 Good morning, everybody. Welcome to the 14th meeting of the Welfare Reform Committee for 2015. Could everyone please make sure that their mobile phones and other electronic devices are switched here playing mode as they can interfere with the broadcasting? We welcome today new members Hugh Henry, Neil Findlay and John Lamont to the committee. Hugh and Neil will be replacing their Labour colleagues Michael McMathen and Margaret and John will be taking the place of his Conservative colleague Annabelle Goldie. I would like to take the opportunity to thank Michael, Margaret and Annabelle for all their great work on the committee. Especially, it is a new committee of the Parliament and it is particularly congratulate Michael on his training of that committee, which I think we have all the committee members have contributed greatly to the work over the last years. We have apologies today from John McAlpine and I would like to welcome as substitute to the committee Kenneth Gibson. The next item of business is gender item 1, which is a declaration of interests of the new or first attending members of the committee. I invite any declarations of interests. I declare that I chair the PCS parliamentary group and the PCS staff often are involved in benefits administration. The second item of business today is the selection of a new convener. The Parliament has agreed that Scottish Labour party members are eligible for nomination. As convener of the welfare reform committee, I invite eligible nominations. As there are no further nominations, I have received nominations for Hugh Henry. There are being no other nominations. Henry is now the new convener of the welfare reform committee and I offer him my congratulations. I would like to suspend the meeting and we shall swap and let the new convener take his place. Thank you very much. I thank Michael, Margaret and Annabelle for their contribution to the work of the committee. In particular, I pay tribute to Michael McMahon's term as convener. He has helped to establish the committee in the Scottish Parliament but he has also helped to take it out and to command respect for the work of the committee. I know that he has put a significant amount of effort into the committee's activities and I thank him for that. I am sure that he will do an excellent job in the petitions committee as well. The third item on the agenda can be agreed to take agenda item 3 in private. Agenda item 4, the next item of business is a presentation by Professor Steve Fothergill of Sheffield Hallam University. The professor has conducted a piece of independent research that was commissioned by the committee into the impact of welfare reform on the Scottish labour market. That is part of a series of reports that have evaluated the effects in Scotland of the changes to the social security system. I know that the professor has been here before and I would like to welcome him back. Can I now invite him to make his presentation and then we can have a discussion thereafter, Professor? Thank you very much and congratulations, chair, on your convener north of the border. Congratulations, convener, on your new role. It will be important during the course of the presentation that people are able to to see these two screens. I always find the video screens a little bit small here in the Parliament building, but we will try to do our best. Three words of introduction. One is that what I am about to present is very much joint work by myself and my fellow professors Christina Beattie at Sheffield Hallam and Donald Houston at the University of Glasgow. The second point is that this research is co-funded. The Scottish Parliament and this committee in particular have had a good financial deal here, because two thirds of the funding for this particular study came from my own university. They were keen that we took our work on welfare reform on to the next stage, so that we are getting value for money. The third point by way of introduction, I would just like to emphasise that small subtitle and exploratory analysis. We certainly do not regard this as the final word on the impact of the welfare reforms on the labour market. Indeed, the three of us plus another colleague are currently putting together an application for a weight for it £400,000 to do much more comprehensive research on this issue. However, I believe that what we have done for the committee does take us a significant step forward. In your introductory remarks, you mentioned that this is not the first time that I have been here in front of this committee. In fact, I think that poor Kevin Stewart has now heard me on four occasions in total. Myself and Tina Beattie in particular have, for better or worse, gained the reputation as the go-to people on documenting the impact of welfare reforms. I hope that that reputation is justified. We have done studies not only here in Scotland, but in Northern Ireland and Wales and in England, of course. This is the fourth in a series of studies. The study that I am presenting today builds on the shoulders of those three previous studies. The first one, where back in April 2013, was an attempt to document the financial losses across Scotland as a whole and in each of its 32 constituent local authorities. The second report then drove those estimates down to ward level for every ward within Scotland. The third report, which I was here earlier on this year talking about, looked at the impact on different types of households. All of those three reports were, in essence, trying to document what is actually happening, quantifying the impacts in terms of financial losses. This new study that I am going to talk about today really takes everything on to a new level because it is asking the question, has welfare reform resulted in higher employment and lower unemployment? It is looking at the consequences of results of welfare reform. We are looking at the overall impact on the Scottish labour market. Obviously, welfare reform may have triggered some individuals to look for work who might otherwise not have looked for work, but often if they then find work, they will displace other individuals in the search for jobs and those other individuals will be unemployed instead. This is an exercise in looking at the overall impact on the labour market. Its employment hire is unemployment lower. It is also an exercise in tracing the impact of all of the reforms, the cumulative impact of the reforms, certainly all the reforms that were announced prior to the July 2015 budget. I will comment towards the end on the new round of reforms, but this is about documenting what has happened so far. This is, as far as we can understand, the first attempt that anyone has made anywhere in the United Kingdom to look at the impact of the welfare reforms on the labour market. Now, why does all of this matter? Well, it matters because the Westminster Government really uses two main arguments to justify the welfare reforms. The first argument is simply that it serves the treasury money and it reduces the budget deficit. I am not going to take that argument on here today, but the second argument is that welfare reform encourages out-of-work claimants to find work and in-work claimants to seek more hours or find higher paid work. Now, if there is no discernible positive impact on the labour market, if we can't actually identify that positive impact on employment, then the second argument used to justify welfare reform falls by the wayside. In the context of the wider political debate about welfare reform, that's a very, very important point indeed. If there's no evidence of a positive impact on the labour market, the justification can only be that it saves money. Now, I probably need to just take a step backwards and go over some of the background and some of the numbers generated in the previous studies in order to provide a context for what comes later. Let's just start off by looking at which reforms we're covering here. I would hope to most of the members of the committee that these reforms are familiar. There's a list of eight reforms that have impacted up here in Scotland. If I was talking to an English audience, I'd be talking about the bedroom tax as well and the changes in council tax benefit as well, but you've found mechanisms for averting the impact of those on claimants up here in Scotland. These welfare reforms have been happening simultaneously with other things as well. Let's not forget that. There's more conditionality in the benefit system than there was a few years ago. Certainly, sanctions are being more widely applied, especially to the claimant unemployed, and there are higher personal tax allowances as well, which of course increases the financial incentive for people to take up employment. So there's quite a lot going on simultaneously, and we're trying to track the overall impact of all of these things. The estimates that we've generated on the financial losses arising from welfare reform are deeply rooted in the Treasury's own statistics. Basically, we start off with the Treasury's own estimates of how much they expect to save. We use certain impact assessments that the Westminster Government produces, combine that with benefits data to trace through the impact on different areas and different types of households. This is taken from the previous report, well actually the third of the reports. It's the overall financial losses arising from welfare reform in Scotland. These are our revised and updated figures. Around about £1.5 billion a year when all of the reforms have come to full fruition. I'm just going over this to refresh the memory of those who've heard this before and perhaps to bring new members of the committee up to speed. We're certainly talking of very, very large financial losses. The financial loss in Scotland averages £440 per adult of working age. That's not per claimant, that's spreading the financial loss across all adults between the ages of 16 and 64. Whether or not they actually are receiving benefits. It gives you some feel for the magnitude of these financial losses. That's actually a little different from the GB average. It's less than the financial hit in Wales, Northern England or London. On the other hand, it's much more than in Southern England. It would have been higher in Scotland if you had not successfully averted the impact of the bedroom tax and the council tax benefit reductions. The financial loss would have been about £35 a head higher. I know that those losses have been borne by other public sector budgets rather than by welfare claimants. Very important in the logic of what I'm going to say about the impact on the labour market is this enormous variation across Scotland in the financial loss. It's hardly surprising that some places are hit harder than others because we know that there are far more benefit claimants in some places than in others. These are our revised and updated estimates of the financial loss per adult of working age in each of Scotland's 32 local authorities. Glasgow, up there at the head of the list, lost £580 a year per adult on average down at the bottom of the list, Shetland. Some big variations. You know your geography of Scotland just as I do, if not better. To a large extent, that geography reflects the economic strength and wellbeing of different local economies. Those figures are important because I'm going to deploy them in trying to trace through the labour market impact. You probably on these small screens can't actually read this particular slide, unfortunately, but it is there in the report itself. Here we're just asking the question, would we expect each of these reforms to increase the financial incentive to take up work? The first column is a list of the reforms. We've broken down the child benefit reforms into its two elements. The second column asks, do the changes increase the incentive to find work? The third column asks, do the changes increase the incentive to take on extra hours? The final column really asks whether or not it's a big incentive or a small incentive. I don't want to work my way through that table, but in general terms the answer is, these reforms do increase the financial incentive both to take up work or to increase your hours of work. To varying degrees, some reforms have a bigger impact than others. That's the theory, but what about the practice? How do we go about disentangling the impact on the labour market? The central problem we face is that welfare reform is only one of several things that are happening simultaneously. Since 2012, we know that the UK economy and the Scottish economy has gone through something of an upturn, and that upturn coincides with the implementation of many of the welfare reforms. They begin to bite from around about 2011-2012 onwards. But that does not necessarily mean that we can attribute the upturn in the economy simply to the welfare reforms. There's been a lot of other things going on simultaneously. So the key to our approach, and this is absolutely central to understand what we've done, is that we are looking at the big variation in the impact of the reforms from place to place. And if it's the case that the welfare reforms are having an important impact on the labour market, it should be possible to observe a much bigger impact on the labour market in those places where the welfare reforms hit hardest. So we know in Glasgow the welfare reforms are hitting very, very hard, but less so in Shetland, so we should expect to observe a bigger impact in Glasgow than in Shetland at the two ends of the spectrum. That's central to our approach. Now there are some practical problems in operationalising all of this. One thing I will flag up to you is you should not assume that everything that was initiated under the last government and by the coalition government in Westminster has already been implemented, far from it. In fact, probably about 90% of the financial losses arising from the change over from disability living allowance to personal independence payments is still in the future. I mean the reassessment of existing claimants only begins next month, and that's when the big losses will kick in. And quite a lot of the financial losses arising from the incapacity benefit reforms are still in the pipeline. There have been all sorts of delays in the work capability assessments in the appeals procedure, and those delays in turn have delayed the implementation of means testing of employment and support allowance for those in the work-related activity group. So we haven't thrown all of the financial losses into the pot. We've had to reduce the financial losses to allow for those things that are still in the pipeline. We've also taken out of the jigsaw the removal of child benefit from higher earners, which frankly of all the reforms we think is probably not one that's going to actually have a significant impact on employment or labour market participation. Most of those higher earners are of course already in work and nearly all in full-time employment as well. Now at this stage I'm going to get into the numbers, and I'm going to show a whole series of these scatter diagrams. You probably can't read all the detail on the screen. It's there in the report, but let me talk you through very carefully what these scatter diagrams actually do. I'm not quite sure how many people are used to dealing with scatter diagrams and how many aren't. On the horizontal axis from right to left is the financial loss per adult of working age arising from the welfare reforms. Adjusted to take out those things by the way that still are in the pipeline, so that's just these things that have already happened by the end of last year. On the vertical axis in this instance is the out-of-work benefit claimant rate. Rolling together all the numbers out-of-work on jobseekers allowance, on incapacity benefit employment and support allowance and on income support as a lone parent. Each one of those dots is a Scottish local authority, so we're trying to look at whether there's a relationship between the financial losses and the reduction in the out-of-work benefit claimant rate. We've taken the period here from February 2011, which is about when the first of the coalition government's welfare reforms began to be implemented, through to November 2014, which was the latest data that we could get when we knocked up this report in June and July. There are also some fancy numbers down there which are about the statistical strength of the relationship. The line is what we call a regression line, and there's something on there called an R-squared, which measures the strength of the statistical relationship. You don't need to be a statistician, however, to see that on that particular graph there is a clear relationship. The bigger the financial loss arising from welfare reform, the bigger the fall in the out-of-work benefit claimant rate. Now immediately you might think, aha, here is evidence that the welfare reforms are working exactly as the Westminster Government thought they were going to work. Wait a minute, let me go through the full logic and evidence. Firstly, let's begin to split up that reduction in the out-of-work benefit claimant rate. I have to split it up here into its two main component parts. The top part refers to job seekers allowance, and the bottom part to employment and support allowance. Employment and support allowance, remember, is the new incapacity benefit, and you can see that there is a relationship between the financial hit arising from welfare reform and the change in JSA numbers, but no relationship with the change in ESA numbers. In other words, the scale of the financial hit doesn't seem to have had any effect on the numbers on ESA. Now I've got to say, intuitively, this is all a little bit surprising because it's ESA much more than JSA that has been targeted by some of the welfare reforms. I mean, the large numbers of people have lost eligibility for ESA, who would have been able to claim the old incapacity benefit, and ESA has become means tested for many claimants, yet there's no evidence of an impact there. The JSA numbers, though, are a clear relationship between the reduction in JSA and the financial impact of the welfare reforms. This is information from DWP benefit statistics. They are rock solid reliable. The numbers out of work on different benefits count them accurately. When I'm going into some of the other labour market data, the statistics are not so good, and often based on sample surveys, particularly something called the Labour force survey, which is a sample survey of people across the country. I think they deal with 80,000 people a year across the United Kingdom. In any one local authority, the sample can be quite small and the data much less reliable. Now, to get around the problem in dealing with the less reliable data from the Labour force survey, we've had to do some grouping of local authorities to try and pool observations to get bigger samples, and that's the grouping for better or worse that we've adopted. They're not quite functional economic areas. They're closer to functional economic areas than individual local authorities, but the main point is actually just to group the 32 authorities into a smaller number where we think the data will be more reliable. Now, here's the relationship then from the using labour force survey data with the number of economic variables. The top one is the relationship between the welfare reform financial losses and the change in the economic activity rate. The middle one refers to the employment rate, that's the share of all adults of working age in employment, and the third and bottom one is what we call the ILO unemployment rate. Now, that is not the same as the numbers on job seekers allowance. It's a survey based measure of unemployment. It comes in much higher than the numbers on job seekers allowance. The ILO unemployment rate is the basis of the headline unemployment statistics these days. When we hear that there are 1.8 million unemployed, it's the ILO unemployment figure that's quoted. JSA unemployment these days is down around about 8,000 or 900,000. If you look carefully at those particular graphs, and I know it's difficult on the screen, you will see that those dots are scattered pretty much everywhere. Now, from a statistician's point of view, you can draw a regression line, but the R-squared tells us that the relationships are very poor indeed. There's not much evidence of strong relationships between the financial losses arising from welfare reforms and the change in any of those particular variables. Let me also now move on to another dataset. It's called the Business Register and Employment Survey. This is a count of how many jobs there are in each area. In terms of statistical reliability, this dataset comes midway between the rock solid good DWP benefit data and the rather ropey labour force survey statistics. We've done it on both bases. The top one, which has 32 dots on, has got all the Scottish local authorities. The bottom one is this grouping that we adopted where we've grouped local authorities into the dozen or so areas. This is asking the question, has there been a bigger increase in the number of jobs in the areas where welfare reforms have hit hardest? You can see the dots are absolutely all over the place. There is no statistical relationship here, whether or not we're looking at individual authorities or at groups of authorities. I know all of that is getting a little bit technical, and it may take a little bit of time to digest. Let me just stand back and say, well, what is all of this actually telling us? It's telling us that bigger losses from welfare reform are indeed associated with bigger falls in the overall out-of-work claimant rate, but that only applies to GSA, not to ESA, and that there's no observable relationship with labour market participation or employment rates, and no relationship with employment growth. We're observing then that where welfare reforms hit hardest, unemployment measured by GSA is falling fastest, but we economists know something about what happens in economic upturns. One of the things that we've been able to observe over many, many years is that in economic upturns, unemployment always tends to fall fastest in the areas with the highest unemployment. There is convergence in unemployment rates. It's easy to have a big reduction in unemployment when you start off at 10% unemployment than if you're already down at 4% unemployment. Having your unemployment rate in an area of 10% unemployment takes 5 percentage points off the bit. We haven't even got 5 to start with in an area where the unemployment rate is only 4%. So it's perfectly possible that what we're observing in this big reduction in jobseekers allowance in the areas where welfare reform has hit hard is actually not the impact of welfare reform, but it's actually the effects of a normal economic upturn. Now to explore this, we've compared three different economic upturns and this particular set of graphs is is important in the overall logic of what our argument is. These three upturns all were associated with a reduction, a similar reduction in the numbers out of work claiming unemployment benefits. The top graph is that one I showed earlier, which is what's been happening in the upturn from 2011 to the end of 2014, the relationship between the upturn and the financial losses arising from welfare reform. The periods below that February to 98 to 2004 period is a longer one, but unemployment fell by similar amounts from a similar level over that long period. The August 93 to August 96 period again unemployment fell by similar amounts though from a much higher starting point I've got to say. Now on the horizontal scale in each instance we've put the financial losses arising from welfare reform in this particular 2011 to 2014 period. That's not to say that those things that happened in the 2010s had any impact on what happened in the 1990s or earlier, but it's just so that each local authority is positioned on the same point on a left to right spectrum. And it's to ask the question, well did we observe basically the same geography in terms of the reduction in unemployment in previous upturns as we've observed in this upturn? And the answer is emphatically yes, that you observed a similar reduction in unemployment in the higher unemployment areas, the areas hit hard by welfare reform recently, you have observed a similar reduction in unemployment in previous upturns when the welfare reforms weren't happening. Now this particular little set of graphs makes it impossible to attribute that big reduction in JSA unemployment in the areas hit hardest to welfare reform. It says this is a normal feature of economic upturns, it's not the result of welfare reform. There we go. Now let me just come into this from a rather different angle, and then eventually I'll try to wrap all of this up. One of the things that everybody out there in the world and certainly economists have been noting about the recession that we had in 2008 and the subsequent economic upturn is that employment has held up remarkably well. These graphs here show the trajectory of three different recessions. Now the dark line that's the bottom one on the GDP graph is the post 2008 recession. The other two lines of the recessions in the early 80s and the early 90s. Now if you look at those graphs you'll see that in the recession that we've just been through and the subsequent upturn, the falling output was bigger than in previous recessions and the subsequent recovery has been slower in GDP. But in contrast employment fell less in the recent recession and has stayed surprisingly high. Now those people who believe that welfare reform has been highly effective could use these figures to argue are. Really what's happened is that welfare reform has leaned heavily on people to look for work so employers have taken on lots and lots of cheap labor they've not invested in plant and machinery and that really welfare reform lies at the root of this resilience of employment during the recession and in the subsequent upturn. By the way I'll just show you a figure there for Scotland that's employment in Scotland unless you were thinking that Scotland's employment trajectory is any different from the UK average. That's since the start of the 2008 recession. The dark line is the UK, the blue line, the lighter blue line is Scotland. You've been pretty much tracking UK trends in terms of employment. But to go back to that argument that you know this is demonstrating the positive effects of welfare reform there's an issue and there's a problem. The welfare reforms kick in three to four years after the recession kicks in. They're kicking in really first from quarters 12 to 16 after the start of the recession. These figures track GDP since the first quarter of 2008. The coalition government's welfare reforms really don't begin to come into early 2011 so that's 12 quarters in. Things like the bedroom tax, the council benefit tax benefit changes in England etc etc don't kick in until April 2013. That's best part of 20 quarters after the after the start of the recession. But what you can see if you look carefully at these graphs is actually employment started holding up long before the welfare reforms kicked in. So it's very very difficult to attribute this resilience of employment to the welfare reforms. Employment has held up better during and after the recent recession but this started well before the coalition government's welfare reforms so it's difficult to attribute the extra jobs to welfare reform. Bundling all of this together what can we conclude? I've got to conclude that on balance taking all of these statistics together the evidence provides little support for the view that welfare reform is having an important and positive impact on the labour market in Scotland. In other words that second argument that's advanced to justify welfare reform looks very very shaky indeed. Final remarks the new cuts in welfare. All of what we've been looking at has been what's happened to date. We can't monitor the impact of the of the new cuts because they haven't started yet but they are coming. Reductions in tax credits lower household benefit cap particularly here in in Scotland you know outside London the cap is is really being brought down. Lower ESA payments for claimants in the work related activity group they're going to be placed on the same basis as GSA claimants and a four year freeze in most working age benefits. As Chancellor George Osborne said in his his budget in July when all of these come to fruition there'll be 12 billion a billion a year of new savings. I would expect we would expect that on the basis of that savings across the UK as a whole further big losses to claimants in Scotland are in the pipeline. I would put them at probably around about one billion a year. We know it's 1.5 billion a year from the pre 2005 reforms in the context of a saving to the treasury of 18 billion across the United Kingdom so one billion a year I would say is probably what's in the pipeline for you. But I've got to ask in terms of the labour market impact why should these new cuts have any greater positive impact on the labour market than the reforms that have happened so far and I think that's particularly the case because a very large proportion of those cuts concern tax credits and therefore they will be reducing the financial incentive for many individuals to take up work. I think at that point I'll stop. Thank you very much. Okay thank you very much Professor Fothergill. It's a fascinating and indeed challenging presentation. A couple of questions come to mind what you've said. You said you suggested that the the big reductions in JSA unemployment since 2011 cannot be attributed to welfare reform and you spoke about the impact of the economic upturn not just the recent one but the previous ones. Is it your assertion that that reduction in JSA unemployment would have happened anyway even if there had been no change to the benefit system? I think implicitly that is what we're saying yes because you know if you go back to those three graphs that we showed where we were contrasting you know the recent upturn with the two previous upturns you know you get the same sort of geography happening of the bigger falls in unemployment in JSA unemployment happening in the high unemployment areas you know where the impact of the welfare reforms is this time greater but you're observing exactly the same thing you know when welfare reform wasn't happening you know in in these other periods so yes I think it's it's very difficult to attribute the change in JSA to welfare reform. Is it then implicit in what you're saying that the further cuts that are in the pipeline will not have the desired effect of reducing unemployment in a significant way given what we've seen so far? We can only judge the future on the on the basis of the evidence you know from the present and the past and there's there's no evidence that the welfare reforms to date have reduced unemployment so I wouldn't expect the welfare reforms that are coming to reduce unemployment that's not to say they won't have any impact I mean clearly they will take a lot of money out of some people's pockets a very very great deal of money you know one billion a year in Scotland is very very far from negligible you know but whether this will have a positive impact I don't think the evidence supports that at all. You said at the beginning that there were essentially two arguments one was that there had to be cuts in benefits in order to to save money and the second argument was that there had to be cuts in benefit in order to stimulate greater employment and you've suggested that there's no link no causal link between the cuts in benefit and the increase in employment which would have happened anyway. Now if we're saying that you know if the government has a valid raison d'etre that you know those in benefits have to make a contribution to to the cuts in public expenditure has there been any work done to see by comparison what burden has fallen on the shoulders of the better off to see whether proportionately they are contributing as much to the savings and the reductions in public expenditure. Right I think that they would have to refer you to the work that the Institute for Fiscal Studies has done on the impact on on different income groups and broadly if my recollection of their work is is correct it's that the welfare reforms hit towards the lower end of the of the income spectrum but it's not quite as simple as that because there are odd little bits of the package particularly the withdrawal of child benefit from higher earners that of course does hit higher up the income scale. I'm not just talking about welfare benefits I'm talking about whether in totality if we look at the burden that's been placed on those in benefits as a contribution to reductions in public expenditure when you look at people like me you know what kind of contribution the people in my circumstances make to those cuts in public expenditure either through some minimal cuts in welfare benefits or through taxation so in other words you know is there anywhere where we've seen a comparison between what the poorer sections of society are having to contribute you know as against those that are better off like me. Yeah I mean looking more generally at the overall package of austerity I mean there is a team at the London School of Economics led by John Hills that has attempted to to quantify these things as far as I understand I'm not wholly familiar with the details of their work but I think the conclusion is that the burden is borne towards the the lower end of the of the income spectrum but it's it's more complicated than simply you know high income versus low income it's also about different types of households I mean one of the things that came up very strongly for example from the last report that we did for this committee was that we documented the impact of the welfare reforms on 15 different types of households in in Scotland now some types of households have escaped virtually unscathed and the welfare reforms impact negligibly on on pensioner households they don't impact on student households but they do impact massively for example on on loan parents also the impact on couples with children much more on average than they do on couples without children so you know we can talk about where people are on the income spectrum but we also need to bear in mind that there are other dimensions to this it's type of household as well as how much income you've got you've got coming in thank you Kevin Stewart thank you convener Grim reading once again for us in the committee in terms of the the impacts that there have been you've said professor father ago father ago that the first concept was for the treasury to save money and that's obviously happened but you say that there has been no evidence of positive impact in the labour market because of of the reforms one of the reforms which we're about to see is changes to tax credits and we know that nearly 200,000 families in Scotland will be affected 346,000 children you said during the course of of your presentation there that these reductions in tax credits may actually reduce the financial incentive to work is that the case yeah i mean if you compare in the situation being out of work and being in work well if being in work you're not getting as much tax credits as you otherwise would have got you know as you would have got under the old regime then it's going to be less financially attractive to move into work so that actually pushes in the opposite direction you know to to the claim that welfare reform actually is all about incentivising people to to take up employment of course if you're already in work and getting tax credits and your tax credits are reduced what it does provide is an incentive for you to try to take on extra hours or indeed to move on from low paid employment to higher paid employment to to try to offset that loss of tax credits but if you're simply comparing being out of work we're being in work being in work is less attractive when the tax credits are cut one of the things which you may of course try to do is to take on extra employment part-time employment as well as the full-time employment that you may already have which again reduces the ability of someone else to find employment. Yes indeed i mean this is this can be a zero sum game particularly in difficult labour markets and that applies to substantial chunks of Scotland and you know large parts of northern England for example and south Wales you know in difficult labour markets it's a zero sum of the game because there's not quite enough work out there to go around so if somebody else manages to get extra hours you know by taking on a part-time job as you say then that job won't be taken right you know by somebody coming off the off the dual queues which is why when we look at the labour market impact it's not sufficient to ask the question well has anybody started looking for work who never looked for work before what actually matters is whether at the end of the day you've got more people in work that's what we're trying to to do in this particular study. Are you aware if the DWP has carried out any impact assessment or the treasury for that matter on that proposal to reduce tax credits? What the DWP and the treasury tend to do is to produce impact assessments on each element of the welfare reforms but those impact assessments generally don't go much beyond you know telling you well how much is going to be saved you know which income groups it's going to fall on it it doesn't actually trace through where those people are which is one of the great advantages of the work that we've done over the last two or three years it doesn't nor does it actually attempt to trace through well what will be the impact of all of this on on labour market engagement and levels of employment and unemployment it it's only past of the jigsaw I mean I I'm not up to date on on the full range of new impact assessments that have come out I suspect there is one sitting there that I need to read on on the the impact of the tax credits reductions but it will only get us so far along the the line in terms of understanding what's happening but it would be fair to say that these changes may well be a disincentive to work for many people who are currently not in employment yes I think that would be a fair assessment thank you very much Kenny Gibson thank you convener I'm just wondering you talked about the £1.52 billion being taken out of the Scottish economy by these reforms what is the impact on employment from this money coming out of the Scottish economy and in particular in the areas where unemployment is already very high I mean you would expect a reduction in spending power of this magnitude to to have some knock-on effects to to local employment levels we haven't calculated this in the context of of Scotland but I did do some of us we did some rather similar calculations in Wales now in Wales the financial loss is about a billion a year now Wales is a smaller place than Scotland and if my memory is correct our estimate was that that might have a knock-on effect of about 7 000 jobs lost in local consumer services so grossing that up in Scotland I mean if you take 1500 million a year out of the Scottish economy you know through the pre 2015 reforms you know maybe maybe 10 000 jobs would go in local consumer services but that is a little bit of a back-of-the-envelope calculation I mean with quite a margin of error on it but it seems plausible but the impact would be highest on areas where there's high you would expect so but the way that the way that labour markets and local economies work means it's a little bit more complex than that I mean if you take money out of the pockets of people in North Lanarkshire some of the impact is felt in in Glasgow through lower retail spending of course you know so local authorities are not hermetically sealed boxes but yes in broad terms I mean it may be one of the reasons though I doubt whether it's a sufficiently powerful reason for the fact that we can't identify any relationship between the change in employment and and the impact of the welfare reforms I mean on the positive side you know you would expect the welfare reforms to encourage more people to look for work and then firms will take on more people but on the negative side you know if there is a reduction in the money in people's pockets that's going to have a knock-on effect to local consumer spending and and the you know the graphs graphs are absolutely all over the place it's totally random the relationship between welfare reform and employment change as you can see from the top one of those two graphs okay so would you suggest then that just finally convene or that employment would be higher without these welfare reforms given the fact you mentioned perhaps 10,000 jobs in Scotland 7,000 wheels some tens of thousands one would expect in England um yes and no um it would be higher in that there would not be the knock-on effect to local consumer spending but you have to then ask what would central government what would the Westminster government have done instead to save that amount of money and you know if the if the fixed bit of the jigsaw is the amount by which they wanted to reduce the budget deficit then if they're not cutting welfare benefits they'll cut something else which in turn will have knock-on effects on employment so it's a little bit of a complex picture it depends on the assumptions you make about whether or not you know the same amount of spending would have been taken out of the economy by other means I'm sounding terribly technical here like an economist I'm afraid that these are technical issues not at all it's fascinating I'd like to ask further questions but convener have said that there'd be more final ones so that'll be more final ones thank you thank you just before I move on can just stick with this issue about financial loss that Kenny Gibson's raised um one of the the the slides that you showed us gave a breakdown by local authority area so for example Glasgow's at the top financial loss £580 from pre 2015 reforms now presumably there will be individuals or families in Glasgow that will suffer substantially more of a loss than that if it if it's an average do you have any idea of what and I know it's maybe related to size of family and other things but do you have any idea of what for some families that the maximum loss might be? Yeah I mean let me underline that these figures you know the £580 is averaging the loss across the entire working-age population of Glasgow now on average we know that for example single parents in Glasgow are losing a little bit over £2,000 a year but that's an average among single parents I mean this that was a figure in our third report to this committee at really once you get up to the extremes in terms of what is the biggest sort of impact that you might get on any household I suspect you're in the territory of four or five thousand pounds a year and that is because some households draw on multiple sources of benefit now if you have for example a household where you know both adults have been on incapacity benefit or what's now employment and support allowance one might lose entitlement entirely the other one may find that their entitlement is means tested they probably also have been claiming housing benefit if they're in the private rented sector their entitlement to housing benefit will have been reduced if they claim disability living allowance and about half of all ESA stroke incapacity benefit claimants do claim disability living allowance as something of a top-up then they may well lose disability living allowance instead and in a sense it's the most vulnerable groups the ones at the margins who may drop off in both instances the people with the highest level of disability should in theory stay on ESA and they should in theory stay on DLA but at the other end of the spectrum if the disabilities are more marginal let me let me say then they could find they're losing not only ESA but they're losing DLA as well and these things add up so four to five thousand at the extreme but that's byn you know that is the extreme and there'll be other households where it's nothing zero absolutely zero those are shocking figures because i think for for anyone like i'm sure if my household income dropped by that amount it would be pretty painful but you know i'm not as badly off as some of these families so for that level of reduction to suddenly impact on a household that is already relatively low income but also may be having to cope with disability and illness that that really becomes quite a traumatic experience i mean the way we've often characterised this in some of our other reports is that the where the old benefit system worked particularly around incapacity benefits was that it allowed some people who were long-term out of work with health problems to live tolerably decently um not well but but to get by to get to get by with some dignity what the reforms essentially do is squeeze that group and it will not remove their income but they will push them down to the poverty line um that's what's uh what's likely to happen final question just on that financial loss you'd said before that you had some other statistics that showed a breakdown by ward but if you look at you know that slide there for example east renfrewshire part of my constituency sits within east renfrewshire but the part of my constituency that sits within east renfrewshire is the poorest part of east renfrewshire barhead in nielson now if you were to look at the figures for barhead in nielson um they will be much much higher than that because the other side of the constituency is one of the wealthiest parts of scotland gifthnock in newton so you know in a sense some of these figures are are actually hiding what are are more localised impacts absolutely and in fact in the in the second of the reports we did for this committee poble kevin might remember all of all of this you know we we generated statistics like this like these here on the screen for every single ward in scotland um and i came along with maps you know uh for the report includes a map for each of the local authorities so you will be able to see within east renfrewshire exactly those differences that you're highlighting i will just have one word of caution though um those maps which were produced it must have been 18 months or two years ago now and now slightly out of date in that we've updated some of the base statistics um on on the on the financial impacts i mean this time has moved on moved on we've got more evidence on actual out turns in terms of uh some of the hits and the treasuries adjusted some of its statistics about financial savings so so so those ward level statistics aren't absolutely compatible with the these particular figures because these are the adjusted and updated figures um whereas the ward stuff hasn't been updated yet um John Lamont and then Christina McKelvie thank you convener um you said that the analysis of the impact on the labour market had discounted or excluded the changes to child benefits and tax credits to the higher earners just come back to that table the financial loss by local authority those reduction figures that you've highlighted do those figures include the reduction no those particular figures are the overall figures um including the uh you know the taking away child benefit from higher earners and so on but what we did when we tried to trace through a labour market impact we we took out of these particular figures certain elements of the jigsaw we took out the child benefit to higher earners we took out a substantial chunk of the impact of the change over from DLA to PIP because it hasn't happened yet and things like this it didn't make any and it doesn't make any impact really on the ranking of the local authorities it reduces the numbers a little bit but you know how much does it reduce the figures by about a third principally because because the the DLA reforms which were very very big bits of the jigsaw have mostly not yet been implemented you know there is something there that is waiting to hit people it's about to hit people um and i don't really think that people are alert to quite what is in the pipeline so far the change over to PIP has only been implemented for new claimants for somebody asking for DLA or now so it's for the first time but you know once the retesting starts whoa this is a big one i mean in scotland we're talking about it being second only to the to the tax credits in terms of the financial losses so just so i'm clear going back to that previous table you had on this the slide i'm looking at my own area of the borders which had a £380 per annum per working age adult reduction if you include the cuts in tax credits and child benefits to higher earners that figure would fall by a third is that what you're saying if you exclude those yeah yeah that that actually that's what we this is these figures are our estimates of what will be the financial loss when all the pre-2015 reforms come to full fruition they haven't yet take a third off probably to to indicate what has come to full fruition well and and actually we're excluding the impact on the higher earners there but you know you're still in the 200s the full impact has not yet fed through in paragraph 50 of your reports you've highlighted the difficulties in disentangling the impact of welfare reform with the other impacts of changes to the employment market could just sort of expand a little bit on that and the difficulties that you've faced in doing that and whether that undermines the conclusions in any way um my version incidentally hasn't got numbered paragraphs page 11 has probably been inserted by your committee staff it's the first sentence under the heading assessing the labour market impact yeah i know what you're getting at um we're trying to sidestep the the the complications by focusing in on the differences between places that's how aware of trying to to to to get around some of these complications we know there's been an upturning in in the in the uk and the scottish economy generally you know this has been often the space it's been triggered by revival in consumer borrowing by revival in the housing market etc etc um all these things have been happening but to try and disentangle the impacts of welfare reform we've been looking at the differences between the places where welfare reform really hasn't had much you know isn't isn't a big bit of the jigsaw and where it is a very big bit of the jigsaw um and we're asking the question well where where it is a big bit of the jigsaw are we seeing a bigger are we seeing bigger changes than in those places where it's not a big part of the jigsaw that's our way into this problem yeah by looking at the differences between places that's that's one potential way into it and we thought it's the most fruitful i said this was an exploratory exercise yeah there are other ways in as well um that we want to do if i can get this £400,000 uh a funding for a major research study but with the resources that we've got we thought that was the best way in look at the differences between where the reforms were a big hit and where they were a small hit and is there a difference and the answer is not really one last one last question at this stage when you report very much focus is on the financial aspects of the reforms and not so much on the non-financial aspects like for example promoting work skills do you have any comment on on that aspect of the reforms and the impact that that's had or rather why was that aspect of it not not included within your analysis well i mean this is a really rather modest piece of research and the committee put £5,000 into this there's a limit to what you can do i mean i'm noting that all these things are happening simultaneously there were other things going on notably the toughening of the uh of the benefits sanctions regime there is the introduction yes of um the work programme to replace all the previous um programs that are going on but but this is a this is not always was set up to be an exercise in trying to trace through whether the big financial losses in some places feed through to bigger impacts in some places for better or worse that's that's what we set out to do and so is that is that quite a big uh weakness in terms of not not not necessarily i think you have to see this in in its own terms and we're asking is there a relationship between you know the changes in the labour market and the financial hits arising from welfare reform across scotland there doesn't seem to be so there's some factors which which you've not incorporated into your analysis like for example these you've worked training schemes and other programs which you've not analyzed in any way well i mean the work the work training the work training schemes there before the work programme of course i mean it's not it's not that suddenly there has been you know some work training scheme that or welfare to work programme that's been introduced in this period you know and there was nothing in a preceding period but it's not here it's not in this particular report it's not a piece of analysis that tries to disentangle the the impact of the work programme in fact i know a lot of the statistics on the impact of the work programme i could quote to you which is that it's not actually moving people back into work it's a significantly higher rate than its predecessor programmes so i don't think the introduction of the work programme necessarily makes big changes to the overall jigsaw. Kevin Stewart, you want to come in quickly? I went to clarification convener and i wonder if we could maybe go back to the table of the local authorities Professor Fathergill because during Mr Lamont's questioning and i know that there were bits and pieces there where you may not have picked up on Mr Lamont mentioned tax credits and the impact of tax credits and what they would have in reducing that numbers tax credits the impact of tax credits are not in those figures am i correct? No no no the tax credit the the tax credit changes announced before the July 2015 budget are in those figures what we have not yet done is being able to look ahead and document how much more will be taken from Scotland or from individual areas you know as a result of the reforms that were announced in july of this year so that includes the tax credit losses you know announced by the last coalition government but not the ones from the recent budget not the new one thank you for that again as a rule of thumb we know that the overall losses in scotland were 1.5 billion from the pre-2015 reforms we're talking of a further billion probably from the the new reforms so these figures i'm doing the calculation in my head all need to be up to by about 60 odd percent if you're to get the figure of summation of the pre-2015 reforms and the things that are going to to to kick in over the next five years thanks for the clarification thanks convener christina mckelvin and neil finlay thanks very much convener a couple of my questions i had you you've sort of answered them anyway but going back to the the loss pair working age adult i've noted that number 10 on your your list here is south Lanarkshire at 470 pounds loss per working age adult now i've got some figures from the south Lanarkshire council website so i'm not sure how accurate they are but they are from February and july this year which suggests that there was about 5,500 people on gysa and about 17,500 on yes air incapacity benefits or or is there any calculation that you've done to work out the loss per claimant rather than the loss per yeah i mean in some of the earlier reports we we presented figures on on the loss per claimant rising from each element of the of the reform package sorry i i didn't want to go over too much of the old territory in in this new report but if you go back to some of the statistics in our earlier work you will see that for example the the the freeze in the value of child benefit which happened i think between 2011 and 14 really takes very modest amounts from large numbers of people you know whereas the average financial loss that will arise from people losing entitlement to disability living allowance when personal independence independence payment comes in is often of the order of a thousand pounds it it it's all in in there i think the average loss to a tax credit claimant is about 900 pounds but i'd have to go back to the to the earlier reports and and check that and then this varies by type of household i've got to say yeah no i'll do some of that calculation myself based on you know the south Lanarkshire figures that i've got here i think i've got figures for the council awards for each of the awards in my constituency which would be really interesting to look at you know the further impact yeah yeah the 470 figure remember is just averaging across all adults working age you know there's going to be enormous variation whichever way you look at this some of these claimants claiming multiple benefits will be the same person as well yes yes that's an element of the jigsaw we always have rather some difficulty in pinning down i think we've bottomed it in in the last report we brought to you but yes you have to remember that that's you know typically you know many claimants are affected by more more than one element of the package yeah i think i'll go and and read john hill's report that he's done i think it's called it's good times bad times a welfare myth of them and us which actually does some of the tracking the pound right to the person so i'll have a look at that and a follow-up question doctor for like i've just gone find the quote in reaction to your report last week a spokesperson for the dwp said and i quote where welfare reforms are transforming the lives of some of the poorest families in our communities while making the system fair for those who pay for it there are 173 000 more people in working scotland since 2010 and we provide more than 80 billion pounds a year in support for people of working age ensuring there is a strong safety net in place now that's a reaction to your report i mean it's very easy to say there are more people in work isn't it and we there are more people in work now in scotland than there were you know in the depths of recession but whether that is attributable to to welfare reform is is deeply questionable and that's what we've been trying to get at in in this report is does the evidence suggest that you know the welfare reforms are behind these reductions and the evidence doesn't suggest that the welfare reforms are behind it well they're not wrong in terms of the facts of the matter but they're wrong in terms of you know reading across from 173 000 x jobs in scotland to saying our welfare reform is working no our evidence does not support that linkage okay thank you very much if we reverse welfare reform or i prefer to call it social security cuts but if we reform those cuts what would we expect to happen to the claimant count and where is the tipping point so if we increase benefits at what point do you increase them so much that there's a disincentive well any increase in out of work benefits would of course increase the incentive to be on out of work benefits rather than to be in employment but if you simply you know reversed what has happened but we're saying that you know the cuts have not actually reduced the level of unemployment in scotland so restoring the cuts you know why should why should that affect the level of of unemployment in scotland it will change people's lives in terms of how much they've got in their pockets but you know there's presumably a little bit of symmetry in this process if cutting if cutting the benefits doesn't reduce doesn't really lead to higher levels of employment and lower lower unemployment why should increasing the benefits have any effect either while we're storing the the benefits and in terms of some of the stuff that's happened here in scotland the the bedroom tax element and the council tax benefit element is there any indication of what impact that has had on on employment on labour market if at all well of course it hasn't had an impact in scotland because you've avoided the impact i mean this is a pilot piece of work that we have done in in scotland we haven't replicated this particular study down in england yet but i've got to say i'd be surprised if the inclusion of the bedroom tax and the council tax benefit reductions actually changed the overall you know jigsaw because in the grand picture of things they're they're relatively modest i mean as i think i noticed noted the fact that you've dodged implementing those two parts of the package is worth about a reduction of 35 pounds per working-edge adult per year in the in the impact of the cuts now that's against a backdrop where anyway you know you're still at 440 so i'd be surprised if if those elements made a big difference down in england but i am speculating and you know there isn't the evidence the hard evidence yet i've got to say just a couple of other points i mean i've never understood why the poor need benefit cuts to incentivise work yet you know city financiers need bonuses to incentivise work but i suppose the great bigger point is from your perspective what sort of social security policies should we be implementing to incentivise work and and maintaining people with a dignified life i think i would read into our figures that the incentive to work is not the crucial factor it's the availability of work and it's the strength of the of the local economy and the national economy that matters you will get people back into work you know when there is an upturn in the economy that has happened this time round with welfare reform going on but it also happened in the 1990s you know and in the 2000s as the as the economy grew you know when we weren't having welfare reform on on this scale you know you grew the economy people moved back into work um so i suppose i would say getting people into work is less about financial incentives and more about the economy yeah i think that's i mean i've certainly from the scottish tuc's point of view and others they have said that it's the availability of good employment that's the key factor in getting people into jobs finally i don't i doubt if you've looked at this but i'm just throwing this out there is there any correlation between other public policy decisions such as cuts in local government funding and the likes on the impact on local labour market um i can't comment on the specific situation in in scotland and you know i am now going certainly well beyond the research that we've done um for for this committee but i do know from looking at figures in england um that the places that have been hit hardest by welfare reform in terms of financial losses per adult working age tend to be the same places that have experienced the largest reductions in in government grant uh to uh their local authorities so they they faced a a double whammy and i'd have loved to have brought along maps um we've got them and they were in some of the earlier uh reports you know documenting the you know the financial impact across the whole of of great britain and there are a whole series of dark areas in the mersi sides in the northeast englands and the south wheels and the west central scotland but there's a sort of great big light area in in in southern england outside outside london uh where the reforms really impact very lightly indeed in terms of financial losses and where we also know that actually you know the the local authorities have escaped rather lightly um from the austerity cuts of the last five years wonder why that is okay thank you clear adamson thank you could be there professor if i could refer to your um slide on the comparisons of recessions and recoveries it's very difficult to read on this one but if i'm reading it correctly it shows the trends um that you mentioned earlier and employment has recovered in this recession as it had previously but if you compare that to the gdp which seems to be lower oh that one yes at this time um does that say anything about the nature of this recession in terms of in-work poverty and the nature of the jobs that people are losing into being low paid low productivity jobs yeah i mean it does say that what's actually happened is we've had very very little growth in productivity in the economy you know that that output has has recovered on the back of expanding employment rather than the expanding output per head and and this recovery is very very different in that respect from the recovery from the from the two previous recessions i mean economists have been deeply puzzled by what's going on and and why i've been using this to to try to illustrate the point that actually this resilience of employment started well before the the welfare reforms were implemented you know we're halfway along the graph from left to right before the welfare reforms are kicking in in quarter 12 or 16 after the recession um yes it does indicate that that this has been a recovery based on low wage low productivity employment thank you okay no one else um professor for other guilt kind of thank you for as i said earlier on um this is challenging um it's certainly given us a useful insight to to what's happening and you know you've left us with some interesting questions to ponder not least of which is the fact that um it's the state of the economy that that's probably making a greater impact in getting people off benefits than than the cuts to the benefits than themselves um you know i would hope that you know that type of information would also feed into the UK debate because clearly this is not just a challenge for us in Scotland so thank you very much for for that work thank you for the hearing okay thank you um i'll spend the meeting for a minute or two and then we'll reconvene thank you item five on the agenda um future delivery of social security in Scotland um the committee has been on some fact-finding visits to Inverness and Glasgow to hear about the implementation of universal credit and the specific experience of ethnic minority and refugee committees um Michael Mcmahon, Claire Adamson and John Lamont visited Inverness um to find out about the practical implementation of universal credit and Christina McKelvie, John McAlpine and Margaret McDougall visited Glasgow at individual meetings hosted by Amina Women's Group, Government Hill Housing Association and the Scottish Refugee Council so i want to invite some feedback on that um i can invite Claire to let us know what's going on in Inverness. Yeah um i suppose i would like to put on record um my thanks and the thanks of the other members for the the opportunity to visit and the programme that had been put together facility by Highland Council um we had a number of panels to see um all of all of which were very informative in their own respects and and it was certainly a very useful and worthwhile visit to have taken place um if could just say i think just general my overall impression is that the rule out of universal credit is um fraught with manual intervention in the whole process at the moment which would give me great concern about the sustainability if it were to be rolled out across the country um and i think um the advice to find fixes to problems in the area but whether those are um scalable in any way or able to be replicated across the country i think will be a real real challenge and we've could just read out some of the the findings from the from the md obviously we were looking at at the rural aspects of universal credit um which have transport and time and an expense issues for everyone who's having to attend for interviews um there's also um a digital exclusion issue in the area which mean people may not be able to access the internet and some of the forms are only available on the internet for use which makes it um a bit of a problem in some of the rural areas um and because some of the work is seasonal and um fluctuating and indeed some of the housing can be seasonal and fluctuating that that was also um an issue because um the housing element of universal credit i was by far in the biggest problem that they've encountered um the housing cost element of the benefit that makes up universal credit in the area is causing a majority of problems 89 of those on on universal credit are on rent arhears which is in comparison to about 12 to 15 percent of rent arhears on other benefits um the average rent arhere for a non uc tenant is 200 pounds but the average for a uc claimant is over a thousand pounds and it goes even worse if people are involved in temporary accommodation where the average arhears is 2100 pounds a claimant will potentially be on arhears on universal credit from the minute they apply because there's a five week period before they receive any payment whatsoever so they're almost in the rare situation right from the the point of applying the stakeholders that we spoke to felt that if the housing part of it could be devolved to those that are the expertise in the councils it would work much better because they're used to dealing with issues associated with housing benefits and rents um but the dwp seemed to have no history in this and also no expertise and understanding of some of the impacts it would have on private landlords in particular in the situation um the discussion of universal credit being paid in a single day of the month um was highlighted by many of the um the people working in the housing office um it's paid on the anniversary of application which doesn't often suit um the housing office in terms of rent payments and the calculations for councils tax support in in those areas um so the there is some flexibility in payments within the system but it was all very manual process so people could request to be paid more frequently but it was done by manual intervention and obviously the scalability of that as it's rolled out would be of huge concern um the temporary accommodation costs are very very difficult um universal credit doesn't cover most of these costs so it's been subsidised by discretionary housing payments for the council um relevant live cases in highland at the moment or they expect that to increase as universal credit is rolled out but also um because of the sometimes transient and chaotic nature of people who are in temporary accommodation it can leave landlords um in a position of having had no payment at all or indeed if somebody moves to a new landlord that new landlord receives the whole payment and there's nothing in the system to um so it's basically the landlords asked to speak to one another to sort these situations out but obviously that's a really difficult situation for landlords to be in um with no sort of guarantee of the income from from the rental there's issues with data sharing still um and many of the updates have to be done manually and there are delays in the system there's also an issue with universal credit being dealt with by call centres that the front line staff in the job centre don't have access to the full details of someone's claim so they can offer very little face-to-face support whereas at the moment they use either a system called Atlas or Sys where they can see the whole picture of somebody's benefit system so that's causing real difficulties when there are issues and problems that come up when we spoke to the claiming group themselves um you everybody said you know the idea of universal credit they don't have a problem with it the problems are all to do with the implementation with fear of sanctions with inconsistencies in the way people are advised about how the system is in operation um the the issue of for for claimants that was was huge is and we took evidence from citizens advice about this too is because the universal credit stops as soon as someone goes into work they can be left for a significant period of time without any payment before their first wage comes in which is actually a disadvantage to taking up employment because of that and it was suggested that you know it's almost better for claimants to not tell the DWP until they've had their first wage and then go into a rare situation but actually that was an easier thing to manage so the fact that there was no scaling or flexibility in the system in that area was an issue as well. The anxiety around the whole system and the changes was expressed by all of the clients that we we saw um and there's also there was also um JSA um and queries there was an implicit consent for benefit advisors to talk to the DWP they have no um consent for universal credit so sometimes it could be very very difficult for any of the advisors to work with the DWP to resolve issues or have queries answered. In terms of the local authority point of view the rollout of delays was causing an issue for the council because they they're trying to balance their support staff to meet the needs of universal credit and eventually they would see a reduction in the number of people that they would have to have in support but because of the delays from even a sort of personal management point of view it was a real problem for the councils trying to manage that and they were expecting to have to have an increase move people into supporting landlords rather than the other way about and the admin grant for administering universal credit was decreasing faster than the rollout so actually they were they were being faced with a reducing grant to deal with the rollout if you see as the bulk that had still hadn't happened and they were seeing problems with that too. They expressed a concern about the contact with the DWP they also said that it could impact on the procurement and the way that they actually looked at using their budgets to procure employability projects because there was still such inconsistency and misunderstanding of how things might develop in the future. In terms of the DWP perspective they said that they felt that the Highland Operational Forum was working well they were feeding in the problems and the resolutions to the things that they were encountering which meant that that should be being fed out in the long term to the rollout of universal credit to other areas and across Scotland they said it was very much a test and learn environment and that things were improving which you know concerned about that is that you know it's people's lives that have been affected in that test and learning process and obviously it impacted greatly on people's lives during that process local authority are working closely with the DWP and they're actually trying to coach the DWP staff on providing debt and personal budgeting advice they're also doing co-location where they actually have money advice officers within the DWP premises and they were looking they felt that that worked very well in terms of how to support claimants that were in difficulty they said that the one digital account that was coming should allow claimants to manage this caviar and that being that we've all seen these you know it solutions are going to fix everything and then actually when it it rolls out it doesn't actually meet the requirements of what's there but them they also said that they would offer telephone appointments for very remote or rural people but how successful that was and how sustainable and scalable that was again remained a question one of the big benefits was seen of universal credit was that there wasn't the claim was basically paused if somebody moved into work so it was made it easier for people to move in and out of seasonal work without having to go through the re-application process that they would at the moment and that was seen as one of the the plus sides of how it worked just a final thing in non-dependent deductions which was the increase in non-dependent deductions means that a family with a child enters work now need to consider the household income with an additional income of a child dependent would it be worth while financially overall if somebody moved into and the situation was given of of an older couple with a young person moving into work now that would impact on the housing benefit for overall household if the despite the fact that the young person wasn't attending in the house and that was raised by the council as a specific issue and we raised it with the DWP but they didn't recognise that as a barrier to work and that was I think most of what the as I say very very informative very good panels that have been put together and I think we all you know benefited greatly from the visit to Highland Council. Okay thank you Claire and thanks to all of those who helped to make the visit a success Christina could you take us through the visit to the Amina women's group? Yeah absolutely convener can I you know please on record my thanks to the women at Amina because they do an amazing job and it was nice to be back to visit them after a very very long period of absence when I used to be involved with them in a professional capacity so it was it was a really really interesting day thanks to the clots for the support that they gave me that day as well. We had a presentation from the group from the climate change group and it was mainly a consultation of 40 families from different ethnicities across the south of classical and it found that 70% of those surveyed were in fuel poverty which is a huge impact and more than 10% of their income but there were more than 10% of income spent on energy costs. The majority of this 70% were also receiving benefits. They also looked at the effects that being in fuel poverty was having on participants health and found that 40% were stressed because of the worry that it caused and half the sample also felt their health problems were caused or exacerbated by it and this all builds up to the you know access to the workplace and how that affects impact and a further study that they did in the north and south of Glasgow covering 100 families 69% of them were found to be in fuel poverty so very very similar results and again a majority of those people surveyed were receiving benefits and both those consultations most people were unaware of and therefore not accessing support services available in this area that was a very clear example that came out that people were saying well we don't know what's available to help us if we can't heat our house or you know it's in a situation like that and this was often you know exacerbated again by language barriers or social isolation some people you know were in sort of a loneliness situations that sort of a gave rise to a conversation about layers of deprivation and layers of discrimination and barriers that that may be some people face so we had a group of women with us who were very quiet to start with but then when they started to talk about their own stories and tell us their testimony we get a clear example of how the layers of discrimination then fit in if you're a woman you know with children there's a number of things that kick in there childcare costs you know having enough and your benefit to you know facilitate school uniforms or you know put food in the table or heat the house if you're a woman you know where kids have grown up your your age then kicks in as an age barrier to access and employment and some of these women were underemployed some you know women sitting around the room were teachers and had different occupations you know that that just they weren't having access to that type of job market so that sort of led on to the main crux of the reason why we're there was about access to employability work capability assessments that type of stuff and the impact of welfare reform they've been running their own employability project for a year but they found it really difficult to signpost women who use their service on the other organisations of schemes and they're never guaranteed to get the language support that they need and allowed to communicate effectively for some women just even turning up at the job centre with two bouncers on the door was terrifying you know and it's these things that maybe we don't think about as everyday issues but you know for maybe a woman it comes from yet a different environment for you know some of us actually facing that barrier just that right at the door step is enough and they were also advised a number of them that and that this was really inconsistent across just individual job centres to be honest that they couldn't bring somebody with them to support them you know and if you're already nervous if you've already faced a number of barriers just to get yourself through the door you know having somebody there even just to give you some confidence or to you know articulate some of your feelings should there be another language issue is extremely important because most appointments don't offer interpreters so you know having that person there and that seemed to be really inconsistent some people were saying no no when I go to the job centre they'll allow me to bring my friend or my support worker or whatever and other people will say no at my job centre they just don't allow it at all so that was a real clear example of inconsistency again barriers to participation there were schemes such as a work programme that women face as I say you know in terms of their faith their race their gender what maybe they're expected to do in the workplace the environment they're expected to work in again you know the issue of language support whether they fitted into the culture of the workplace was was a huge thing that maybe most of us don't even think about but it became one of the other layers a discrimination and placed further obstacles in their ability to access any of the the mainstream sort of a work programme opportunities at this point a number of the ladies that were in the room with us that did talk about their age that they'd spent you know 10 15 years bringing up their kids where they were ready to enter the job market you know getting access to you know even work experience or a further training or you know cpd on you know some of the professional qualifications they found that really really difficult and they were really quite myth that the apprenticeship programmes offered within the organisation were only for 16 to 24 year olds because most of the 16 to 24 year olds in the group were bringing up their kids so that that was another you know another very stark difference between age groups the amana employability project workers are currently trying to link into the work programme they're finding that that quite difficult because what they would like to offer is their programme to the work programme to allow some tailored support for people and when it came down to it that's where it there's the whole crux of the conversation come down to that if somebody sat down with me and worked out a plan for me based on you know all the experience and worthwhile contributions I've got but dealing with some of the barriers then that would help and the main thing seemed to be for most of them it was health issues it was if I could get my health issue you know supported properly you know under control you know the right package of care then I would feel confident and able to then step back into the workplace and that was the there's a sort of a three point plan and I've got a wee bit to say about that at the end to say the first step that the women thought was to get medical issues resolved and there seemed to be a real misunderstanding or lack of understanding within some job centre staff about how how some health issues impact on your ability to go into the workplace and it wasn't that they weren't the motivated to go into the workplace it was for some of them they just weren't able and it was very similar to some of the evidence we heard yesterday and you have your say with people that were going forward for work capability assessments yeah they probably could get in the door and walk 20 yards but they're in their bed for the whole day the next day you know and it was that type of thing that they felt wasn't it wasn't they being resolved and if that could be resolved it would tell them the other bit was about you know further study work experience and that's sort of a you know baby steps almost back into the job market for people who had been out the job market for maybe 15 or 20 years and the impact that that has some of the women actually said you know it's a bit of a vicious circle because although I'd quite like my health issues sort of do it so it would give me the confidence and the ability to go back into the workplace being in the workplace would actually maybe help the fact that I feel depressed about my health condition you know so there was a bit of that sort of a vicious circle there and most of them had identified that but you know really identified ways of resolving it at this point although they did have quite good ideas on how some of them were were about to do that just about getting up in the morning being able to study that type of stuff and they also suggested it would be beneficial to have individual support and that's when I put my politicians up put my social worker hat back on and said well how would that work would that be like a key worker sort of a system you would have one individual that would support you with all of these issues sort of a holistic report a support you know a support you to interview and that's exactly what they were looking for was that type of system how we replicate that across the land I think would be difficult to do but I think that the results from it would be extremely worthwhile so you know the the input would create a really good output as far as the group that we were talking to about the other big issue was a bit trust and trust in the system and how they would build that trust and if they had a key person key worker you know nominated person that would help them to do that then they would build up trust with that person and then understand that they then would you know work through the system with them and therefore then build a trust in the system because that seemed to be a clear understanding let me just flick to my own wee bits of notes I took one of the biggest barriers for most of the women who had kids with childcare costs and the ability to have a tailored childcare for one woman she was offered a job was she had to sat at 6 am in the morning but she had small kids and there was no ability to you know have somebody come and make sure the kids got up newt to school and stuff like that so very personal things like that the other big issue was for some gps or charging 20 pounds for sign in the dwp letter and the group that we had round the table for have your csd asked them all if they had been charged with this question in mind and none of them had been so it's obviously again something like the job centre you know allowing somebody in or not allowing somebody and it's something that seems to be inconsistent across the board and maybe something that we should we should take a wee bit further and the other big issue was about under-employment and the impact that that then had on somebody's motivation and you know their participation in the system because like you know back in Afghanistan I was a senior teacher or I was a scientist or I was a you know but I've not you know been allowed to use those skills or those abilities to give something back and that seemed to be what most of these wanted to do but to give something back to the system that they felt supported especially ones that came via a refugee background okay thank you Christina and thank you to them at the Ammoner women's group um Simon you have a a prepared note by a from Margaret McDougall and John McAlpine do you want to give us a gist of it put back on behalf of Margaret Dougal on a meeting with refugees in Glasgow at the Scottish Refugee Council and on behalf of John McAlpine's meeting we had with officials at Government Hill Housing Association looking at the issues that affect Roma groups in the south of the city I'll stick to the main headlines one one of the reasons the committee opted to carry out these visits was to see if there were specific welfare issues that affected these groups that we hadn't come across in terms of dealing with the mainstream issues and for both of these groups there were actually in terms of the refugee group the biggest issue they have is the switch from being supported as refugee asylum seekers and applicants where there is support from the government for accommodation and living expenses to actually being accepted as refugees and granted status in this country when the existing support continues for 28 days and in that time they have to put in place everything that will allow them to claim benefits if they need to do that this never happens the 28 days is not long enough to allow you to get national insurance number to apply for benefits and so on so all of them basically become homeless during this period and then for the responsibility falls on the relevant local authority to house them and so on so it's it's a system that just doesn't seem to work at the moment for anyone and of course being put in homeless accommodation and so on results in increased costs both to local authority and to them so that was the the big issue for them really the perhaps less important issues were there was a concern about the claimant commitment that many people are signing these without realising what they're signing up to it's an issue we've heard elsewhere but seems to particularly apply to refugee groups there was an also concerned about how digital the access is becoming for the welfare system and of course many refugees have language issues and in terms of physically accessing the equipment to be able to respond online and the final point was really about the English language requirement people who are applying for JSA have to undertake mandatory English classes if their English is judged not to be good enough many there was a question about the quality of the the training that's provided on that and the how how the fact only lasts for maximum 20 weeks maximum 15 hours a day and the fact that most people at the end of that period wouldn't necessarily have good enough English to be able to get a job there was also a particular concern because many people organised for themselves English classes before they get to the point of being granted status they have to stop that and switch to the mandatory classes and there's lots of complaints about that so those were the main issues from the refugee group the meeting in govern hill looked at issues for Roma groups in the south of the city they are exclusively either Slovak or Romanian citizens and as such they're covered by specific employment and right to reside rules these rules were changed last year to be made stricter so that now they have to demonstrate that they are or have been undertaking genuine and effective work and this has quite a high barrier attached to it they have to be earning 150 pounds a week which is equivalent to the equivalent minimum wage for 24 hours a week over a period of months this is particularly a problem for these groups one because a lot of their employment has been informal and some of it below the minimum wage of course so they have trouble proving any of that or if they have worked they could have worked in the past but not necessarily have any records of that because at that stage the rules were quite different so the main problem for these groups is people become completely ineligible for benefits and are effectively destitute we discussed a little what happens to people in this situation and they seem to sort of disappear in some shape or form whether that's back to Slovakia or Romania or within the local community people weren't clear one of the other aspects of this we explored was the knock-on effects because of course rights to passport benefits and so on for children free school meals things like that all disappear so one of the factors which the housing association had uncovered was that the main local primary school which has is about 80% Roma has a lower level of free school meals provided than the most affluent parts of Glasgow because the children aren't eligible because they no longer are on benefits the council and the housing association are doing something to try to tackle that but that's a sort of measure of the the problem that exists locally that was it and can you pass on our thanks to the Scottish Refugee Council and to the Government Hill Housing Association for allowing both Margaret and Joan to carry out that work our next meeting on 15 September will start taking oral evidence on the inquiry into the future delivery of social security in Scotland but at this stage we'll now bring the public part of the meeting to a closing on to private session to look at the next item on the agenda thank you