Scottish Government does not have access to UK Government data detailing the profile of recipients of Tax Credit or Universal Credit awards in Scotland. We have therefore been limited to what conclusions we can draw on the impact of the planned amendment.
The available data shows that ethnic minority households and households with a disabled adult or child have a higher risk of being in relative poverty. It is likely that these households will continue to be positively affected by the planned change if they fit the criteria for receiving Working Tax Credits and Child Tax Credits or Universal Credit. However, we do not currently have access to data that would allow us to assess the extent to which these households contribute to the specific population targeted by the change in eligibility criteria. Therefore we can only indirectly make an assumption that these specific protected characteristic groups (in particular Sex, Race and Disability) are more likely to be impacted positively.
The 'Tackling Child Poverty Delivery Plan 2018-22' demonstrates that ethnic minority families are more likely to be in work but on lower incomes. It also highlights that minority ethnic groups have a lower reliance on social security payments than the population average. The data analysed did not have a large enough sample size to look at minority ethnic poverty in isolation, or to look at the different Scottish minority ethnic groups.
The 'Poverty and Income Inequality in Scotland 2016' suggests that in comparison to 'White-British group (combined data for 2014-19) people from minority ethnic (non-white) groups are more likely to be in poverty, both after and before housing costs. After housing costs 38% of people from 'Mixed, Black, Black British and Other' ethnic groups and 39% of 'Asian or Asian British' ethnic groups were in relative poverty.
The Scottish Household Survey 2019 report also indicates that Minority ethnic people are less likely to report managing well financially. In 2018, 42% of those in minority ethnic groups (non-white) were managing well financially compared with 56% for the White groups. If we explore deeper, the findings of the publication show that Pakistani and Chinese ethnic groups are more likely to be in poverty (51% and 45% respectively were in relative poverty). It also suggests that in 2014-19, 49% of people who identified their religion as Muslim were more likely to be living in poverty after housing costs.
'Child and Working Tax Credits statistics: Finalised awards, 2018-19', is the most recent publication available at this time. The summary report provides information on the UK level statistics for the number of families benefiting from tax credits. It also presents details about the number of children in benefitting families. In 2018-19 at a national level, there were approximately: 3.3 million families claiming Child Tax Credit (CTC) and/or Working Tax Credit (WTC). There were approximately 6.1 million children in tax credit claiming families. At a regional level, figures for Scotland show that approximately 242,000 tax credit recipient families and approximately 405,000 tax credit recipient children. In the UK lone parent families with children were either receiving the full award of CTC (when out-of-work) or WTC and CTC (when in-work). In 2018-19, 41% of tax credit families were in work and in receipt of both Working Tax Credit and Child Tax Credit. Breakdowns by protected characteristics are not provided in the published analysis.
'Universal Credit statistics, 29 April 2013 to 8 April 2021'published by DWP, show that at a national level and in response to the pandemic, Universal Credit claims doubled from March 2020, from 3 million claimants to currently 6 million.
The latest DWP statistic show that nationally, women account for 52% of people on Universal Credit. It also suggests that single parent families account for 25.22% of claims and couples with children account for 12.81%. The proportion of people on Universal Credit that were men increased to 49% in May 2020 from 44% in March 2020.
The 'Scottish Household Survey 2019' found a large proportion of single parent families are female-headed. The survey suggests that female-headed households are less likely to report "managing well" financially (a term used in the publication). In 2019, households where the highest income householder was male were more likely to say they managed well.
Data from the 'Poverty and Income Inequality in Scotland 2016-19' publication shows that the relative poverty rate after housing costs was higher for lone mothers (39%) than for other single working-age adults.
The poverty rate for single working-age women without dependent children was 28%, and for single working-age men it was 34%. This report has also published three-year averaged estimates of the percentage of people, children, working-age adults and pensioners in Scotland living in poverty, and other statistics on household income and income inequality.
These estimates are used to monitor progress in reducing poverty, child poverty and income inequality. Although evidence suggests that poverty rates may have stopped rising, in 2016-19, after housing costs are accounted for, 24% of children and 19% of working-age adults were living in relative poverty. Analysis shows that before housing costs were deducted there were 20% of children and 16% of working-age adults in Scotland were living in relative poverty. We do not currently have access to a breakdown of this data in relation to those families who may qualify for funded ELC, which would allow us to assess the extent to which these households contribute to the specific population targeted by the change in eligibility criteria. Therefore we can only indirectly make an assumption that these specific protected characteristic groups (in particular Sex, Race and Disability) are more likely to be impacted positively.
The 'SSELC phase 1' study found that that 53% of the households of eligible 2 year olds in the SSELC were single parents. This compared with 16% of households of 3 year olds who had just started accessing 600 hours of funded hours in November to December 2019.
The study shows that 49% of the households of eligible 2 year olds were in households amongst the lowest 10% (decile) of equivalised household incomes (having an annual income of less than £9701) . A further 20% of households had incomes in the second lowest decile (an annual income of at least £9701 but less than £13,929). The report identifies that there is a disproportionate representation of lower income households amongst the cohort reflects the eligibility criteria for access to statutory funded provision of ELC for two year olds. These are households that are more likely to have a parent or carer in receipt of certain qualifying benefits (out of work benefits or income related benefits).
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