Restricting the Scottish Welfare Fund – a case of misused statistics

Progressive Taxation for Welfare Mitigation trimmed

Of the various suggestions in our petition calling on the Scottish Government to do more to mitigate the Tory welfare cuts, the simplest was to increase the discretionary help given to those most in need through the Scottish Welfare Fund, administered by the local councils. The case for increasing the fund was so strong that this was recommended by the Scottish Government’s own Social Security Committee. But it was ultimately refused on the grounds that the fund was being underspent. As we argued at the time, this is an indication of poor administration of the grant, not of lack of need. A new report by Menu for Change delves into the background of this underspend and shows that not only does spend vary hugely from council to council – some subsidise the fund with their own money, but this will not appear in Scottish Government statistics – but councils are also avoiding advertising the fund as they wouldn’t be able to cope with the increase in demand.

The latest official statistics on the fund can be seen here. They explain the background of the fund, which has not gone up since it was established in 2013, and admit to lack of any central recording of overspend by councils:

The Scottish Welfare Fund is a discretionary, budget-limited grant scheme that prioritises applications according to need. It provides grants that do not have to be repaid. It does not provide loans. The DWP transferred the funding spent in Scotland on its Community Care Grants and Crisis Loans for Living Expenses to the Scottish Government. For 2013/14 and 2014/15 this amounted to £23.8 million. The Scottish Government topped this amount up by a further £9.2 million, giving the Scottish Welfare Fund a total budget of £33 million for both these years. This level has been maintained at £33 million from 2015/16 to 2018/19 by the Scottish Government. Local Authorities have been able to top this up with their own funds, together with any underspends carried forward from previous years. There is no statutory limit on the amount of money which can be spent on the Scottish Welfare Fund.

In previous publications, we have included funds provided by Local Authorities in the available budget when calculating the proportion of budget spent. However, for this version of the publication this funding has been removed from calculations. Available budget therefore only represents the amounts allocated by Scottish Government plus any estimated underspend from previous years, and it is assumed that Local Authorities meet any overspend each year. However, some local authorities may also have committed to adding extra funds to their budgets.

The Menu for Change report can be seen here (emphasis added).

Increasing local authorities’ ability to advertise and administer the fund will undoubtedly impact how much money is available to give to applicants . In her letter answering the recommendation made by the Scottish Parliament’s Social Security Committee that programme funding should be increased (i .e . the pot each local authority receives to pay out), the Cabinet Secretary for Social Security and Older People, Shirley-Anne Somerville, pointed out that there was an overall underspend to the programme budget in 2017/18 . This could be interpreted as suggesting there is not a compelling reason to increase the programme budget . However, there are several possible reasons for the underspend . For example, the underspend could be explained by the persistent under resourcing of the administration budget . If councils feel it necessary to take from their own general funds to keep the fund running at current levels, it is understandable that they would not look to widen access to the fund in order to try to keep staff workload manageable . As outlined above, several local authorities also suggested they would not be able to cope with demand if they were to advertise the fund .  It should also be pointed out that 68% of the programme budget underspend in 2017/18 is attributed to only six councils . In fact, nine councils overspent, and two councils significantly overspent in the same time frame – one council overspent by £100,000 and another by over £300,000 .This suggests the underspend is not clearly attributable to a lack of need, and can be explained by differences in local authority practices and demographics . If the Scottish Government is going to make the Scottish Welfare Fund work to its full potential, ensuring people facing acute income crisis receive adequate cash based support, it must be prepared to properly fund the administration budget so local authorities can administer the fund to the highest standard . However, this must be accompanied by an increase in the programme budget to meet the increased demand which a rise in awareness of the fund, and enhanced practice in the delivery of it, is highly likely to create .

Of course, we fully recognise that the origin of the cuts is Westminster, and that Scotland provides more help than other places. But we also recognise that further help is desperately needed, and that it could and should be provided by the Scottish Government. While we don’t (yet) have the powers to make fundamental improvements to the system that Independence would bring, Scotland already has the ability to increase revenue through more progressive taxation, and to use this to repair the holes in the vital welfare safety net. Whatever the colour of the administration, politicians at all levels must be held to account.

Thank you to Ian Davidson for his persistence in going through government documents and for finding the above quotes.

The image is from our protest outside the Scottish Parliament budget debate in March

 

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