step in what we will do with carers, and it was our first priority when we took over social security powers.
Have you been in touch with the UK Government to inquire about any flexibility in the earnings threshold that would allow carers in Scotland to maintain their working hours?
We have signed an agency agreement with the DWP that ensures that we will move forward with the carers allowance as it is currently delivered. If we want to reopen that agency agreement and discuss any changes to it, we could of course get into that, but that would take us away from delivering the disability benefits, which would take us away from plans to devolve the rest of the social security system. We could look into making those changes, and the DWP would tell us how much they would cost the Scottish Government, or we can use the interim arrangement to move forward quickly with our disability assistance packages, as we are doing.
Convener, I have questions on the other instrument, but do you want to give other members the opportunity to ask some questions?
It is probably better if you just finish off your line of questioning, and then I will let other members in.
I have a quote here, which states that the consumer prices index
“does not adequately reflect the cost of living and ... moreover, the Treasury must already know that, because it uses the RPI whenever it wants to justify an increase in taxation”.—[Official Report, 22 June 2011; c 878.]
Do you agree with that characterisation of the difference between the CPI and the RPI?
In looking at how to measure inflation, we have taken into account the work of, for example, the Office for National Statistics, the Bank of England and the chair of the UK Statistics Authority, all of which have concluded that there are deficiencies in the use of the RPI and that the CPI is a better measure of inflationary pressures. That is the work that I have looked at in coming to the decision that we have put before the committee today.
The quote that I gave is from Jamie Hepburn, who is one of your ministerial colleagues. It reflects quite clearly the Government’s position that, when it comes to taking money from citizens, it considers the RPI method to be appropriate—we see that with the increases to rail fares—but when it comes to paying citizens, it is content to use the CPI, which has been at a lower level historically.
I will ask about the process. When you appeared before us during our scrutiny of the budget, I asked you for further detail on your deliberations, your methodology and how you came to the conclusion that the CPI is the preferred option. In response, we have a single paragraph in a letter that does not go into detail about the methodology or how you came to that conclusion. Given that this is such a significant stage in the creation of social security payments in Scotland, do you not think that a wider debate—not just a paragraph in a letter—would have been beneficial? Setting the uplift rate of social security payments will set an important precedent.
If the committee was not content with that paragraph, I would have been more than happy to respond to another letter asking for more detail at that time. I am not aware that such a response was requested from me.
I will go into the detail, if that would help Mark Griffin to understand why we have done what we have. The RPI is an erratic measure of inflation; it greatly overestimates and, sometimes, underestimates changes in prices. You can have a negative RPI rate. For example, the RPI changed over the 12 months to September 2009 by -1.4 per cent. That was mainly due to the erratic nature of housing costs, which are part of the RPI measurement.
There is no single measure of inflation, so we looked at different measures. In yesterday’s debate, I mentioned that we had looked at the CPIH—consumer prices index housing—and that, if I remember rightly, in seven of the past nine years, it would have led to a smaller increase in the payment when compared with the CPI, so we ruled it out.
As I have said, the retail prices index does not meet international standards for the designation of a national statistic. It is heavily influenced by house prices. The ONS, the UK Statistics Authority and the Bank of England have discouraged its use. Legacy requirements are allowed to be recognised in some areas, but authorities recommend that we should move away from that measure.
I hope that that gives more detail, again, on some of the aspects that we have looked at and why we came to the decision that we did.
On the issue of the uprating mechanism, your policy note mentions that you relied on the consultation on the Social Security (Scotland) Bill. Again, I ask that you reflect on the significance of the uprating mechanism that we are being asked to accept and the precedent that it will set for all devolved social security payments and whether an individual consultation on the uprating mechanism would have been more appropriate. The policy note simply says that the majority of stakeholders to the consultation on social security in Scotland agreed
“that devolved benefits needed to keep pace with the cost of living.”
That does not reflect the range of submissions that supported the RPI, the CPI and other measures. Given the precedent that we are setting and how important the uprating mechanism will be, a consultation would have been valuable.
There is no statutory requirement to consult on this instrument, but uprating was part of the consultation on the Social Security (Scotland) Bill. That consultation included a chapter on uprating and sought the views of stakeholders on the best way to ensure that benefits keep pace with the cost of living. Mr Griffin is quite right to point out that there were differing views on that. There is no agreed definition of inflation, so it is not surprising that there was no agreement on what uprating should be done. However, that consultation was completed as the bill progressed.
The convener mentioned in questioning that, when we introduce uprating regulations under the 2018 act, they will, of course, be subject to independent scrutiny from the commission. Therefore, very clear independent scrutiny of the regulations will take place. A one-off decision will not be made today that will carry on; we will go forward on an annual basis. When we introduce regulations, they will be independently scrutinised by the commission.
I know that that was an extensive line of questioning, but it is important that we have that level of scrutiny.
I remind members that, if they have wider comments to make, there will be an opportunity to make them under the next agenda item.
I appreciate that the Scottish Government is currently committed by the agency agreement with the United Kingdom Government to uprate carers allowance in line with its plans. We have had a discussion about how we uprate but, before carers assistance comes online, how can we be sure that we have the amount correct in the first place? During the debate yesterday, we heard in considerable detail about the sometimes very negative financial impact that caring can have, as carers may have to give up work. It can be costly to care for one person, if not more than one. Can you assure us that the Government will carry out extensive consultation with carers and the organisations that represent them before it comes to a decision on that?
Certainly. I am in contact with stakeholders when we move forward with social security, and carers organisations are no different from other stakeholders. I meet them regularly to discuss that issue and many others.
Alison Johnstone is right to point out that, yesterday, quite a few members pointed to areas in which we need to take a more holistic view of what is happening with carers, and to whether the Government has got the level of the carers allowance supplement right. That is a valid debate for the Parliament to have, and it is valid to question the Government on that.
We think that the supplement has made a tremendous difference to carers. There may be people in the Parliament who think that we should go further, and it is quite right and proper that people have such views. As I pointed out in my introductory remarks, I will have such discussions on an annual basis during the budget process as we discuss all the Government’s decisions on social security and whether we have got the policies and the levels right. I think that we have done a good job in delivering our first priority for carers as we move forward with the carers allowance supplement, but the Parliament and the different political parties can challenge us on whether we have got that right.
I want to get something clear in my own mind before the debate. No legislation is required to effect the uprate, but it is open to the Scottish Government in future, if it is persuaded, to make the choice to change the method that is used.
No legislation is required in the case of the carers allowance supplement. However, as I said during the debate yesterday, I know that there are differing views on this, and we have committed to carrying on discussions and to hearing suggestions. We have already taken a great deal of time and given a great deal of thought in the Government to do that, but of course people will have differing opinions on the issue in the future—I am sure about that.
But it is a choice.
Yes—for the carers allowance supplement.
I noted what you said on Mark Griffin’s questions on earnings. There might be difficult conversations for some carers, who might find themselves over the threshold. Was that known about? Did that issue arise when you were making decisions about the uprating?
10:15
The decisions that we take are, in essence, built on the fact that we have an agency agreement. I will not reiterate the point too far, but I go back to the reasons why we took out that agreement in the first place, which was to ensure that we could get money into carers’ pockets. If we required any other changes that would make what we are doing in Scotland different from what is happening in England, that would involve a renegotiation of the agency agreement and the DWP would tell us whether there was a cost to the Scottish Government for changing what it is doing for Scottish clients as compared with those in England. We chose to move to an agency agreement to allow us to pay the carers allowance supplement.
I appreciate that and I appreciate why you took the decision, but do you accept that the downside is that some carers will have to have the difficult conversations with employers that you talked about, and a lot of people will lose their entire entitlement?
The challenge is that we either have an agency agreement or we do not. If we do not have the agency agreement, we will need to set up an entirely different system to deal with what we know people want to see in carers assistance. We could make those changes, but not at the speed that we delivered the carers allowance supplement. That is a choice that the Government made.
I have a wee question about your point that the RPI is an erratic measure. I will confess up front that this is not my specialist subject, but I was interested that the year that was used as an example was 2009, which was the year after the financial crash. I know that there is an on-going discussion about the question of housing costs, which are a major factor in pushing people into poverty, but have you looked beyond what happened in 2009? Do you acknowledge that that was a strange year because it was the year after the crash and the economy was erratic? Did you take that into consideration?
That year was one year after the crash, which was a major economic event that caused great difficulty for the country. We can only imagine other examples of great economic events over which we have no control that may affect the country in the next year or two, causing the RPI to be erratic. However, it is not just about what happened after the crash; it is an on-going situation that the RPI is an erratic way of measuring inflation. That is not just the Scottish Government’s view; independent agencies such as the ONS have come to the view that it is an erratic measure.
I have two questions, which I will ask at the same time to be brief. They follow on from that conversation. There are reports in today’s newspapers that there has been a significant setback in house prices because of Brexit. If that played out, depending on what happens with the shambolic Brexit process, and there was a substantial and sustained reduction in house prices, would that open up the possibility that, if the allowance was linked to the RPI and included housing costs, people receiving it could end up with a significantly reduced uprating or even a downrating?
Secondly, can you give us any idea of the likely cost of having a change made to the agency agreement? In my experience, that can be very expensive. What would the scale of the cost be—would it be £1 million, £5 million or £10 million? Would the Scottish Government have any say over that? Would any bargaining take place on that or would the price simply be given to you by the DWP?
Given that Brexit is coming up, I will not even attempt to forecast what inflation might look like over the next year, when we have no idea what is going to happen in the next couple of weeks. You are quite right to point out that, when there are economic challenges and economic circumstances that are disadvantageous to the housing market, that will have an impact on the RPI but not the CPI, because housing costs are not covered by the CPI. That is why the RPI is a more erratic measure of inflation than the CPI, which is why we have not chosen to go down that route.
On the question of cost, it is not possible to put a price on a change, because we have not asked for a change. We are concentrating on getting on with the devolution of the disability and carers benefits. Anything that involved us trying to renegotiate an agency agreement would take people away from that work. The cost of a change would need to be looked into on an individual basis, depending on what we were looking for. You are right to point out that it is not within our gift to decide what that cost would be. It would be for the DWP to suggest what the cost was. The Scottish Government would work hard to ensure that that cost was kept to a minimum and that we delivered best value for Scottish taxpayers. The cost of a change would not be chosen by the Scottish Government; it would have to come out of negotiations with the DWP.
I have a late bid for a question. I am conscious of time, as it is important that we get the maximum opportunity for scrutiny. I apologise, Mr Balfour, but can you be quite brief, please?
It is a short question that requires a yes or no answer.
Cabinet secretary, I think that you said that, if you went back to the DWP to renegotiate, that might delay progress on other benefits, such as the personal independence payment. Is that correct? Is there a danger that you would not be able to deliver the other benefits as planned if you had to renegotiate with the DWP?
I will put it this way: I am exceptionally fortunate to be supported in my work by an exceptional bunch of civil servants and agency staff. There are no directorate or agency staff who are sitting around looking for something else to do. If anyone had to renegotiate the agency agreement, they would have to be taken off other work. Those staff are working exceptionally hard to ensure that we deliver at pace on social security, and I do not want them to have to delay any of that work because of what would be, in effect, an interim solution as we move forward with the devolution of benefits.
Carer’s Allowance Up-rating (Scotland) Order 2019 [Draft]
We move to agenda item 3. I invite Ms Somerville to move motion S5M-15926.
Motion moved,
That the Social Security Committee recommends that the Carer’s Allowance Up-rating (Scotland) Order 2019 [draft] be approved.—[Shirley-Anne Somerville]
We now have the opportunity to have a debate. I appeal for it to be a short debate, given the time constraints that we are under. Does any member have comments to make?
As I indicated in my questions, this is such a momentous stage in the devolution of social security entitlement that the uprating method that will be used deserves wider discussion, wider consultation and wider debate before we make the decision.
Members will know that, when the committee scrutinised the Social Security (Scotland) Bill, it was concerned about the exact position that we find ourselves in—in which a take-it-or-leave-it instrument would come before the committee without having had a high level of consultation, scrutiny or debate, because of how the legislation is drafted and how reliant it is on regulations.
It transpires that we are now in that position. We are making a momentous decision—it is a key milestone in the progress to full devolution of the social security entitlements—but, without yesterday’s debate, it would be done with almost no debate at all.
The Government and the cabinet secretary and her predecessors are on record as criticising the UK Government for exactly the policy that the cabinet secretary intends to implement. Regularly, ministers and members talk in the chamber about the almost £4 billion that has been cut from social security spending. The briefings that the cabinet secretary received when she assumed her position set out clearly that the coalition’s uprating policy of changing from the RPI to the CPI would cost recipients of social security in Scotland £1.9 billion up to 2021, yet we continue with the CPI, with almost no debate, in the absence of the issue being brought to the chamber yesterday. If the UK Government had continued with the RPI, carers would be almost £1,000 better off at this point.
For those reasons, I do not support the decision to uprate by the CPI. There has been a complete lack of debate and discussion and, given that this is such a huge decision, I am really concerned about the precedent that will be set.
I am happy to support the motion. If the issue was hugely significant, as has just been suggested, an amendment to the budget should have been lodged. No amendment was proposed, so that level of significance was not attached to the issue at that time.
People seem quite happy to see a cumulative cut of more than £2 billion to the Scottish Government’s budget—there have been no RPI increases to that budget over the past nine years—and yet, once again, more is being asked of the Scottish Government than is being given to it to undertake what is being asked.
Over the past few weeks, we have seen many demands to increase funding for all sorts of things. There was a demand for the Scottish welfare fund to be increased, even though it was underspent. However, I have seen no suggestions about where that money should come from. It is hard to see the logic in that.
What has been said tries to take away from how much is being done for carers through the social security provisions in Scotland, which are a major step forward. If we managed to convince the Scottish Government to accede to a request to revert to the RPI and then Brexit had a major impact on the housing market, would we be here next year to demand a return to the CPI to protect carers? For those reasons, I am more than happy to support the motion.
I have some sympathy with Mark Griffin’s worries about a tick-box exercise—I get his point. The issue is fundamentally complicated because the RPI has been found to be flawed. There have been a lot of calls for it to be fixed, although those calls have been resisted.
The debate is about two things. It is about whether we should debate and look at how we uprate—I totally agree that we should do that, which is why we asked for and got a welcome guarantee from the cabinet secretary yesterday that the method will be looked at consistently as we go along. That is important.
10:30The RPI could be fixed and the flaws corrected, although, ironically, the flaws are to do with clothing price estimates and not housing, so some of the discussion is slightly offbeat, given what the problems actually are. However, it would be irresponsible for the Government to suggest that we should use a flawed measurement as a starting point for the new system. For that reason, I support the Government’s position, but it is important that we keep on reviewing that.
I doubt whether the RPI will be fixed any time soon, because it is linked to the gilt market, and there would be significant effects on that. The last gilt will expire in something like 2066, so I suspect that we will have to wait quite a long time for anybody to be willing to fix the RPI.
It is members’ responsibility to have the appropriate depth of understanding when we debate a subject. I would never call for us to use a statistically flawed method of uprating. That would be irresponsible, and it is for that reason that I support what the Government is doing.
It is beholden on us as a committee and individually to bring the appropriate depth of understanding to debates. We might not like what is proposed and we might see other issues that will be caused by it, but it is incumbent on us to understand that we need to call and press for fixes to be made or to find an alternative. We need to look at the thing in the round.
I heard what Mark Griffin said about cliff edges and so on, but that is a different issue from uprating. We should not conflate the two issues. We need to look at them separately and figure out how we can do the best for our carers along the way. For that reason, I will support the Government’s position, but I empathise with Mark Griffin and see where he is coming from.
I thank the cabinet secretary for answering our questions straightforwardly, although I do not agree with everything that has been said.
I have always recognised the importance of the work that the Scottish Government has done on introducing the supplement. I hope that that goes without saying. Through the bill amendment process, the committee and the Government were clear that there should be an annual uprating mechanism and, as Mark Griffin said, it is healthy to debate what uprating mechanism we should use to reflect the effects of inflation on people’s living costs.
There is huge distrust of use of the CPI, which the UK Government adopted in 2010, and that distrust goes wider than members of the committee, as it is also expressed by a number of third sector organisations. We need to take that into account.
I see this not as a budget issue but as a matter of principle. We may have a difference of opinion, but I want us to adopt a measure that truly reflects people’s costs, and people’s housing costs are an essential element in the calculation. I am also concerned about the earnings issue. I noted what the cabinet secretary said about the things that she has to weigh up in relation to the agency agreement, but it distresses me deeply that, although we do not know the numbers, some carers will lose all of their entitlement because of the lack of flexibility.
I welcome the fact that we will have future discussions on the subject and I note that the cabinet secretary said that she is content that the proposed approach is correct, but I hope that she will keep an open mind. No one would want to support a statistically flawed process but, for today’s purposes, use of the CPI is the wrong approach and I do not support it.
Time is against us. I call Jeremy Balfour, to be followed by Alison Johnstone.
I, too, welcomed Mark Griffin’s debate, because there is an issue here. I support the Scottish Government’s position, but the committee will need to have dialogue with the Government on how future regulations are considered. As Mark Griffin said, one of our concerns when the bill was going through was that we were leaving a lot to regulation, and there is a danger in that approach. We might like only 75 per cent of what is proposed, but we cannot amend it.
Other regulations will come forward, so we need to find a mechanism to allow them to be debated without our having to vote just yes or no at the end of the process. We have had a bit of discussion about using third parties to do that. It is important that we do not end up in a situation where we like a lot that is in the regulations but, because of one or two things, we have to vote against them. The committee needs to think and have a dialogue about how we deal with that in a way that is open and provides scrutiny but does not delay decisions.
It is widely recognised that the Greens support the use of the RPI rather than the CPI in this situation, but I understand that, at the moment, the Scottish Government is locked into uprating at the CPI rate, as the UK Government is doing. I am not sure that there is an alternative to the agency agreement. The situation is difficult, and we are in an unsatisfactory situation this morning, as has been expressed fairly widely by members. For those reasons, I will abstain in the vote on the motion.
Thank you for making your position clear.
As no other members want to comment, I will make a few remarks before the cabinet secretary sums up. I take seriously my role as convener in scrutinising the Scottish Government’s work on the delivery of social security. I hope that that was clear from the extensive questioning that I allowed Mr Griffin, given his specific interest in the issue.
I am sympathetic to an evidence-led methodical approach to considering what measures should be used to uprate thresholds and levels for benefits and entitlements. If the committee wishes to carry out work on that, we absolutely should do it. However, the details of the uprating of carers allowance and carers allowance supplement were provided to the committee on 12 December 2018, some 11 weeks ago, and it was not until the past couple of days that particular issues were raised.
I read the cabinet secretary’s letter when we received it, including the section on “Uprating in future years”, which clearly states that, when we move from carers allowance to carers assistance and the Scottish Government and Social Security Scotland take control of the benefit, the Scottish Commission on Social Security will have a statutory role. That seems an absolutely appropriate time for the committee to have a substantial look at the level of benefits and how they are uprated. That is the appropriate way for the committee to do our business, particularly given that we have had that information from the Scottish Government for the past 11 weeks.
The situation is disappointing, given that we are considering an investment of an additional £37 million that will go into the hands and pockets of carers, who do an amazing job. If we want to talk about the level of benefit, let us have that discussion, but that should be at budget time, when we can consider the consequences of any financial asks to the Government from back benchers or Opposition parties.
The figure that we have been given is that using the RPI would put an additional £3 million into the pockets of carers. If we are going to have a political discussion about how best to put £3 million into carers’ pockets, let us have a frank discussion about where that money comes from and the best way to spend it. Is that through changing the uprating mechanism, extending the young carers grant or looking at respite care for carers? We could consider a wider package to improve the lot of carers.
The committee absolutely has to continue to scrutinise without fear or favour in relation to the level of benefits and how they are uprated but, in my opinion, opposing an affirmative instrument when that opposition would, if successful, in effect mean less money and not more money for carers is an irresponsible way of doing business.
Ironically, I commend Mark Griffin for raising the wider issue. There are underlying discussions to be had in areas of scrutiny that our committee should engage with.
Others have had the opportunity to say where they stand in relation to the debate; that was my opportunity to put my thoughts on the record. It has been a high-quality debate and the cabinet secretary now has the opportunity to sum up.
Thank you, convener; I appreciate that opportunity. As some members have pointed out, the first time that I raised the matter formally with the committee was in the letter that I sent in December 2018, which set out in detail what we proposed for the carers allowance and the carers allowance supplement. There has been some time for the committee to reflect on that, and I would have been happy to provide further evidence or to appear before the committee earlier, had a request been made to have that wider debate. I am, of course, more than happy to do that in the future.
The debate has been informative not just on the instrument that we are looking at but on the wider points that Jeremy Balfour and others raised about how we deal with regulations as we move forward with social security. The letter of December 2018 was my first opportunity to make clear my direction of travel on the issue, but I am mindful that more might need to be done to ensure that the committee is aware of the issues and has opportunities to engage with them.
I hope that Mr Balfour and others are reassured that section 77 of the 2018 act requires me to report to Parliament, to discuss the issues and to be held accountable for them. As the convener pointed out, the draft regulations will go to the commission for independent scrutiny and they will be available for the committee and wider stakeholders to take a view on and require further evidence about. I will be more than happy to take part in any deliberations at that point.
I am mindful of the points that have been raised today and of the fact that people still have concerns about what we have chosen as a measure of inflation. As I said yesterday, I am happy to hear those discussions as we move forward. I will look seriously at and reflect on the wider point about how we deal with regulations under the 2018 act. I am available to the committee at any point should further questions be raised on that issue.
Thank you, cabinet secretary. That concludes the debate.
The question is, that motion S5M-15926, in the name of Shirley-Anne Somerville, be agreed to. Are we agreed?
Members: No.
There will be a division.
For
Allan, Dr Alasdair (Na h-Eileanan an Iar) (SNP)
Balfour, Jeremy (Lothian) (Con)
Ballantyne, Michelle (South Scotland) (Con)
Brown, Keith (Clackmannanshire and Dunblane) (SNP)
Doris, Bob (Glasgow Maryhill and Springburn) (SNP)
Robison, Shona (Dundee City East) (SNP)
Against
Griffin, Mark (Central Scotland) (Lab)
McNeill, Pauline (Glasgow) (Lab)
Abstentions
Johnstone, Alison (Lothian) (Green)
The result of the division is: For 6, Against 2, Abstentions 1.
Motion agreed to,
That the Social Security Committee recommends that the Carer’s Allowance Up-rating (Scotland) Order 2019 [draft] be approved.
I thank the cabinet secretary for coming.
10:43 Meeting suspended.10:46 On resuming—
Carer’s Allowance Up-rating (Scotland) Regulations 2019 (SSI 2019/21)
Under agenda item 4, which is still on subordinate legislation, the committee is invited to note the Carer’s Allowance Up-rating (Scotland) Regulations 2019. Is the committee content to note the instrument?
Members indicated agreement.