Considered in Grand Committee
My Lords, I am pleased to introduce this instrument, which was laid before the House on 17 May 2021. Subject to approval, the regulations will make some necessary legislative changes to prevent overlapping entitlements to the soon-to-be-introduced Scottish child disability payment and UK disability benefits. It will also permit the Department for Work and Pensions to accept the Scottish government appointee arrangements for UK government benefit purposes, thereby reducing the administrative burden for claimants and appointees in dealing with both Governments. I am satisfied that the regulations are compatible with the European Convention on Human Rights.
The UK Government are committed to making devolution work and to ensuring the safe and secure transition of powers to the Scottish Government under the Scotland Act 2016. As a result of the devolution of social security powers to the Scottish Parliament under this Act, the Department for Work and Pensions will need to update its legislation from time to time to reflect the introduction of the Scottish Government’s replacement benefits. Section 71 of this Act allows for the necessary legislative amendments, in this case as a result of benefits introduced under the Social Security (Scotland) Act 2018.
I am grateful for the opportunity to debate these regulations today. They will effect some purely technical changes and prevent overlapping entitlement to and payment of the Scottish child disability payment and UK disability benefits such as disability living allowance for children, personal independence payment and Armed Forces independence payment. It also includes some time-limited overlapping provisions for Northern Ireland. It will enable the Department for Work and Pensions to accept appointees over the age of 18 if they have already been granted appointee status by the Scottish Government. This is a positive change for claimants and staff.
Noble Lords will be aware that the Social Security (Scotland) Act 2018 established the legislative framework for the Scottish Government to introduce new forms of assistance using the social security powers devolved under Section 22 of the Scotland Act 2016. Specifically, Section 31 of the 2018 Act allows the Scottish Government to introduce legislation to provide financial support through their disability assistance for people in Scotland with long-term additional health needs. The Scottish Government have legislated for disability assistance for children and young people, which will be introduced from July 2021. They are calling this child disability payment; I will refer to it as CDP from now on.
I understand that CDP will have residency conditions attached and primarily will be paid only to claimants who live in Scotland. However, as part of their offer the Scottish Government will continue to pay CDP for a period of 13 weeks after a claimant has left Scotland and moved to another part of the UK. This will allow claimants time to sort out new benefit arrangements, should they wish to.
Our intention is to offer a similar facility for those moving to Scotland, though this will not be needed for a few years. What is needed now is a modest legislative amendment to deal with this policy, in order to both support the devolution agenda and strengthen a union that works together in the best interests of our shared citizens.
If these regulations are passed today, they will ensure that there are clear boundaries between entitlement to CDP and entitlement to a similar UK government benefit, and that there is no overlapping provision of entitlement. They will do that by making it clear that entitlement to a relevant UK government benefit will not start until the day after payment of CDP has ended and will reflect the Scottish CDP legislation, which acts in a similar way. This will not only protect the public purse by avoiding double payment but help prevent the need for complicated overpayment calculations and recovery. Furthermore, it is also in the best interests of the claimant, who will have a clear expectation of which Government is responsible for paying their benefits at which point in their claim or award.
The instrument includes provisions on behalf of the Ministry of Defence to ensure that Armed Forces independence payment will similarly not overlap with CDP. Provisions have also been introduced to prevent overlapping entitlement when a claimant moves to Northern Ireland and is in receipt of the 13-week run- on payment from the Scottish Government.
Finally, we recognise that many DWP claimants will also be claimants of the Scottish Government’s devolved provisions. This instrument will make changes to UK government legislation to allow the Department for Work and Pensions to accept that a person over the age of 18 has appointee status if they have already been granted it by the Scottish Government. This removes unnecessary burdens on the claimant, the appointee and the department through effective and proportional collaboration on information shared and used by respective Governments. I commend this instrument to the Committee and beg to move.
My Lords, I recognise the antecedents of the Smith commission, itself deriving from the 2014 Scottish independence referendum, and the following Scottish Acts in 2016 and 2018. I am no expert on the details of this particular SI or social security benefits in general, and I do not know if I am right on this, so maybe my noble friend can clarify it when she speaks at the end, but it seems to me that it does not affect social legislation in Great Britain—or, that is, it affects England and Wales but not Northern Ireland.
My key concern is about the background of the importance of the union—we all know what is happening on the ground at the moment—and a recognition of what the current SNP leadership is all about. This in itself is in contrast to the powers of the Scottish Parliament. For example, it has the power to borrow over and beyond the benefits of the Barnett formula, as I understand it, so there is a double incremental benefit to Scotland as a whole.
What will be the impact on the other three nations that make up the United Kingdom? Is this just a simple implementation agreed by all four parties, with Scotland in the lead? They are doing trials in various cities. Or is it what I would call a ratchet effect, in that they take an initiative which the rest of the union then has to follow? I do not know, and I hope my noble friend can make that absolutely clear for the record when she winds up.
I will now focus particularly on Northern Ireland, and colleagues may wonder why. This is primarily because I was PPS in Northern Ireland from 1979 to 1981 and got to know that part of the UK quite well. I have deep concerns about what is happening on the ground there; they are struggling with the protocol and the aftereffects of Brexit on top of everything else. I would have thought that to have an important part of their social security affected as well—seemingly in the autumn—is just another problem and challenge for them.
I have two implementation points to make. I note that this is to be trialled in Dundee City, Perth and Kinross, and maybe somewhere else, from 26 July. It is thought that there will then be a full national rollout in the autumn. But 26 July is, in effect, the beginning of the summer, and nothing very much will happen in August, so we will really begin to have some test of this in September or October. Normally, to do a proper test, you would do it for at least three months. You would then review it for a month, because there are bound to be some elements of it that are not quite right, particularly if you have to consult the other three nations. Maybe they are not going to consult, but they should. I suggest to my noble friend that she should have a quiet word with her colleague across the border and ask if they are absolutely sure that it should be rolled out in the autumn and why it should not be rolled out from January, when people have had time to look at it, make necessary technical amendments and then implement it accordingly.
The other technical matter I would raise is that it is all very well saying that there is a 13-week change in some of the moves from Scotland to England, Wales or wherever. It never ceases to amaze one, having been a Member of Parliament, but there are families who do move around regularly when they change jobs or if something else happens—
This SI is a small step in the long, drawn-out and complicated process of transferring responsibility for some aspects of social security from the UK Government to the Scottish Government. The Scottish Government are always vociferous in their demand for more power, despite struggling to use many of the powers they have effectively or, sometimes, at all. That is not to say there cannot be value in administering benefits to meet the needs of beneficiaries in Scotland, but only time will tell whether it delivers a net positive and an affordable outcome.
This statutory instrument is necessary to facilitate the establishment of the Scottish Government’s child disability payment as a replacement for disability living allowance. The aim is to transfer approximately 50,000 recipients of DLA to CDP over 12 months, all being well. The amount of benefit will not change, but the assessment will. There will be no upsides—no political upsides, certainly—if current recipients fall through the net or if any change disadvantages an applicant for CDP compared with the previous DLA arrangement. Concern has already been raised about the altered definition of night-time care under CDP compared with DLA and whether that might disadvantage Scottish claimants. Having said that, my understanding is that this is being jointly administered between the DWP and the Scottish Government, so that should help eliminate such complications.
One positive change that has emerged on the back of consultation is that recipients of CDP will not have to apply for PIP at 16, as is the case with DLA, but can continue on CDP until 18, and then apply for PIP. It would be interesting if the Minister could comment on whether her department considers that beneficial and something that might be applied elsewhere in the UK.
The SI does three things. It ensures that there is no overlap, as the Minister said, between CDP, DLA, PIP and the Armed Forces independence payment; it provides for the continuation of CDP for up to 13 weeks after a recipient moves to another part of the UK, to allow time to apply for the appropriate replacement for CDP; and it allows the Scottish Government’s criteria for appointing someone on behalf of a recipient to be recognised across the UK.
These are practical and sensible measures, and that explains why the Scottish Parliament’s Social Security Committee dealt with it in less than a minute. Nevertheless, if the transfer of some social security benefits from the UK to Scotland is to have purpose, there must be practical and real benefits, rather than just name changes and different administration. The PIP point looks like it might be something for the DWP to consider, so I repeat: can the Minister say whether this might lead to a rethink in her department?
Where will all this lead? Can the Minister indicate how many other Scottish social security SIs she expects in the coming months? The question is: will this lead to the Scottish Government tackling the serious problems of poverty, multiple deprivation and drug abuse that blight Scotland, or will it amount to just relatively small administrative changes that could add to the complexity for those in need without providing transformational benefit?
No doubt the SNP will claim that only independence will unlock the resources needed to turn poverty around, despite the very real risk that Scotland will lack the resources to maintain current benefit levels, let alone improve them. Indeed, if Scotland decided that it was going to pay more generous benefits than the rest of the UK, which it would be entitled to do, we could see some kind of reverse benefit tourism, which would be at the Scottish taxpayers’ expense.
The challenge is to use these social security powers to demonstrate a positive difference in shaping the system to Scotland’s needs, to take account of the different social circumstances and different geography of Scotland. If it is done in that way, it will be beneficial to both Scottish and UK citizens by delivering benefits in a fairer and more efficient way, but whether or not it does, we shall have to wait and watch with interest.
My Lords, we are here today because this statutory instrument will make consequential amendments to social security legislation in respect of Great Britain and Northern Ireland to prevent payments of DLA, PIP and AFIP overlapping with the Scottish Government’s child disability payment. The Scottish Government are introducing the CDP, which will replace the disability living allowance for children, currently delivered by the DWP. This new child disability payment will be open in pilot areas for applications from 26 July this year in Dundee City, Perth and Kinross and the Western Isles council.
This is the first application-based disability benefit to be introduced by the Scottish Government, and the pilot will be followed by a full national rollout in the autumn. Families currently getting DLA for children will be transferred automatically to the new Scottish system. People who currently get disability benefits from the DWP will have their awards transferred to the new Scottish system in stages after the new benefits are introduced. We believe that the work will be completed by 2025.
We entered the pandemic with too many people living in poverty, and this poverty is endemic in many parts of the UK, in all the nations and regions. The Scottish Labour shadow Cabinet Secretary for Social Justice and Social Security has raised several matters about this issue with the Cabinet Secretary Shona Robison MSP and has asked her to consider making progress on tackling child poverty in Scotland by doubling the Scottish child payment immediately as well as to mitigate the two-child limit in Scotland. Projections show that this would cost just 0.2% of the Scottish Government’s total budget. Further ideas expressed to reduce poverty include removing the full-time study rule in carer’s allowance and moving from the safe and secure transition of disability benefits to transforming eligibility and rate, together with using procurement to enforce the living wage and end zero-hours contracts, bringing housing costs down by capping rent rises, and requiring businesses that get public money to pay the living wage and end zero-hours contracts.
Can the Minister confirm that no one will lose money by stopping any overlap between the DLA, PIP, AFIP and the new child disability payment? Also, is the Minister confident that the 13-week CDP run-on payment will take place? What happens if it does not? Finally, when does the Minister expect the national rollout of CDP to take place? Most importantly, is the DWP ready for it?
I thank all noble Lords for their contributions today. I shall deal with some of the points that noble Lords have raised.
In answer to the noble Lord, Lord Naseby, and to some degree the noble Lord, Lord Bruce, I would say that all five parties in the Scottish Parliament accepted the Smith commission recommendations on the devolution of social security. The two Governments are now working together to implement them, and this SI is part of that process. In Wales, social security is reserved by virtue of the Wales Act 2017, although the Welsh Government have the power to make payments to people in extreme financial hardship using the discretionary assistance fund. In Northern Ireland, social security is transferred to the Northern Ireland Executive. However, in line with the Northern Ireland Act 1998, the DWP and the Department for Communities in Northern Ireland work closely together with a view to maintaining parity between the two systems.
The Barnett formula is used by the Treasury to calculate the annual block grants for the Scottish and Welsh Governments and the Northern Ireland Executive. It calculates funding for devolved public services based on what the UK Government spend on those functions in England. If the devolved Administrations want to spend more on devolved services, they must find the funding from elsewhere in their budgets.
On the evaluation of implementation, which noble Lords have raised, that is a matter for the Scottish Government. The UK Government will, of course, be interested in the iterations of the reserved benefits, given the larger number of people in Scotland receiving benefits from both Governments.
In answer to the noble Lord, Lord Bruce, the DWP currently administers benefits on behalf of the Scottish Government where they are the same as other benefits. However, replacement benefits, such as CDP, will be entirely delivered by Social Security Scotland, which is part of the Scottish Government. We will, of course, follow with interest how the Scottish Government deliver their new benefit and we can, of course, learn from their experience where we both face similar challenges.
On cross-border moves from Scotland to England, the noble Baroness, Lady Wilcox, asks what will happen if someone moving from Scotland to England and Wales does not apply to the DWP in time for their claim to be processed before their CDP runs out, and whether they will incur a break in payment. If the claimant is late in making the claim following the move, there is a greater risk that there will be a break in payment. However, arrears will be paid back to either the date of the claim or to the date the run-on ceases, depending on the circumstances. If a claimant delays making an application and their CDP stops before their claim has been made, any new claim can be paid only from the date of that claim.
The DWP and the Scottish Government both have devolution programmes to ensure that all partners are ready in delivery and ready for the implementation. We hope that that working together will continue.
The noble Lord, Lord Bruce, asked about how many more SIs on Scotland are coming. It seems that there are three more statutory instruments on devolution of Scottish Social Security to the Scottish Parliament before the Summer Recess. Further instruments will follow as the Scottish Government make further progress on the replacement of benefits.
The UK Government are working collaboratively with the Scottish Government to ensure that the two systems of social security will operate effectively alongside each other and the required legislation that underpins them is delivered successfully for the people of Scotland and, where relevant, claimants in England, Wales and Northern Ireland. This order highlights the importance that the UK Government place on the effective functioning of devolution. I commend this order to the Committee.
That completes the business before the Grand Committee this afternoon. I remind Members to sanitise their desks and chairs before leaving the Room.
Committee adjourned at 5.28 pm.