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Good morning. I welcome the opportunity to assist the committee in its consideration of the draft order and regulations. The draft Social Security Up-rating (Scotland) Order 2024 provides for the uprating of benefits administered in Scotland by the Department for Work and Pensions. The draft Social Security (Up-rating) (Scotland) (Miscellaneous Amendments) Regulations 2024 provide for the uprating of devolved benefits administered by the Scottish Government and Social Security Scotland. I am pleased to say that the laid instruments provide a 6.7 per cent increase in the rates of all devolved benefits. That means that we are uprating all those benefits where there is a statutory requirement for us to do so, and we have additionally chosen to uprate those where there is no statutory requirement.

We know that the hard Brexit and the Tory cost of living crisis are having devastating consequences and a detrimental effect on people. That is why the Scottish Government is investing a record £6.3 billion in social security in 2024-25, delivering £1.1 billion more than was received via the block grant adjustment from Westminster. We are doing all that we can within the limited powers of devolution to protect people from the continued austerity that is being driven by Westminster. Since 2022-23, we have continued to allocate around £3 billion a year to policies that tackle poverty and protect people as far as possible during the on-going cost of living crisis.

In addition, this year, as part of our annual process to consider the impact of inflation, the Scottish Government has published a fuller multicriteria analysis of the available uprating measures. We consider that the annual rate of the consumer prices index to September remains the most appropriate measure to use. Subject to parliamentary approval, the new rates will come into force in April 2024.

I thank the committee for its scrutiny of the uprating instruments, and I welcome any questions that you may have.

As you say, the issue was debated when the Social Security (Scotland) Bill went through Parliament. The Government’s view at the time—it continues to be our view—was that it is important that there is sometimes a discretionary approach to uprating, as that allows ministers the flexibility to consider all the different ways in which we can support people. As the committee is well aware, social security is but one way in which the Government can and does support people during a cost of living crisis, or at any other time.

It is important to look at the different benefits that we have. Some are of a higher value and perhaps provide a greater proportion of a person’s income, and some are intended to supplement income from other sources. There is a difference in the types of benefits that Social Security Scotland and the Scottish Government administer, which is why we take different approaches to them. As I said, we also look in the round to see whether there are other ways outwith social security that we can support people. That is why we have the £3 billion a year overall to support people during the cost of living crisis.

Indeed, it reduces the Scottish Government’s flexibility to spend the money on anti-poverty measures and other measures. Of that £1.1 billion, £614 million is for new benefits that are unique to Scotland, including the Scottish child payment, which will cost £457 million in 2024-25. We also have £110 million for other social security benefits, such as the welfare fund and discretionary housing payments. The spend above the BGA for social security is around £368 million, of which £300 million is for the adult disability payment.

I hope that that gives the committee a sense of the decisions that are taken on new benefits and the policy changes that we have made to other benefits that have been devolved, which have led to that £1.1 billion additional expenditure above the BGA.

As I said to Mr Doris, that is part of the wider discussion that we have in Government about how best to support people. You will be aware of the action that the Government has taken to increase eligibility for the best start foods payment, for example, which we estimate will increase eligibility by 20,000 people. That is an important measure that we have taken to increase our support, but it does not involve uprating.

Again, it comes down to decisions that the Government inevitably has to make about how best to support people. That can be about changes to eligibility or uprating or, as I said, it can involve aspects that will support people but that sit not within social security but in other parts of Government.

As Mr O’Kane rightly hints, that uprating is not in the bill as a statutory requirement. I will continue to keep that under review as the bill develops.

It is fair to say that the provisions on childhood assistance and care experience assistance in the bill are at the early stages of formation. The committee will be well aware that other consultation is going on—for example, on care experience assistance. We continue to consider what that benefit will look like and how best to deliver it, so it would be unwise to make decisions about some of the other details of the bill until that is done and we have more concrete policy formations.

I will keep that under review as the bill develops. After the bill, if Parliament chooses to pass it into an act, we will do everything that we need to do in secondary legislation, as it is sometimes more important and more reasonable to do things in secondary rather than primary legislation.

The latest data from the Office for National Statistics shows that food prices had a large downward trend effect on the overall annual inflation rate under the consumer prices index including owner occupiers’ housing costs—CPIH—in January 2024. No official forecasts are available for energy and food inflation, so this a challenging area to consider.

With the greatest respect to Ms Clark, I would say that the whole point of the debate on Tuesday was to point out that there will be no change at Westminster to assist with energy prices or to help people with the continuing cost of living crisis. It was therefore important to have a debate on the fact that there is an opportunity for change, but it can come only with independence.

The First Minister is keen to continue to look at that, as he has said previously. The real challenge that limits our ability to do that will be that we continue to have to mitigate some of the worst excesses of Westminster policies. For example, there is already £127 million in the 2023-24 budget to mitigate some of the UK Government’s welfare reform. Quite frankly, I also class the Scottish child payment as mitigation, because if the UK Government took forward an essentials guarantee, for example, and universal credit and other benefits were at a fit and proper rate to allow people to live with some sort of dignity, the Government in Scotland would not be continually asked to protect people from the poverty levels that they are experiencing.

We will continue to look at what can be done, but it is difficult when we continue to mitigate Westminster welfare policies. It is difficult to see how that will change, given the restrictions on the Scottish Government budget. However, we will continue to do everything that we can, and we will continue to look at that as part of each budgetary process.

That is an important point. Given everything that we have done in the past on social security, I hope that Mr O’Kane is reassured that we always endeavour to work closely with people with lived experience. We will continue to do that on those types of assistance and on other parts of policies to do with care experience.

It is an important point that we need to listen to, and I am happy to give that reassurance. If the cross-party group wants to be involved in that, I am at its disposal.

The member raises an important point, and I appreciate that carers have asked the Government to consider it. At present, there is no legal requirement for Scottish ministers to increase the earnings limits for benefits delivered under the Social Security (Scotland) Act 2018 or under UK-wide legislation, but carers believe that it is exceptionally important for us to consider it.

The committee will be aware that, overall, the most important aspect for which the Government has responsibility is the safe and secure transition of payments. As we move through case transfer for carers, we are keen to prevent a two-tier system, whereby some people are on one earnings threshold due to some regulations, while others who have not had their case transferred yet would be on a different system. That is not a place where we want to be.

Following case transfer, the way in which the UK Government looks at earnings limits and so on might not be the most appropriate or robust way of making earnings measurements in Scotland; it will require further analysis. When we get to the point of case transfer completion—once a safe and secure transition has been completed; I reiterate that we are on target for the completion of case transfer by the end of 2025, as we had planned—that will be the time to consider it.

The member will be aware that carers themselves took part in the consultation on carers, and they discussed the different priorities. The Government wished to have a realistic discussion, noting that we might not be able to do everything all at once, because of financial and resource limitations. We are, however, committed to considering that approach for the increase of earnings thresholds for Scottish benefits once the case transfer is complete, using the discussions that have already taken place under the carers consultation and keeping the discussion going as we move to case transfer completion.

If you look at the scope of the bills that Parliament has passed, you will see that there was no available alternative. In many ways, the decision was to not continue to wait until an appropriate bill came along but to make sure that we lived up to the commitment that we had made in court.