Scotland is a country where compassion is strong, but where child poverty is an ongoing injustice that we have to end together.
Best Start, Bright Future, the Scottish Government’s Tackling Child Poverty Delivery Plan, was published at the end of March. It’s designed to help create the change we need to drive down child poverty and reach Scotland’s interim child poverty targets in 2024.
There are a lot of commitments in the plan, and we are hosting a special morning webinar to explore how we can make sure they are implemented, and how they can best deliver practical change in our communities.
The plan includes pledges to: increase the level of the Scottish Child Payment; create a new employability offer to help parents get into work, and; mitigation of the benefit cap.
There is lot more besides, and Best Start, Bright Futures will touch on all areas of anti-poverty activity in Scotland. It is crucial for groups and organisations across the country to understand what it all means for their work.
Between 2016 and 2020, one tenth of people in Scotland were in persistent poverty after housing costs. Persistent poverty identifies individuals who live in relative poverty (have a household income of less than 60% of the UK median) for at least three years out of the last four.
Persistent poverty rates were similar for children and working-age adults (10%) and pensioners (11%). Over time, persistent poverty rates have been fairly stable for all age groups, except for children in the most recent period.
Persistent child poverty saw a relatively large drop compared to previous estimates, from 15% to 10%. This observed fall should be interpreted with caution as persistent poverty estimates do tend to fluctuate. So not all of this decrease is likely to reflect real change and will be due to a range of factors.
Some low income households will have benefitted from increased financial support during the pandemic. At the same time, reduced earnings and job losses may have resulted in a lower median income, leading to a fall in the poverty line, and a drop in the relative poverty rate.
Not everyone in poverty is in persistent poverty: More than a third of people in poverty move out of poverty each year. At the same time, a similar number of people who were not in poverty before enter poverty each year.
The persistent poverty report usually goes alongside the main poverty statistics publication Poverty and Income Inequality in Scotland. This will not be published this year due to the disrupted data collection during COVID-19 restrictions.
An analytical report will be published instead to explain the limitations of the most recent data. Users should note that the latest reliable figures are those previously published.
These figures are produced in accordance with professional standards set out in the Code of Practice for Official Statistics.
Reacting to the publication of new statistics on poverty in Scotland and across the UK, Poverty Alliance director Peter Kelly said: “In a compassionate society like ours, we believe in looking after one another and protecting each other from harm. But these new figures show that we are failing to put that compassion into practice.
“When the Chancellor raised Universal Credit by £20 a week, he lifted 400,000 children across the UK out of poverty. But when he cut that £20 lifeline, many of those children and their families will have been pulled back into poverty’s grip. It was an unjust and scandalous decision then, and its impact on people’s lives is becoming even clearer now.
“The Scottish Government’s actions to increase the Scottish Child Payment show what can be done when we make our compassion concrete and is a good example to build on. We need to make sure that the money gets to the people who need it, as soon as possible, and that wider action on transport, childcare and housing all ramp up in ambition to help us meet our child poverty targets.”
The full publications are available here:
Persistent Poverty in Scotland presents estimates of the proportion of people in Scotland who live in persistent poverty. The data come from the Understanding Society Survey, and the latest statistics cover the period from 2016 to 2020.
These poverty statistics are used by the Scottish Government and other organisations to monitor progress in tackling poverty and child poverty, and to analyse what drives poverty and what works for tackling poverty and income inequality.
Poverty and Income Inequality in Scotland – analytical report provides information on the limitations of the most recent data for 2020/21 from the Department for Work and Pensions Family Resources Survey Households Below Average Income dataset.
This report and dataset are not official statistics. Users should note that the latest reliable figures are those previously published for 2019/20.
The latest estimates are unreliable as they are based on data collected during the first year of the coronavirus pandemic and associated restrictions. These affected the data collection and as a result, it was not possible to obtain a representative sample for Scotland. UK income and poverty figures are published on the same day by DWP.
Key poverty measures:
Relative poverty: A household is in relative poverty if its income is below 60 percent of the middle household income in the UK (the poverty threshold). Relative poverty is a measure of whether the income of the poorest households are keeping pace with middle income households across the UK.
Persistent poverty identifies the number of people in relative poverty for three or more out of four years. People who live in poverty for several years are affected by it through their lifetime.
Household income is adjusted for household size.
The poverty publications present poverty figures before and after housing costs. Before housing costs figures are a basic measure of household income from earnings and benefits.
After housing costs figures subtract spending on rents, mortgage interest payments and other unavoidable housing costs from this basic income. In Scotland, poverty statistics focus mainly on poverty after housing costs.
The poverty estimates in this summary refer to relative poverty after housing costs.
Child poverty in Scotland is projected to fall to its lowest level in nearly 30 years as a result of the actions taken to date and commitments in the second Tackling Child Poverty Delivery Plan.
More than 60,000 fewer children could be living in relative poverty in 2023 compared to 2017, according to updated modelling.
Social Justice Secretary Shona Robison said a focus on long-term parental employment opportunities, strengthened social security and support to reduce household costs are at the heart of the new four year delivery plan, Best Start, Bright Futures.
In 2022-23 this work will be supported by investment of almost £113 million on top of funding already allocated to ongoing programmes.
Actions include:
Significantly increasing employment services with the aim of supporting up to 12,000 parents to enter and progress in sustainable and fair work through actions taken over the life of the Plan, with initial investment of up to £81 million in 2022-23 in employability support for parents
Increasing Scottish Child Payment from £20 to £25 when the benefit is extended to under 16s by the end of 2022. This means £1,300 of support per eligible child per year. It is five times more than originally asked for by campaigners and an investment of £671 million over the next two years
Delivering a new Parental Transition Fund to tackle the financial barriers parents face in entering the labour market, particularly over the initial period of employment, with an investment of up to £15 million each year
Taking immediate steps to mitigate the UK Government’s Benefit Cap as fully as possible within devolved powers, through Discretionary Housing Payments. This will support our priority families, in particular, who are disproportionately impacted by this policy
Ms Robison said: “I am proud that our actions of the past four years, together with those set out in this plan, are projected to deliver the lowest level of child poverty in Scotland in 30 years.
“We are taking immediate steps to put cash in the pockets of families – tackling the cost of living crisis and helping to lift thousands of children out of poverty in Scotland.
“Our package of five family benefits for low income families, including the increased Scottish Child Payment, will be worth over £10,000 by the time a family’s first child turns 6, and £9,700 for second and subsequent children.
“That is a difference of more than £8,200 for every eligible child born in Scotland in comparison to England and Wales – highlighting the unparalleled support offered by this government to children across the early years.
“We will also build on our investment in employment support for parents, through new skills and training opportunities and key worker support to help reduce household costs and drive longer term change.
“Our national mission to tackle child poverty is already giving more children the best start and a bright future. We are determined to meet our ambitious targets set for 2023-24 and 2030 and beyond, so that no children in Scotland are living in poverty. We know there is not a silver bullet and this cannot be done overnight.”
Scottish Government Minister and Scottish Green Party Co-Leader Patrick Harvie said: “This plan delivers on key commitments to tackle child poverty and inequality in the cooperation agreement between the Scottish Government and the Scottish Green Party.
“We welcome the actions being taken, particularly in mitigating the UK Government benefit cap and increasing the Scottish Child Payment which will provide major support to thousands of low income households.”
Reacting to the Scottish Government’s publication of its Child Poverty Delivery Plan, Peter Kelly, director of the Poverty Alliance said: “Child poverty is unjust and unnecessary. It’s a sign of Scotland’s commitment to compassion and justice that there are stretching targets to end it.
“A clear message from Poverty Alliance members ahead of the new plan was to ‘put money in people’s pockets’. Commitments to increase the Scottish Child Payment to £25 by the end of this year and to mitigate the unjust benefit cap are therefore welcome. With one in four children in Scotland still growing up in the grip of poverty, and the rising cost of living meaning that many more families are being swept into hardship every day, this new plan needed to set out how we can do more to protect people from harm.
“On the back of the Chancellor’s failure of a Spring Statement yesterday, we needed to see real commitments that will make a positive impact on the lives of people on low incomes. Alongside the mitigation of the benefit cap, the expansion of employability support that provides tailored support to families can help to make that impact.
“However, there is significant scope to go much further to ensure that cash makes it to those who most need it. There is clear evidence that increasing the Scottish Child Payment to £40 would have an even greater impact in unlocking families from poverty and take us closer to the target of eradicating child poverty by 2030.
“The rising tide of poverty sweeping across the country demands that the actions contained in this Plan are not the peak of our ambitions, but merely a start. Our efforts cannot and must not cease.”
‘A failure of courage, a failure of compassion and a failure of justice‘ – Peter Kelly, The Poverty Alliance
Chancellor announces Spring Statement tax cut for 2.4 million Scottish workers through rise in National Insurance thresholds – saving the typical employee over £330 a year.
Unveiling plans to give families further help with the cost of living, Rishi Sunak also slashes fuel duty on petrol and diesel by 5p per litre for the next 12 months.
Spring Statement also sets out measures to help businesses boost investment, innovation, and growth – including a £1,000 increase to Employment Allowance to benefit around half a million SMEs across the UK
The UK Government is providing an additional £45 million to the Scottish Government next year as a result of measures announced by the Chancellor today.
The Chancellor delivered a Spring Statement today that ‘puts billions of pounds back into the pockets of hard-working people in Scotland’– unveiling a series of tax cuts to ease the cost of living.
Rishi Sunak announced that National Insurance starting thresholds will rise to £12,570 from July, meaning hard-working people across the UK will keep more of what they earn before they start paying personal taxes.
The cut, worth over £6 billion, will benefit 2.4 million working people in Scotland with a typical employee saving over £330 a year, whilst the typical self-employed person will save over £250. This means the UK now has some of the most generous tax thresholds in the world.
Mr Sunak also announced that fuel duty for petrol and diesel will be cut by 5p per litre from 6pm tonight (23 March) to help drivers across the UK with rising costs. Worth £2.4 billion, this is the biggest cut ever on all fuel duty rates and means a one-car family will now save on average £100.
As a result of a cut to the basic rate of income tax for savings income, taxpayers in Scotland will see benefits worth £3 million. As other income tax rates are devolved in Scotland, the Scottish Government’s funding is automatically increased as a result of this tax cut as set out in the agreed Fiscal Framework. This is initially worth £350 million in 2024-25.
The Chancellor also set out a series of measures to help businesses boost investment, innovation, and growth – including a £1,000 increase to Employment Allowance to benefit around half a million businesses.
As a result of measures in this Spring Statement the UK Government is providing the Scottish Government with an additional £45 million through the Barnett formula next year.
Chancellor Rishi Sunak said:“We’re slashing taxes for millions of hard-working people in Scotland, getting pounds in people’s pockets and helping pay cheques to stretch further – from July more than 2.4 million in Scotland will get a tax cut with the typical employee keeping £330 more each year.
“By cutting fuel duty, we’re making it cheaper for people in Scotland every time they go to the pump, which together with the freeze means people save £100 per car on average a year.
“We’re boosting small business growth by increasing the Employment Allowance – a tax cut worth up to £1,000 for thousands of businesses.”
To grow the world’s very best talent in AI, the UK Government will partner with industry and academia to create 1,000 new AI PhDs. The Government will invest £117m to create PHDs across the UK at Centres for Doctoral Training, building on the existing three sites in Scotland. This will train a new generation of AI researchers who will develop and use AI in areas such as healthcare, climate change and creating new commercial opportunities.
Delivering the statement, the Chancellor made clear that our sanctions against Russia will not be cost-free for people at home, and that Putin’s invasion presents a risk to our economic recovery – as it does to countries all around the world.
However, announcing the further measures to help people deal with rising costs, he said the extra support could only be provided because of the UK’s strong economy and the tough but responsible decisions taken to rebuild our fiscal resilience.
The immediate financial support for people and businesses comes as part of a wider tax plan announced by the Chancellor that will create better conditions for growth and will share proceeds from growth more fairly – ensuring people can keep more of what they earn.
Mr Sunak also announced that the Scottish Government will receive £41 million more funding as there will be an extra £500 million for the Household Support Fund, which doubles it’s total amount to £1 billion to support the most vulnerable families with their essentials over the coming months.
The Chancellor also reduced the VAT on energy saving materials such as solar panels, heating pumps and roof insulation from 5% to zero, helping families become more energy-efficient.
This cost of living support comes on top of the measures that the Chancellor has already announced over the recent months to support families. This includes an over £9 billion energy bill rebate package, worth up to £350 each for around 28 million households, an increase to the National Living Wage, worth £1,000 for full time workers, and a cut to the Universal Credit taper, worth £1,000 for 2 million families.
The Spring Statement also confirms that:
A new Efficiency and Value for Money Committee will be set up to cut £5.5 billion worth of cross-Whitehall waste – with savings to be used to fund public services.
£50 million new funding to create a Public Sector Fraud Authority to hold departments to account for their counter-fraud performance and to help them identify, seize and recover fraudsters money.
Local residents across the UK will benefit from a fresh set of infrastructure projects as we open the second round of the £4.8 billion Levelling Up Fund. It will continue to focus on regeneration, transport and cultural investments.
Chancellor’s statement ‘a failure of courage and compassion’, says Poverty Alliance
Reacting to today’s Spring Statement, Peter Kelly, director of the Poverty Alliance, said: “Government should be about compassion and justice, and making sure people are able to live as full a life as they can.
“The Chancellor said his Spring Statement today was all about security. Yet his plans show a failure to comprehend the situations being faced by households across the country, leaving them with insecure and falling incomes in the face of rising costs.
“Amid a rising tide of poverty, the Chancellor could have thrown a lifeline by increasing benefits in line with inflation and by scrapping the unjust benefit cap. Instead he has provided additional funding of only £500m to the Household Support Fund which, although welcome, will quickly be consumed by the rising cost of living for families on the lowest incomes.
“The increase in the National Insurance threshold has also been presented as a support to people living on low incomes. In reality two thirds of this effective tax cut will go to middle and higher income households.
“By ignoring the tidal wave of rising living costs that is pulling so many people into poverty, the Chancellor has made clear his priorities. His tax cutting agenda will generate positive headlines, but could see another 400,000 people across the UK swept into poverty.
“Ultimately, the Chancellor’s statement is a failure of courage, a failure of compassion, and a failure of justice.”
The UK Government has not delivered the support and help that families and businesses need today, according to Finance Secretary Kate Forbes.
Responding to the Spring Statement, Ms Forbes said the Chancellor failed to help thousands of worried households facing poverty as a result of soaring energy bills and a cost of living crisis.
In 2018/19, the Scottish Government introduced a more progressive approach to tax, including a 19% starter rate band below the basic rate, ensuring those who can afford to pay a little more do so.
Ms Forbes said: “The Spring Statement has failed to address the biggest challenges facing households today. With soaring energy bills and a cost of living crisis, the Chancellor has not used his Spring Statement sufficiently to provide lifeline support that could prevent households facing fuel poverty.
“The Scottish Government is providing a further £10 million to continue our Fuel Insecurity Fund into 2022-23, which supports people struggling with their energy bills. Most powers relating to the energy markets remain reserved and Scottish Ministers have repeatedly called for the UK Government to urgently take further action to support households – including a reduction in VAT on household energy bills and support for those on low incomes.
“We are doing all we can to tackle the cost of living crisis – including doubling the Scottish Child Payment from £10 per week per eligible child to £20 next month. The UK Government should have followed our lead and matched the 6% uprate on social security benefits which the Scottish Government is adding to eight of the benefits we deliver. The Chancellor failed to match that commitment which could have provided lifeline support to thousands of households.
“On taxation, we have already acted to introduce a 19% starter rate of income tax below the basic rate, in line with our commitment to progressive taxation, which makes Scotland the fairest taxed part of the UK. We will continue to take that approach when we set taxation policy in future budgets.”
In the midst of the biggest wages and bills crisis in living memory, Rishi Sunak’s Spring Statement has failed families who need help NOW, says the TUC.
He didn’t stand up for families. He didn’t take the opportunity to stand up to the bosses who’ve sacked hundreds of workers at P&O. And he didn’t set out a plan to get wages rising – leaving the average workers facing a wage cut of over £500 this year.
Fund efforts towards a peaceful solution to the conflict in Ukraine
Take additional measures to support families in the UK with rising energy prices
Deliver the long-term changes needed for a high-wage, high skill, high productivity economy
Below we set out how the spring statement matched up to our tests and assess what it means for working people.
The Chancellor didn’t deliver an immediate boost to pay
Workers’ pay prospects from the statement don’t look good. The OBR forecasts real weekly wages to fall by £11p/w (2.0 per cent) in 2022, and fall again in 2023. This will put wages back below their 2008 levels (after a brief recovery in 2021), where they’ll stay until 2025. And even this contains some optimistic wage forecasts, with the OBR forecasting pay before inflation to rise by as much as 5.9 per in Q3 2022.
The OBR forecasts that the 2022-23 financial year will see the biggest fall in living standards since records began in 1956-57, explaining that the “failure of nominal earnings growth to keep pace with rising inflation” is a “key factor” in this.
It adds that the policy measures announced since October only “offset a third of the overall fall in living standards that would otherwise have occurred in the coming 12 months”.
But there was no action to tackle falling pay in the Chancellor’s statement: nothing on raising the minimum wage, or funding public sector pay rises, and no recognition that collective bargaining (and union presence) is the most sustainable way to get wages rising.
Measures to support families in the UK with rising energy prices and the cost of living were totally inadequate
The spring statement offers little good news for struggling families, especially those in receipt of benefits.
Benefits uprating
Worst of all there was no increase in the basic rate of benefits. As it stands, the standard allowance for Universal Credit and legacy benefits is set to rise by 3.1 per cent in April 2022. But this is far below the latest inflation figure (CPI is 6.2% in Feb 2022 and RPI is 8.2%), with inflation forecast to rise higher in the coming months.
This will leave those on benefits facing a real terms cut at a time when energy bills are rising by 54 per cent. The families who need the most help have been left totally out in the cold by the Chancellor today.
The decision not to cut benefits in real terms will particularly impact those who are unable to work. This reflects a wider ignorance of the equalities impact of the cost of living crisis.
We also didn’t see a reversal of the decision to suspend the state pension triple lock. The decision to abandon the pensions triple lock will cost pensioners almost £500 a year. Pensioners are particularly vulnerable to price hikes as they spend a higher percentage of their income on food and fuel.
Targeted support
The big new announcement for targeted support for low-income households was £500 million in additional funding for the Household Support Fund – a temporary discretionary fund run by local authorities. This scheme was set to end this month, and the initial funding was £500 million.
This extra money is worth less than £10 each to the six million families claiming Universal Credit – in the unlikely event they hear about it and are able to jump through the hoops needed to claim it. And contrast this £500 million to the £10 billion cut to benefit spending in 2022-23 as a result of not uprating benefits in line with inflation.
Income tax and national insurance threshold
Changes to tax cuts won’t help the families who need it most now. Raising the National Insurance threshold mostly benefits middle earners and, compared to increasing benefits payments, does little to help those with low income. This can be seen in the chart below, from the Resolution Foundation.
And promises of income tax cuts tomorrow do nothing for families facing cuts to their living standards now.
And the Chancellor has missed another opportunity to raise sick pay and make it available to all. Living with Covid requires decent sick pay for all, yet we’re still waiting for government to take action on this.
VAT-free insulation and solar panels
Alongside this was the removal of the 5% Value Added Tax currently applied to building materials, like home insulation and solar panels. But this only benefits families who own a home and can afford to renovate it anyway.
The Chancellor should’ve taken the opportunity to invest in home retrofits at scale. Improving the average UK home’s energy efficiency to band C would reduce the country’s gas demand by 15% and cut hundreds of pounds off fuel poor homes’ energy bills. A massive social homes retrofits programme, delivered by local authorities, could also create over a quarter million good jobs over two years. But here again the Chancellor failed to act.
Transport
The 5p cut on fuel duty does next to nothing to support those at the sharp end of the wages and bills crisis. Analysis by NEF estimates that a third of this tax cut will go directly to the richest 20% of households, while the poorest 20% will on average only receive £5 per month. To make transport truly affordable for everyone, Government should be expanding bus and rail services in the public sector.
The Chancellor didn’t talk about the long-term changes needed for a high-wage, high skill, high productivity economy
We heard nothing on reforms to corporate governance, industrial strategy or expanding the public sector workforce to deliver the decent public services we need to level up.
The Chancellor did announce a review of the apprenticeship levy. We believe that any changes to the levy should focus on significantly increasing the number of high-quality apprenticeships and widening access to groups facing long-standing barriers. A review must not be an exercise in allowing employers to duck their responsibilities on apprenticeships.
And much more than this is urgently needed to tackle the shortfall in training, including increased government skills funding and new workplace training rights to expand opportunities for everyone to upskill and retrain.
The Chancellor didn’t stand up to the scandalous behaviour by bosses P&O
The Chancellor talked about security but did nothing to take on the bosses who take every measure to undermine their workers’ job security. He could’ve made it clear that no employer who treats workers with the contempt shown by P&O Ferries would receive a penny of public money until they reinstate their workforce, including by taking freeports contracts off DP World, the parent company of P&O.
Yet once again the Chancellor failed to mention the issues that matter to working people.
The government’s response to those fleeing conflict and war is inadequate
The Spring statement document outlines the £400m in humanitarian support the government has given to Ukraine, and says it has committed “to provide local authorities with £10,500 per person for support services, and between £3,000 and £8,755 per pupil for education services depending on phase of education, as well as £350 per month for sponsors for up to 12 months”.
But it’s clear that the government’s support for the people fleeing war and conflict is worse than inadequate. The Ukraine for Homes scheme is no substitute for a properly funded system that provides universal refugee protection. And yesterday, the Government’s nationality and borders bill, passed a vital stage in the House of Commons, meaning that those fleeing conflict may find themselves treated as criminals and deported, instead of finding sanctuary.
The Chancellor let families down today.
Families are facing soaring bills at a time when their incomes have been squeezed by years of wage cuts and attacks on the social security system. The wages and bills crisis is a consequence of decisions taken by successive governments. Today the Chancellor chose to make the pain last for longer.
THERE WAS SOME PRAISE FOR SUNAK’S MINI-BUDGET, HOWEVER:
Simon Roberts, Chief Executive Officer, Sainsbury’s said:“We know our customers and colleagues are concerned about increases to the cost of living and at Sainsbury’s we are doing everything we can to support them.
“We really welcome today’s changes to fuel duty and national insurance. We are passing a 6 pence per litre cut in fuel across our forecourts from 6pm tonight as we know fuel costs are one of the biggest pressures everyone is facing right now.
“We were pleased to welcome the Chancellor to one of our stores today to discuss what we are doing to offer customers great value and to invest over £100 million in increasing pay for our colleagues with a new hourly rate of £10 per hour nationally and £11.05 in inner London.”
Michelle Ovens CBE, Founder, Small Business Saturday said:“Moves in today’s Spring Statement to increase the employment allowance, reduce fuel duty and raise the National Insurance threshold are welcome, and will go some way to help businesses deal with rising costs.
“In particular, It is good to see the immediacy of this rise in employment allowance.”
Martin McTague, Chair, Federation of Small Businesses, said:“We are very pleased to see the Chancellor adopting our top ask for this Spring Statement: uprating the Employment Allowance to help small employers with national insurance costs.
“We originally put forward the Employment Allowance as a targeted measure to help small firms, and it has now been expanded three times since its creation.
“Together with a cut to fuel duty, these measures will provide crucial breathing space for our embattled small employers.
“This Spring Statement marks a good starting point, with welcome measures on business rates, net zero and energy investment taking effect next month.
“With steep inflation, energy bills increasing fast, without the same support in place as enjoyed by consumers, and hiring pressures landing hard on small firms, more of the right stuff will be needed in the autumn given this challenging backdrop.
“We’ve seen a VAT cut on net zero investments for households today, which is good for small firms involved in their installation.
“However, a high street shop or local bar cannot access the same support that consumers do when dealing with the same energy supplier, and they should have access to the same assistance to reduce energy use and support the move to net zero.
“We look forward to working with the Chancellor on his new tax plan. Achieving the new culture of enterprise vision he rightly aspires to, alongside levelling up aspirations, will mean putting community small firms and sole traders front and centre of reforms.
“That means taking more of them out of the business rates system, protecting SME R&D investment incentives and delivering on commitments to end an endemic late payment culture that destroys thousands of firms a year.”
Alex Towers, Director of Policy and Public Affairs, BT Group said:“We welcome the Chancellor’s focus on tax reforms for business investment, given how central this is to UK infrastructure and growth.
“This is particularly important for BT Group as we make once in a generation investments to build the UK’s full fibre broadband and 5G networks. The existing super-deduction has already helped us to significantly increase and accelerate that investment.
“We agree that longer-term incentives are now needed, to support this country’s growth and competitiveness, and we will be keen to contribute evidence to aid the Government’s decision-making.”
Dr Clive Hickman OBE, Chief Executive, the Manufacturing Technology Centre said: “We welcome the Spring Statement, which outlines concrete steps to ensure that the manufacturing sector remains competitive, sustainable, and resilient.
“The Government’s commitment to cut tax rates on business investment is important if the UK is to boost manufacturing productivity and create high-quality jobs. In addition, the reform to R&D tax credits is a very positive step that will enable the scheme to be more effective, better value for money, and more generous.
“These measures will be crucial to spur innovation and encourage investment across the country.”
Julian David, Chief Executive, TechUK said: “Rightly the majority of the Spring Statement focused on addressing the cost of living concerns resulting from the war in Ukraine and rising inflation. Along with this vital action, the Chancellor also outlined a welcome package of consultations and policy programmes aimed at boosting businesses investment.
“In our recent Digital Economy Monitor Survey UK tech companies said increasing support to invest in R&D would be their top ask of Government, with 76% saying R&D is important to their business operations in the UK.
“The proposals unveiled today to further expand R&D tax credits and consult on ways to maintain the tax deduction for capital expenditure have the potential to unlock more investment into UK innovation.
“However, to get this right the Government must ensure that the software and intangible assets that power modern business investment are kept in scope. Otherwise, the Government risks missing an opportunity to unleash the potential of tech led growth.”
Dom Hallas, Executive Director, COADEC said:“Better R&D tax credits would mean more innovation from startups and innovative companies.
“We’re delighted the Chancellor recommitted to expanding it to cover cloud and data costs – and look forward to discussing the many ways to improve the credit further.”
Irene Graham OBE, Chief Executive, ScaleUp Institute said: “In the face of increasing pressures of inflation and wider international uncertainties, it is very good to see the Spring Statement continues to recognise the importance of business growth and innovation.
“It reaffirms policies targeted towards R&D, people and skills, investment, and innovation including the new Innovation Challenge across central government departments. We will continue to work closely with the Government on the evolution and development of these policies which are so vital to our scaleup economy.”
Michael Moore, BVCA Director General, said:“Increased business investment is key to the future of the UK economy and we welcome the measures announced by the Chancellor today which support this objective.
“Private capital’s focus on sectors like AI, robotics and fintech has helped the UK to become a world leader in these areas – further reform of R&D tax credits will help businesses to drive further innovation and strengthen the UK’s position in this new economy.”
Fuel Duty
Edmund King, President, the AA said: “The AA welcomes the cut in fuel duty. However, we are concerned that the benefit will be lost unless retailers pass it on and reflect a fair price at the pumps. Average pump prices yesterday hit new records- despite the fall in wholesale costs.
“The Chancellor has ridden to the rescue of UK families and businesses who use their vehicles, not for pleasure, but to function in their daily lives. Since the start of the year, the 20p-a-litre surge in pump prices has been the shock that rocked the finances of families, and particularly young drivers, pensioners and lower-income workers who need to commute each day.
“AA research showed that even in November, when petrol pump prices set new records at around 148p a litre, 43% of drivers were cutting back on car use, other spending to compensate or both. That rose to 59% among young drivers and 53% among the lower-paid. Petrol started this week averaging 167p a litre.
“On top of the duty cut, there has been a substantial reduction in wholesale road fuel costs feeding through to the forecourts since 9 March. That needs to drive lower pump prices also. The road fuel trade shouldn’t leave the Treasury to do the heavy lifting when cutting motoring costs.”
Elizabeth de Jong, Director of Policy, Logistics UK said:“With average fuel prices reaching the highest level on record and rising inflation, there has been an unstainable burden on logistics businesses which operate on very narrow margins of around 1%; the Chancellor’s decision today will help to ensure operators can continue to afford supplying the nation with all the goods it needs, including food, medicine and other essential items.
“Fuel is the single biggest expense incurred by logistics operators, accounting for a third of the annual operating cost of an HGV. The cut in fuel duty of 5ppl will result in an average saving of £2,356 per year per 44-tonne truck; this move will help to strengthen the UK’s supply chain during a time of ongoing financial and operational challenges.”
Zero rating VAT in energy efficiency measures
David Cowdrey, Director of External Affairs, MCS said:“The Chancellor has used the Spring Statement as an opportunity to kick-start the home heating revolution by zero rating VAT on home energy efficiency and renewable technologies for five years.
“This announcement allows people to insulate their homes and save on our fuel bills, making houses cheaper to run, especially when gas prices are at a record high.
“The government’s bold move to zero rate VAT can help the UK meet its net zero targets by using proven, off the shelf, zero carbon domestic energy solutions, such as solar and heat pumps, which are ready to be upscaled now.“
Professor Robert Gross, Director, U.K. Energy Research Centre, Professor of Energy Policy, Imperial College said:“The VAT cut on energy efficiency products is a great first step in helping households adopt simple measures to help cut fuel bills for the coming winter.
“Better insulated houses need less energy to keep warm and this is good for our bills, energy security and the environment.”
Amy MacConnachie, Director of External Affairs, Association for Renewable Energy and Clean Technology (REA), said:“The REA warmly welcomes today’s announcement to remove VAT on domestic renewables for five years. We have long campaigned for this change because we know these installations will help protect people from volatile gas prices and reduce their energy bills, while also supporting the transition to Net Zero and providing a catalyst for new jobs and investment across the country.
“The move to bring forward business rate exemptions for green technologies from April 2022, including solar panels and heat pumps, will help to further drive down costs and support the decarbonisation of buildings.
“We now want to see the Government clarify and go further on the range of technologies included as Energy Saving Materials, particularly energy storage, but this is a positive package of measures for our sector.
“We stand ready to deliver an energy future which is independent, secure, and stable.”
UP TO £660 PER YEAR COULD BE SLASHED FROM HOUSEHOLD INCOME
In a letter to the chancellor last week, the Bank of England stated that it expected inflation to be “around 8 per cent” this spring. With Universal Credit set to rise by just 3.1 per cent in April, families with children on universal credit now face a real-terms cut of around £660 per year, on average.
This is an increase on Child Poverty Action Group’s original analysis which showed a cut of £570, when inflation was expected to be 7.25 per cent.
The £20 cut to universal credit last October plunged out-of-work benefits to their lowest level in 30 years. Latest analysis shows that the picture for families is going from bad to worse.
Without government action, families will be pulled deeper into poverty. Increasing benefits by anything less than 8 per cent risks pushing those with already stretched budgets past breaking point.
Anti-poverty charities wrote to the Chancellor last weekcalling for a minimum 7% benefits rise:
Prices are rising at the fastest rate in 30 years, and energy bills alone are going to rise by 54% in April. We are all feeling the pinch but the soaring costs of essentials will hurt low-income families, whose budgets are already at breaking point, most.
There has long been a profound mismatch between what those with a low income have, and what they need to get by. Policies such as the benefit cap, the benefit freeze and deductions have left many struggling.
And although benefits will increase by 3.1% in April, inflation is projected to be 7.25% by then. This means a real-terms income cut just six months after the £20 per week cut to universal credit.
Child Poverty Action Group’s analysis shows families’ universal credit will fall in value by £570 per year, on average. The Joseph Rowntree Foundation has calculated that 400,000 people could be pulled into poverty by this real-terms cut to benefits.
The government must respond to the scale of the challenge. Prices are rising across the board. Families with children in poverty will face £35 per month in extra energy costs through spring and summer, even after the government’s council tax rebate scheme is factored in. These families also face £26 per month in additional food costs. The pressure isn’t going to ease: energy costs will rise again in October.
A second cut to benefits in six months is unthinkable. The government should increase benefits by at least 7% in April to match inflation, and ensure support for housing costs increases in line with rents. All those struggling, including families affected by the benefit cap, must feel the impact.
Much more is needed for levels of support to reflect what people need to get by, but we urge the government to use the spring statement on 23 March to stop this large gap widening even further. The people we support and represent are struggling, and budgets can’t stretch anymore.
Alison Garnham, Chief Executive, Child Poverty Action Group
Emma Revie, Chief Executive, The Trussell Trust
Graeme Cooke, Director of Evidence and Policy, Joseph Rowntree Foundation
Morgan Wild, Head of Policy, Citizens Advice
Dan Paskins, Director of UK Impact, Save the Children UK
Imran Hussain, Director of Policy and Campaigns, Action for Children
Thomas Lawson, Chief Executive, Turn2us
Sophie Corlett, Director of External Relations, Mind
Dr Dhananjayan Sriskandarajah, Chief Executive, Oxfam GB
Caroline Abrahams, Charity Director, Age UK
Eve Byrne, Director of Advocacy, Macmillan Cancer Support
Kamran Mallick, CEO, Disability Rights UK
Katherine Hill, Strategic Project Manager, 4in10 London’s Child Poverty Network
Karen Sweeney, Director of the Women’s Support Network, on behalf of the Women’s Regional Consortium, Northern Ireland
Satwat Rehman, CEO, One Parent Families Scotland
Mark Winstanley, Chief Executive, Rethink Mental Illness
James Taylor, Executive Director of Strategy, Impact and Social Change, Scope
Irene Audain MBE, Chief Executive Scottish, Out of School Care Network
Steve Douglas CBE, CEO, St Mungo’s
Richard Lane, Director of External Affairs, StepChange Debt Charity
Robert Palmer, Executive Director, Tax Justice
Claire Burns, Director, The Centre for Excellence for Children’s Care and Protection (CELCIS)
The Disability Benefits Consortium
Dr. Nick Owen MBE, CEO, The Mighty Creatives
Peter Kelly, Director, The Poverty Alliance
Elaine Downie, Co-ordinator, The Poverty Truth Community
Tim Morfin, Founder and Chief Executive, Transforming Lives for Good (TLG)
UCL Institute of Health Equity
Dr Mary-Ann Stephenson, Director, Women’s Budget Group
Natasha Finlayson OBE, Chief Executive, Working Chance
Claire Reindorp, CEO, Young Women’s Trust
Businesses in Scotland are also calling for the Chancellor to announce new measures to help with rising costs ahead of his Spring Statement tomorrow, according to a recent survey from Bank of Scotland.
As inflation hits the highest levels seen since 1992, over half (55%) of Scottish businesses said that direct help with energy bills and rising costs tops their wish list for the Chancellor. This was followed closely by calls for a reduction in VAT, cited by two-fifths (40%), while almost a quarter of firms (23%) want increased funding to help create new jobs and develop skills.
Rising prices remain a key challenge for business. Almost half (46%) of respondents said they are concerned about having to increase the costs of goods and services and over one in ten (14%) stated that inflation is reducing profitability. Almost one in ten (9%) said rising prices had caused them to worry about having to make staff redundant and a further one in ten (9%) were concerned about not being able to pay their bills.
To help specifically with rising prices Scottish businesses are asking the Chancellor for a VAT reduction (46%), while a third (35%) have called for grants to cover rising energy costs. A further quarter (23%) called for grants to support investment in energy saving measures.
The data comes as businesses face continuing supply chain challenges, which are reducing the availability of stock (40%), causing hikes in freight costs (39%) and disruption through Rules of Origin and VAT requirements from EU suppliers (33%).
Fraser Sime, regional director for Scotland at Bank of Scotland Commercial Banking, said:“Rising prices are causing multiple challenges for businesses across Scotland and the pressure from inflation shows no sign of abating in the near-term.
“As we wait for the Chancellor’s Spring Statement, we’ll continue to remain by the side of business in Scotland and support the country’s ongoing economic recovery from the pandemic.”
Responding to the ONS public sector finances statistics for FebruaryChancellor of the Exchequer, Rishi Sunak said:“The ongoing uncertainty caused by global shocks means it’s more important than ever to take a responsible approach to the public finances.
“With inflation and interest rates still on the rise, it’s crucial that we don’t allow debt to spiral and burden future generations with further debt.”
“Look at our record, we have supported people – and our fiscal rules mean we have helped households while also investing in the economy for the longer term.”
All will be revealed when the Chancellor delivers his Spring Statement (Budget) at Westminster tomorrow.
MSPs have today (Wednesday 26th January) launched a call for evidence on the impact of poverty-related stigma, after being told by experts that negative and discriminatory attitudes towards people living in poverty are continuing to blight the lives of people across Scotland.
The Scottish Parliament’s Cross-Party Group on Poverty, which brings together MSPs from all parties with organisations working to tackle poverty in Scotland, have issued the call as part of their new inquiry into the causes, impacts of and solutions to poverty-related stigma in Scotland.
At an evidence session held yesterday (Tuesday 25th January) as part of the inquiry, MSPs heard evidence from Professor Imogen Tyler (Lancaster University), Professor Tracy Shildrick (Newcastle University) and Dr Greig Inglis (University of the West of Scotland).
The three academics, all of whom specialise in the links between stigma and poverty, told the inquiry that:
Stigma is created by a combination of factors, including media depictions of poverty and the creation of media and political narratives that portrays people on low incomes as ‘undeserving’ of support
Negative experiences of public services, for example experiences of judgemental attitudes from staff, can entrench feelings of stigma and shame
Stigma is directly linked to poorer mental health and lower levels of wellbeing
Key to tackling stigma is to involve people with experience of poverty in the design of services, particularly the social security system.
Now, MSPs have issued a call for written evidence to be submitted to the inquiry. They’re asking for people and organisations from across the country to feed in their experiences and perspectives of poverty-related stigma, to help inform and shape their final report, which is due to be published in May.
As well as the call for written evidence, the group will also be holding further evidence sessions with people working in the media, as well as with people who have experience of poverty.
Peter Kelly, Director of the Poverty Alliance, said: “Too many people living on low incomes across Scotland face challenges and barriers because of the stigma associated with poverty.
“This can impact on the kind of support people are able to access, the treatment by public services, the media and the wider public, and most importantly on individual mental health and wellbeing.
“The Cross-Party Group on Poverty’s new inquiry offers the opportunity to explore some of the drivers of poverty-related stigma as well as, importantly, what the solutions are.
“Critical to the success of the inquiry will be the involvement of people with experience of poverty, who will help shape the inquiry’s findings and key recommendations.”
Pam Duncan Glancy MSP, Deputy Convenor of the CPG on Poverty, said: “Stigma is not only unfair and causes real pain for people, it stops people accessing the essential support they need. That traps people in poverty.
“People in Scotland living in poverty need support and action, not blame and suspicion. They have seen far too little support for far too long.
“If we’re to reduce poverty in Scotland, we have to end the stigma of it, and take down all barriers to getting support.
“I am pleased the Cross Party Group on Poverty have created an opportunity to dig deeper on this. This will give us a clearer idea of how to break down barriers – and empower people to speak up and reach out when they require support.”
For full details on the call for evidence, including how to submit your views, click here.
The Fraser of Allander Institute has tday published a new report, jointly authored with @MMUPolicyEval & @PovertyAlliance, that explores some of the challenges and opportunities that the Scottish Government faces in meeting its Child Poverty Targets:
Around 1 in 4 children in Scotland live in relative poverty. This means they live in a household with an income 60% below the UK median income after housing costs have been deducted.
Child poverty can have serious and lifelong impacts across a range of outcomes, and the Scottish Government have stated their aim to reduce significantly the incidence of child poverty. The Child Poverty (Scotland) Act 20172 includes a target to reduce relative child poverty to 10% by 2030/31.
Meeting this target would represent an unprecedented reduction in child poverty to levels not seen in Scotland certainly since the early 1990s when the current statistical series began.
The purpose of the analysis in this report is to look at some of the large, national level, devolved policy levers that the Scottish Government could use to meet the targets. We have focussed on childcare, employability programmes and social security.
By analysing variations of these types of policies, and different combinations, this analysis illustrates the scale of the impact on poverty and the associated costs and benefits of different options.
We envisage that this will be helpful for policymakers and stakeholders who will be focused on developing actions for the next Tackling Child Poverty Delivery plan, due to be published by the Scottish Government by the end of March 2022.
The 2022-2023 Scottish Budget will help transition Scotland to becoming more prosperous, fairer and greener, Finance Secretary Kate Forbes has said.
Speaking ahead of delivering the Budget to Parliament today, Ms Forbes said the Scottish Government will deliver a bold and ambitious package of public investment that delivers on the priorities which matter most to the people of Scotland.
Ms Forbes said: “The Scottish Budget will provide taxpayers with stability and support, set out clearly how we will accelerate our Covid recovery, and crucially, how our spending plans will set Scotland on a new ambitious path.
“It has been a challenging Budget due to the continuing impact of the pandemic, and the uncertainty and worry that Covid poses for us all. This has been confounded by the UK Government’s decision to remove necessary Covid consequential funding at a time when we undeniably need to help our public services.
“The Scottish Government has taken spending decisions that prioritise supporting people and our vital public services through the twin crises of Covid and the cost of living. It is a budget for Scotland’s future – one that will help us secure a fairer, greener and more prosperous country.”
Responding to the Scottish Budget, Tracy Black, CBI Scotland Director, said:“While the Finance Secretary has outlined some helpful interventions for business, firms that have been working tirelessly to get back on their feet after two miserable years will be left with little to get excited about.
“The removal of the business rates cliff edge in April for hospitality, retail and tourism firms will be welcomed, however many will be disappointed that the government hasn’t gone further – particularly as uncertainty around Omicron gathers pace.
“Increased funding for employability is clearly a step in the right direction but much more detail is needed on how skills funding will help firms address immediate challenges. Ultimately, greater ambition is needed on upskilling and retraining if we’re to ensure workers are equipped with the skills they need for a modern economy.
“On green investment there were some welcome announcements around green jobs and just transition. However, failing to use the non-domestic rates system to incentivise private sector investment in low carbon infrastructure feels like a missed opportunity that could have helped Scotland push-on towards its net zero target.
“Overall, business shares the Scottish Government’s vision for a fairer, greener and more prosperous economy. Firms will be keen to see how the forthcoming National Economic Transformation Strategy turns ambition into action; setting Scotland on a path towards competitiveness, dynamism and productivity growth – which is the only sustainable route to higher living standards.”
Scottish workers bitterly disappointed by pay deal as STUC insists ‘budget will result in robbing Peter to pay Paul’
The Scottish Trades Union Congress (STUC) acknowledged the increase in public sector pay floor to £10.50 and insisted that pay rises must be fully funded by Scottish Government to avoid cash strapped councils having to make other cuts to pay the increased rate.
STUC General Secretary Roz Foyer said: “Workers across Scotland will be bitterly disappointed as they hear about the pay cuts announced today. Below inflation pay increases do nothing to help people deal with escalating costs this winter. Councils will have to rob Peter to pay Paul as services could be cut to meet the gaps in funding.
“There is a desperate need to back our public services. Huge gaps in funding in the NHS and social care have left some of the most vulnerable people in our communities without the treatment and services they urgently need. The Scottish Government have failed to take the opportunity before them to step up and back public sector workers.”
COSLA released its ‘Budget Reality’ document last night in response to the Scottish Budget.
COSLA’s Resources Spokesperson Councillor Gail Macgregor said that COSLA Leaders will meet today to discuss the implications for Local Government and respond more fully then.
In a brief statement Councillor Macgregor, said: “Our ‘Budget Reality’ document is important as it sets out the facts about the Local Government Settlement.
“It appears to be a disappointing budget for the communities that we represent, as it does not give Local Government what we need to survive and nor does it meet our campaign aspiration to help those communities to ‘Live Well Locally’,
“Once more, our core financial settlement has been hit.
“That said, we will take time to consider the finer details of today’s announcement and the full implications for both ourselves and our communities.
“As a membership organisation, our Council Leaders will come together virtually tomorrow to consider the implications, before we make a more formal response following that meeting.”
Responding to the Scottish Government’s budget, which was published today, Peter Kelly (Director, Poverty Alliance), said: “Today’s Scottish Government budget contains a number of welcome commitments.
“Doubling the Scottish Child Payment from April, as we and so many others across Scotland campaigned hard for, will help stem the rising tide of poverty across the country. Introducing free bus travel for young people under 22 is also a positive step toward a transport system that can tackle inequality.
“But with over one million people in Scotland living in the grip of poverty, it is clear that we cannot let up. In 2022 we must see these actions built upon, with further steps taken to build a Scottish social security system that unlocks people from poverty.
“We must also go further in redesigning our public services, like by extending free bus travel available to all under 25s and to everyone on low incomes.”
Scottish debt help charity welcomes the doubling of the Scottish Child Payment in the Scottish Budget
Child poverty is rising in every local authority in Scotland. Even before the pandemic, one in four children in Scotland were growing up in poverty and food bank use has increased by 63% over the last five years.
The pandemic has made things even more difficult for those already struggling as it has disproportionately impacted people living on low incomes.
CAP Scotland National Director, Emma Jackson, says, “We are delighted to hear about the Scottish Government’s commitment to double the Scottish Child Payment for families with children under the age of six.
“This is the single most impactful action that will take us four percentage points closer to reaching our interim child poverty targets and signals that ending child poverty will be a defining priority for Scotland. It is encouraging to see Scotland leading the way with this unique payment for families.
“This additional income will make a significant difference for the families we work with at Christians Against Poverty (CAP) Scotland. Families like Holly’s, who experienced problem debt after an overnight reduction in hours at work. Coupled with ill health and the challenges of being a single parent, debt began to deeply impact all aspects of Holly’s life.
“Through working with CAP Scotland, Holly was able to access the right debt solution for her and begin a debt free fresh start. The additional £40 per month will mean not having to worry as much about keeping her home warm for her and her son or buying him more food.
“Yet the very real challenges of making a low income stretch far enough to meet essential living costs remains. We welcome the news of free bus travel for those under the age of 22, the extension of free school meals to older age groups and the accelerated roll out of the Scottish Child Payment to include all children under the age of 16 by the end of next year. However, we would urge the Scottish Government to do all it can to bring the roll out of the Scottish Child Payment forward.
“With the rising cost of living and the end to the Universal Credit uplift, many families are facing a significant struggle this winter. We’re concerned that even more people will be pushed into poverty. We are keen to hold the Scottish Government to their commitment that “we can’t leave anyone behind”.
“The announcements in today’s budget leave a risk that key groups could experience further hardship. For too many households we work with at CAP, like single adult households, there is insufficient income to cover everyday essentials – rent, food, fuel, toiletries – and borrowing money is often a necessity to survive. No one should be forced into problem debt in order to survive.”
The Scottish budget 2022-23 includes £150 million for walking, wheeling and cycling, an increase of £19.6m.
Living Streets Scotland, part of the UK charity for everyday walking has welcomed the significant funding and the impact it will have to make cleaner and healthier forms of transport.
Stuart Hay, Director, Living Streets Scotland said: “Today marks a fundamental and positive change in how transport is funded with a much greater focus on people walking, wheeling and cycling.
“Walking accounts for 22% of all trips, so it’s great to see spending levels reflecting this reality, switching from a focus on new road schemes that have resulted in congestion and emissions.
“The £150 million investment will make it easier, safer and more attractive for more people to choose cleaner ways to travel. This is vital in the face of a climate emergency and a crisis in public health brought about by inactivity.
“This level of investment means new projects, such as national action to get more children walking to school are possible. It also makes plans to cut traffic on Scotland’s roads and streets by 20% more realistic.”
Responding to the Scottish Government’s Budget for 2022-23, Dr Liz Cameron, Chief Executive of the Scottish Chambers of Commerce said:“Scotland’s economy is recovering from the COVID-19 pandemic faster and stronger than many expected, and this budget offered the Scottish Government an opportunity to accelerate this return to growth.
“Whilst there was much to welcome in this budget the Scottish Government should have gone further to support Scotland’s businesses, the drivers of economic growth.
“Many economic deterrents as a result of the pandemic remain in place, impacting on footfall on our town and city centre high streets, driving down demand in our vital tourism and aviation sectors, and the looming threat of a return to greater level of restrictions is holding back investment. The Scottish Government should have provided assurances for businesses that targeted financial support will be made available to those ongoing affected sectors to deliver a clear pathway to recovery.”
On Non-Domestic Rates:
“Businesses will welcome the extension of rates reliefs afforded to properties in the retail, leisure, and hospitality sectors for an additional three months, however, this should have gone further to give businesses the time they need to recover from this incredibly challenging period.
“Scotland’s town and city centres have already lost thousands of businesses over the past twenty months and prolonged periods of home working have made the trading conditions for brick-and-mortar retailers tougher than ever, and many ratepayers will question if this extension goes far enough to support them.
“It was also disappointing that the Scottish Budget failed to confirm whether or not the long awaited NDR Revaluation due to take place in 2023 will go ahead as planned.”
Training, Skills and Supply Chain:
“Scotland’s businesses are still experiencing challenges through supply chain connectivity problems, rising cost prices, inflationary pressures, and recruitment difficulties.
“Additional funding for training interventions at all levels is welcome news and investment in Scotland’s workforce drive up business capacity and improve investment opportunities.
“Cost pressures and supply chain challenges require urgent action from government and whilst we await further details in the forthcoming National Economic Transformation Strategy, it’s important Scottish Government act now, collaborate with business and begin to resolve these issues as a priority for our economy.”
Energy and Just Transition:
“The energy sector remains a critical part of Scotland’s economy and the funding commitments in the budget to support a Just Transition are a step in the right direction.
“To meet Scotland’s Net Zero ambitions and secure the future of jobs in the energy sector and North and North-East though, this investment and funding needs to continue to be stepped up, at pace, in partnership with industry to enable businesses to pivot successfully.”
The Covid-19 pandemic has “intensified” the poverty experienced by low income families across Scotland, according to a report published by the Poverty Alliance. It calls for increased action in order for Scotland to meet its 2030 child poverty targets.
The report, published by the Poverty Alliance as part of its Get Heard Scotland project, is based on interviews with 32 low-income families from Renfrewshire and Inverclyde, which explored their experiences during the pandemic.
It found that Covid-19 had intensified their challenges, with lone parents, Black and minority ethnic families, and families with a disabled parent or child the most impacted.
Particular issues that the report highlights include:
The mental health impact of living on a low income through the pandemic, with the loss of support networks and the loss of childcare and schooling having a significant impact
The precariousness of incomes through the pandemic, with an increased reliance on crisis support
The prevalence of insecure employment, with structural discrimination against Black and minority ethnic communities and disabled people being highlighted
The importance of access to good community spaces and infrastructure, including green spaces
Digital exclusion was also a key issue, with participants needing digital access for leisure, shopping and reducing isolation. But despite the research exploring the negative impacts of the lack of digital access, it also highlights the importance of robust non digital alternatives. It calls on service providers to continue investing in face-to-face support for their clients to ensure everyone can access the help they need.
Recommendations made by the report in order to better support people living on low incomes include:
Increasing investment in mental health services, including addressing stigma through targeted local activity
Undertaking more action to increase the number of workers receiving the real Living Wage, as well as ensuring employability services work for everyone regardless of age, gender, race or other characteristics
Ensuring that income adequacy is central to the development of Scottish social security, and doing more to promote people’s awareness of their social security entitlements
Increasing support for community groups and local anchor organisations
Peter Kelly, Director, Poverty Alliance says: “Through our Get Heard Scotland programme we heard about some amazing efforts made by community organisations and local public services to make sure people were supported during the pandemic.
“Groups and local authorities worked together to get help to those who needed it. But the reality that we found is that despite these efforts many people felt their experience of poverty deepen during the pandemic.
“The Scottish Government have set themselves ambitious targets on tackling child poverty. This report demonstrates, through the experiences of people living on low incomes, how much work is still required if they are to meet them. Communities across Scotland are held back by the grip of poverty , with the report highlighting the particular challenges communities in Renfrewshire and Inverclyde face.
“It is vital that policy-makers at every level – particularly local authorities and the Scottish Government – listen to and act on the voices of people experiencing poverty. To help do that, they must also place those voices at the heart of their decision-making processes.”
Laura Robertson, Research Officer, Poverty Alliance: “Covid-19 has not only tightened the grip of poverty on the lives of many children and young people, but has also exacerbated these inequalities.
“We hope that this report can be a call to action, with its recommendations acting as a blueprint on how we can redesign our society to tackle hardship and create a more just Scotland.”
The Scottish Child Payment will be doubled to £20 per week per child from April 2022, the First Minister has announced. The decision has been welcomed by poverty camapigners.
First Minister Nicola Sturgeon confirmed that more than 105,000 children will immediately benefit from the increased payment, which supports low income families with children aged under 6.
First introduced in February 2021 as a £10 per week payment designed to tackle child poverty, it provides regular, additional financial support for eligible families.
The benefit, which is unique in the UK, will be fully rolled out to children under the age of 16 by the end of 2022, subject to data on qualifying benefits being received from the Department of Work and Pensions. It is expected over 400,000 children could be eligible for the doubled payment from that point.
From 2023/24 it will represent an annual investment in tackling child poverty of around £360 million a year. The increase to £20 per week further underlines the Scottish Government’s national mission to tackle child poverty.
The First Minister said: “The Scottish Government is determined to lift children out of poverty.
“Of the £2 billion a year that the Scottish Government invests to support people on low incomes, over £670 million is already targeted at children. Through the range of new payments delivered by Social Security Scotland, low income families receive, in the early years of each child’s life, £5,000 of additional financial support.
“At the heart of this is the Scottish Child Payment – the only payment of its kind anywhere in the UK, designed solely to lift children out of poverty and give them better lives. The £10 per week payment for eligible children under age 6 will be extended to all eligible children under 16 at the end of 2022; and we committed to doubling the payment to £20 per child per week within this Parliamentary term.
“I am proud that our budget will confirm that we will double the Scottish Child Payment from the start of the new financial year. This increase to £20 per child per week will reach over 105,000 children under age 6 in just four months’ time. When we extend the Scottish Child Payment to all under 16s at the end of next year, over 400,000 children and their families will be eligible.
“This is the boldest and most ambitious anti-poverty measure anywhere in the UK. Delivering it isn’t easy. It will involve hard choices elsewhere in our budget. But it is a choice we are opting to make.
“Eradicating child poverty is essential if we are to build the strongest foundation for Scotland’s future. And that is what we are determined to do.”
Scottish Government Minister and Scottish Green Party Co-Leader Patrick Harvie said: “With rising inflation, energy costs and the recent UK Government cuts to Universal Credit, further action to tackle child poverty could not have been more urgent.
“I’m therefore delighted that the Scottish Government has been able to double the Scottish Child Payment from April, just months after our policy of free bus travel for children and young people goes live.
“These bold actions deliver on key commitments made in the cooperation deal between the Scottish Government and the Scottish Green Party, and will make a real difference to families across Scotland.”
Scottish Greens MSP Lorna Slater said the decision will be pivotal to tackling child poverty in Lothian.
Ms Slater said: “With a new Covid variant, rising energy costs, inflation and the catastrophic impact of a Tory Brexit being felt, it is more important than ever that we do everything we can to help people that are being hit by Westminster’s cuts and austerity.
“That is why I’m delighted that we will see the Scottish Child Payment doubled in the forthcoming Scottish budget. This will be pivotal to tackling child poverty and will be welcomed by families that are feeling stretched, particularly those that have been hit by Boris Johnson’s punishing Universal Credit cut.
“With Greens in government we are delivering for people and the planet and making a real difference to families in Lothian and beyond.”
“That is why we are introducing free bus travel for everyone under 22 from January, extending free school meals to all primary school pupils and ensuring that government contracts pay the real living wage. We will continue to work towards a fairer, greener Scotland.”
Social Security Scotland delivers a number of benefits for families. These include Best Start Grant Pregnancy and Baby Payment, Early Learning Payment, School Age Payment and Best Start Foods.
The newly doubled Scottish Child Payment, together with the three Best Start Grant payments and Best Start Foods, could give families up to £8,400 by the time their first child turns 6.
Campaigners have welcomed the announcement:
Chris Birt, Associate Director for Scotland at Joseph Rowntree Foundation said:“This is very welcome news that will provide vital support for families with young children following what is expected to be a challenging winter as the cost of living continues to rise. Doubling the payment for older children cannot come soon enough.
“As we noted in our Poverty in Scotland report, this investment alone will not be enough to meet the interim child poverty targets, but it is an important step in the right direction and will make a real difference to families.”
