Welfare and social justice: No poverty of ambition

Written by Jenni Davidson on 5 April 2016 in Inside Politics

While welfare and social justice haven’t topped the agenda of any of the political parties in the election campaign, they are the key to success in all other policy areas

Welfare and social justice might not first appear to be one of the key planks of this election campaign but they are at the core of the battle between the parties of the left in winning the argument and the votes over how best to bridge the inequality gap.

So-called welfare reform was already a political hot potato. What with the controversial rollout of Universal Credit, plans to cut local housing allowance for social tenancies, the continued negative press about the impact of benefit cuts, onerous sanctions, harsh work capability assessments as well as the increase in foodbank use, welfare reform and its impact on social justice was never far from the headlines. 

And with the increasing cost of welfare to the public purse and a debate about the imminent devolution of further powers over welfare to the Scottish Parliament through the Scotland Act, the politics in Scotland have sharply focused on mitigation over things like the bedroom tax and how to stop Tory austerity being passed on to those that could least afford it.


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But then came the resignation of Iain Duncan Smith, the former UK secretary of state for work and pensions, and the UK Government’s subsequent U-turn on cuts to Personal Independence Payment (PIP) for people with disabilities, and welfare reform has now become an area for keen debate by all the parties competing for seats in the Scottish Parliament in May.

Issues relating to welfare, social justice, poverty and inequality are pivotal to all political parties going into this election because of their impact on the success of many other policy areas such as health, educational attainment and the economy.

“While I fully recognise the need to tackle poverty in all its guises, health poverty and inequality, education poverty and inequality, housing poverty and inequality, community and physical asset inequality, a prerequisite to maximising success in all these other areas of poverty is first of all to tackle income poverty and inequality,” said Alex Neil in a recent debate on poverty.

All parties have committed to raising Carer’s Allowance to the same level as Jobseeker’s Allowance and there is broad cross-party agreement, with the exception of the Conservatives, on scrapping the bedroom tax – the effects of which have been mitigated so far by the SNP government – once Holyrood gains that power. 

However, thus far, welfare is not centre stage in the election debate. The Conservatives are steering clear of what has become a toxic issue for them has become, particularly with the resignation of IDS, and are instead promoting themselves as the party of low taxation and a with a firm stand against another independence referendum. 

The Lib Dems and Labour, meanwhile, are both focusing on education, albeit as a way to reduce inequalities, with their policy of a penny on income tax for education to reduce cuts to local authority budgets. The SNP is focusing on health, education and the economy.

It is difficult to know what UKIP proposes. In the recent BBC televised leaders’ debate, David Coburn, UKIP Scotland’s leader, appeared not to understand what welfare was, responding to questioning on his party’s welfare policy by talking instead about the NHS and education.

The Greens have perhaps so far pushed strongest for welfare to be on the agenda. Housing and fuel poverty are key areas for them, but their flagship welfare policy, a citizen’s income, is not within the powers of the Scottish Parliament, nor will it be with the new powers in the Scotland Act.

Yet there are a number of changes in welfare at a UK level that impact on Scotland and in the welfare powers coming to the Scottish Parliament that should push this higher up the agenda.

Universal Credit, which combines six previous work and income-related benefits, is being gradually rolled out. The key issues have been that single parents in work have found themselves worse off than before, it is paid monthly in arrears and the first payment is not paid until six weeks after application, leaving some people in a crisis situation waiting for the first payment. 

Unlike housing benefit, which could be paid direct to a landlord, all of Universal Credit, including the housing element, has to be paid directly to the claimant and many people, particularly in social housing, are becoming responsible for paying their rent for the first time. Early evidence suggests this is leading to a steep increase in rent arrears. A survey by the National Federation of ALMOs (NFA) and the Association of Retained Council Housing (ARCH) in December showed that since Universal Credit was rolled out across England, 89 per cent of claimants had accumulated rent arrears.

There are also major welfare changes in the UK Government’s recent Welfare Reform and Work Act, with benefits to be capped at £20,000 per household, a level the UK Government can lower at any point without consulting parliament. It also reverses most of the Child Poverty Act 2010, scraps the UK Government’s duty to end child poverty by 2020 and it redefines poverty based on worklessness rather than income, even though around two-thirds of the poorest children live in working families.

In a letter to the Guardian, Javed Khan, chief executive of Barnardo’s UK, called the act a “Pandora’s box for Britain’s poorest families”, saying it contains “many measures that risk locking more children into poverty”.

However, when the Scotland Bill comes into force in April 2017, the Scottish Parliament will gain powers over around £2.7bn of welfare payments – around a quarter of welfare spending outside of the state pension – in addition to the two welfare areas currently delivered by Scottish councils: council tax reduction and crisis grants and community care grants provided by the Scottish Welfare Fund. 

From 2017 the Scottish Parliament will gain control of a range of benefits: Disability Living Allowance, Attendance Allowance, Carer’s Allowance, Severe Disablement Allowance, Industrial Injuries Disablement Benefit, Personal Independence Payment, funeral payments, Sure Start Maternity Grant, winter fuel payments and cold weather payments. 

It will take control of the housing costs element of Universal Credit and also be able to vary the payment arrangements for it as a whole, but not the levels. So too, it can top up reserved benefits, either on a case-by-case basis to certain individuals or across the board. It will be able to introduce short-term discretionary payments for people whose wellbeing is at risk as an expansion of the Scottish Welfare Fund and use discretionary housing payments to help people in rented accommodation with housing costs.

The SNP MPs voted against the welfare act in July 2015 and continue to oppose it. “The SNP continue to mitigate UK welfare cuts where we can – the Scottish Government have injected £100 million to ensure no one pays the bedroom tax, and investing £40 million with local government to ensure that council tax benefit in Scotland wasn’t cut when it was cut across England,” the party says. It also set up the Scottish Independent Living Fund in July 2015 which supports over 2,800 disabled people across Scotland.

The SNP has pledged to abolish the bedroom tax completely when it has the powers to do so and set up a new early years maternity and early years allowance. It has also promised to bring forward a social security bill within the first year of the new parliament to introduce measures to “address weaknesses in Universal Credit,” and “mitigate as far as we can” the impact of UK welfare cuts. Nicola Sturgeon has promised to establish a Scottish social security agency. 

She promised not to “balance the books on the backs of disabled people”. However, while she committed to not cutting PIP, in the recent televised leaders’ debate, she also refused to commit to increasing disability benefits from the level of PIP back to previous levels.

Scottish Labour’s leader, Kezia Dugdale, has committed to using a 50p top rate income tax to establish a Fair Start Fund for schools. This would mean an extra £1000 for every primary pupil from a deprived background. She has also said that she will create a new employment agency to run the newly devolved Work Programme. 

The party has also committed to using the new welfare powers to give children leaving care and going into higher education a full grant, raising Carer’s Allowance to the level of Jobseeker’s Allowance, doubling the Sure Start Maternity Grant to £1,030, abolishing the bedroom tax and banning zero-hour contracts for care workers. 

Although the Scottish Conservatives could be expected to agree with most of the UK party’s policy, Ruth Davidson spoke out against reducing tax credits. Davidson said families faced “a cliff edge” if the cut was pushed through. She has more recently spoken against the reduction to PIP, albeit after the resignation of Iain Duncan Smith. 

They will also increase Carer’s Allowance to the same level as Jobseeker’s Allowance and Ruth Davidson has said she would like to devolve PIP to local government level. The Conservatives are keen that Scotland maintains taxes in line with UK levels, so they are unlikely to diverge far from UK Conservative policy on welfare.

“The idea that Scots are yearning to pay more tax to fund ever higher welfare policies simply isn’t true,” said Davidson in a speech to the Adam Smith Institute in August last year.

Speaking to the Joseph Rowntree Foundation in February on the subject of poverty, Ruth Davidson said took issue with “the old-fashioned right-wing stereotype” on poverty that “all individuals are able, through willpower and sheer guts, to make it in life.” 

“Let me say where I agree with and disagree with that story. I agree with where we begin. That starting point is both optimistic, virtuous and noble.”

However, she added that, “It forgets that – while all individuals should be equally free – not everyone is equally empowered – either offered the opportunities or has the resilience to take advantage of those freedoms in the same way.”

Her proposals centred on early years childcare, literacy and mentoring and outreach. She also promised funding for poorer children would follow the child, rather than being disbursed en bloc.
The Lib Dems, likewise, have committed to raising Carer’s Allowance to the level of Jobseeker’s Allowance, to set a zero-rate tax band when Scotland receives the power to set tax bands in 2017, effectively extending the personal allowance and lifting people on low incomes out of tax. 

In their ‘pre-manifesto’, the Lib Dems also commit to making sure the bedroom tax is “fully removed” from the Scottish system and replacing the Work Programme and work choice with a new employability programme in partnership with Skills Development Scotland, colleges, charities and other agencies. They will also use the proposed penny increase on income tax for a pupil premium.

While we don’t yet know UKIP Scotland’s policies, UKIP’s UK manifesto for the Westminster elections last year supported a lower benefits cap, limiting child benefit to two children who are resident in this country, scrapping the bedroom tax, ending capability assessments for disabled people and increasing Carer’s Allowance to match Jobseeker’s Allowance.

It also proposed putting advisers into foodbanks to provide advice on issues such as debt, employment, addiction, physical and mental health problems and family breakdown. This may give some clue as to what the party’s policies may be going into the Holyrood election.

In the long term, the Scottish Greens favour a citizen’s income as a replacement for almost all benefits, but given that that is currently outwith the powers of the Scottish Parliament, they would like to take steps in that direction. 

In a recent interview with Holyrood, co-convener Patrick Harvie said: “[What] we’re going to do in the Scottish Parliament election is talk about things like the Carer’s Allowance and the living wage, particularly in the care sector, which are hugely undervalued forms of work in our society and we’d like to move somewhat in the direction of having a guaranteed income for people in those areas.”

In their 2015 Westminster manifesto, they promised to abolish the bedroom tax and workfare and allow the Scottish Parliament to design a scheme that works with new devolved social security powers.

This encapsulates the difficulty for all parties, to put forward vote-grabbing proposals with only partial powers over taxation and benefits is very challenging. Any serious divergence from UK benefits would also require significant divergence in taxation. 

That perhaps is why none of the main parties wants to make this a key campaign area for this election. But with poverty on the rise, fuel poverty increased and set to miss this year’s target for eradication, foodbank use rising, homelessness staying steady at around 54,000 and over 150,000 people on housing waiting lists, it remains a key policy area that has the potential to see the lives of thousands of people in this country, and indeed the economic and social future of this country, changed dramatically. 

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