forging a new path? welfare reform in scotland

Forging a new path?

Welfare Reform in Scotland

#TakingItOn @Carer49

NICVA, October 2014

Lynn Williams, SCVO

Outline• History• Lessons from Scotland – devolution so far• A different approach?• Impact (if time)• (Brief) introduction to SCVO work

Devolved?

Main devolved powers:•Courts•Education •Health•Agriculture/Fishing•Police•Housing•Business Support Environment•Arts and Culture•Some transport•Sport•Fire & Rescue•Local Government (social care)

Scotland Act 2012 adds:•Stamp Duty Land Tax (April 2015)•Landfill Tax (April 2015)•Borrowing powers (April 2015)•Scottish rate of Income Tax (April 2016)

Some history….• On 22 December 2011, Scottish

Parliament took the unprecedented step of partially refusing legislative consent for parts of UK Welfare Reform Bill relating to elements of UC and PIP.

• Pushed by third sector – SCVO, Poverty Alliance and others.

• Political fight back against wider impact but also allowed some protection to be put in place e.g. passporting

History (2)

• Resulted in the Welfare Reform (Further Provision) (Scotland) Act 2012 – Gave Ministers powers to change Scottish legislation to protect pass-ported benefits. Also required to produce annual report on impact/response.

• Welfare reform became a key feature of parliamentary business

Scottish Parliament Welfare Reform Committee• Committee established January 2012 – continual review of UK

Act, implementation, impact on Scotland. Also relevant Scottish legislation.

• SNP Majority • Active Committee – scrutiny of Government mitigation

policy/spend (£80m this year alone).

Wider context…

Referendum Debate:

•Scottish Government White paper on independence – social protection/investment focus•Benefits featured strongly in debate – esp. from Yes•Radical independence movement – reshape social security (Citizens Income – Common Weal)•Better Together “pooling and sharing”– applied especially to benefits/social security.

Wider context (2)

Expert Working Group on Welfare (2013-2014)

•phase 1 - transition in event of yes vote/costs

•phase 2 - features of Scottish system after “yes”

Principles/themes:

•Dignity, respect, maximising life chances

•How do we rebuild trust? Creating a “social partnership”

•Paid work is NOT a route out of poverty

•People who can’t take up paid employment are valuable citizens; must be supported to achieve full potential

•Chance to connect disparate services and support

Where are we now?

Smith Commission:•Different proposals on welfare•Can principles identified by Expert Group shape future devolution?•Completing the circle – devolution of employability support/programmes has support.•Views on devolution of welfare as plural as sector.

Here and now?

Welfare reform mitigation activity:

Funding to advice sector – Making Advice Work; support for families:

•BUT, impact on sector wider than “advice” organisations

•Community organisations resilience fund created

Mitigation focus to date in policy/funding: c£250m +++

Wider “welfare state” commitments:

•Free School Meals expansion; expansion of Childcare (£280m); fuel poverty initiatives (£79m) ££££++++++

Lessons from Scotland:Devolving a “small” power…..

Bedroom tax/Discretionary Housing Payments

Scottish Government opposed to the bedroom tax – calling for abolition•But – stalled on finding Scottish solution? (Opposition)

Provided local authorities with the maximum funding allowed within the statutory cap on DHPs – but short of mitigation

Some local authorities had already found ways to top up - Renfrewshire


Ministerial contact:

31 Jan 2014 – Scottish Government wrote to Lord Freud, asking DWP to either increase DHP funding to allow additional funds to mitigate the bedroom tax OR remove statutory cap on DHPs

2 May 2014 –Scotland Office replied offering to transfer the power to vary the cap in Scotland to Scottish Ministers.

7 May 2014 - SG accepted

8 May 2014 – DFM and David Mundell met to discuss potential timetable


•Section 63 Order (Scotland Act) currently progressing through both Parliaments and should be in effect by December 2014

•25 June - Joint letter of comfort issued to reassure LAs that they could breach statutory cap on DHPs ahead of the Order - Letter signed by Nicola Sturgeon, Lord Freud and David Mundell

•Plan to remove DHP cap – enable bedroom tax mitigation

A different approach?Scottish Welfare Fund:

Discussions on abolition of Social Fund/transfer of funds to Scotland - 2011 and 2013.

Funding to administer – non negotiable BUT•Scottish Government negotiated an additional £1.8m in set up costs from DWP; making case on basis on running national Fund, delivered locally by 32 local authorities.

Third sector (including SCVO) involved in shaping from beginning.

Scottish Welfare Fund• Section 30 order transferred power• Grants, not loans• Fund top up (but bear in mind managing down prior to devo.)• Third sector training to help set Fund in motion. Provided

training/supporting materials.• Worked to ensure local authorities understood need to work

with sector locally.• Feedback from sector/lobbying led to significant changes in

guidelines• allow sanctioned individuals to apply to Fund.

• Underspend year 1 – issues around operation (gate-keeping)• Placing fund on legal footing

A different approach?

Independent Living Fund

Management of fund will transfer to Scottish Govt – will remain a Scottish Govt function

Set up Scottish Independent Living Fund:•funds transferred•additional Scot G investment to stabilise/open to new members

National scheme – shaped by disabled people (ILF project and advisory boards)

Transfer of existing systems (including IT) – does this limit ability to do things differently?

Wider issues….Language/stigma•“Hard working families”:•Emphasis on paid work as main contribution•Sanctions – hard on Westminster, but would Scotland be different?•Need to radically reform support for disabled people – not just reserved but devolved services too.

Mitigation not prevention – are safety nets failing (80,000 families using SWF)?

UC back on table – what next and how will it impact on further devolution?

Wider issues….

National guidance but local variation in implementation:•Postcode lottery???•Different times for processing Scottish Welfare Fund•DHPs – some local authorities take account of DLA as income•More bureaucracy and worry for families in need?

Impact of Welfare Reform - Scotland

Food banks – increase largely as a result of benefit changes/delays in system. (40+)

Sanctions a key issue – increased presentation of people in absolute crisis. Significant impact on lone parents

Demand on sector significant (80%+ increased demand)


SCVO mapping phase 2:

Impact on people•Mental health issues exacerbated•Stress, anxiety – impact on health services•Preventative work being undone•Increase in absolute crisis


What it means for sector:•Significant and complex demand•Funding to mitigate – community organisations missing out•Scale of impact - partnership between statutory/third sector critical Prevention of crisis (e.g. financial education, people understand entitlements; prevent sanctions?)

Impact

• More than half of cuts are falling on households containing a disabled person

• Scottish disabled people to lose over £1 billion a year by 2015

• Sanctions more likely for people with learning disabilities and other vulnerable groups e.g. lone parents

• In work poverty – significant challenge

• Sector research – SAMH, Inclusion Scotland, HIV Scotland, SCVO

Impact?Revised figures - when the reforms have come into full effect they will take more than £1.6bn a year out of the Scottish economy. This is equivalent to around £460 a year for every adult of working age.

Clear relationship between the extent of deprivation and the scale of the financial loss. The most deprived wards are hit hardest.

Incapacity benefit reforms resulting in the biggest financial losses, particularly in more disadvantaged communities.

Some households and individuals are hit by several different elements of the reforms

What matters…

• How our economy and labour market operate critical – pushing people towards benefits?

• More to come? • How we respond critical – people’s lives devastated; we will

see wider community divisions/inequalities

Nothing short of collective response will do

All about…..SCVOWelfare reform is a key priority for us. Key work includes:

•Mapping of impact (1 and 2)

•Responses to Westminster

•Working with Scottish Government on Welfare Reform policy

•Responses to Scottish Government/parliament consultations

•Third sector reference group

•Fortnightly Welfare Cuts bulletin

•Developing welfare reform hub on our site

•Member of key government groups – Welfare Reform Scrutiny; Welfare Fund group

•Wider policy work – future of welfare paper.

•Poverty campaign, lobbying, etc.

All about…..SCVOWelfare reform is a key priority for us. Key work includes:

•Mapping of impact (1 and 2)

•Responses to Westminster

•Responses to Scottish Government/parliament consultations

•Expert Group on Welfare

•Welfare Reform reference group

•Fortnightly Welfare Cuts bulletin

•Developing welfare reform hub on our site

•Member of key government groups – Welfare Reform Scrutiny; Welfare Fund group.

•Working with Scottish Government on Welfare Reform policy – assets based policy seminar

For more information

http://www.scvo.org.uk/news-campaigns-policy/campaigns/welfare-reform/

forging a new path? welfare reform in scotland

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