 Good morning and welcome to the 18th meeting of the Social Justice and Social Security Committee. Our first item of business today is the decision to take items 6 and 7 as priorities. Are we all agreed? We now turned to our next item of business, which is an evidence session on Social Security spending forecast with the Scottish Fiscal commission, who are all in the room with us today. I welcome to the meeting Dame Susan Rice, DBE, who is the Chair and Commissioner, Professor David Alff, Head of Social Security and Public Funding for the Fiscal Commission, Clare Mardach. Good morning. Before I invite Dame Susan Rice to make some opening remarks, I'd like to take this opportunity to thank Dame Susan for her leadership of the Scottish Fiscal Commission as we note your term of office is coming to an end. It has been a pleasure to work with you and the commission's forecasts are integral to the committee's ability to scrutinise the Scottish Government's spending on social security. I'll now invite you to make a few opening remarks, please. Thank you very much for those kind words and even more so, thank you for the invitation to come and discuss our most recent forecasts. I'll say a few words about the current economic context before turning to our social security forecasts. The outlook for the Scottish economy is much more uncertain than in our last forecast in December 2021, the Russian invasion of Ukraine, rising energy prices and further global supply chain disruptions on the back of China's response to Covid have led to a very challenging economic outlook. Rising inflation is creating a cost of living crisis for many households. For those households in work, we forecast real earnings to fall. Our forecasts expect inflation to peak at around or nearly 9 per cent in the last quarter of this year as the October energy price cap increase comes in. For those receiving social security payments, our current forecasts are based on an increase of 7.5 per cent in April 2023, but the exact uprating will depend on this September's CPI inflation figure. The effects of inflation will be felt particularly by lower-income households who spend more of their money on essentials and can't easily cut back on savings or discretionary spending to cover rising costs. This economic outlook feeds through into the Scottish Government's funding position for the resource spending review. Overall, we are expecting total funding to drop slightly in real terms for the next three years before increasing only slightly. Social security spending will account for a growing share of the resource budget. Right now, the social security accounts for around 10 per cent. By 2026-27, we expect it to have increased to around 14 per cent. We are here that we only forecast spending on the payments that are made to people, not the administrative costs or wider implications of social security spending. Since December, our forecasts of social security spending for 2026-27 have increased by nearly a billion pounds. This increase is because of higher inflation alongside the inclusion of Scottish Government policy announcements, such as the increase in the Scottish child payment to 25 pounds a week. Also in our previous forecasts, we did not include Scottish Government commitments on social security where crucial details on those payments were still to be decided. The forecasts that we have just produced are supporting a four-year spending review, and within that four-year period, the Scottish Government has committed to replacing the devolved payments that are still administered by DWP through the devolution of winter fuel payments and the introduction of replacement payments for carers allowance, attendance allowance and industrial injuries disablement benefits. We have now included indicative forecasts of additional spending for these payments coming over the next four years in total, adding nearly £350 million to our forecasts by 2026-27. Some of you may have been doing your maths, and if you were, you will see that there is still an increase of just over £300 million, which I have not yet explained. This increase is the result of data updates, modelling changes and changes to our assumptions. The most significant changes relate to personal independence payment, which is being replaced by the adult disability payment, and reflect changes in the data available from DWP. Overall, social security spending is expected to increase and to be higher than the funding received from the UK Government. By 2026-27, we expect nearly £1.3 billion to be spent above the funding received. We call out as realistic a picture as we can of what will need to be spent on social security in the future to help the Government plan its budgets to ensure sufficient funding has been allocated to its social security priorities. These payments are demand-led, and the spending in future years is determined by policies that the Scottish Government has already set in place. When our forecasts for social security spending are added to the Government's own plans for health and social care spending, the funds left for other portfolios are constrained. Once adjusted for inflation, funding for these other areas falls substantially for the first three years of the spending review and is 8 per cent below current levels by 2526. By 2026-27, funding is expected to be 5 per cent below this year in real terms. If I could to complement your opening comments, I will finish on a personal note and say that it has been a genuine privilege for me to lead the commission over the last eight years—five of those under a statutory framework, but we did start in 2014. I have enjoyed and genuinely valued our regular engagement with several parliamentary committees, not least this very important one. I think that we have all come a long way, so I thank you. We are very happy to take some questions. Thank you very much for your remarks. We are going to turn to questions from members now. We have a few themes to explore. The first theme is comparison with December forecast, and thank you very much for setting the scene, as you just did in your opening remarks. I am going to turn to questions from my colleague Paul MacLennan first, who will be followed by Jeremy Balfour. Thank you, convener, and morning panel. The first question that you touched on is which Scottish Government policies are having the greatest impact on the forecasts and which are having the least impact? I think that mimicking what one thing we said after the December budget and after our report is that bringing in the forecast for ADP, which is still being trialled, if you will, in certain areas just now, but it is in the process of coming in fully, that is a huge benefit in terms of financial terms, so that is adding significantly. A reminder that ADP and there are several other disability benefits and some other benefits are also indexed links, so that they rise with inflation, which is appropriate for the recipients. That obviously makes sense, but it also means that they grow, and that is why we have looked at that concern about what is the spend now and what will the spend be. There are other factors that have come into the growth. I do not know if David or Claire, I do not want to say too much. Some of the factors that I work here are, there is about a third of a billion increase in the ADP forecast because of the data and modelling assumptions. Higher inflation has about another point two of a billion, and these indicative forecasts we have made of new payments still to be launched has about another 0.3 billion. It is a combination of different factors at work here. I suppose that one question you touched as well, David. Was it about the inflationary outlook? I do not think that anybody would have forecast that it went to 9 per cent, even with some of the geopolitical events that it went on. I think that it has been higher than it was forecast before. I do not know what your outlook then is. It is a crystal ball type of thing, but where can you see inflation listening to radio for this morning, and we are talking about the various things this morning saying is this a flip, or is this something that is going to be going on for the next year or two? There are food supply issues and so on. Where do you see that going? I know that it is hard to hold you to this one, but is inflationary next year? Is this something that you would see in the next year or two, almost peaking, or is this an issue going forward for, as I said, maybe beyond that? It is a really important question. The importance of it is that it is not so likely that the figure that is attached to inflation, although the number is, you know, it attracts our attention right now because it is quite high, but it is how long does it become entrenched or not? That is the real issue. We are not in a position to say, so our central forecast is that by the end of this year, with the next price cap increase for energy, we think that it will come close to 9 per cent. The inflation in April was even a little higher than that, but we do not yet know. That is one thing. The other thing that I think is important to say is that with the Chancellor's package, particularly the one from late May, the additional funding being made available mainly to low-income families—now that is not the case with everyone who receives social security benefits—is not low income, but a lot of people are, and they struggle more. They will be made whole possibly for this year, so they will have enough to cover the increase in those costs for food and for energy this year. That is a general and an average statement, but if inflation becomes entrenched, there lies a potential problem. David, were you going to come in on that? To amplify what Susan said, in our forecast report, we said that one of the big risks was the shape of inflation over the next few years. In our forecast, we are forecasting that it will fall rapidly back down towards about 2 per cent, but that is a big area of uncertainty. What is going on here is that, as Susan said in her opening remarks, a lot of the inflation that we have seen is driven by cost-prush inflation coming from availability of energy and other inputs. If that turns into a wage-price borrow, that is where there is a risk of it becoming more endemic and lasting. If it does not become endemic, we do not see any other big pressures driving up prices. It does not mean that the prices are going to fall, it just means that they will stay high, but there is nothing else we see at the moment that is necessarily going to have the same rate of increase as we have seen over the last year or so. Thank you very much. Jeremy. Good morning to the panel. I wonder if you could just tell me, going forward in regard to when you are looking at your forecast, which is easier, harder to forecast if it is a benefit that is going to lots of people. The winter payment goes to the most people in Scotland. Something like ADP and UDP is a much more available thing. When you are forecasting and there is a committee, perhaps you could guide us on whatever ones we should be looking at for you as you predict which are the easier ones and which are the harder ones. I will give a general answer, but then, again, turn to my colleagues. Again, come back to ADP because that is just bigger and it covers a large population. Something like the winter heating that is just to come over the next few years. If there are no changes to that benefit, then the funding comes with it. You do not need to worry even though more people, I do not know the numbers, Claire might know the numbers or David, but the difference is where in Scotland, both paying attention to the social security charter and what the Government's priorities are, a lot of the benefits have expanded in the sense of the way people can apply for them and the way that they are advertised and people are invited in. The process has been made more user-friendly, the renewal process has been made more user-friendly. There are a lot of reasons why a bigger population may come in for individual benefits here and may apply for them and may qualify for them and may stay in them longer. It is a little hard for me to pinpoint others, but I do not know, Claire, do you have a particular other one? I can just add that in terms of the number of people that are being supported by a payment, that does not directly correlate to how difficult or easy it is to forecast. The pension aid winter heating assistance, which will replace winter fuel payments without sounding too confident about our forecast, is probably one of the easiest ones to forecast because it goes to almost everybody over a certain age and it affects payment amounts. As Susan has said, the most difficult thing to forecast is when you have these policy changes, particularly around how a payment is delivered, which is harder for us to quantify. If a payment amount has changed, that is easier. It is where these changes are made that I think the greatest attention needs to be paid. Particularly on ADP because of the scale of the changes that are being made and the scale of the payment in terms of total value. A relatively small forecast error here from us can actually amount to quite large amounts in the Government's budget. Thank you. That was helpful. Just a quick follow-up. When you are doing your forecast and say around ADP there is a divergence between the UK Government and the Scottish Government. What information do you need from both Governments around that? Do you take a view of whether that is a significant divergence that would then have to be paid for by Scottish Government or whether that can be mopped up within the UK budget? We do try to identify which elements of the reform are purely Scottish elements. Once we have identified that, it is clear from the way the fiscal framework works that that spending will fall on the Scottish Government's budget, not on the UK. There will not be any BGAs that come along with that. What we did with ADP was we first of all tried to forecast what we call the PIP baseline, which is what would have happened had been persisted with PIP in the rest of the UK. Then we tried to systematically build up our understanding of what all the various reforms the Scottish Government was making to the way in which it would be delivered, even though the payment levels were the same. The way it was being delivered was with a change. We identified about 12 different factors of work there. We went through and systematically examined each one of those. We have no data to go on until the policies actually implement it. We have no data to go on. Essentially, there is a lot of judgment involved. We cross-checked our assumptions with a range of other experts in forecasting social security so that they thought our assumptions were broadly sensible. We put a lot of effort into cross-checking them. Of those 12 areas, are they controversial? Is there a general feeling that these are the 12 areas that we should be looking at? I know you are not involved in politics, but at some point, presumably, we will have to be a judgment call by both Governments in regard to that. So far, do you think it is fairly clear that there is an agreement that these 12 areas that you have looked at are agreed by both Governments? These are reforms that have been announced by the Scottish Government. I do not know if there is any debate about whether those are in or out, whether they are there. I think that one important point to make at this stage is that when you make these types of reforms, not just a one-off effect on the level of payment, some of these effects persist over very long periods of time. If you make it easier for people to be put on to the ADP in the first place, then once they are on that, if you extend the length of time in which they remain on, the benefit of making it easier for them to go through a reassessment process, anything you do at the outset persists for many, many years. So, the fact that it is growing, that growth will continue for quite a period of time after all these reforms have actually started to come into play. So, we cannot say exactly what that rate of growth will be, but I do not think that the level is going to stay at the level in 2728. There are factors in these reforms that will cause that to carry on growing. You asked about the UK Government policy changes earlier. We do look at when the UK Government is making a change which will affect Scottish social security spending, we do take that into account. So, at the moment, if the UK Government changes PIP, because the majority of people are still being paid by DWP, those changes will have an effect in Scotland. So, we take those into account and we can discuss that with DWP and with the OBR and similarly, change to its major universal credit, which might affect eligibility for payments such as the Scottish child payment. We take those into account as well. Before we move on to our next set of questions which is round about the potential gap in funding that has been looked at, I think that what you have just described at the moment tells us that it is a very iterative process. It is constantly changing in terms of the data that has been given at different times by different sections of government, but also by what is going to come out of the pilots and then what is going to actually come out of the review that is going to take place. So, it is a very iterative process and I think that it is very important that this committee has close links with yourselves in terms of how we scrutinise that going forward. It does show from December just how drastically things contained when we take all of these things on board. So, thank you for that. Our next theme is round about a gap in funding. I am going to go back to Paul MacLennan who will start us off on that and then over to Miles Briggs. Thank you, convener. One of the things that was talked about was how uncertainty would reduce as payments were launched. I think that, obviously, in the situations of December and I think that Dame Susan talked about that that has now changed. It comes back to the point that the convener made. From our analysis point of view what is almost like the feeding time if we are talking about how things have changed how early should we be engaging with yourself in that process in terms of rather than us coming to this and it is almost a shock should we be engaging at an earlier stage with yourself in terms of the impact that is going to have because even from December to June that has changed quite substantially should we have been engaging with the earlier rather than at this stage so that it is more on about the process that you have also indicated that uncertainty has increased rather than reduced since then but it is more about where we should be analysing it and working with yourself in that regard. That is an interesting question because we obviously welcome any inquiries or contact. The way we approach and others approach developing a forecast is usually around a 10 week period of time but the way we need to wait there are various elements it is not that we sit there and say tomorrow we will do it it does take time and it is an iterative process also there are reports of data so data for some areas come out annually monthly, quarterly, weekly whatever and our forecast has changed as we are able to bring in more up-to-date data so sometimes we are asked why are you a little different when we are in a particular place and it's because they've had data or even the Scottish Government in some cases in the RSR will have used December data because that's the practice, the protocol whereas we will use the most up-to-date data so it's hard for me to say there's a point in time when it would be helpful but if you have questions in your deliberations I'd urge you presumably through a letter from the convener to come to the commission and at least say you're concerned about something and we'll see what we can do I think the point you made because it's almost taken a point in time and that point in time can change very quickly and obviously analysis we're based in is on that point of time when circumstances might have changed even within the six months we're talking about so I think that's my big deliberation we need to have within the committee and obviously I think the Scottish Government how do we analyse that so yeah that's thank you for that it also goes back to the scale of spending because evens relatively small changes in EDP start to add up to tens of millions if not hundreds of millions of pounds so it depends a lot on the benefit for relatively small benefits some degree of uncertainty is not going to change the overall funding that much and small things change it by very large numbers that's maybe something I'll raise at the end but when we analyse that because you're right I think you mentioned at the start that some of the modelling was 300 million inflation was a certain part of it and so these changes even though you're saying it's small can have a major impact we're talking 200, 300 million pounds that can make a huge difference but that's maybe something we need to take up thank you thank you very much Paul over to yourself Miles good morning to the panel thank you for joining us this morning I wanted to follow on from that line of questioning with regards to uncertainty around the launch of some of the new benefits and for example the forecasts around disability benefits which are outlined in December is there more clarity since they've been launched around cost predictions we would like to sit here and say yes but I'm afraid the short answer is no so the Scottish Child Payment launched last year and Social Security Scotland have published some statistics so far on the number of children receiving payment but they're not in the form that is comparable to what we have from DWP at the moment so we haven't been able to take those into account in our forecast this means that all our disability payment forecast are still very much based on assumptions and judgments we're going to be working with Social Security Scotland over the summer to discuss the data that they have, what they can make available and hopefully as a spoiler when we speak to you in September after you published our forecast evaluation report which will evaluate child disability payment spending last year we'll be able to say what we can say in terms of whether the forecast that we made for last year was accurate whether the things that we expected to see in the number of children applying and the number of children being successful has been seen or whether the data isn't available in the form that we need yet that's great, that's helpful, thank you my other question was with regard to the Scottish Government's spending review did you see any clarity in that around where this funding gap potentially will be found and I think we were all looking at what was a predicted cut in local government funding of around 7% do you think that's where funding is likely to come from so could I just say something in general about the spending review I sort of personally believe and I think my colleagues agree that this was a really useful thing to have done and I in another committee use the word brave as well because it does lay things out but for the Government knowing that it has the commitments and the priorities and the area that this committee looks at and that these numbers grow and it's hard to know what the future holds by doing the spending review it forced the discipline of saying if using our forecasts for funding as well as for spending if those numbers were all today the numbers that we publish were the numbers they project how they would have a balanced budget some of you it's the Government all of you and that legally is the requirement to balance the budget now if more funding comes in over time that's a place to start that's a concrete platform to say this would have been balanced but we have more funding so maybe we give some to local government or maybe they would say we haven't really sort of done it for child poverty and we want to add more there the decision process would be more effective having done the spending review but the spending review is basically showing I think it's roughly an 8% cut on average across areas that are outside of health and social care spending and social security so that's what you have to do move your priorities you've obviously been doing these reports for a number of years and seeing this where you must have also seen every year that the budgets are facing that cut from your experience across other committees where you're giving evidence is there more of which can be found within these budgets to be able to meet that shortfall so that's beyond our pay grade if you will so we don't I think you know but it's always good to remind ourselves and others we don't involve ourselves and develop the expertise and consider policies potential policies when a policy, new policy is announced we then cost it because it is an announced policy so we wouldn't come up with speculative more could be done here or there that's really the government's job Could I maybe just add your first question about understanding the spending review one thing that has happened over the last couple of forecasts is we've gone into far more detail about how exactly the government has come to balance its budget from year to year so we've had a lot of discussion about other sources of income that might be available to the government to get a year on year balance in the budget and that I think has been a big development in the relationships between us and the Scottish Government we were interrogating areas that had previously not been looked at before so we're just bringing a degree of transparency to how the government thinks it will be able to manage some of these fluctuations in spending and in revenue and funding from year to year so that's another area where I think we're making big steps forward Thank you very much and we'll move on to questions with regards to indicative forecasts and I'll bring the deputy convener in to start us off Natalie Thank you convener and good morning to the panel You've touched this morning on some of the matters that are and will continue to impact these forecasts such as inflation and Scottish Government spending in the cost of living crisis but can you advise how uncertain these forecasts are and can you expand on any other areas that might impact the forecasts? Date becher when I start off There are different areas of uncertainty here We've touched on a lot of the areas of uncertainty around ADP The indicative forecasts have a different degree of uncertainty or a different source of uncertainty because we know some elements of what the policy is going to be but we still don't know full elements of the policy normally we would only cost a policy once we know in quite considerable detail what the elements are going to be about launch date how it's actually going to be delivered what efforts will be put into promoting the benefit and so on all these factors we want to know at some level of detail before we produce the costing but we felt that in order to be helpful for the spending review we couldn't just say these policies are not known well enough for us to say anything that would have been just as misleading as saying something so we decided to develop these indicative forecasts which try to help the government understand something about the range of spending that might be involved with these policies that are coming under that heading so there is a degree of uncertainty to that which is different from other areas because we felt it was helpful to produce forecasts not fully understanding all the level of detail that we would normally want to understand one of the areas around Uncenteno is UK Government funding and we can see in the report the Scottish Government funding from the UK falls up to the period 24-25 and capital funding is decreasing over the next three years so I understand that social security funding works a little bit differently in that we receive BGAs based on the UK payments but that means that UK Government decisions on areas of social security are going to dramatically impact the Scottish Government's position so I'm just wondering clear, I know you touched on this slightly earlier can you expand on how the SFC consider the impacts on forecasts depending on the level of spending of the UK Government? That's a good question and I think it's part of the fiscal devolution that the Scottish Government has that its budget is inherently very linked to what the UK Government does in terms of spending and also tax revenue as well so when we're forecasting the Scottish social security spending we do take account of UK Government policy where it changes to things like PIP or changes to universal credit and those will feed through both in terms of when the payments are still being administered by DWP but almost more importantly through the block grant adjustments and if the UK Government makes a change to say PIP spending in England and Wales that will directly affect how much the Scottish Government receives in funding so that's the sort of social security element of it and we do then compare that to we compare our Scottish social security forecast to the block grant adjustments in terms of our social security commentary and where we sort of show a funding gap here it's not necessarily a gap in real terms in terms of it not being funded it's just the gap between what's directly received and what the Scottish Government is spending and then separately there's a wider question of the whole budget where the block grant is a big component of Scottish Government funding still even with the tax-raising powers being devolved and that's again directly related to how much the UK Government is spending in other devolved areas so we do include we set out what the Scottish Government's funding looks like over the next five years and how that's changing depending on what the UK Government is doing and that is a big area of uncertainty which we discussed more with the Finance Committee but the UK Government can change its spending plans in here as we have seen with just the announcement from the Chancellor a few weeks ago that did result in some consequentials for the Scottish Government so the Government is managing its budget in the year also over multiple years so it's challenging for you all to be scrutinising what's happening as well as it is for us to be forecasting when this change is being made all the time absolutely, absolutely, alright thank you, convener, no further questions on this theme thanks very much for that we'll now move on to questions from Pam Duncan-Glancy and then followed back by Miles Briggs again, Pam thank you, convener and good morning to the panel, thank you for the information you've given in advance and also for the questions you've answered so far it's really helpful particular for someone like me who finds some of this the detail of it quite complicated so it's really helpful to have it set out in the way that you have in advance so thank you I just want to explore a little bit more about some of the options available to the Government so some of this will touch on of course the forecast and a little bit possibly on the gaps in the previous kinathomatic discussion obviously you've set out today that some of the funding decisions around social security will mean that the pressures on other areas are significant could you set out your view on what other options were available to the Government to balance the books on social security in this way oh, what other, well so they've they've put out a plan the Government has only so many levers to use basically so borrowing is limited there's the reserve and they've put out a plan for how they would draw on the reserve in what schedule for doing that so what else I don't know David one answer is to go back to the question the answer I gave before that if you look at some of these indicative forecasts for new areas of social security what will happen is because we've forecast what will happen under the spending review that means that the Government will have to understand that if it wants to implement further policy reform in those areas at the moment there is no funding within the funding profile for that so it will have to think about how does it prioritise that within the areas where it can make other decisions so we're not saying it can't make those things we're saying it can make further changes but it has to now understand that within the funding profile that we've given it within the funding envelope there will have to be other areas that will have to be accompanied by those spending decisions so I think that's where we've been helpful to the cluster Government as I said before there's a lot of details about how the Government manages budget to be here what other sources of funding it might have available and we're getting greater transparency on what it can do in those areas but there's a little uncertainty around that area as well just to pick up on that point Professor, you mentioned earlier about the changing relationship I think you said it's been a bit more transparent on what other funding options it has available can you give us any more detail about those conversations that you've been having well the issues are around how it manages at the reserve what its plans are for spending into the reserve what its plans are for joined anthems there was an assumption in the 21 budget there was 620 million pounds that the Government would find from other sources we then interrogated those 620 million sources we found that two of them have generated around half the 620 million one source of funding to cover the gap in the last budget was Scotland but now the Government decided not to use Scotland to cover the 620 million it wants to use that to put in to cover funding gaps in the earlier years of the spending review so we've got so understanding now where the Scotland funding is going to go how much is it going to go in one year how much is it going to go into the other year what is transparency process I think is it's a conversation they're doing their job we're doing our job we're trying to help them understand how they can or cannot manage the budget our job is to see whether we think their assumptions are reasonable that's the judgement we have to come to we came to the decision that were broadly reasonable that's not a quarrel I appreciate that and I guess that leads me on nicely to my next question which is about the broad reasonableness of the assumptions and I note that you mentioned earlier that aspects like launch date promotion and approach to benefits can add to the uncertainty around the cost how much information have you had in your discussions with the Government about any likelihood for changes to policy within the period that you have I note in the submission that you gave us you've said that you assumed that it would be on a kind of reasonable fewer changes to policy in the next period and that they had considered that reasonable we're obviously keen as a committee to understand what opportunities there could be through things like the review of ADP do you get any sense of in the timescales or thought process from the Government about changes to those things so that we could start to look at that in advance in terms of where the money would come from I think it's ADP it's a little bit early because that is still being trialled in a way and I think the Government will look to see what it learns from that where we have made some general assumptions we talked about the four payments which will come in over the next four years and will come over to become Scottish payments and we've assumed at least for three of them one is just coming over as is the winter fuel payment but the other three so we've made assumptions the reason we call it indicative forecast is we have a little information but we don't have all of that information so we've assumed that probably the similar approach to advertising society that these benefits are available so the Social Security here has invited in it's opened up that communication more so than one would have seen previously under the DWP benefits and we're assuming that same approach will apply to these new ones so we don't know for sure so it's all before this is iterative for you and it is for us and indeed for the Government as well as it learns over time it will take some years till the data accumulates till the pattern show and till the Government sees what is really effective in terms of its desired outcomes Thank you and the point about the iterative process that the convener made earlier is really important so that we can see it going forward Just one follow-up from that can forgive me if it's in the detail you've given us and I've missed it What assumptions are you making about uptake of benefits? Are you applying a particular percentage uptake assumption? Oh gosh that varies very much from benefit to benefit and actually we make judgments based on how easy it might be for people to apply has the process changed, has it been easier when do individuals need to review or be reviewed and is that an easy process or not so all of these factors come into whether people will take it up we've also had some conjecture around inflation if that has an impact on some households and puts greater strain, some that might not have bothered to apply for a benefit might do so so a lot of factors again David you want to What was just one point about is that what matters for the number of people ultimately getting benefit is two factors of entitlement and then is the take up rate The problem we face is that for a lot of these benefits it's not even clear what the entitlement is so what we sometimes do is we just forecast the numbers while they're trying to break it down into this is the entitlement this is the take up rate for some benefits we do try to do that break it down into entitlement and take up rate but it's not just take up the drives it is also entitlement but clearly you want to I could perhaps give you some specific figures of examples so as David has said particularly for the disability and carers benefits we don't know the total size of the eligible population because you have to meet the certain criteria and nobody goes out and surveys everybody and checks whether or not they meet the criteria before they apply so what we do is we look at the number of people flowing on to the benefit but people successfully applying so for example for the Scottish carers assistance once that launches we're assuming that in 24-25 there'll be an increase of 2% in inflows and that'll increase to 5% more people flowing on to the payment in 27-28 and there's a number of reasons for this and this is partly because we think people will become more aware of the new social security payments we also think Social Security Scotland is committed to being more visible and making the support easier to access and also because of the changes that the Government are proposing to the earnings limit we also think that might be to some people changing their working arrangements and therefore claiming the payment and we've made similar assumptions on the disability benefits as well that we assume there'll be slightly higher inflows which in a way reflects higher take up although we can't give you that as a take up percentage and then for the means tested payments we have an assumption on take up for those as well so for example on the Scottish child payment when it launches in the current year for children over 6 we assume 70% and once it's I say fully launched it will fully launched by the end of this year but it will take time for people to claim it and then the next financial year we assume take up will be 80% so that's hopefully gives you an idea of some of the assumptions and as the child payment amount has increased we assume it becomes more meaningful and that will also affect decisions on take up thank you I appreciate that, I have one final question in this area if that's okay convener and it's around the unemployment rate and you know in your papers that the unemployment rate is low can you tell something about the types of jobs that people are accessing and what is the whole picture because obviously if people are in low wages or in secure work then that affects tax take as well so can you tell us anything deeper on those figures and how that affects the funding envelope available if we don't go down to that level of detail and we're forecasting both what's happening for the economy in terms of employment on earnings and what's happening to primarily income tax revenue we do that at a pretty aggregate level we are aware of some of the factors sitting below that for example we have done some analysis of regional disparities in earnings and earnings growth within Scotland compared to other parts of the UK so we do dig out a bit below the surface but I don't think the work we do gets down to the level of detail that sits behind your question if employment was to grow which particular people who might be eligible for benefits might flow into employment I think there are other institutes and research bodies that would do that kind of detailed analysis more than we would do Thank you Thank you very much I'll bring Miles Briggs back in to be followed by Paul MacLennan who has a supplementary who will then take us into our final theme which is round about the cost of living in the economic context Miles, first thanks I wanted to follow on some questions there and kind of getting the saying from Donald Rumsfeld of known, known, unknown I think we're probably going round in circles on that of the forecasts which previously being around the cost of administering Social Security Scotland and if you've looked at that at all in terms of where potential additional costs will be given the amount of benefits they're going to be administering No, I think I may have said something before and it's always good to remind ourselves and everyone else we don't look at the cost of administering Social Security in Scotland and we don't look at any other you know perhaps peripheral ramifications of so we just look at the payments themselves that's what we can forecast That's helpful and I think that's maybe another area of uncertainty One point there One issue that I think we will be facing will be that as Social Security Scotland as ministers these benefits it will collect a lot of data but it may collect that data in a form which is most helpful to it in terms of administering the benefits that may not be the form that's most helpful to us in terms of doing the forecasts for the future so there is an area of potential tension there as to how we manage to work with Social Security Scotland to make sure we get the data in the form and of the type that makes it most helpful for us to do our business given that quite rightly their business is primarily focused on delivery Thank you for that I wanted to go back to the question with regards to previous examples and I obviously were in new territory with the levels of Social Security benefits which the Scottish Government will be delivering and how much of the Scottish budget that's going to take up but I wondered in terms of previous years around you touched upon reserves for example the reserve have underspends also been factored in sometimes to that and additional money in year being available by the Scottish Government for some of this So just a point about how you as a Government manage when you are required to have a balanced budget you pretty much have to plan to underspend in every year so that you don't overspend there's something about of that so it's a general thing David do you As I said before things we've been talking about with the Scottish Government is how they plan to manage the reserves and they'll be much more transparent as to how they actually plan to do that but one issue that needs to be reflected on is that there are very tight limits on what can be paid into the reserves and what can be drawn down on the reserves and that can make for a challenge to the Government which is different from other Governments that might face the same sort of issues of balancing the budget from year to year so one question which you may want to reflect on is should those limits change over time in proportion to the scale of the funding that the Scottish Government is undertaking is it correct that these limits stay flat in absolute terms just finally what was that limit did you say 25 25 million pounds what is the current limit to the Scottish Reserve Scottish Reserve in total can hold £700 million and in normal times the Government can draw down £250 million a year to support resource spending for these couple of years because there was a quirk with our economic forecast last year there's been a Scotland specific economic shock triggered and that means that reserve limit has been waived for three years so that gives them a little bit more flexibility that they have at the moment and that flexibility will go again in two years time that's great, thank you thanks very much, Paul over to you and then you'll be followed by Fosle Childry who is online I want to pick up on a point that you made around about the consequentials of decisions that are made by Westminster and how that can impact on your forecasting and I suppose it then looks at the wider picture of within the existing fiscal framework that's in place just now and it's really commenting on does the fiscal framework assist you in your forecasting and obviously assist the Scottish Government because obviously then it impacts on the level of spend that we can look at in terms of social justice so the fiscal framework for me needs changed but I'm just wondering in terms of where you come from in your forecasting does it help or does it hinder you and is there more need done in that because I think there's obvious amendments required to it but in terms of what your job in forecasting does it help or hinder you so I will give you a general response and you'll realise I'm not going to answer that specifically because the fiscal framework is an agreement between the Scottish Government and the UK Government on a plan to revisit that over this year and that will happen at some point when results will come from that so that review will happen and that was baked in when taxes were first devolved that the point of having that review at this stage and that was to learn from how it's worked so the question is a really good one but we're not in a position to say how it should change it really is up to the Government I suppose not so much in where you think the specific changes are and I can appreciate where you're coming from in terms of your forecasting does it help or hinder that because I'm sure at some stage you'd have some input into what you think that would look like and I'm not asking I can understand what I hear or not but does it help or hinder you in terms of your forecasting if we didn't ask properly if we didn't have a framework so the fact that we have a framework and it helps in that sense it's a complicated arrangement between Scotland and the UK so just and I'm not trying to put words in your mic does it need simplified in a factor case I have a personal view about simplification so I'll turn to Claire I might give a politician's answer and answer your previous question so I think it's worth thinking about there's our role forecasting in terms of forecasting components of the Scottish budget and you can think about that very narrowly in terms of forecasting how much directly the Scottish Government spends on social security forecasting how much it collects in tax revenue those forecasts are essentially on some level meaningless if you don't take into account the wider budget if you don't take into account the funding arrangements from the UK Government so we include that commentary in our report to try and help yourselves and media and public understand what that means for the Scottish budget it's not an easy task because the fiscal framework is complicated I think everybody admits that in terms of whether or how it should be changed that is for other people to decide but I do think it's worth pointing out in our December report it was a previous report I'm pretty sure of December how particularly things like late consequentials from the UK Government so the UK Government does what they call supplementary estimates which are normally in February and that can actually change how much money the Scottish Government is getting quite late in the financial year particularly during Covid some of the changes here were really significant and those limits sometimes are much greater than the reserve but what we have seen on several occasions is that Treasury has reached an agreement with the Scottish Government that allows them to defer those consequentials the framework sets the rules but there's also times when you can see the two Governments reaching an agreement which recognises that those rules if put in place in a very strict sense would create difficulties for the Scottish Government I think you just added just to remind you that there are two elements of the work we do one is forecasting but another one as I said before is commenting on the reasonableness of the Government's boring plans the fiscal framework makes forecasting any harder or easier what the fiscal framework does is whatever it is we have to meet those comments on the reasonableness of the Government's plans on how it manages reserves and how it plans to borrow so that's what the area where the structure of the fiscal framework will change the way in which we actually think about those issues but also how the Scottish Government thinks about those issues that's helpful thank you thanks very much if we can go to Faisal Tadry who joins us online to be followed by Emma Roddick Faisal thank you good morning panel I've got two questions how can they be sure that inflation is just a spike and not an upward trajectory in relation to what happens next year come true how will that affect our future spending commitments the simple answer is we can't be certain about inflation being just a spike or not we just don't know but we have thought about that within our forecasts and we took the judgment to keep the view about inflation peaking or at the end of this year as central to our forecast but what we did was we lay out a downside risk to the forecast which is that inflation becomes entrenched that it lasts over a longer period of time and that risk seems a little greater because of factors but there's so much that could happen that will affect inflation and it's not just inflation it's the impact of inflation earlier I pointed out that the chancellor's recent package will be helping lower income households this year to ease the impact of inflation but that's only one off and that's just for this year so your question is important how long will it last but it's pretty hard for us to say in the second question I'm sorry it's in the second question I was going to ask I'm going to ask the second question why does Scotland's earning growth lag behind the rest of the UK oh gosh can I suggest something you were just going to come in on the back of the last question and then we'll go do this it was just to answer the question on OBR forecast and if you're referring to how the Scottish Government's budget is set in terms of block grant funding the UK Government had a spending review for the first two years based on UK Government's commitments and spending plans after that we're using OBR forecasts of UK Government spending levels so that for the next two years in particular how the block grant differs from what the Government have included in their resource spending review will depend on UK Government spending decisions rather than OBR forecast changes thank you very much Claire and then for your next question on factors a couple we've been talking about for quite a while we have a different demography in Scotland we have a greater population and it's growing of people who are aging out of the full time work space and we don't have a large population of youngsters who will be growing into that workspace so if you have fewer people working that affects ultimately what both productivity and tax and so forth but there's another specific factor that is reflected in our current forecast the oil and gas sector has been depressed recently and so if you're looking at impacts on funding the jobs that pay well have an impact if there are fewer of those jobs and people aren't in them in terms of tax but also counterbalancing that sector you have a real boom if you will in the financial sector in London based parts of the financial services sector where particularly bonuses but income has been very high so you've got a bifurcation there as well so that's part of what we're reflecting David you want to give some more texture possibly is that going back to some of these demographic issues to which Susan referred one thing we've identified in our data is that the youth participation rate in Scotland is lower than in the rest of the UK at hand recently it seems to be in falling we don't have a full understanding yet of why that is the case and that's an area we want to go into in greater detail obviously one factor that could be at work here is simply that young people are choosing to go more into higher education or tertiary education because they see the job situation in the future be more challenging if they want to cut ahead they need to get more skills and education to do that so they may be delaying getting into the labour market for that reason but it's an area we want to do more work on thinking about for the future thank you very much I think that was a very helpful scene setting that you just did in terms of that situation I'll hand over to Emma Roddick for her question and then Pam Duncan to Glancy with a final one we are kind of slightly running a wee bit over time we do have another panel to come in but I feel it's important that we hear these questions Emma that lower income households are going to face higher inflation relative to higher earners because of the cost of essential items is inflation on essential items expected to stabilise as quickly as the CPI overall estimate of 2 per cent by 2024 or is it going to be quicker, slower again if you had a crystal ball you might be able to tell us that the really big hits are around the cost of energy people needing to heat themselves they need to get petrol put in the car all of that and it's cost of food as well there are various factors that are having an impact we are a net importer of energy and any country which is will be subject to rising prices that are more in a global scale so it's not in our gift in the whole of the UK to change that very quickly although there certainly is a big push towards renewables and things that we can own here but that's a long game that isn't going to happen just now or it is happening but it will take a long time to kick in properly so it's hard to say but the extreme response in China to Covid has made it real different the biggest port in the world is Shanghai so you look at what's manufactured in China and then what gets sent out you stop that even for a period of two to two and a half months that makes a difference so that's now opening up but it's very hard to say where this will all go the conflict in Ukraine is certainly not helping in these areas for me it would be too hard because what's been driving the inflation we've seen it although as I said before it looks like cost-bush inflation that's part of the difference by the fact that as lots of countries have come out of the pandemic demand has suddenly soared for energy and other raw material inputs so you've got that supply shock it's in your demand shock and that's what's been driving this up when the economy's adjusted to that some of those elements will disappear and we don't see at the moment what the next supply shock would be that would come through and drive prices up at the scale we've seen over the last year or so so we still think it's reasonable as a central assumption to assume that inflation will fall for those items but there's a huge uncertainty in that thank you thank you very much it was a follow-up if that's okay briefly on the point about youth participation I guess it goes back to my less helpful word than on my question earlier on what other understandings do you have of inequalities in workforce participation such as you've described for low-level youth participation what I've said before we don't hold down too much on distribution issues a lot of our forecasts are based around aggregates or average levels obviously we are aware of the fact that sitting behind that there are distribution factors so when we're forecasting growth in our needs it's an average growth in average earnings but we are aware across the distribution it's quite hard to say exactly how it differs across the distribution going back to the point that Emma made there are big differential impacts of inflation across the distribution and again we're sensitive to that but we don't hold down to that level of detail to really understand what's happening at every level of the distribution growth of employment participation levels there are so actually institutes that do that work but it's not part of our work thank you I appreciate that and I know that you gave a similar answer earlier and that was just when you'd mentioned the youth employment I thought maybe I've worded it badly first time round and there is more but I take that point, thank you for that my final question was around the cost of living particularly in the Scottish Government's child poverty delivery plan and whether or not you felt that the current review and also in your forecasting takes account of the money that's going to be required to deliver that plan and can you see aspects in the Government's plans that show there is going to be money attached to each of the outcomes within that delivery plan again we're not making judgments about the costs of administering but Claire is there anything we can say we have taken account of the policies the Government has included in the child poverty delivery plan which affects social security spending so we included the increase in the Scottish child payment to £25 a week there's also the removal of best start foods income thresholds and also we have assumed that benefit cap mitigation starts fairly swiftly so we assume there's £4 million of spending on benefit cap mitigation in this financial year rising to £11 million next financial year so those are the factors that we have included from the child poverty and the other factors including around employability support are there any plans for you guys to look at those factors as well particularly given the constraints that colleagues have highlighted in other areas in the budget? Yes, so the part of employability which we do take account of is currently that the Scottish Government has set out a programme they haven't fully committed to what's going to happen afterwards but similarly to how we took account of the Scottish carers assistance the replacement for attendance allowance these other payments we have included in our forecast provision for a replacement employability service which is from £25-26 £25 million a year onwards so that's included in the resource spending review and finally just one question to kind of push a little bit further on that do you see a direct correlation between the outcomes and the child poverty delivery plan and the spending review? Can you see where the money has been allocated and whether or not it's likely to be enough? Beyond social security we're not looking at individual Government spending lines we've only included the portfolio level analysis which wouldn't go into that level of detail but there will be other people out there who are looking at this in detail That was a very good answer at the end there Claire because it's incumbent upon us to find those other people to get them to come to help us scrutinise those plans so thank you very much to all three of you for coming along this morning and giving your evidence and I will suspend briefly for our changeover of panels thank you very much Good morning and welcome back to our meeting of the social justice and social security committee we're now on to item number three the committee is going to take evidence on the disability assistance for working-age people transitional provisions and miscellaneous amendments Scotland regulations 2022 and I welcome to the meeting in person Ben Macpherson, Minister for Social Security and Local Government Kate Thompson McDermott who is the head of care's benefit and case transfer policy unit at the Scottish Government and joining us remotely we have Kaylee Blair who is a solicitor for the Scottish Government and Darren Kelly, head of operations Dundee at Social Security Scotland and I'll invite the minister to make an opening statement Good morning, convener and colleagues, thank you for inviting me to give evidence today on the disability assistance for working-age people transitional provisions and miscellaneous amendment regulations 2022 Let me begin by saying I'm grateful for our recent discussion on case transfer more generally which I hope you found useful as well I also appreciate the work of the committee today in considering the case transfer provisions for people whose awards are moving from disability living allowance to child disability payment and from personal independence payment to adult disability payment The draft regulations we are discussing today mirror the processes in those regulations in many ways but there are some key differences which I will come to shortly As I've set out to the committee and Parliament before we are determined to ensure that case transfer is a seamless process and that we transfer people's awards safely and securely This is not a simple administrative process we are transferring and then refining information from DW system some of which are decades old to Social Security Scotland's new agile single benefit system making sure we have the right information and that no one falls out of payment across approximately 700,000 awards that we'll transfer is a project that takes planning and time We are doing this work at pace whilst ensuring we do not risk the undertaking of the process in a safe and secure way Protecting payments is of course our absolute focus The benefits in question are payments of money that people rely on and we will make sure that recipients continue to get paid the right amount at the time they expect From the 13th of June we will pilot the personal independence payment transfer with full transfer beginning at the end of August with the national introduction of our adult disability payment At this point adults who receive disability living allowance or DLA required to apply for personal independence payment will start to see their awards selected for transfer It is this transfer that we are here to discuss today known as natural case transfer The draft regulations before the committee will ensure that a Scottish resident born after 8 April 1948 will have their disability living allowance award selected for transfer to adult disability payment One of the following three criteria are met One, a change of circumstance relevant to the DLA award is reported or two, where the DLA award is due to be renewed or three, where the person asks to have their DLA award transferred Once the transfer completes the person's initial adult disability payment award will be a like for like copy of their DLA award because the eligibility rules for DLA and adult disability payment are different the person's award will be reviewed and adult disability payment rules will apply I must be clear that this review will mean that some people's awards will stay the same while some people may see their awards ended, reduced or increased That said this process will not be a repeat of DWP's transition from DLA to personal independence payment In line with our case transfer principles people will not have to apply for adult disability payment like they had to apply for personal independence payment Instead they will be supported through a review process People undergoing this review will have our new forms of support available to them through our local delivery service and our independent advocacy service People will have the enhanced rights we have built into adult disability payment available at every stage of the process and I will briefly outline that support now We have replaced the adversarial approach of the DWP through the removal of assessments and degrading examinations and we start from a position of trust in what people tell us The onus will be on Social Security Scotland to collect information on people's behalf and they will only need to collect one piece of formal supporting information when making a decision Short-term assistance will be available for anyone that has a reduced or nill award after the review and wishes to seek a redetermination or appeal Finally, we are also exploring ways of providing support to anyone who may lose the enhanced mobility component on review Given the impact that will have on their ability to continue to access the AVE scheme and I will update committee as soon as I can on this In conclusion, convener we have designed this process to be as supportive as possible while acknowledging the challenges that moving between different benefits and different rules could create I believe we have struck the right balance with these regulations and I am now happy to take any questions Thank you very much minister for your opening statement and we will now move on to questions from members and to kick us off Deputy convener Natalie Dawn will come in to be followed by Fausal Choudhury who joins us remotely Thank you convener Good morning minister and good morning to the rest of the panel Can the minister expand on the plans for the tailored communication and the support for those transferring from DLA to ADP? Certainly We have developed a strategic communication and engagement plan for case transfer as you would expect This covers how we plan to communicate key messages and timings and our plans for stakeholder engagement which of course are very important and also paid for marketing communications activity Additionally, we are developing a wide range of clear communications to help support people transferring from disability living allowance to adult disability payment and these include easy to read notifications so clients know what is happening at every part of the transfer journey a specific leaflet consistent with Scottish recommendations to explain the differences between disability living allowance and adult disability payment and it will also encourage people to get independent advice before making a decision to ask to have their award transferred We will also be undertaking a series of stakeholder road shows which will begin this month in the transfer process for this group, the two are key stakeholders and we also have a stakeholder toolkit which will include specific fact sheets, video content and frequently asked questions to stakeholders We are developing specific case transfer guidance to provide stakeholders with further information on the case transfer process and this guidance will be hosted on socialsecurity.gov.scot website We know that this client group that we are talking about today with regard to the regulations can be particularly difficult to reach so we will be relying on our public and third sector partners to help to get the word out and of course as the Government undertakes this work of course we would encourage MSP colleagues as I do across what we do to continue to raise awareness in our constituencies and regions Thank you So touched on my next question which was going to be how will people be helped to decide whether they would be better off volunteering to move to ADP and I know that you mentioned independent advice about award transfer so it's just will that advice be given by social security Scotland or will people be asked to or sign posted to another advice service In addition to the significant communications we are developing I've just gone over advocacy and local delivery services will be available too so the advocacy service as colleagues know is a free service available to anyone who identifies as disabled and requires support to engage with social security Scotland so that will be there and available and those circumstances are different so we encourage everyone who is thinking about asking to have their benefit transferred to seek independent advice in their situation and circumstances Also in the current financial year the Scottish Government is investing approximately £12 million in funding to support the provision of free welfare and debt advice as the committee is aware of the independent advocacy service and this funding will help people access the advice and support that they need in a way that works for them whether that's face to face online or over the phone and as I've mentioned we have our local delivery teams in every authority area from social security Scotland as well so we would encourage people to seek the advice and information that they need Okay thank you minister I have no further questions just now to be followed by Jeremy Balfour Faisel please Thank you convener Good morning minister I think you've answered quite a few of the questions I was going to ask but I just want to add that our social security Scotland and DWP working together to ensure that client get consistent communication from both agencies Thanks for that question and I think it's important one given that we are still in a joint delivery programme with the DWP it's a joint case transfer is a joint project between ourselves and the DWP and we work closely together to develop our processes and guidance to make sure that people get consistent answers to their questions individual client communications developed by each organisation are shared so that we can ensure that we are giving the same messages an example of our joined up approach when an award is selected for transfer the DWP will write to the client to let them know that their disability living allowance has been selected for transfer and will be coming to an end and then we will write out to introduce the person to Social Security Scotland and will provide information about the transfer process so that's an example of how both organisations will work together to make sure that people are informed and properly appraised of the process that they will be going through thank you that's very much for that we will now go to Jeremy Balfour who will be followed by Emma Roddick thank you, good morning minister and to your team two questions if I could follow up a bit just on the deputy community's second question where I'm just trying to get into my head this understanding of what advice people will be given whether they should transfer or not because clearly the ultimate decision will be made by Social Security Scotland when we review all the papers you appreciate from your legal days that what weight does the advice if I phone up and say should I transfer across and the advisor takes me through that that's the advice's decision it's not the decision of Social Security Scotland and how will that be very clear to the individual that this is not definitely going to happen but it's only the person's opinion first of all just reiterate what I've said about how we would encourage people to get independent advice and to utilise the resources that are being made available by the Scottish Government on that independent advice what the agency can do is advise on individual entitlement in terms of describing to people in their circumstances because as I've emphasised everyone's circumstances are different what the situation will be for them but we would strongly advise people to take that independent advice from the advocacy service and welfare provision that we're providing answer to the deputy convener and that would that would be made clear when we phone up the agency to get that initial comment that the best thing to do would be to seek advice from an independent individual yeah because sorry I should have been clear that the agency can't advise on entitlement because obviously people have got to go through the process so the agency so just be absolutely clear and correct my previous answer the agency can't advise on entitlement because people will have to go through that process but through our work with stakeholders and I'll bring Kate Thompson McDermott in in a minute with anything further that she wants to add through our engagement with stakeholders where of course doing what we can to make sure that those that people would turn to for that advice as well as our independent advice service throughout Scotland are well appraised of this process so that they can help people in that decision making in their individual circumstances Kate, I don't know if you want to add anything further Just to build on what the minister said about the technicalities of the process once somebody has contacted the department for our conventions and asked to have their case transferred then it will be transferred it will be put in the case transferred pot and that process will be gone through so it's very important to us that we are trying to get the communications and messages and signposting for support out there and to people before they make that decision and make that phone call and that's very important so we are designing our communications plan and the supporting materials to make sure that we can try and reach people ahead of making that decision because once the decision has been made to transfer then the cases will transfer there's no ability to put a break on or reverse that process at any stage Thank you very much helpful by clarification The second issue is just the point that you made towards the end of your opening statement I welcome the review in regard to looking at the mobility issue in particular in regard to the car you said that review was taking place clearly the pilot programme starts and then the full programme runs out in August or starts in August fully when do you expect that review to complete and have you any feeling of where that might go that's actually a fair second question but more point, when do you think review will be complete so we had hoped to be able to tell committee about this today we are working closely with Motability to ensure that those on that move on to accessible vehicle scheme have access to the transitional protection scheme provided for individuals that lose their enhancement ability award when transferring from DLA there are different rules depending on when the individual joined the Motability scheme as Mr Balfour would be aware but in most cases this will allow the client to keep the vehicle for eight weeks after the end of entitlement and receive a £2,000 payment we have neared formal agreement to this approach with Motability and we just need to continue our discussions with them but I would be happy to write to the committee when this is confirmed and we are seeking to do that as soon as possible I don't know if you want to add anything to that that would be very helpful thank you minister thank you very much, I'll now bring in Emma Roddick I realise the hope is that people will understand that they might be better off on ADP than they are on DLA and transfer when they can what challenges will be presented around managed migration if a lot of cases end up not transferring through the natural migration process and what negative effects might there be for those claimants if they don't move we still have a as I referred to in my opening statement we call this part of the process where I talked about the three circumstances in which people would be part of the cohort transferring in these regulations and that we call this natural case transfer we still have managed case transfer to undertake for working disability living allowance and ADP and have considerations to undertake on that the position is clear that those three different situations are realised for clients then they will be selected as part of this process and of course we've worked to make sure that people do not undergo a DWP style assessment and are asked to apply for PIP so a lot of the motivation behind this natural case transfer process is to seek to prevent people having to go through that process of a PIP assessment and instead be transferred on to adult disability payment and then there'll be a review of their situation in due course thank you very much I'll move on to some further questions about transitional protections that my colleague Pam Duncan-Glancy would like to come in on Pam thank you, good morning minister and to the others who have joined us on the panel I'd just like to up front to say that there are aspects of these regs as in other areas on ADP that of course we welcome for example the terminal illness rules and the different approach so my questions are kind of on the basis that we will support these regs today but I just have a few questions about some of the decisions that have been taken till now so obviously the amount of that the move from DLA to ADP is not necessarily because someone's circumstances have changed, it's an administrative change how can you guarantee and can you guarantee the no worse off principle as part of the social security commission how can you guarantee that for the people who are going to be moving from DLA to ADP particularly in the midst of a cost of living crisis so as I talked about in my opening statement we've thought about how this process will affect individuals so there is the case transfer process that will be undertaken and then the question of the review thereafter what you are referring to if I am mistaken so the as case transfer takes place it's important to acknowledge that no one would be worse off than they would be if they stayed with the DWP so that's very clear position in a situation where their cases is then reviewed which of course will happen in due course where there will be differentiation in our system is that if an award is increased after being reviewed then that increase will be backdated to the point of case transfer ensuring that no one misses out so people who receive an increase will receive that backdating which doesn't happen in the current system if an award is decreased the change will only take effect from the date when the decision is made so there would be no overpayment that the person would be asked to repay so that is a clear difference that will be of advantage to people that both of those circumstances I know will be welcome and just in case I forget to do this and I have in the past so please allow me to do it just now to declare an interest as someone who receives it and at some point assumes I will transfer to ADP those aspects that you have just set out minister are both really really helpful I am still not clear though if you think that some people will be worse off can you specifically commit to the no worse off principle for this so during case transfer no one will be worse off but in the long term after review I cannot speak for individual circumstances that will be part of the review process under the eligibility rules for adult disability payment but we explored a number of options of course for presiding people who may see a reduction in award or an ill award when their adult disability payment is reviewed and I will just set out some of those now that are different so we will support people in a number of ways first of all we are ensuring individuals are on their current award levels as I have stated in the first instance so that they can be supported through the review process we are setting out clearly in advance the support available to them through our local delivery service and independent advocacy service in response to deputy convener and then individuals will benefit from the changes we have made to adult disability payment to ensure that they are treated with dignity, fairness and respect including that we will trust what they tell us and we will place the onus on social security Scotland to collect information on people's behalf during the review and only require one piece of formal supporting information and importantly people will have the right to challenge any decision that sees a reduction in their award or an ill award and they will have access to short term assistance through that process so there will be significant improvements in the situation for people being in the DWP system Thank you and I don't doubt that at all the current DWP system particularly from moving to DLA to PIP is well documented on how poor it is and so it is welcome hugely that the Scottish Government will take a different approach to that including to protect people for that bit longer but ultimately at the end of that period of time you said earlier people will not have to reapply like they do now from DLA to PIP but ultimately they will they will just be longer and then they will have to make an application for ADP which is what they won't have to make an application their case will be reviewed and it will be a light touch review process in the way that we've set out the review processes for ADP will be undertaken That's helpful Had you at any point considered and I'm sure there'll be Depends on the individual circumstances of the individual of course Sorry to interrupt you That's okay It's important that we can have dialogue on this Disabled people will be watching and worrying as anyone on DLA transfer to either PIP or ADP worries, it's not a great feeling when the review happens as I'm sure we'll all appreciate and everyone understands that so it's really clear that the communication that you're putting out is important and that the messages are important At any point, given that in the previous years particularly your Government and our party have said that the changes from DLA to PIP were concerning, at any point did you consider replicating some of the some of the systems in DLA in ADP so that you could have created a like for like benefit for those people as well, given that you had so many problems with when the UK Government changed to PIP We have of course thought about a lot of different options here and I'll bring Kate Thompson-McDermott in in a moment because it's been considered a moment of work done and of course the big challenge for us is that we obtain these powers over disability benefits when the UK system was still in a position of transition between DLA and personal independence payment which we have tried to make decisions sensitively and effectively to improve our system but also undertake case transfer in a safe and secure way and I don't know if you want to add anything Yes, just to say we looked at a whole manner of options Obviously, when we first started looking at case transfer the expectation had been that the managed migration from DLA to PIP would have completed before we took Parliament and Ministers to Competency for Disability benefits so when it was cleared that wasn't going to happen and obviously the first kind of action was to ask that that managed migration process was halted and we then looked at a number of options we've looked at whether we could transfer cases administratively into the SPM system but keep them within the DLA legislative framework that poses quite significant challenges because we would essentially have to build DLA into social security Scotland systems and train up staff to work to DLA and to work to the DWP legislative framework so to carry out revisions and processions rather than redeterminations so the whole framework that comes with the benefit would essentially have needed to be recreated within SPM which would have been a huge undertaking which would have impacted our ability to deliver ADP and go on further we then looked at can we do a hybrid system can we bring can we create a benefit within the 2018 framework that has the eligibility and criteria components for DLA but is otherwise within that 2018 framework so we can use the same same rules in SPM for appeals and redeterminations and reviews and that's within the Scottish system should also be better for clients and we did look at that and it was just not possible to deliver that in time for ADP national and we really looked at it at every which way that's still very much an option we're considering for DLA managed and for DLA 65 plus and we hope to be able to come back to the committee with our decisions on that in due course so that is still an option that's being considered but it was not one that was going to be able to be delivered by ADP national and we wanted to ensure we had an option in place from ADP national that clients could move on to ADP and go through the ADP process rather than have to move on to PIP and this was the best option that could be delivered that's really clear I guess I'm trying to get to the question of when designing ADP did you at any point consider replicating the kind of best of both from PIP and DLA so that the system for ADP transfer was much much smoother I guess for anyone who was coming from DLA or PIP because the system was able to look at the eligibility criteria across both of those things I mean I would just refer to what's just been said but also that we of course have to transfer people on personal independence payment into PIP and need a consistency of the rules that's like for like with personal independence payment and we have 300,000 personal independence payment case transfers so I see that so versus 40,000 from the deal I see the figures I was just keen to know if there was thinking and perhaps then just fallen from that some of the recommendations and scores kind of hinge on the review process and I guess that's also back to the point around some of the eligibility can you give us an update on that review process at this point certainly so it's important that we transfer now of any individual that would otherwise be required to apply for personal independence payment under the DWP businesses as usual rules so I know colleagues are appreciative of that so we have already made significant improvements to the assessment process for adult disability payment and we'll apply the eligibility criteria fairly and consistently to all those entitled to adult disability payment and to ensure that the impact of a disability or health condition on an individual including the impact on mental health conditions, learning disabilities and fluctuating conditions are taken fully into account as Pamdol yn Cwmglansu has rightly emphasised we have given a firm commitment to a wide-ranging independent review of adult disability payment commencing one year after the national launch of adult disability payment and in active discussions in recent days on that with officials however given the extensive feedback received we as you know further committed to a two-stage review with work beginning later this year to identify what improvements could be made on the mobility criteria and what scope of the stage 2 independent review should include we will provide details on both of these as soon as we are in a position to do so and I appreciate that with regard to the first stage both members and stakeholders and more broadly people are interested to get an update on that and have an undertaking to do that as soon as we can ok thank you my final question in this area is on the support and you have touched on this already about the support people will get through the transitional arrangements do you have an understanding of how many people you think will need that kind of independent support for the advocacy service or indeed other third sector organisations and have you looked to the capacity that would be required in those organisations to meet that? As I laid out in my answer to the deputy convener around those first questions so you'll know that our resourcing for the independent advocacy services is set out and budgeted for and being provided and scaled up I talked about the £12 million that we've provisioned for welfare advice and that the Government provides and I talked about the engagement with stakeholders that is being undertaken with officials and we have a very close both agency and Government relationship with relevant stakeholders the fact that we have an understanding that the quantity of transfers per month will be around 100 means that we have capacity in the systems in Scotland and within the agency of course and within the advocacy service to be able to provide that support to around 100 people a month Thank you, I've no further questions on this Thank you very much we have some questions around the issue of backdating I'll bring Emma Roddick in on that to be followed by Jeremy Balfour and then Miles Briggs Emma Sorry, I just have a moment on Absolutely, I'll go to Jeremy first if that's okay, then I'll come back to you My computer's just gone quiet so I'll let Miles go first Miles! Working luckily in that case Minister, good morning to the panel as well I wanted to follow on from Pam Duncan Glancy's line of questioning because I just wondered what work the Scottish Government had also been undertaking to predict the number of people who may see their award ended or reduced and whether that modelling has been undertaken It depends on the individual circumstances it's very hard to evaluate every case on the merits of the individual's position and the fact that we will of course be doing every review from a position of trust but the situation with we have some awareness of what has happened with Pitt of course our system has differences built into it I think you were just hearing about some of implications of that from the fiscal commission this morning so we know that from DLA to Pitt there is about a third have received an increase a third have received a decrease and a third have stayed the same as I said we will treat every case individually as people would expect and we will of course project where we can but we want to make sure that people are assessed individually and within their circumstances and don't prejudice that I take from your answer there that that's where you think this may go a third a third a third I'm not saying that that's the evidence from Pitt to disability living allowance to Pitt but that is the basis of evidence from the DWP's undertaking of their process that we have some evidence for but we will see how that situation develops and of course a key point of emphasis that members will be appreciative of is that we expect to get more decisions right first time and the third a third a third that I talked about of course our initial findings but then 65% of PIP appeals are successful so there's a different outcome in the end when it comes to to the situation with DLA to Pitt so we have those background situations on which to consider how this process into adult disability payment will progress but certainly we would look to get decisions right first time that's a determination of ours so we're likely to see more successful I don't know if anyone else wants to come on that I don't know if Mr Kelly would have an opinion on that modelling I'm sorry sorry is it not for me to bring in my officials if I wish to it is for you to bring them in if you wish to bring them in Mr thank you Cymru with apologies Mr Bre Mr Kelly if there's anything you want to add from an agency perspective then feel free to do so but I think the of course members will be aware that our determination is to get more decisions right first time and to the process that I've set out of how people will move have moved from DLA to PIP is background information but we are at the beginning of the process when it comes to Social Security Scotland sorry the only thing I would add is just the investment in time we've put into training and working closely with 30 people colleagues to ensure that we do get that decision right first time but I don't have anything else to add on that thank you very much Mr Kelly do you have anything further at this point I'll go back to Emma Roddick if we can and then after that Jeremy Baffer Emma please I'm aware that we're concerned about the back dating to the start of the ADP claim rather than when a change of circumstance is reported as the natural case transfer by definition applies to those who are coming forward with a change of circumstance is what difference is there likely to be between those two dates when it comes to increases that result in a change of persons conditions we do not estimate there will be any increased costs because our approach largely mirrors disability 11 hours to personal independence payment transition which is covered in the funding we received from the block grant adjustment however our approach to any decreases will likely increase our costs as we are choosing to be more generous than the DWP policy so the position with increases as I said will be back dated to when the case transfer happened with regard to decreases we will only apply that from the date of the review rather than a change of circumstances or case transfer so it will be when the persons review outcome is decided and of course if they choose to undertake a redetermination or appeal then they will get short term assistance through that process so it would only be from the conclusion of their review that the any decrease or no award would be applied thank you very much now over to yourself Jeremy thank you for clarification I do not think that anyone for Social Security Scotland works for him as hopefully an independent body away from Scottish Government but maybe just so that there is no misunderstanding on that just a very quick question minister there is a system to be a difference in the treatment and extent of back dating available to people transferring from DLA compared to those transferring from PIP did you look at any mitigating measures around that can you just refine that question Mr Buffer my understanding of the back dating available but it is different for DLA compared to that with PIP and there may be people who will be less well off with that mitigation happening such that with that transfer happening and I'm just wondering whether there had been any mitigation looked at that so in I talked about when there's an increase that that will be from the date of case transfer in terms of a reduction or a nill award there is the process of case transfers so that will be 13 to 17 weeks and then if there's any appeal or redetermination and then there's a review so that will take a period and then any redetermination or appeal there may be circumstances where under the DWP system that time would have been longer but before the reduction was applied but in a significant amount of circumstances and I'll bring Kate Thompson my endermat in a moment and we anticipate that in the event of a decrease or a nill award people will because of short term assistance and because of the fact that we will only apply the decrease from the date of final decision rather than date of transfer or change of circumstance which is the situation with the DWP that people will generally be better off within our system don't you want to add anything to that? I mean, yes I had to read more so our approach across all the case transfers seeks to ensure that people are not financially disadvantaged as a result of the transfer Obviously, prior to transfer there are different roles for different groups of people and people are in different circumstances and what we do is try and look at what would have happened if they did at DWP and ensuring that when we move them over that if not an analogous position then they will be better off so for each of the case transfers there will be slightly different rules in terms of effective dates and processes and backdating to make sure that we are matching as closely as possible the journey that clients would have continued on had they stayed with DWP To follow that up people may be less well off long term for that period under DLA compared to PIP which of the two is likely to see somebody getting that backdating happening quicker than the other one Or are we both the same? They matched the journey so if somebody had been moving from DLA to PIP then they would have to put a PIP application in average of 22 to 26 weeks and any increase or decrease would have been applied for that point when we move somebody from DLA on to ADP we obviously have to wait as the minister has explained and then we backdate the increase but we wouldn't seek to backdate the decrease so they will get the increase around about the same time in some circumstances a bit quicker the decrease will come through much later For PIP what we try and do is match what the effective date would have been had that change for the natural case transfers had that change of condition by DWP and the review undertaken by DWP and PIP and then we will try and match the effective date rules for when they move over so I think it depends on the individual circumstances of the cases for most of the time Okay, thank you We'll move on to our last theme which is roundabout monitoring and evaluation and I'll bring in Deputy convener and Ashley Dawn for a question on that Thanks convener In relation to the case transfer communication strategy that we discussed earlier can the minister advise how this will be evaluated over time to ensure that it is working as planned and just following on from that while statistics be published breaking down which elements of clients awards change following the post-transfer review so for example what is it going to be transparent how many people are losing out on gaining from this move Thank you So we will consider the effectiveness of our communications as part of our wider evaluation of case transfer and that wider evaluation of the case transfer process forms part of our wider published strategy for evaluating the policy impact of the devolution of disability benefits We are developing plans for the case transfer evaluation which would include a focus on individuals moving from DLA to adult disability payment and expected that the evaluation of the case transfer process will draw on data from multiple sources including management information, social security Scotland research activity and qualitative evidence from those who have experience of the case transfer process We currently expect to publish an evaluation report on the case transfer process in summer 2023 and are continuing to consider appropriate reporting timelines in line with our developing evaluation plans In terms of the statistical question quarterly reporting of adult disability payment statistics will begin from the 14th of June 2022 The content of these statistics releases will expand over time and we intend for information on case transfers and reviews to be included in future cycles of this reporting Apart from this we expect to include as part of this we expect to include information relating to the change in clients awards following post transfer reviews That's extremely helpful No further questions I'll move back to Jeremy Balford You were typing that you don't Great stuff, thank you very much Finally Pam Duncan-Glancy did you have a further question on this one? Very brief, thank you It was just to ask the minister if he would commit to come back to the committee in a year's time to give us an update on this particular part of the transfer Certainly Open to coming to committee we had a good discussion on case transfer generally recently and certainly open to doing that again Obviously we have different engagements like we have today on specific regulations but if there's an appetite from the committee to have a similar session to what we had previously on case transfer which would include the process that we're discussing today then I'm certainly of course I would attend if the committee wanted to have such a session Thank you, I appreciate that I'm going to fall in from my colleague the deputy convener's points around an analysis of how that's impacted on individuals whether that be available in a year I'm unsure obviously but if that was available that would be really helpful I just refer to matters to the deputy convener which set out what we'll publish and of course the statistics will be assimilated as time progresses and will be more insightful for all of us as the the roll-out of case transfer is undertaken more generally more and more and of course I talked about our evaluation report in the summer of 2023 and I would imagine that the committee would probably want to discuss that at that point Thank you If there are no further questions from members we will move on to our next formal item which is the formal debate on the motion and I remind committee members that only members and the minister may take part in the formal debate and I invite the minister to move motion S6M-04303 that the social justice and social security committee recommends that the disability assistance for working-age people transitional provisions and miscellaneous amendments Scotland regulations 2020 formally moved Thank you Do any members wish to speak on the motion? Nope As no members wish to speak on the motion I will put the question on the motion and the question is that motion S6M-04303 be approved Are we all agreed? Agreed Thank you, as we are all agreed the motion is therefore approved and I invite the committee to agree that the clerks will produce a short factual report of the committee's decisions and arranged to have it published Is that agreed? Great, thank you to the minister and to the officials who have joined us online today and we will now move on to our next item of business Thank you very much Agenda item number 5 is subordinate legislation and we are now going to consider the council tax reduction Scotland amendment number 3 regulations 2022 which is a negative instrument background information was supplied to the committee in paper number 5 Are the committee happy to note the contents of this to note the instrument Great, so that does conclude this morning's public part of the meeting at next week's meeting we will be hearing from the cabinet secretary for social justice, housing and local government and the minister for public finance, planning and community wealth as our final evidence session on our inquiry into low income and debt problems and we will now move into private session to consider our remaining agenda items Thank you