Meeting of the Parliament

Meeting date: Thursday, April 27, 2017

Official Report 903KB pdf

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Social Security Agency

Good afternoon. The next item of business is a statement by Jeane Freeman on the new social security agency. The minister will take questions at the end of her statement, so there should be no interventions or interruptions.

14:30  

Today, as I announce the model for the delivery of social security in Scotland and publish the evidence supporting the decision, we mark the next significant milestone in building Scotland’s new social security system.

I will outline the shape and approach of Scotland’s social security agency and touch on both the estimated number of people it will employ and the estimated costs involved in delivery. In the autumn, I will announce the location of the agency and the next steps for our assessment model for determining eligibility for benefits.

Following the decision last March to establish a new executive agency, we have undertaken a second-stage options appraisal to examine how the agency could deliver a rights-based social security service in a way that both aligns with our core principles of dignity, fairness and respect and achieves value for money. In doing so, we have again underlined our commitment to co-production and transparency by involving partners from the third sector, local government and academia and using the responses to the social security consultation to determine and assess the appraisal criteria. That was a formidable and detailed analytical task, which has led to a thorough and balanced options appraisal report, which itself demonstrates the integrity and robustness of the process and the evidence base from which we have worked.

Our preferred model for delivery has two key strands. Ten of the 11 devolved benefits will be delivered directly by the new social security agency through an efficient centralised function. However, our social security agency will also provide locally accessible face-to-face pre-claims advice and support, co-located—where possible—in places that people already visit. Discretionary housing payments and the Scottish welfare fund will continue to be delivered by local authorities.

The option that we have chosen will best deliver on our key objectives, which are: consistency of provision across Scotland; a person-centred, rights-based service; a strong, local, human face to improve accessibility and support; and a safe and secure transition for the 1.4 million people who rely on the service.

That local presence will be one of the key differences between our social security agency and the current United Kingdom system. Our approach will provide consistency of service across Scotland—irrespective of where an individual lives—and a more responsive service.

We welcome the 11 benefits being devolved, but too much remains reserved and will continue to be delivered in a UK system that has all the deficiencies and faults that are so eloquently detailed in responses to our consultation. We want to see all welfare being devolved, so the agency that we are creating will have built into it the ability to expand to accommodate new powers in the future.

Our next steps will be to decide on the agency’s central location. Again we will take a systematic, evidence-based approach, taking into account a variety of socioeconomic factors and using the same multicriteria framework that was used for the wider options appraisal. In identifying co-location opportunities for the local presence that is central to our model, we will begin discussions with local partners.

There is no doubt that the jobs created in the new agency will bring a major economic benefit to Scotland. We estimate that at least 1,500 people will work in Scotland’s social security agency when it is fully operational. With our provision of a local presence across Scotland, those jobs will not be confined to one central location.

As one would expect, we required the options appraisal to closely examine the estimated running costs of the new system. I am pleased to report that our chosen delivery model not only meets our principles, but represents the best value for money. Although the figures will be refined as we move forward, we estimate that when the agency is fully delivering all the benefits its annual running costs will be around £150 million.

Before I conclude, I will say a little about the assessment model that we will use for the disability and ill-health related benefits. In the past 11 months, I have learned a great deal about how the current UK system goes about assessments. Over and over again, I have heard the personal experiences of so very many people who have found assessment to be one of the most difficult, distressing and demeaning aspects of their whole experience.

I am in no doubt that the current UK assessment model must be substantially changed. I make clear that the approach that we will take will give due recognition to self-assessment and to clear, third-party, professionally founded supporting evidence. If relevant information is secured at the first decision point in the overwhelming majority of cases, we can speed up decisions, getting more right first time and reducing the demand for appeals, which currently place additional psychological and financial strain on individuals.

We will be guided by people’s personal experience through our experience panels, and by the expertise of our disability and carers benefits expert advisory group, which met for the first time last week.

We will also be guided by our principles. One of those principles is that profit should never be a motive or play any part in making decisions or assessing people’s health and eligibility. I have seen and heard enough evidence to know that the private sector should not be involved in assessments for Scotland’s benefits. I can confirm to the Parliament that in our assessment model there will be no contracting with the private sector.

I have begun to explore the potential to use the existing information and expertise of the health and social care sector. I want a genuine partnership to access only the already-known information that is relevant to social security decisions, with appropriate consents and robust safeguards. That will free up the time that health and other professionals currently spend dealing with the negative impact of the UK system on individuals, and enable our skilled and professional health and social care staff to focus on the role that they have trained to take on: caring for and supporting the health and social care of their patients and clients.

We need to get this absolutely right, so we will be working as a Scottish public sector with the professional interests of those in the health and social care sector, drawing on the views of our experience panels and asking the expert advisory group to map out clearly the application and assessment process, to enable us to gather evidence as early as possible and get our first and subsequent decisions right first time. I will return to the chamber in the autumn to provide members with an update and detail on our next steps.

Today’s announcement is not just the culmination of a major and robust options appraisal but the starting point for the design of more detailed operational arrangements—agency locations, staff numbers and service design. Next will be our forthcoming social security bill, which is on track for introduction in the Parliament by the summer, and a timescale for the first suite of benefits that we will deliver.

Our number 1 priority remains the safe and secure transition of 11 benefits for the 1.4 million people who rely on them. Our social security agency will deliver the benefits in an efficient and person-centred way that will be tailored to individual needs. It will provide major economic gain with a significant number of new jobs. It will demonstrate that social security is an on-going investment in the people of Scotland, and we will demonstrate that there is a better and fairer way of delivering social security to those who are entitled to and rely on that support.

This Government will build a social security system that will stand the test of time and the test of trust from the people of Scotland who rely on it. This is a challenging time—as Audit Scotland said, it is “an exceptionally complex task”—but it is also a golden opportunity, and I am determined that we will get it right.

The minister will take questions on the issues raised in her statement. I intend to allow 20 minutes or so for questions, after which we will have to move on to the next item of business.

I thank the minister for providing early sight of her statement. It is good that progress is finally being made on the delivery of social security devolution, now that we are getting on for three years since the Smith commission agreed its terms. It is not news that there is to be a new Scottish social security agency—we have known that for more than a year—but we still do not know where it will be located, how it will be structured, what powers and responsibilities it will have and to whom it will be accountable. In particular, we do not know what opportunity we in the Parliament will have to scrutinise appointments to and decisions made by the new agency. Will the agency report only to the minister, and if so will that be in public or in private, or will the new agency be directly accountable to the Parliament? How will the new agency function? Will it be operationally independent of Government, like for example Revenue Scotland, or will it have a closer working relationship with ministers than that?

It is a bit disappointing that Mr Tomkins has chosen to take that approach. He said that we have made progress “finally” and after “three years”, but that is finally after three years with a Holyrood election in between, and we knew before that election—in fact, in March 2016—that we would have an executive agency.

To answer Mr Tomkins’s specific question, the agency will be directly accountable to ministers, who are directly accountable to the Parliament. As he will know from the most recent evidence that I gave to the Parliament’s Social Security Committee, on which he sits, the legislation that we will introduce will include not only the principles and the fact that the system will be rights based but a requirement to create a charter that outlines clearly the responsibilities of the social security system to the people of Scotland and to those who use it. Under that charter, ministers will be accountable to the Parliament and therefore to the people of Scotland for our delivery of the model that I have outlined.

At this point, we have made very clear the direction of travel that we are going in and the specifics. We did so before the election that brought Mr Tomkins and me to the Parliament and we have done so since then. I would hope that he listened on the three occasions that I have appeared before the Social Security Committee to explain very clearly the approach that we are taking. We know that 1.4 million people will rely on our safe and secure delivery of the benefits. There are key steps that we have to take and we are taking them. Importantly, we are taking them by building on people’s direct personal experience of using the benefits system. How very different that is from the approach of the UK Government.

Labour whole-heartedly welcomes a great deal of what is in the statement, including the intention to create a new social security system that gives face-to-face contact and pre-claims advice and that seeks to have a local presence in communities. Labour very much welcomes the fact that the assessment model will not contract with the private sector. My colleague Mark Griffin has been particularly vocal about that.

The minister has been reported as saying that the new arrangements will not be implemented until at least 2021. Will she clarify whether there is any intention to go beyond that date? Does she recognise that thousands of claimants desperately want the arrangements that she talks about sooner rather than later, as they are at the mercy of the current system? Will the minister give a commitment that the pre-advice and support will be available in every deprived community and that the basic model of co-location, which she mentioned in her statement, will not be the exclusive approach, to ensure that Scotland’s new social security agency has a local presence across the country?

I am grateful to Ms McNeill for her support for at least the bulk of what I said in my statement and in particular for our determination and decision not to involve the private sector in contracts for assessments.

On the new arrangements, the accurate reflection of what I have said in the past is that, by the end of this session of Parliament, we will be delivering all 11 benefits. I also said at the Social Security Committee that we will take on responsibility for each of those 11 benefits incrementally following the passage of legislation in this Parliament, which we will introduce before June and which I expect to take until the spring of 2018 to pass. I said in my statement that, in addition to introducing legislation, we will advise members of the next steps in delivering the suite of benefits that come first.

I hope that that answers Ms McNeill’s question and provides reassurance that we will not wait until 2021 for a big bang to happen before we introduce all 11 benefits. That is not because we are under pressure from anyone to do otherwise, but because to do so would risk the safe and secure transfer of benefits.

Pre-advice and support will be available to individuals across Scotland regardless of where they live. We will largely be talking to public sector partners and perhaps third sector partners about that. I am particularly looking for co-location in order that we as the Scottish public sector make it as easy as possible for things that are currently available, such as discretionary housing payments and welfare fund payments, to be triggered by an individual’s first appearance, whether to their local authority or the social security agency.

Ten members still wish to ask questions. Everyone can see the clock, which shows that we have only 14 minutes left. I ask for short questions with no preambles and for economic answers too, please.

I thank the minister for her statement. I am grateful for it because we have all been working towards the new social security system. We have all had people at our surgeries who have issues around communication with the DWP. People dread it; even seeking out basic information causes them great stress and anxiety. Will the minister reassure me that, in serving the people of Scotland, the social security agency will be an exemplar in how to communicate, in stark contrast to how the DWP does that at the moment?

That did not quite follow my request, but I live in hope.

I can reassure the member about communication. From the outset, even in recruiting to the experience panels, we have worked directly with individuals who will be involved in the system and with those who have experience of the current system to help us make sure that our communication is as clear and direct as possible. We will use a wide range of communication methods. We will have digital, telephone and face-to-face contact and we will be able to translate, as we have done for applicants to the experience panels. We will maximise our use of all possible communication channels to make our system as accessible as possible.

Within the analysis of the written responses to the consultation, I note an entry by Dumfries and Galloway Council regarding the delivery of social security. It states:

“Local authorities have a proven track record for delivering centralised benefits in a localised responsive way to meet the needs of its citizens.”

Why is the Scottish Government ignoring the proven track record of local authorities in delivering newly devolved benefits and why—

That is fine. I want to get everybody in.

I refer Ms Wells to the options appraisal analysis, which shows that exclusive local delivery was judged to dilute accountability, lack the consistency of service across 32 separate systems and lack the flexibility to easily incorporate changes into existing structures. As I said, the appraisal process was undertaken with our partners including COSLA. COSLA’s response to the consultation, while expressing a preference for local authority delivery, noted:

“we are not suggesting all the elements being devolved fit within the local government family.”

I strongly welcome and agree with the no-profit motive in our social security system. I recently noticed that the DWP—

No, sorry. I am going to put my foot down. I want questions, please.

With regard to overpayments for personal independence payment assessments, does the minister agree that public funds should be used for public services, not for private profit?

Yes, I do.

Of the 1,500 people who the minister has announced this afternoon will work in the agency, how many will be in new jobs—extra jobs that have been newly created? Are those 1,500 full-time equivalent jobs? When will the jobs be created? What about the old jobs—will the current workforce who are providing those services be transferred and offered redeployment?

That is how to do it, Mr Leonard.

Fifteen hundred is our estimate of the number of jobs that there will be in the social security agency. In that sense, they are new jobs, because the social security agency will be new. The number of those jobs that may currently be being undertaken by existing DWP staff working in Scotland is still to be determined. As I said at the outset, the next step following our decision on the shape of the agency is to begin to design the specific jobs that will be required in our model and in our agency, taking into account face-to-face delivery and the communication methods that I mentioned. That will be done in discussion with the Public and Commercial Services Union, the Scottish Trades Union Congress and others.

When it comes to the transfer of existing DWP employees, at this stage it is not clear to us or to the PCS whether the jobs that are required in the final shape of the agency will match any that are currently at the DWP, so we cannot yet say whether COSOP, the Cabinet Office statement of practice, which is the public sector version or equivalent of TUPE, the Transfer of Undertakings (Protection of Employment) Regulations, will apply. However, as a Government, we have made a commitment so, should COSOP apply, we will undertake that.

I welcome the announcement from the minister. As we know, when profit has a role in assessments for benefits, claimants can suffer major stress, especially those who are disabled and suffering with mental health issues. Does the minister believe that the decision will result in reduced anxiety among claimants, especially those suffering from poor mental health who have been stigmatised by the Tory Government?

The degree to which what we intend to deliver will be significantly different from the experience that individuals currently have will be one of the major tests of the decisions that we are taking. I am convinced that it will be different. In particular, I am convinced that the model of assessment that we will devise—with the benefit of help from the experience panels, the expert group and our partners in health and social care—will be better able to deal with mental health conditions and fluctuating conditions. The model will use the clinical experience that is directly relevant to the condition that the individual suffers from in assessments for disability benefits. I firmly believe that that is the case. Should it ever be found that what we are attempting to do does not in reality match our principles, we will not do what the UK Government did, which was to change the rules because the Upper Tribunal disagreed with what it was doing. We will always change our practice to meet our principles.

The minister and the previous questioner highlighted the demeaning and distressing experience that so many people with ill health and disability have had when applying for benefits. The minister said that she is exploring using existing information. Does that mean that a letter from a general practitioner would do away with the need in the system for assessments? That would be a great step forward.

With the help and assistance of colleagues in health and social care, allied health professionals and others, and with the welcome involvement in our expert advisory group of individuals with experience, including the Scottish Association for Mental Health and Dr Alan McDevitt from the British Medical Association’s GP group, I am attempting to secure evidence that currently exists in health or social care in order to make the decision at the first point a decision that determines eligibility based on self-assessment and supported by that additional professionally founded evidence.

That is not straightforward, because there are issues with confidentiality and data protection, and it will always require the individual’s agreement to have their data shared, but if we can manage that, I am convinced that we will then be able to make more decisions at first determination, without the need for face-to-face assessment unless the individuals themselves wish that to take place. That should speed up the whole process but, in addition, it should allow us to use the right individual to undertake the assessment—someone who is professionally qualified in relation to the condition with which the applicant is presenting. All those things, taken together, are a significant improvement on the current UK system.

I thank the minister for early sight of her statement, and for the inclusive approach that she has taken to adopting the new system. However, there is no mention in the statement of the information technology infrastructure that will underpin that. We have seen the failure of IT systems elsewhere in the public sector, despite years of development, not least in the £60 million i6 police system.

Can we have a question please?

What confidence does the minister have that the new system will have IT infrastructure that is capable of supporting a smooth transfer of powers and payments?

I am grateful to Mr Cole-Hamilton for that important question. The starting point in my answer is that our approach is not to see the IT system as some stand-alone thing that sits outside our design of the benefits and assessment process or the way in which the agency will operate but to see it as an integral part of that. I am pleased to advise the chamber that, in the work that has been done by officials up until this point, all the teams are integrated. We have digital specialists, IT transformation programme managers and policy officials all working together to define a solution. We are taking the same step-by-step process to the IT build as we are to everything else, learning the lessons that have gone before and using individuals with experience of the current system to test out our emerging and developing IT system.

That alpha process is significantly advanced, and we will continue to work it through, so that, when we pass the legislation, however that is formed in this Parliament, and we begin to deliver these benefits, we have a system that has been tried and tested. We will then take over delivery of the benefits incrementally, so that we continue to refine and develop that system without putting 1.4 million people’s financial support at risk.

It was good to hear the minister ruling out a role for profit in the assessment for benefits, and saying that we are not following the failed assessment model of the Tories that caused so much stress and worry. What evidence has the minister looked at in coming to that decision, and what role will the experience panels have as the assessment process is developed.

Give a short answer please, minister. We are running out of time.

I looked at the evidence from how the current system is being delivered and I looked at the evidence from our consultation exercise, most particularly the experience of those applying for benefits in the current system and also those advising those people on their applications. Also, critically, I looked at the evidence from unions that represent people who are currently working in the DWP and in that system. That, broadly speaking, is the evidence that I looked at.

The experience panels will play a significant role, giving us the benefit of their direct personal experience, of course, but also testing out for us our policy and system development ideas and helping us to make sure that what we think is the right thing will, in practice, make the system efficient and accessible.

In her statement, the minister said that the annual running costs of the agency will be around £150 million. Can the minister tell me how much greater that is than the cost of the current system that operates in Scotland, and also how that figure compares with the running costs of the last significant agency that was set up by the Scottish Government—Revenue Scotland?

The minister only has time to answer one bit. Answer the first bit please, or we will be out of time.

There is no current system in Scotland, so the figures that I have given represent our estimate of the agency model as we have devised it. It is just over 5 per cent of what we expect to be the overall cost of the total service, including administering the benefits, and it is significantly less than the DWP’s administration costs for non-pension benefits, which are estimated at 6.3 per cent.

That must conclude questions to the minister; I apologise to Fulton MacGregor. That is what happens if members take too long—another member does not get to ask their question. I will allow a minute or so for front-bench members to change places before we move to the next item of business.