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I will bring in Stephen Kerr in a minute, because that issue has a direct impact on what has been happening in his directorate, with staff moving to the agency.

This is a process that the committee would expect to happen. The evolution of social security will continue, but the devolution of it under the programme is coming to an end. We would expect the ways of working in the Government to change; some work that was previously in the Government now needs to move to the agency. Stephen Kerr can give examples of that.

I appreciate that people want reassurance that our system can deal with fluctuating conditions. We made alterations to our system to make it more person centred in order to allow fluctuating conditions to be better served through the application process and the work that is undertaken in Social Security Scotland when decisions are made. However, I appreciate that there is concern about that area. We are right to continually challenge ourselves about whether the social security system is delivering for everyone as we intended it to do.

I know that there is concern, particularly around rare conditions or disabilities that a case worker might not come across very often. That is why it is important to continually look at the training and knowledge of case workers and to have the support of others in the agency who can be brought in to assist with decisions in difficult cases.

I will bring in Stephen Kerr on that.

Forgive me, Mr Balfour, but that fund does not sit within my portfolio—it sits within the Deputy First Minister’s portfolio—so I do not have the details to hand, but I know that Richard Lochhead recently answered a question about it in Parliament.

We are very keen to learn lessons. That is why we wanted to work more closely with the UK Government on the development of the strategy, because we thought that there might even be things that we could learn from it—who knows? We did not have that opportunity, but we are keen to look at it.

It is important to recognise that we in Scotland have sometimes taken different approaches to policies and that there are also policies available in Scotland that are not available in the UK. I mentioned the fact that, overall, around £3 billion is spent on helping those on low incomes and the cost of living crisis. We have developed the five family payments, including the Scottish child payment, in which we invest more than £0.5 billion, and there are the free prescriptions and free eye tests. There are therefore a number of things that are not in the UK strategy that are in the Scottish Government’s policy.

As we look at where the UK Government has taken a different policy approach, it is also important that we learn lessons. There is a difference in approach to childcare in England, with that approach being available only to working families. The Institute for Fiscal Studies has made it clear that, despite the investment that has been made, the poorest third of families will see almost no direct benefit from the new entitlements. When I was down in London for my most recent round table, I also heard that there are some implementation challenges when a policy is being launched, but there are also challenges with delivery. That is quite normal when such a large policy is undertaken.

Those are the types of lessons that we would like to be able to learn, so we can learn about what has worked well and about the challenges that different Governments, whether in England or Wales, face when they take different approaches.

The aspect that we warmly welcome is the abolition of the two-child limit. We said all along that it would be much better to do that at source rather than have the Scottish Government mitigating the effects of the limit, so that is to be warmly welcomed.

However, I would use that as an example or demonstration of how, because we did not know where the UK Government was going on that, the Scottish Government and Social Security Scotland had to continue our work so that we could be ready to mitigate the two-child limit ourselves. Indeed, the UK Government’s decision is warmly welcomed and will make a difference to children across the UK. The other caveat is that, because the benefit cap remains in place, many children will not fully benefit from the two-child limit being lifted, because they will be hit by the benefit cap. That is not the case in Scotland because the Scottish Government will mitigate the benefit cap, which will be an additional expenditure for us, in order to ensure that everyone will benefit from the two-child limit being scrapped.

Thank you very much, and good morning, convener. Eradicating child poverty is the Scottish Government’s top priority and a national mission for us all, and I am glad to see the UK Government’s renewed focus on that critical issue, albeit later than it had envisaged.

Although there is action to welcome, including the scrapping of the two-child limit following unrelenting pressure from the Scottish Government and many charities, I am clear that more is required to support families.

There was initially very positive engagement with the co-chairs of the UK Government’s child poverty task force in October 2024 and an interest in developing a truly four-nations approach. However, I am sad to say that that did not materialise. There was a lack of meaningful engagement from UK ministers and, despite sharing learning and experience from Scotland, UK ministers unilaterally decided to end four-nations engagement on the strategy earlier this year.

Despite my repeated attempts, no ministerial engagement took place between May and December as the strategy was finalised. It is deeply disappointing that the UK Government failed to foster the consensus and partnership across Governments that was initially agreed and to seize the opportunity available to us all. Instead, a strategy has been developed that sets no statutory targets for poverty reduction, immediately weakening accountability.

A broad range of measures have been outlined in the strategy, but that mostly represents a consolidation of previously announced policies rather than a commitment to further action. As the Poverty and Inequality Commission and others have highlighted, the strategy does not go far enough to support families with no recourse to public funds, it fails to remove the benefit cap and it continues to freeze the local housing allowance rates. Those are all conscious decisions that the UK Government has taken.

The UK Government’s own analysis shows that relative poverty rates are estimated to remain broadly stable across the UK as a whole, despite the measures in the strategy, with 4.3 million children expected to live in poverty by the end of the decade. That is the scale of the UK Government’s ambition—that poverty remains broadly stable.

In contrast, there is already clear evidence of the impact of the Scottish Government’s approach. Child poverty rates have fallen in Scotland only because we have taken bold action, such as the Scottish child payment, which is successfully keeping children out of poverty. Our action is making a difference, with the lowest-income households with children estimated to be £2,600 a year better off this year as a result of Scottish Government policies.

I will continue to urge the UK Government to go further and to match our ambition and action. As it does so, we remain committed to working with and supporting the implementation of the strategy in Scotland.

As the committee knows, the Scottish Government is in the process of developing our third child poverty delivery plan. We have committed to reinvesting the money that is committed to the two-child limit payment to tackle child poverty. We will set out the details of our investments in the Scottish budget, which will be published on 13 January 2026.

In conclusion, we will continue to review the UK Government strategy and the written evidence provided by the secretary of state, which we did not have the opportunity to look at in detail before giving evidence today. We will look at what that means for Scotland and for our next delivery plan, which is due for publication by the end of March 2026. The Scottish Government is committed to doing all that we can to eradicate child poverty and the UK Government must do so too; the strategy must be its crucial first step and not the only step.

I am grateful for the opportunity to be with you today and to answer any questions that the committee may have.

In my opening remarks, I referred to the strategy being more of a consolidation of what was previously announced rather than what is new, with the exception of the two-child limit. I do not know what language the UK ministers have used in their written evidence, but in the discussion that I had before we had the copy of the strategy, it was implied that it was a collation rather than a launch of new things. Therefore, there are no additional consequentials from it, because there does not appear to be anything new that would bring any consequentials to the Scottish Government.

If there is anything in the written evidence to the contrary, I will be happy to look at it, but that is our understanding at present.

I could indeed talk for some time on that. It may be useful to the committee if I provided in writing the details, or at least some of the information, that we sent to the UK Government as we tried to move these various aspects along.

It is also important to recognise that I was not sighted on the written evidence from the UK Government until this morning. Perhaps we can wrap in some of my reflections once I have had an opportunity to read the letter from the Scotland Office in greater detail. That will go through some of the missed opportunities that we were hoping to work with the UK Government on as the strategy was developed.

You raise a very important point about the competing demands within the budget. The First Minister has made it very clear that the money would be used for child poverty, because the purpose of the mitigation of the two-child limit was to tackle child poverty. Clearly, it is not the only aspect of the Government’s actions to deal with the cost of living crisis that many people face—not just families with children. That is exactly why we invest around £3 billion a year in helping those on low incomes and helping to tackle the cost of living crisis.

That goes wider than our work on child poverty, but the money for the two-child limit will be allocated to a child poverty measure.