SC/S5/18/7/A

SOCIAL SECURITY COMMITTEE

AGENDA

7th Meeting, 2018 (Session 5)

Thursday 22 March 2018 The Committee will meet at 9.00 am in the Mary Fairfax Somerville Room (CR2). 1. Decision on taking business in private: The Committee will decide whether

to take item 5 in private. 2. Subordinate legislation: The Committee will take evidence on the Council Tax

Reduction (Scotland) Amendment Regulations (SSI 2018/69) from—

Robin Haynes, Head of Council Tax, Scottish Government.

3. Subordinate legislation: The Committee will consider the following negative instrument—

The Council Tax Reduction (Scotland) Amendment Regulations 2018 (SSI 2018/69)

4. Benefit automation: The Committee will take evidence on local authority benefit automation from—

Richard Gass, Welfare Rights & Money Advice Manager, Glasgow City Health and Social Care Partnership and Chair, Rights Advice Scotland; John Campbell, Manager, Financial Inclusion, North Lanarkshire Council; Nahid Hanif, West Lothian Council.

5. Work programme: The Committee will consider its work programme.

SC/S5/18/7/A

Simon Watkins Clerk to the Social Security Committee

Room TG.01 The Scottish Parliament

Edinburgh Tel: 0131 348 5228

Email: SocialSecurityCommittee@parliament.scot

SC/S5/18/7/A

The papers for this meeting are as follows— Agenda Items 2 & 3

Note by the Clerk

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PRIVATE PAPER

SC/S5/18/7/2 (P)

Agenda Item 4

Note by the Clerk

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Agenda Item 5

PRIVATE PAPER

SC/S5/18/7/4 (P)

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Social Security Committee

7th Meeting, 2018 (Session 5), Thursday 22 March 2018

Subordinate Legislation

Background 1. There is one subordinate legislation instrument for consideration at today’s

meeting:

The Council Tax Reduction (Scotland) Amendment Regulations 2018: SSI 2018/69.

2. The Committee has been designated lead committee for the instrument. 3. The purpose of the instrument is to amend the Council Tax Reduction (Scotland)

Regulations 2012 to:

Uprate figures used to calculate the amount of council tax reduction that

an applicant is entitled to receive.

Allow a local authority to estimate an applicant’s income and universal

credit payable where the income is subject to frequent fluctuations (which

would otherwise require their entitlement to a council tax reduction to be

recalculated repeatedly over the course of a year).

Increase the period by which claims can be backdated.

Allow for any grants paid by the Thalidomide Trust to be disregarded for

the purposes of council tax reduction entitlement

4. Further background information is provided in the SPICe briefing (paper SC/S5/18/7/2).

5. The Policy Note for the instrument is attached at Annexe A. This provides detail

on the Scottish Government’s aims for the instrument. A Scottish Government official will attend the committee meeting to answer any queries on the instrument.

Delegated Powers and Law Reform Committee consideration 6. The Delegated Powers and Law Reform (DPLR) Committee considered the

Regulations on 27 February 2018 and agreed, by division, to draw the Regulations to the attention of the Parliament on the grounds that they raise a devolution issue as they may relate to reserved matters.1

1 https://sp-bpr-en-prod-cdnep.azureedge.net/published/DPLR/2018/2/27/Subordinate-legislation-

considered-by-the-Delegated-Powers-and-Law-Reform-Committee-on-27-February-2018/DPLRS052018R09.pdf

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7. This is a recurring issue. In their report, the DPLR Committee state:

“The Committee considers that these Regulations, which amend the principal Regulations, raise a devolution issue. This is for the same reasons that the Committee considered apply to the Council Tax Reduction (Scotland) Amendment (No. 2) Regulations 2017 (SSI 2017/326). The Committee considered that instrument on 31 October 2017.”

“The Committee's consideration is the same as in relation to that instrument. The question before the Committee is whether or not these Regulations relate to the reserved matter of "a scheme supported from central or local funds which provides assistance for social security purposes to or in respect of individuals by way of benefits", as defined in Section F1 (social security schemes) of Part 2 of Schedule 5 of the Scotland Act 1998.”

8. The report goes on to state that the Committee recognises that the Scottish

Government takes a different view:

“The Committee recognises that the Scottish Government takes a contrary view. The Scottish Government contends that no question is raised as to whether the Regulations relate to matters which are reserved by Section F1 of Part 2 of Schedule 5 to the Scotland Act 1998 (social security schemes). In relation to the principal Regulations, the Scottish Government has contended that they were properly made under section 80 of the Local Government Finance Act 1992. Section 80 gives the Scottish Ministers powers to prescribe conditions under which an individual's liability for council tax may be reduced.”

9. It then states:

“An Exception 10 has been inserted into the Section F1 reservation by section 28 of the Scotland Act 2016. This exception has given the Scottish Parliament powers to create new benefit schemes in areas of devolved responsibility where the requirements of the exception are satisfied, including that the new scheme must be funded from the Scottish Consolidated Fund.”

10. In relation to the Council Tax Reduction (Scotland) Amendment Regulations 2017

and the Council Tax Reduction (Scotland) Amendment (No. 2) Regulations 2017 (SSIs 2017/41 and 2017/326), the Committee suggested that framing a new discrete scheme could avoid the Committee’s concern, were that scheme to comply with the requirements of Exception 10.

11. The Committee wrote to the Cabinet Secretary for Finance and the Constitution, on 23 January 2018, seeking a timetable for consolidation and the Cabinet Secretary has indicated that he will update the Committee in the summer.

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Action The Committee can either:

note the instrument

Agree to make recommendations and report on the instrument.

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Annexe A

POLICY NOTE

THE COUNCIL TAX REDUCTION (SCOTLAND) AMENDMENT REGULATIONS 2018

SSI 2018/69

The above instrument is made in exercise of the powers conferred by sections 80 and 113(1) and paragraph 1 of schedule 2 of the Local Government Finance Act 1992. It is subject to the negative procedure. Policy Objectives This instrument amends the Council Tax Reduction (Scotland) Regulations 2012 (“the Working Age Regulations”) and the Council Tax Reduction (State Pension Credit) (Scotland) Regulations 2012 (“the Pension Age Regulations”) (jointly referred to as “the principal Regulations”). The Council Tax Reduction Scheme operates by reducing a household’s council tax liability by taking into account their circumstances and income. It was introduced with an overall policy objective of ensuring that no household would be worse off than had Council Tax Benefit not been abolished. These regulations maintain that policy objective by uprating various allowances and premia in line with equivalent changes made by the Department for Work and Pensions to Housing Benefit. In particular, this instrument uprates certain applicable amount allowances and premia set out in schedule 1 of each of the principal Regulations. The applicable amounts are changed for persons of pension age (by the increase in pension credit of 2.3%) and those for carers and people with disabilities by CPI inflation for the year to September 2017 or 3.0%. These changes apply to approximately one third of all households presently in receipt of a council tax reduction – specifically those subject to the means test. The remainder are, for practical purposes, entitled to the maximum council tax reduction by virtue of the income and circumstances indicated by their being in receipt of a particular benefit.

This instrument uprates the income thresholds set out in schedule 2 (alternative maximum council tax reduction) of the Working Age Regulations and the equivalent schedule 5 of the Pension Age Regulations by 2.2% - equivalent to the annual growth in the average weekly earnings for the quarter ending in July 2017. This instrument increases the income thresholds for non-dependant deductions by average weekly earnings growth described above and the non-dependant deductions by CPI inflation for year to September 2016 of 3.0%. Regulation 3 replaces the existing Regulation 26 of the Working Age Regulations concerning the calculation of income and capital for persons who have an award of Universal Credit. This maintains the previous policy that the estimates of income and

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capital made in order to determine a person’s entitlement to Universal Credit should be used in assessing entitlement to Council Tax Reduction, whilst enabling a local authority to estimate the income of an applicant over a period if that is subject to frequent change. This broadly repeats the existing approach set out in Regulation 29 (3) of the Working Age Regulations for applicants not in receipt of a Universal Credit award and is intended to avoid circumstances of a person’s Council Tax liability being recalculated repeatedly over the course of a year. Regulations 4 - 6 and 12 -14 require any grants paid by the Thalidomide Trust to be disregarded in the calculation of an applicant’s capital. Regulation 7 changes the period by which an application for Council Tax Reduction made by a person of working age may be backdated, with good cause, from one month to 6 months. Consultation 1. Formal consultation was not considered to be necessary as these amendments do not alter the policy intention of the principal Regulations. However, the Scottish Government has worked with the Convention of Scottish Local Authorities (COSLA), the Institute of Revenues, Rating and Valuation, local authority revenue and benefits practitioners and their software suppliers in the development of these Regulations. Financial Effects 2. The amount of council tax reduction which an applicant will receive is based on their income less their deemed living expenses. The principal Regulations are amended to take account of increases in social security benefit rates for 2018/19 so that the increased income from social security benefits treated as income in the Council Tax Reduction does not serve to increase liability to council tax for those in receipt of social security benefits. Impact Assessments 3. An Equalities Impact Assessment (EQIA) was undertaken in development of the principal Regulations. As these amending Regulations do not alter the policy intention of the principal Regulations, a further EQIA has not been produced. 4. As there is no impact on business or the third sector, and no impact on the environment or on environmental issues, no Business and Regulatory Impact Assessment or Strategic Environmental Assessment is required. Local Government and Communities Scottish Government February 2018

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Social Security Committee

7th Meeting, 2018 (Session 5), Thursday 22 March 2018

Benefit automation evidence session

1. This evidence session has been organised following Alison Johnstone and Pauline McNeill's attendance at a roundtable event on benefit automation in Glasgow on 8 November 2017.

2. At that event, staff from Glasgow City Council shared their experience of automating the School Clothing Grant.

3. That event took place in the context of scrutiny of the Child Poverty Bill, and specific measures to reduce child poverty.

4. The term ‘benefit automation’ refers to the practice of automatically giving a benefit to an individual who is eligible, even if they have not applied. It relies on connecting data sets. For example, connecting data on housing benefit and data on the school roll in order to identify children eligible for the School Clothing Grant.

5. Child Poverty delivery plans must "set out what (if any) measures the Scottish Ministers propose to take in relation to supporting local authorities to consider the automatic payment of benefits and support."1

6. The Committee agreed to explore the issue of benefit automation further by inviting local authorities to give evidence on practice in their area and on the wider issues raised by benefit automation.

7. Witnesses:

Richard Gass has two roles. First, as Welfare Rights and Money Advice Manager at Glasgow City Council. Second, as Chair of Rights Advice Scotland.

Nahid Hanif, West Lothian Council.

John Campbell is Manager of the Financial Inclusion Team at North Lanarkshire Council.

8. Witnesses have been asked to provide a short outline in advance of the meeting. These are included in annexe A where available. Witnesses will outline briefly what their local authority has been doing at the meeting.

9. This session is a one-off session intended to inform wider inquiry work.

1 http://www.parliament.scot/Child%20Poverty%20(Scotland)%20Bill/SPBILL06BS052017Rev.pdf

(Section 7, line 26)

Annexe A

North Lanarkshire Council - Financial Inclusion Team John Campbell, Manager

1) Our work in North Lanarkshire

Financial Inclusion Team • Provide a Welfare Rights (Income Maximisation) and Debt Advice (Money

Advice/Financial) Service to the Residents of North Lanarkshire.

• Provide Support, Advocacy and Representation with Mandatory Reconsiderations, Social Security Appeals and Court for the residents of North Lanarkshire.

• Commission and Monitor External Advice Service who provide Advice and

Information Services on behalf of North Lanarkshire Council.

• Lead on Tackling Poverty and Welfare Reform issues/agenda on behalf of North Lanarkshire Council.

• Work corporately with other Council Services and North Lanarkshire Health

and Social Care Integration Service to tackle poverty, deprivation and inequalities in North Lanarkshire.

The Financial Inclusion Team, Health and Social Care and Housing Services have generated £157 million in benefit income for the residents of North Lanarkshire since the introduction of the current Welfare Reform programme in 2011. The team have also been central to the North Lanarkshire Partnership response to welfare reform.

Key activity has included:

Completing over 116,000 benefits checks for residents of North Lanarkshire since 2012

Providing representation at 11,321 Social Security Appeal Tribunals with a success rate of 65.5% against a national average of 46%.

Delivering training to over 5,000 Council, NHSL, Police Scotland, SFRS and third sector staff in both welfare reform and benefits.

The cost/benefit terms that for every £1 invested by the Council in income maximisation during 2016/17 generated £25.91 for residents and the local economy.

2) Innovative practice and the challenges faced Review of Advice Services and Commissioning Model – The council reviewed its provision of information and advice services across the local

authority. In doing so we carried out a demand map of what was required across the council using; child poverty figures, SIMD figures, current and previous provision of services. In doing this we were able to create locality profiles of what work was required to be done by the successful tender for each locality that would compliment the in house service. The challenges in this field came from those unsuccessful bidders and at times their communities. Food Poverty Referral Gateway – Taking a different approach to tackling food poverty, the council has put Scottish welfare fund and the persons needs at the heart of its pathway, resulting in a 22% reduction in demand for food bank referrals. Triage Team – Due to the increase in referrals for welfare rights advice, a Triage team was created meaning people referred into the service will be contacted within 24 hours from the referral being made. People, who are able to, are given advice to deal with issues themselves, where further work is required a referral is made to the locality for assistance. NHS Lanarkshire – Working closely with NHS Lanarkshire we have been able to set up welfare rights surgeries within 3 health centres as well as working in conjunction to deliver patients income maximisation. The challenges which the team face include

Funding – short term funding for projects make for uncertainty and issues over sustainability, together with local authority cuts to non- statutory services.

Advice Providers face UK government welfare reforms, universal credit roll out and the Scottish social security agency, each contributing to service user’s confusion and reliance upon services.

3) The role that automation can play in increasing benefit uptake

There are no automation processes within the Council for the benefits that we currently administer, either for the Council or on behalf of the DWP and Scottish Government. What we do have are self-management systems (Making Life Easier) and digital services (Housing Benefit and Council Tax Reduction Scheme) and the Council has a Digitalising Council Services project to digitalise its Services over the next 3/5 years. Whilst there are pro’s and con’s to automation for a variety of different industries including the benefit system (Cold Weather Payments and Winter Fuel Payments for example), there are a number of benefits including the devolved benefits where automation will face major challenges, particularly where there are discretionary powers or grey areas e.g. disability benefits (discretionary consideration required in the decision making process), overpayments/backdating of benefits, errors and failure to disclose and links to other benefits. Automation could potentially eliminate stigma and more importantly eliminate value judgements. It may also reduce error and fraud, employee costs and advice costs. However, for automation to work someone has to provide all of the necessary information at the very start, so the question would be how do you get

this information, how do you know that it is the right information, how do people report change of circumstances and can automation understand these changes and how they impact on the UK and Scottish benefit systems. Automation could also lead to error and fraud, if the information being used for automation is not correct or updated and could provide more uncertainty for claimants, advice services, DWP and Scottish Social Security Agency. Self-management is another developing area in delivering services, however the experience in North Lanarkshire is that if the claiming of benefits is left to the claimant, family or friends then the claim does not get made in the correct manner or timescale etc.