Bill to mitigate benefit policies ‘eyewatering’ but alternative worse, MSPs told

The bill the Scottish Government pays to mitigate Westminster benefits policies is “eyewatering”, a campaigner has said, but the alternative would incur “astronomical costs”.

Scottish ministers use their own budget to cover costs that could hit Scots such as the bedroom tax, while plans have also been announced for the Government to mitigate the impact of the two-child benefit cap and introduce a universal winter heating payment for pensioners.

According to a freedom of information request released in October of last year, the Government has spent almost £740 million since 2013-14 mitigating Westminster policies.

I would urge the committee and indeed the Scottish Government that if it comes to these decisions to think about the cost of what it would be to service the failure demand from this and the impact on other services

In addition, scrapping the two-child cap in Scotland is due to cost around £200 million by the end of the decade and £100 million has been allocated for the new pension age winter heating payment in this financial year.

But with spending on devolved benefits due to hit 14.9% of Government spending by the end of the decade, according to the Scottish Fiscal Commission – meaning ministers would have to find £2 billion – some have questioned the cost of such mitigations.

Appearing before Holyrood’s Social Justice and Social Security Committee, head of social justice at Citizens Advice Scotland Emma Jackson said: “It is an eye-wateringly staggering bill to cover the cost of these mitigations, but I would urge the committee and indeed the Scottish Government that if it comes to these decisions to think about the cost of what it would be to service the failure demand from this and the impact on other services.

“It will be astronomical, and the long-term impacts of that will last for generations, so we really can’t take a short-term view on that.”

Ms Jackson also spoke about the proposed £5 billion in cuts to benefits from the UK Government through changes to eligibility for the personal independence payment (Pip), but also from a reduction of the health element of universal credit.

The changes, she said, would be “catastrophic” and have a “far-reaching impact on sick and disabled people and their families”.

She added: “It is undoubtedly going to push people further into debt and destitution, with devastating impacts on people’s mental and physical wellbeing.

“None of this is hyperbole, it is the reality of what we will see and we absolutely must grapple with that and do everything within our power to prevent these from happening.”

She also hit out at the language used in the debate around the cuts, claiming it has been “deeply villainising”.

A spokesperson for the UK Department for Work and Pensions said: “Responsibility for the policy areas set out in the Green Paper differ between the devolved governments.

“The Government is determined to support more people back to work. At the heart of our reforms is a £1 billion package to help the sick and disabled find secure, stable jobs.

“Alongside this, we’ve increased the ‘national living wage’, uprated benefits, and are helping over one million households by introducing a fair repayment rate on universal credit deductions.”

Social Justice Secretary Shirley-Anne Somerville said: “Over the last 15 years The Scottish Government has spent around £1.4bn mitigating the impacts of UK Government policies such as the bedroom tax and benefit cap.

“This money could have been spent on services like health, education and transport, or on further ambitious anti-poverty measures, and would pay for around 3,000 teachers or 3,700 band 5 nurses each year.

“Under our Programme for Government we will spend £97 million this year to enable councils to use discretionary housing payments to protect more than 94,000 households in Scotland against the worst impacts of harmful UK Government policies.

“In pursuit of its self-imposed fiscal rules, the UK Government is determined to impose austerity and its own analysis estimates the welfare changes it is planning will push a further 250,000 people, including 50,000 children, into relative poverty.

“The long-term importance of these mitigations is clear, with, for example, Trussell Trust analysis published just last month indicating that hunger and hardship are costing the Scottish economy £5.6bn a year.

“The UK Government must listen to the Scottish Parliament which recently voted for these plans to be scrapped.

“It is not too late for them to change course, and follow the Scottish Government’s lead in protecting and enhancing the social security safety net.”