Fairer Scotland Duty (FSD) for Scottish Welfare Fund Statutory Guidance amendments: April 2026

Stage 2 – evidence

What does the evidence suggest about existing inequalities of outcome, caused by socio-economic disadvantage, in this specific policy area?

The standard approach used by Scottish Government to identify multiple deprivation is the Scottish Index of Multiple Deprivation (SIMD), with the latest version available being the 2020 index. The SIMD ranks data zones from the most deprived (1) to least deprived (6,876). There are known issues with this approach, for example data zones in rural areas can cover wider geographical areas, which make it harder to understand levels of deprivation.

The SWF method of allocating funding to the 32 local authorities that deliver funding is based on the SIMD number of income deprived people in the local authority.^[4] This is a methodology of grant allocation that has been agreed with COSLA. This links to the key policy aims of the SWF which is focused on supporting qualifying individuals who are on a low income who are in a crisis or needing support to establish a settled home.

The inequalities associated with socio-economic disadvantage may mean this group are more likely to rely on support from the SWF in a crisis or for support to live independently. For example, adults living in the most deprived areas were more likely to be a victim of crime, with robbery more likely in areas of higher deprivation. Additionally, almost half of social security applicants in Scotland were living in the three most deprived deciles. People who are socio-economically disadvantaged are less likely to own their home and in turn, are more likely to experience a crisis such as an eviction.^[5]

Scottish Government, via the Communities Analysis Division, publish regular reporting in relation to the SWF. The most recent annual statistics shows that awards tend to go to the applicants living in the most deprived areas in Scotland. Around one in five people in Scotland live in the 20% most deprived areas in Scotland, as defined by the SIMD. However, in 2024-25 around half of Community Care Grants (50%) and Crisis Grants (48%) were awarded to applicants living in these areas. In comparison, around 2% of Community Care Grants and 3% of Crisis Grants were awarded to applicants from the 20% least deprived areas.^[6] The tables in the annual update further shows that discounting those records where we are unable to match postcode, that 66% of awards for Crisis Grants went to those living in Deciles 1 - 3 (Most deprived) and only 6% to those living in Deciles 8 - 10 (Least deprived). This is similar to Community Care Grants where the split was 69% (3 most deprived) and 5% (3 least deprived).

The amount of award received by Community Care Grant applicants didn’t correlate closely with deprivation levels during 2024-25, with those in quintile 3 receiving the largest awards, and those in quintile 5 the least. For Crisis Grants, average awards were marginally higher in the least deprived data zones. Thus, there is generally no correlation between the deprivation levels and amounts received in awards; deprived people living in a prosperous area are still likely to require similar things to those living in deprived areas, and may even be subject to higher costs for some items because of where they are living.

What does the evidence suggest about possible impacts of the policy/programme/decision, as planned, on those inequalities of outcome?

The independent review of the fund highlighted some barriers that different groups of people face that make them less likely to apply.^[7] This included older people, the “working poor”, people who are digitally excluded and those new to the benefits system. Reasons for this include feelings of perceived stigma, confusion about the eligibility criteria, support available to apply and cost barriers linked to phone or internet access. Our proposed changes to the statutory guidance with annual reviews aim to address these issues and make it easier for people who are socio-economically disadvantaged to access the fund.

We have also updated the statutory guidance this year to highlight that local authority decision makers should not use social media sites to gather information about an applicant.

The approach taken to updating the statutory guidance has focused on making the guidance clearer and more accessible. Engagement has continued with the Poverty Alliance ‘Get Heard Scotland’ Citizen Panel of people living on a low income in a second phase of work, following the initial phase last year.

Previously, panel members gave their views on further areas for development including staff training in relation to poverty related stigma, making an application to the fund simpler and more secure, clearer information on eligibility and improved accountability processes. Their input led to changes including to the statutory guidance, a short introductory section in plain language was introduced last year with a focus on making the process clearer to applicants.

Is there evidence that suggests alternative approaches to the policy/programme/decision? For example, evidence from the UK or international evidence?

The Independent review into the SWF looked at the evidence base of other similar schemes and highlighted analogous schemes such as discretionary award schemes in Northern Ireland and Wales. These operate via centralised provision, unlike the SWF which is delivered by the 32 Scottish Local Authorities. It was found that these schemes despite being centralised, still faced issues of consistency and clarity of decision making.

Wales – Discretionary Assistance Fund (DAF):

This scheme also provides two grants like the SWF, called Emergency Assistance Payment (EAP) and Individual Assistance Payment (IAP). The criteria for eligibility for the EAP is similar to the SWF except for requiring the individual to ‘have considered all other legal and responsible lenders such as credit unions’. The IAP further differs from the SWF in that, for example, it requires receipt of a qualifying benefit as well as for the individual to have ‘tried all other affordable sources of funding for example credit union’.^[8]

Northern Ireland – Discretionary Support (DS):

This scheme offers a grant like the SWF which doesn’t have to be paid back, but also an interest free loan. This is further restrictive compared to the SWF in criteria. For example, you must be over 18 (at least 16 if you do not have parental support). Further, total income for the applicant and any partner must not be more than £28,571.40.^[9]

England

England does not currently have a national grant scheme, though this will change with the launch of the Crisis and Resilience Fund (CRF) in April 2026.^[10] While the original UK Social Fund led to national schemes in Scotland, Wales and Northern Ireland, in England the funding was passed to councils without being ringfenced for welfare support. More recently, the UK Government has provided councils with the Household Support Fund, but each council sets its own eligibility rules, application processes and priorities. Council websites show significant variation in how funds are used, with many also working alongside partner organisations to deliver support.

What gaps are there in key evidence?

• Is it possible to collect new evidence quickly in other areas?
• For example, through consultation meetings, focus groups or surveys?

There is capacity to do further analysis on particular equality groups beyond what has been reported in our equalities summaries. A key area of focus has been on encouraging local authorities to improve the quality of the data that is collected, which would help further in improved analysis. This is an important and long-term commitment as part of our work in the SWF action plan. The Scottish Government have been working with SPSO and six local authorities on a pilot focused on learning through data which is expected to launch over 2026/27. The aim of this project is to capture more qualitative data that will complement the regularly published annual SWF statistics.

How could you involve communities of interest in this process?

• Aim to include those with lived experience of poverty and disadvantage.
• The voices of people and communities are likely to be important for identifying potential improvements to the programme/policy/decision.

We have involved those with lived experience of poverty and the social security system in Scotland in the revisions of the statutory guidance, to ensure that it highlights principles of dignity and respect and is restructured for accessibility and ease of use.

Scottish Government officials worked with the Poverty Alliance regarding workstream 2 of the Action Plan in Autumn 2024. As part of their ‘Get Heard Scotland’ campaign, two experience panel sessions were set up to receive feedback from those with lived experience of the SWF and the social security system in Scotland.

Panel members gave their views on staff training in relation to poverty related stigma, making an application to the fund simpler and more secure, clearer information on eligibility and improvement in accountability processes.

The panel helped to inform, refine and shape some of the proposed changes to the statutory guidance. For example, their feedback helped us to strengthen sections on accessibility and the trust based approach and we highlighted in the statutory guidance what we heard from the Panel in terms of what dignity and respect meant to them. The engagement also led to a short introductory section in plain language with a focus on making the process clearer to applicants.

We have also worked with the Poverty Alliance on Phase 2 of this work with the panel on additional themes that they highlighted as well as to ensure that implementation of the changes is in line with the policy intent. This includes themes such as communications and trust and asking sensitive questions and signposting to longer-term and preventative support that the SWF is not set out to provide.