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You are quite right to point out the cost—before I have mentioned it—of a run-on, for example, but we also have to bear in mind that the legislative foundation of the Scottish child payment is being eligible for universal credit. Someone who is not eligible for universal credit is not eligible for the Scottish child payment, because of how the legislation was developed. We developed that foundation because it was the quickest way to deliver the Scottish child payment. Any changes would have to take advantage of the legislation that the committee scrutinised and change the legislative basis for the Scottish child payment. After that had been done, you could look at changes that allowed a run-on, but that is not possible under the current system.

Thank you.

As we develop the budget for this year, we would welcome submissions on these issues not only from other parties—or indeed those who are in no party, Mr Balfour—but from a number of organisations. You pointed to the work on children aged zero to one. I know that Save the Children has submitted evidence on that aspect. We have received calls from other organisations on how to make changes both within and outwith social security. I reassure all those organisations that I take such calls very seriously. The committee will not be surprised to hear that if I totalled up the amount that people wish us to spend on social security and all other aspects of my portfolio, never mind what is in other people’s portfolios, it would not be possible to spend that, but we take those calls very seriously. We look to see what our response would be and to see whether there are ways that we can spend the money that we are already spending, not just in social security but in other areas, more effectively.

We are undertaking work. As I alluded to earlier, the Scottish Fiscal Commission’s forecasting for disability benefits, and indeed other benefits, is based on a number of assumptions about the growth and reasons for expenditure. The increase in the Scottish Fiscal Commission’s forecast to the end of the decade in the main is due to factors common across the UK, which I am sure will not be surprising to the committee. We are looking at the increasing demand for carer and disability benefits, the impacts of the increased cost of living crisis and the rises in payments due to uprating.

The Scottish Government has also undertaken work to identify the different drivers of demand for devolved disability benefits in Scotland and it is our intention to publish that analysis in autumn 2025. We know that some of the reason why we have increasing demand in Scotland in particular is that we have developed a system in which we encourage people to take up support and in which there is less stigma. That is part of the reason why there is more of an increase in Scotland than is anticipated in the rest of the UK. There is also an impact from the number of claims that are now being received to do with mental health or behavioural conditions.

Those are some of the underlying issues that underpin the assumptions in the Scottish Fiscal Commission’s work and the work that the Government has been undertaking.

I have looked at that evidence, which reiterates the points that many organisations have made to the Scottish Government and directly to the Cabinet Secretary for Finance and Local Government about their desire to see changes in the tax system in Scotland. I pointed earlier to the decisions that the Scottish Government has already taken on income tax since devolution that are different from the current UK set-up. Those are estimated to raise up to £1.7 billion in additional income in 2025-26 in comparison with what would have been raised if we had implemented the same rates and bands as the rest of the UK. That demonstrates that the Scottish Government is willing to look at, and indeed has implemented, a more progressive and ambitious taxation system.

The First Minister and the Cabinet Secretary for Finance and Local Government have set out in Scotland’s tax strategy our next steps in our approach to taxes. We think that it is very important that taxpayers and, in particular, businesses have some knowledge and confidence about what will happen. That is why we are providing stability in income tax for the remainder of this session of Parliament and there is no intention to increase the number of bands or rates of Scottish income tax. As I have said, without sounding too repetitive, if the committee will forgive me, I am sure that there will be discussions in which proposals will come forward on other changes that could be made, but the Government has been very clear on the Scottish tax strategy and some of the points where we felt that it was important to provide taxpayers and businesses during the cost of living crisis with some certainty for the remainder of the session of Parliament.

An example is how much is spent on mailings. We know that the agency has quite a significant cost attached to simply mailing out to individuals, which is why it is looking at changing the processes to have more email traffic, for example. Those areas are analysed and we recognise that that is a cost that we can make savings on, and indeed the agency already has a workstream to reduce those costs.

I find the minister very approachable and accommodating in the conversations that we have had. It remains to be seen whether that follows through to the minister making policy decisions that the Scottish Government would support. I have had a number of meetings with him over a variety of issues. For example, I have discussed the UC review with him as well as the calls that the Scottish Government has made in relation to the five-week wait and split payments, and we have offered to share with him the work that we have already done on Scottish choices for UC. We remain ready to engage with him on the work that he will be doing on disability benefits, too.

From what I hear from disabled people’s organisations—they can well speak for themselves, of course—there is a slight concern that the minister’s genuine interest and knowledge in this area may not follow through to policy changes that would allow support to disabled people to be increased. That could have an impact on the Scottish Government, and I hope that the minister will find a way for us to have discussions about those types of impact before he makes decisions rather than after.

The discussions with the UK Government are on-going, and I will update the committee once a final agreement has been reached with the Treasury. In essence, when it comes to recouping the funds, it is more about what happens with the block grant and the Scottish Government than with the agency. The agency will continue to deliver the benefit as planned.

Scottish Government officials continue to engage with their Treasury counterparts to develop the plan with a view to minimising the additional complexity and to looking at the operation of the fiscal framework. This is a new type of discussion that has not been entered into previously, but it is continuing at this point. As I say, once we have a conclusion, we will update the committee on the decisions that have been taken.

This is certainly the process that will be in place. With every benefit, we have a system of support to ensure that we analyse what happens in real time with real people as they go through the process, and that will be an important part of how we can evaluate how big any challenges for individuals are. If there is evidence of issues, we will not be talking theoretically but will be talking about the actual impact as people have gone through the process, so we would certainly go back to the DWP with that evidence, because this is not the position that I want to be in. However, at this point, the DWP’s position is the DWP’s position, so we have to get on with making the best that we can of the situation. I can reassure the committee that we have the process in place to see what is happening on the ground with clients as they go through the process.

Thank you, convener, and good morning.

The provisions that are laid out in the regulations will ensure that vital support is available to eligible pensioners with their fuel bills this winter. From this winter onwards, all pensioner households will typically receive £203.40 or £305.10, depending on their age, with the vast majority of people receiving the payment automatically.

We are in discussion with the United Kingdom Government to extend the proposed arrangements in England and Wales to recover payments from those pensioners with an individual income of more than £35,000 through the tax system. The tax charge will be brought forward through separate UK Government legislation, and it is our intention that the payment will be recovered automatically and that pensioners will not need to register with His Majesty’s Revenue and Customs for that or to take any further action.

The UK Government has set the income threshold at £35,000, which is broadly in line with average earnings. For this winter, HMRC was not able to deliver a different income threshold in Scotland, but it might be possible to introduce a different threshold in future years and we will consider the options that are available.

This will now be the largest single benefit to be delivered by Social Security Scotland since its inception, and it will require significant planning and resourcing. We are reliant on the Department for Work and Pensions to provide the data that is required for delivery; indeed, we are highly dependent on receiving high-quality data from the DWP and the Ministry of Defence in a timely manner to enable Social Security Scotland to carry out the required period of data assurance and to complete the household matching process to allow us to meet our target of beginning payments by the end of November. Although that will be a significant challenge for the agency, it has been working at pace to prepare for delivery and to ensure as smooth a transition as possible, and we are absolutely on track to start making those payments in November as planned.

As the committee will be aware, since the UK Government’s restriction of winter fuel payments eligibility in 2024, the Scottish Government has consistently acknowledged that other people of pensionable age might also face financial difficulties and would benefit from that support. For that reason, following the UK Government’s autumn budget in October 2024 and the confirmation of the associated budget in Scotland, we worked at pace to consider the options for delivering pension age winter heating payment in winter 2025-26, as well as the mitigations that might be available for winter 2024-25. Within the funding available, we decided that £100 payments for pensioners not in receipt of relevant benefits were affordable and would go some way towards supporting those households in meeting their heating bills through the winter.

On 6 June 2025, the Scottish Government laid regulations to introduce a universal pension-age winter heating payment from 2025-26 onwards.

Forgive me, convener, but I am choked with the cold. I am just going to have to stop and blow my nose a little bit.