Seòmar agus comataidhean

It is very important that we listen to stakeholders about their asks of the Government to go further, whether it is on social security policy or elsewhere. I am very conscious of the support that social security provides. We discussed earlier the impact that it has for disabled people, carers and those on low incomes in assisting and supporting them. Given everything that I said at the start of the evidence session, I absolutely recognise the impact that that investment has had and I recognise the calls for us to go further.

This comes down to the decisions that the Government will have to take, looking not just at the calls on us to increase social security payments for people but at the additional asks that are coming in from Government. The calls that come from all political parties are for us to look in the round at our expenditure and assess whether additional expenditure on social security would be the best way to support an individual or a group of people or whether that best way would be an investment elsewhere or a change of policy elsewhere.

Those are the types of discussions that we will be having during the budget to ensure that we are spending the money effectively, because I take very seriously the challenge that is rightly put to Government about the fiscal sustainability of our plans. That is exactly why we have the MTFS there to look at those, because we have additional asks of what people want Government to do but we also have a challenge that we must balance the budget.

That is a benefit that successive UK Governments have effectively not changed in 75 years or so. It is a massively out-of-date policy that is essentially based on industrial injuries sustained in heavy industry. The consultation that we recently undertook gave two options: to effectively lift the outdated system directly into Social Security Scotland; or to ask the DWP to hold that for us while we do the policy work to make the benefit fit for purpose. The results showed that there was a preference for us to look at the benefit in a more holistic sense.

That will take time because, as I said, the benefit has not been touched for decades, which means that there is a lot to unpick. We have established a committee for that which sits outwith Government, although it is supported by officials. It is undertaking a more holistic view of the benefit, given the views that were expressed in the consultation process. The benefit will carry on under an agency agreement in order to ensure that those who receive the benefit at the moment continue to receive it.

If we want to move past the back-and-forth critique that the Scottish Government’s social security expenditure is unaffordable or unsustainable, the answers must come back about what policies people want to be changed—even if I fundamentally disagree with the proposals that are made—so that the trajectory changes.

The approach is based on eligibility. I might fundamentally disagree with suggestions that are made, but suggestions would at least move us past the discussion that we are having at the moment, which does not take us far. That is exactly why we have set out in the MTFS and the fiscal sustainability delivery plan how we propose to look at the financial sustainability work. It is for others to come up with other suggestions; my door is always open.

It is important that we look at the figures in the round. Of the clients who responded, 69 per cent said that the SCP had had no impact on their decisions about employment or that it was not applicable. For the 29 per cent who reported an impact, the most common impact was that the payment was helping them with work costs such as travelling or clothing, followed by enabling them to stay in work or work more hours. It is important to look at how the payment has helped people to get into employment, stay in employment or increase their hours, but the analysis that the Scottish Government published in 2024 concluded that, at the current levels, the payment is not negatively affecting labour market outcomes at scale.

I know that people ask us to increase the Scottish child payment. As well as considering the budgetary impact of that on the Scottish Government, we would look at any impact that that might or might not have on the labour market. That is an important aspect but, at this point, it looks as if the payment is, in the main, having no impact or having a very positive impact on families by allowing them to make choices about staying in employment.

The analysis that I just referred to pointed to evidence on the labour market impact of a cliff edge, and it does not appear to support a compelling policy rationale for implementing a trigger. That is an important aspect of that evaluation. Even if people wished to see a taper, they would need to think about how that would be done. That could not be done with the processes that we have, so it would require new systems in social security.

Some people say that we should look at people’s incomes, that we should have more means testing and that we should taper or look at further targeting—I am not saying that Marie McNair is suggesting that for all benefits or one benefit, but it ties into the question that she asked. That approach would require information that we do not have, because we do not need to collect people’s income data at this point. If we needed that, it would have to be collected and analysed. That would have an impact on how complex the process was and therefore on its cost. For all such aspects, as well as the impact on individuals, we would need to think about the impact on cost of delivering a system that included tapers or an analysis of anybody’s income.

It is fair to say that there has been a fair level of scrutiny of and discussion about winter heating payments. I do not think that it is going too far to say that there is a consensus that there should be winter heating payments for pensioners. I think that we are all agreed on that—I hope we are, but you never know these days. If we agree with that premise, it is then about which pensioners should receive that benefit. The Government has proposed targeting the spend at those on the lowest incomes.

The carer additional person payment is a long-standing Government commitment. We have discussed this at various points, so the committee is well versed in the fact that a number of carers are living in poverty and carers organisations have grave concerns that the current system does not reflect the additional burden that people face if they care for more than one person.

On the two-child limit payment, it is about the impact that the payment will make on child poverty. Just last October, the IFS said:

“the single most cost-effective policy for reducing the number of children living below the poverty line is removing the two-child limit.”

It is far from the only organisation, charity or think tank that would point to that impact.

That is why those decisions have been taken.

In that exceptionally hypothetical situation, the discussion that we would be having would be about how to spend the finances that the Scottish Government has to make the most impact and whether we thought that such spending should be on social security or on other areas. Given that I am also responsible for the “Tackling Child Poverty Delivery Plan 2022-26” and that I have responsibility for equalities as well as social security, I am sure that the finance secretary and I would get into a discussion about where the maximum impact would be and whether it would be in social security or elsewhere.

I am not here to speak on behalf of Liz Smith, but she continually probes on that issue, too. She is particularly astute in the challenges that she has put to Government on that, as you have been for some time, Mr Balfour. As I have said in the past, the Government has a range of different policies, some of which are universal and some of which are targeted.

I would say at the outset that all social security expenditure is targeted. People might wish it to be targeted at different people or in a different way, but it is targeted. The universal services that we have are a very important part of the Government’s commitment to our social contract with the people. We have a more progressive tax system in Scotland, and aspects such as the concessionary travel scheme, free prescriptions and free tuition are an important part of the social contract. Others might have different views on that, but that is certainly the Government’s position.

We have also been very clear that we do not plan to take away entitlement from people. That is an important reassurance, because, although we talk often and quite rightly about people who are in poverty or whom we are trying to keep out of poverty, I am conscious that many of our constituents, while not in poverty, are still being impacted by the cost of living crisis, and we have a responsibility to those people, too.

When we look at how we target social security expenditure, we look at the impact that it has on particular groups. If people wish to see different proposals coming forward, I say again that my door is open to that, but I have laid out the principle of where the Government stands on universalism and the importance of targeting in certain areas.

An important point is that the devolved disability assessment is not linked to employment. We have many people in receipt of ADP who are in employment and feel that ADP is what allows them to stay in employment because of the additional support provided. I will bring in Julie Humphreys on this aspect.

The language is very important. It is not just important as we sit in committee in this Parliament, but important for the people that we are here to support. I am reminded of a recent round-table discussion that I had with disabled people’s organisations and others who talked about their worry that the stigma that we had hoped to take away from the social security system in Scotland is coming back. I fear that that is because of the language that is being used, particularly in connection with some of the most recent UK Government welfare changes, some of which have been scrubbed, while others are on-going. The language makes a real difference to how people feel about themselves and how they feel that they are perceived by others.

I think that this is an investment. In my introductory remarks I set out some of the ways in which the investment that we make in social security moves directly into people’s pockets to support them to get out of poverty or to stay out of poverty. It is also an investment to ensure that we are not having to spend the money elsewhere in our public services. We are making proactive decisions: I have sat in front of the committee for every eligibility Scottish statutory instrument that we have had, and we have discussed and debated them. Out of all of that secondary legislation, there are exceptionally few examples where anyone has dissented and voted against the SSI. We have come to the committee and to Parliament with the areas of eligibility and Parliament has voted on them.