Minimum Income Guarantee: report - a roadmap to dignity for all

Building the Guarantee: 2026-31

The first steps on the Roadmap towards a Minimum Income Guarantee are designed to be possible within existing powers, requiring greater flexibiliy and cooperation with the UK Government in some instances. We believe they are deliverable within the current financial, economic and political context in Scotland. They focus on setting the foundations and strengthening the safety net. They allow progress towards a Minimum Income Guarantee to begin without delay and in a way that can have a significant impact on destitution, poverty and financial security, enhancing progress towards Scotland’s 2030 legally binding targets on child poverty.

Step 1: Theory to action

The first step on our Roadmap is about turning the theory into a reality. That means the Scottish Government committing to a Minimum Income Guarantee, embedding it across all relevant policies and practices. This will ensure the widespread commitment to a Minimum Income Guarantee we need beyond Government, from all political parties; employers across the private, public and third sector; and employees. For example, we would want to see commitments from employers to provide fair work. Many have already done so, and we would ask that they continue to champion a Minimum Income Guarantee. We believe that everyone should live with dignity and work together, and that change must happen fast.

The commitment to a Minimum Income Guarantee is about the first steps in the creation of a new social contract, and this must be one whereby anti-poverty policy design and implementation is fit for purpose. It should be built upon an understanding that women, disabled people, Black and minority ethnic communities, lone parents, unpaid carers, particularly those who experience compounding inequalities as members of more than one of these population groups, are disproportionately more likely to experience poverty. As such, policy design and delivery must prioritise these groups and take an effective equalities and intersectional approach.

Recommendation 1: The Scottish Government should agree to progressing towards a Minimum Income Guarantee as a matter of urgency in 2026, embedding the principle across all policies, strategies and portfolios. They should set a clear target for reducing the number of people living beneath the Minimum Income Guarantee level and report on progress against this and towards implementation through an annual statement.

Step 2: Guaranteed safety net

The second step on our Roadmap is about building a guarantee of support, a genuine safety net for households, and transforming the current social security system. It outlines significant reform to social security in Scotland over this first five-year period, building the foundations for a Minimum Income Guarantee in Scotland. We have identified actions that can allow us to make progress towards financial security for all and towards Scotland’s legally binding targets on child poverty.

The current UK-wide benefit system too often resembles a social insecurity system. It has destitution built into its design with waits, limits, caps and freezes acting to leave gaping holes in the safety net. We believe a new approach to social security, in line with the Minimum Income Guarantee’s principles, is required. Crucially, this is about building an approach to meet the needs of people in Scotland. We believe that each of these recommendations are deliverable now. We have published a separate paper that outlines some of our more detailed deliverability considerations.^[79]

The two-child limit

We are pleased that the Scottish Government announced a commitment to end the two-child limit within Universal Credit in 2026.^[80] However, this commitment is of little comfort to families suffering from this policy now. We call for the Scottish Government to deliver this policy quickly. The impact would be significant, analysis from the Fraser of Allander Institute estimates that it would cost £182 million in 2030/31 (in 2024/25 prices) and result in a reduction in relative child poverty of 1 percentage point and a reduction of 4 percentage points for children in deep poverty. When coupled with our recommendation to increase the Scottish Child Payment to £55 it would see a reduction of 6 percentage points in relative poverty.81

Under the current system, families do not receive the Universal Credit Child Element for third or subsequent children if born after 6 April 2017, with very few exceptions. Scottish Government modelling estimates that the number of households affected by the two-child limit has steadily risen over time to reach over 25,000 as of April 2024, representing over 90,000 children. It estimates that, by the end of 2024-25, the two-child limit will have withheld a cumulative total of £377 million from Scottish households since it was introduced, equivalent to £424 million in 2024-25 prices. ^[82] As more children are affected by the limit over time, with an increasing proportion being born after the April 2017 cut-off, this impact will continue to grow.

The two-child limit more deeply impacts certain groups. Twenty percent of all households impacted by the two-child limit are families with at least one disabled child. At the UK level, single-parent households are another group hit hard by the two-child limit: 25% of all families affected by the policy are lone parents with a child under three years old.^[83] Family size varies by ethnicity: at UK level, 51% of Black African, 65% of Pakistani and 64% of Bangladeshi children live in large families (three or more children), compared to 30% of those in White British families.84

We see ending the two-child limit, as with other recommendations in our first steps, as an initial investment in building a Minimum Income Guarantee. We call for the UK Government to scrap the two-child limit at source, across the UK. This would enable the Scottish Government to prioritise resources towards making further progress on this Roadmap.

The five-week wait

Under the design of Universal Credit, people must wait five weeks for their first payment, leaving many people with the choice between destitution or unmanageable debt. A safety net should ensure that nobody needs to rely on a food bank while waiting on their first Universal Credit payment.

We know that the five-week wait disproportionately impacts certain groups in society such as disabled households who face higher costs;^[85] low-paid workers who do not have savings to get them through the wait;86 and those newly granted refugee status who have been unable to earn money previously due to their immigration status.87 A critical part of building a Minimum Income Guarantee for Scotland will be ensuring this no longer happens and that no person has to face a choice between survival in the immediate term versus a long-term struggle to afford to pay back debt.

Ending the five-week wait in Scotland in full for all new applications to Universal Credit has been estimated to cost around £175 million in 2024-25. This cost would be lower if, rather than ending the five-week wait in full, action was instead taken to shorten it, for example to two weeks, at an estimated £100 million in 2024-25.^[88] As above, we call on the UK Government to act to end this unjustifiable policy across the UK. If they were to do so this would enable resources in Scotland to be invested in making further progress on our Roadmap in other areas.

Lessons could be learned from the approach in Northern Ireland where they have a Universal Contingency Fund already in place, this helps those facing financial difficulty while awaiting their first payment.^[89]

Parenting penalty

Financial security for all should ensure that parents who want to enter employment are supported to do so. Action is needed to end an often-overlooked injustice within the current system. At present, parents in receipt of Universal Credit that pay for childcare while they work, can claim up to 85% of childcare costs, up to a capped amount. However, this leaves parents to find the remaining 15% of childcare costs, and any costs over the capped amount, from other income. This can amount to thousands of pounds per year for some of the lowest-income households in Scotland, in part due to the incredibly high cost of childcare. In our view this amounts to a parenting penalty, and a significant barrier to employment and other opportunities.

Scottish Government analysis estimates that ending this parenting penalty would cost £12 million in 2024/2025, assuming full take-up of benefit entitlements.^[90] We considered deliverability and found that there might be options for the Scottish Government to deliver this through social security.91 We believe it would require cooperation from the UK Government, changes to current legislation and changes to operations and business processes. We recommend these are explored further.

It is important to note, that while addressing the cost element will be of great value to many families, there needs to be clearer communication about what support people are entitled to and improved provision. There is currently a lack of availability of childcare services which accept Universal Credit payments.

Action will also be required to ensure childcare is more affordable, which is discussed later in this report. Making improvements to the current system, taking a person-centred and place-based approach, is crucial to supporting children and families. It is critical to ensuring the sustainability of the sector and fair work for childcare employees.

Recommendation 2: As an urgent priority the Scottish Government must set a deadline for action to move closer to a guaranteed safety net that people can rely on. This means progressing with urgency towards its existing commitment of scrapping the impact of the two-child limit for the Universal Credit Child Element in 2026, children in larger families must no longer be punished or put at greater risk of poverty. By the end of 2026, the Scottish Government must act if the UK Government fails to by ending:

• the unjust five-week wait for the first Universal Credit payment, which leaves a gaping hole in the safety net and risks destitution for those that need support.
• the unfair parenting penalty within Universal Credit, which limits support for childcare costs for low-income families to 85% of childcare costs up to a cap, creating barriers to employment and other opportunities. Instead, 100% of costs up to a cap should be covered.

Increase Scottish Child Payment

Without further action it is forecast that Scotland will miss its child poverty targets by 2030, with 20% of children still forecast to be in relative poverty in 2030/31, even with mitigating the two-child limit.^[92] The damage that poverty and inequality can have now and in the future is clear. We must prevent this being inflicted in the early years of a child’s life, as we know the negative impact that poverty can have on attainment longer term.93 Impacts are disproportionately felt by some groups with over half of children in minority ethnic families (53%) trapped in poverty. Tackling that poverty at source would help every child flourish and realise their potential, necessary for the future of Scotland, alongside better economic, social and health-related outcomes.

The Scottish Child Payment will be set at £27.15 in 2025/26 and is available to families with a child under the age of sixteen who are in receipt of certain low-income benefits. In total, as of 31 December 2024, 326,080 children aged 0-15 years were actively benefiting from Scottish Child Payment.^[94] As a poverty reduction measure, it is recognised as highly successful: Scottish Government modelling estimates that the Scottish Child Payment will keep 40,000 children out of relative poverty in 2025-26, meaning the relative child poverty rate in Scotland will be around 4 percentage points lower than it would otherwise be.95 The Scottish Child Payment has benefitted families at greatest risk of poverty, including the six priority family types identified in the Tackling Child Poverty Delivery Plan,96 in particular those with three or more children, who have seen a significant increase to their household finances as a result.

The success of this policy should be built on. Increasing the Scottish Child Payment can help to build the foundations of the Minimum Income Guarantee and ensure the 2030 child poverty targets are met. We call for the Scottish Child Payment to be doubled by the end of 2030 at the latest. This equates to £55 per week (in 2024/2025 prices).

This would cost an additional £444 million by 2031 (in 2024/25 prices) and effect a reduction in relative child poverty of 3 percentage points. When coupled with ending the two-child limit, in line with our recommendation, at a combined cost of £626 million, the reforms would result in a reduction of 6 percentage points in relative child poverty.^[97] On current projections, this would take us around half-way to reaching Scotland’s relative child poverty target of fewer than 10% of children living in relative poverty by 2030, with a projected child poverty rate of 15% as compared to 22% without these policies.98 Further action would be needed, beyond our recommendations, to meet the target in full.

As part of increasing the Scottish Child Payment, the Scottish Government must continually review the impact of the increasing ‘cliff-edge’ of support on low-income families in Scotland. This cliff-edge is a result of entitlement for Scottish Child Payment being based upon receipt of reserved benefits, so those who lose their Universal Credit entitlement could lose several elements of passported support in Scotland (such as Scottish Child Payment, the Best Start Grants, childcare hours for two-year olds). Analysis by the Scottish Government shows there is no evidence the Scottish Child Payment negatively affects labour market participation at any scale.^[99] Nevertheless, to support families’ financial security and stability and enable them to make the most positive choices in balancing paid work and caring responsibilities as incomes rise, several mitigations could be considered if necessary. These include introducing a taper (though our deliverability analysis100 shows this may be costly) or introducing run-on periods so that people do not lose entitlement to everything all at once in the same month.

Recommendation 3: The Scottish Government should prioritise increasing the Scottish Child Payment to reach £55 p/week (in 2024/25 prices) as soon as possible in the next parliamentary term and by the end of 2030 at the latest.

The Essentials Guarantee

Universal Credit does not even cover the essentials. If we are to progress towards financial security and dignity for all this must be addressed with urgency. Trussell and the Joseph Rowntree Foundation have called for an Essentials Guarantee within Universal Credit, meaning that the level of payment should be adequate to cover life’s essentials such as food and energy. This is currently calculated to be at least £120 per week for a single person in 2024-25 prices.^[101] Further work would be required to determine a rate for households with children.

Scottish Government modelling estimates that implementing the Essentials Guarantee could reduce child poverty by 4 percentage points, leading to 40,000 fewer children living in relative poverty.^[102] 56% of all working-age families in the UK with a disabled family member would benefit; as would those in in-work poverty, the majority of households (three-in-five) who would gain are in work.103

To be effective, the Department for Work and Pensions must prevent sanctions and deductions from a household’s Universal Credit entitlement (such as debt repayments) bringing the support below this minimum level. We support the calls for the Essentials Guarantee across the UK. This would provide a strong foundation for building a Minimum Income Guarantee in Scotland.

Recommendation 4: The UK Government should implement an Essentials Guarantee as a matter of urgency, no later than the end of 2026.

Reforming conditionality, sanctions and Jobcentre Plus

Longer-term, a Minimum Income Guarantee would end conditions and sanctions on social security payments. Sanctions do not encourage people into sustained employment and so are not compatible with a Minimum Income Guarantee. People subject to sanctions may spend less time in receipt of Universal Credit, but this is not driven by them finding secure work – many simply leave the labour market entirely.^[104] Those who do move into paid work usually do not earn enough to leave Universal Credit. Perhaps most tellingly, for those leaving the ‘intensive’ work-search regime, earnings were lower over a six-month period for those who had been sanctioned compared to those who had not. In addition to being counterproductive, sanctions have also been found to have a discriminatory impact, disproportionately penalising Black and minority ethnic105 and disabled people.106 We believe there are better ways to support employment and proposals for this can be found throughout this Roadmap.

The Experts by Experience Panel agreed that sanctions do not help people access paid work and that the enforcement of these punishes people. While there were concerns among some Panel members that some people would take advantage of a system with no conditionality, the need for reform was apparent in their deliberations, and the potential risks far outweighed the benefits for most members. Equally, members recognised that moving away from conditions and sanctions in their current form could work to increase the numbers of people able to take up fair work, given the negative effects conditions and sanctions can have on peoples’ health, wellbeing, confidence and hope. We agree, there cannot be a genuine safety net while sanctions remain in place.

Instead, promoting fair work and good careers must be prioritised. The system needs to be person-centred and focus on both trust and an expectation of honesty. Our Experts by Experience Panel raised that wider personal experiences should be considered alongside work experience when seeking employment and that people should not be penalised for prioritising suitable work over finding any job by the DWP. We need employability services that focus as much on career progression and job quality, as they do on moving people into work.

Employability services must also take account of wider needs and personal circumstances to ensure anyone who is seeking paid work feels supported into fair, suitable and sustainable employment. Disabled people face disproportionate barriers to accessing and staying in consistent employment. This is coupled with what is often a lack of understanding of the skills and experiences disabled people can bring to roles.

The Experts by Experience Panel want to see a refreshed Jobcentre Plus which is more friendly, empathetic, personalised and believe they should be more present within local communities in Scotland. We agree and think lessons could be learned from the good practice within Social Security Scotland with local advisors and the embedding of advice within other local services.

Power over conditions, sanctions and Jobcentre Plus are reserved powers to the UK Government. However, with a new UK Government in place, there could be opportunities for cooperation with the Scottish Government. They could agree to pilot a different approach to conditions and sanctions within Scotland, testing other ways to support people to enter sustainable work. One option might be to separate out the employability and benefit payment functions as each should have a different focus. This would support access to fair work, an essential foundation of a Minimum Income Guarantee. The Scottish Government should also continue to call for the full devolution of employability with the aim of aligning its priorities with that of Social Security Scotland.

A new approach should be trialled, recognising caring responsibilities and promoting more sustainable, high-quality jobs and careers. The Scottish Government should work with the UK Government to seek further cooperation, flexibility or devolution in relation to Jobcentre Plus and other currently reserved employability services to deliver greater impact for people and families in Scotland.

Recommendation 5: By 2027, the UK Government and Scottish Government should work together to facilitate the necessary flexibilities to pilot and implement the removal of conditions and sanctions in Scotland.

Debt

It is important that an improved safety net is not undermined by unfair debt repayment practices.^[107] People in debt already face financial challenges and obligations to repay this debt can leave people dropping too far below an acceptable standard of living.

The current mechanism for repaying debt and arrears can exacerbate financial hardship, such as wage arrest which sees a portion of a person’s income deducted from wages or benefit deductions from Universal Credit.^[108] Those in receipt of certain benefits, such as Universal Credit, may see deductions which are paid directly to a creditor or supplier under the Third-Party Deduction Scheme. This includes debts incurred for essentials such as housing rent, fuel costs and council tax.109

The current system disproportionately affects lone-parent households, the majority of which are headed by women, as it doesn’t account for household composition (e.g. the fact deductions may have a greater impact on a single earner) when determining wage arrestment amounts.^[110] Debt recovery practices must be reviewed and suitable welfare and income maximisation services should be available as part of a Minimum Income Guarantee.111

Nobody should have their financial security undermined by unmanageable repayments, least of all by the public bodies there to support us. More than half (55%) of low-income families in Scotland in receipt of Universal Credit have at least one deduction by the Department for Work and Pensions from their monthly income to cover debts to public bodies.^[112] On average 10-14% of Scottish families’ entitlements were deducted at source. In addition, they found that Scotland has a higher proportion of households with children with multiple deductions than Britain as a whole. In August 2024, there were £16 million of Universal Credit deductions in Scotland; £3.36 million were third-party deductions.113

Recommendation 6 By 2027, the Scottish Government should stop unaffordable third-party deductions by public bodies (i.e. the money taken from benefits to pay down debts), ensuring that no public body in Scotland (such as local authorities) applies for a third-party deduction without first having undertaken a proper affordability check.

Step 3: An equalities-centred system

The third step focuses on everyone benefitting from progress and increased financial security. It ensures we build a greater understanding of how a Minimum Income Guarantee can be delivered in a way that prevents financial abuse and enables women to access an independent income. It looks at the additional costs faced by some groups in society – disabled people, unpaid carers, and rural and island communities – and how those costs should be quantified and their adequacy reviewed. It looks at take-up and automation and how we can ensure all households can access their entitlements and experience financial security. Finally, it looks at the current data gaps that must be addressed so that we can effectively build our understanding of how inequalities intersect and compound for different people and groups as we continue to build the system. We want to get to a place where the government fully understands the outcomes it wants to achieve for people as individuals, as we progress towards delivering Minimum Income Guarantee.

Ensuring women can access an independent income

The Minimum Income Guarantee in Scotland needs to be gender-competent. It should prevent discriminatory, negative impacts and inequitable outcomes and protect the most vulnerable as far as possible.

We have engaged with a significant number of extremely complex issues when building a Minimum Income Guarantee, including commissioning research to help bring further expertise to the process where required. However, there are some areas that we recognise will require further work and resources. One is the issue of whether a Minimum Income Guarantee payment, and social security more broadly, should have eligibility assessed by household income or individual income. Given the complexity of this issue, for this report we have assumed a household assessment of income to provide an illustration of what a Minimum Income Guarantee could look like in Scotland. However, that does not mean household assessment should be the default as our Roadmap progresses.

Women’s and carer organisations have raised concerns that a potential unintended consequence of a household assessment of income could result in some women, unpaid carers and disabled people on a low income in a high-earning household not having an adequate income due to finances not being shared. However, equally, an individual assessment risks paying low earners in high-income households, where household finances are split more fairly. Individual assessment would bring more people into eligibility for a payment, thus costing more, and potentially weakens the link between need and support. Individual assessment would also need to carefully consider the status of lone-parent households, the majority of whom are women, as they will have additional costs compared to households with two adults.

The Scottish Government needs to provide adequate time and resources to determine how any payment should be assessed and whether this is on an individual or household basis, ahead of the introduction of a Minimum Income Guarantee. Regardless of whether eligibility is assessed individually or as a household, we are clear that the payment should be made separately, as outlined later in this report. Higher levels of payment should also go to the primary carer and/or lower earner in a household.

Potential risks have also been identified that a Minimum Income Guarantee could contribute to more women leaving the labour market to undertake unpaid caring responsibilities.^[114] This could have an impact on women’s longer term economic security and employment opportunities. Conversely, a Minimum Income Guarantee also offers greater recognition of the immense contribution unpaid care makes to society and will offer greater choice in terms of balancing work and unpaid care. There is a need for the longer-term impacts on intersectional gender equality to be considered in greater depth.

Recommendation 7: The Scottish Government should undertake an intersectional, gendered modelling and analysis of the impact of a Minimum Income Guarantee by 2026. This should consider the implications of eligibility for a Minimum Income Guarantee payment being assessed by either household or individual income. The longer-term impacts of a Minimum Income Guarantee on women’s labour market participation must be considered. This will be critical to ensure the Minimum Income Guarantee can be designed in a way that is gender-competent, addresses existing gendered, intersectional biases within the current social security system, and prevents gender-based violence and abuse.

Early steps on additional costs and towards premium payments

Additional costs faced by disabled people

Ultimately, the Minimum Income Guarantee should provide disabled people with greater financial independence to allow their general living costs to be met. It is crucial this is accompanied by strengthening access to essential services and resources which support independent living and better tailored support for those disabled people who can enter the workforce.^[115] However, to ensure the Minimum Income Guarantee fulfils its potential for disabled people, action is needed. We know that disabled people are disproportionately negatively impacted by cuts to social security and services compared to non-disabled people.116,117 This is unacceptable. This is even more so given recent UK Government announcements on plans to make cuts, worth billions of pounds, to disability benefits across the UK.

People who face additional costs due to a condition or impairment should continue to receive additional financial support with these costs under a Minimum Income Guarantee. These additional payments should be paid and assessed separately to a Minimum Income Guarantee payment, not means-tested. For disabled people, current financial support for these costs come through the Child, Adult and Pension Age Disability benefits.

We know that these payments are insufficient to cover the additional costs many disabled people face and this may worsen due to UK Government proposals to make cuts to disability benefits over the coming years. An estimated 41,428 households with a disabled person have sacrificed a warm meal to run or charge essential medical equipment.^[118] The Experts by Experience panel drew attention to the range of conditions or impairments where extra costs may arise and in general were supportive of these payments remaining separate to the Minimum Income Guarantee.

Understanding the true additional cost of disability is complex as every disabled person is different and every person will be impacted in a different way by disability. An independent review of Adult Disability Payment is currently underway and the Interim Report^[119] was published November 2024. However, despite calling for it in our interim report, adequacy is not part of the remit of the review. This means the income gap will not improve for disabled people.

The additional costs faced by disabled people must be met urgently as part of building the guarantee and foundations for a Minimum Income Guarantee. First, action to quantify the additional costs faced by disabled people should be taken, for example, a Minimum Income Standard for disabled people should be developed. This should be built using a similar approach to the current Minimum Income Standard, in collaboration with disabled people and seek to understand what outcomes they wish to achieve. The Scottish Government should then take steps to ensure that these additional costs are adequately met through existing non-means-tested disability benefits.

Recommendation 8: A Minimum Income Standard for disabled people should be developed by 2027 and used to aid a review of the adequacy of disability benefits. This should ensure that additional costs faced by disabled people are adequately reflected in the level of payment. Similarly, the UK Government should also review the adequacy of related benefits still being paid via DWP to ensure that disability benefits are adequately funded in Scotland.

Additional costs faced by unpaid carers

A Minimum Income Guarantee should benefit unpaid carers, the majority of whom are women, and recognise their increased risk of poverty. The significant role unpaid carers play in society, enhancing collective wellbeing, and the economic contribution must be acknowledged.

Certain groups are more impacted than others, Pakistani people are almost twice as likely than white Scottish/British people to provide full-time unpaid care. Aside from Indian, Chinese and Mixed groups, every other minority ethnic group is overrepresented in providing full time care.^[120]

One of the main drivers of unpaid carer poverty is the difficulty they have combining paid work with their caring role, primarily because of a lack of suitable replacement social care services. Many unpaid carers must give up their careers or reduce their working hours because of their unpaid caring responsibilities, which can result in a loss of income and negatively impact their ability to accumulate savings and pensions.^[121]

Providing unpaid care should never result in poverty, disadvantage, or reduced wellbeing. We believe further work is needed now to fully understand the additional costs faced by unpaid carers, and to then ensure that carers are adequately supported. This should be done in collaboration with unpaid carers and seek to understand the outcomes that they wish to achieve.

Recommendation 9: By 2027, the Scottish Government should undertake further work to quantify both the additional costs faced by unpaid carers and loss of income (including long-term implications) and understand what changes to unpaid carer benefits are required.

Ensuring people access their existing entitlements

An early step towards a Minimum Income Guarantee is ensuring everyone can access their existing entitlements. The complexity of people’s lives must be recognised and the difficulties in dealing with multiple complex applications to access entitlements. This is compounded for those who have intersecting inequalities, such as a lone parent with disabilities.

The research we commissioned on an intersectional analysis of a Minimum Income Guarantee highlighted that despite Social Security Scotland having inclusion and dignity built into its approach, the consequences of systemic inequality are still visible in its implementation. For instance, the social security approval rates by ethnicity are 67% across all applicants; mixed or multiple ethnic group applicants are 66%; followed by Caribbean or Black at 62%; and the lowest rate were Asian applicants at 61%.^[122] There are likely to be multiple causes behind this but these may include issues related to access, communication, and bias within the decision-making processes.123 This should be urgently addressed and further work undertaken to understand what further compounding inequalities might prevent people achieving financial security. Measures to promote benefit take-up should be increasingly proactive.

A key cultural shift that needs to happen is ending the stigma around recieving entitlements. This is reflective of the principles identified by the Experts by Experience Panel: the importance of compassion and that the system should be delivered by well-trained and empathetic staff, aimed at reducing unnecessary stress, ensuring people feel confident to access support. The findings of a 2024 Citizens Panel^[124] funded by the Scottish Government and delivered by the Poverty Alliance found that internalised feelings of shame and self-doubt could prevent people accessing support.

Work should be undertaken to shift the public narrative around accessing entitlements, through measures such as positive messages in the media. The Scottish Government’s Benefit Take-Up Strategy^[125] identifies hard-to-reach groups who are likely to have reduced access to support. These groups include refugees, care experienced people and survivors of abuse. In 2024, the Scottish Government commissioned an evidence review which identified further seldom-heard groups. This included people from established minority ethnic communities, those with long-term physical and mental health impairments or conditions, people with learning disabilities and/or learning difficulties and socially isolated older adults.126 We also know that disabled people currently struggle to find accessible support.127 Work to shift the public perception of social security and ensure everyone accesses their entitlements must be a priority.

There will also be a necessity to ensure that free, impartial advice is always available across Scotland via multiple channels. It is necessary to ensure that advice services are adequately resourced to implement this Roadmap. For disabled people, welfare rights delivered in accessible settings, preferably by Disabled People’s Organisations would assist in ensuring take-up of all benefits. Holistic approaches which recognise the barriers disabled people face in applying for benefits is needed. Welfare rights work in schools and primary care would assist in ensuring that disabled children and those with health conditions accessed their entitlements early. The additional positive outcome of this is that carers benefits would become available to other family members, passporting to other benefits e.g. concessionary travel, blue badges, premiums and disregards for the Local Housing Allowance Council Tax Reduction Scheme.

The aim of the Minimum Income Guarantee, given its longer-term design as a universal guarantee of financial security, should be a system able to proactively identify people at risk of falling beneath the minimum income level, rather than awaiting an application. We are hopeful that technological changes in the future, over the course of this Roadmap, could support this. One way of ensuring people access their entitlements could be through increased automation, using existing data to support automatic access to further entitlements. We collaborated with Edinburgh University^[128] to understand more about the public perception of automation and the role it could play in supporting households to access their entitlements, via focus groups. This highlighted the current low levels of trust people feel about the purpose for which their data is used, which is not perceived to be for the public good. Many felt humiliation about the degree to which data is collected on them, and the imbalance between the data collected from those on low incomes versus other groups was apparent. It was highlighted that for disabled people the level of information required can be even more extreme, often relating to very personal health information. This feedback highlights the importance of building trust, tackling stigma and communicating clearly about data collection as central to the drive towards automation and increasing benefit take-up.

The focus groups did see the benefits of increased automation, recognising the current burden of providing the same data to multiple agencies. Many had experienced the frustration of going through multiple applications. In particular, the advantages for certain demographics who might have higher barriers to accessing their entitlements were noted including single mothers; disabled people and those with long term conditions; and those experiencing digital barriers. Therefore, if trust can be established, automation is built on consent, and data is used with both transparency and proportionality, the payoffs could be significant for households and their financial security.

Recommendation 10: The Scottish Government should align current benefit eligibility (for example, free school meals eligibility with the Scottish Child Payment, and better alignment of eligibility for the five family payments overall) and increase automation to support and increase accessibility by 2029.

Recommendation 11: Building on current approaches to benefit take-up, the Scottish Government should increase investment in schemes at the local and national levels that will reach people and families currently not taking up the support they are entitled to by 2031. This should pave the way for Social Security Scotland to move towards an approach, utilising technology and data where helpful, that aims for as close to full take-up of entitlements as possible.

Gathering the evidence to ensure competence on intersectionality

A Minimum Income Guarantee must meet the needs of, and be easily accessible to those that need it most. If it is not implemented in a way that benefits the most marginalised in our societies, then it will fail. The Scottish Government must improve its understanding of the systemic barriers and intersecting discrimination different population groups experience in accessing social security, services and employment. The experiences of people can rarely be effectively understood through the delineated categories of protected characteristics alone. Intersectional analysis is increasingly integral to ensuring systems are designed and implemented effectively.

The analysis provided to us by The Collective^[129] emphasised the need for intersectional analysis to be built into the foundations of any work advising the Scottish Government from the outset. Whilst intersectional analysis is being utilised more within the Scottish Government, the analysis emphasised the need for this to be a more coherent approach.130 The consequences of intersecting inequalities are often acknowledged but not responded to in how policy is designed and then implemented. A future Minimum Income Guarantee is an opportunity to showcase an intersectional approach from data collection to service design. The Scottish Government will need to focus on rates and experiences of poverty, inequality and financial insecurity across Scotland, in local areas and within population groups, including the child poverty priority families identified by the Scottish Government and disabled people. The ability to undertake gender analysis and intersectional analysis will require significantly improved disaggregated data and will be crucial to understand the experience of all population groups and those facing intersecting inequalities and injustices. The statistics that Social Security Scotland published on approval by ethnicity demonstrated that this can be done.131 Intersectional data gaps should be prioritised and addressed. This is necessary for policymaking more broadly and will be critical as a Minimum Income Guarantee is introduced. Policymaking institutions must work with these communities and relevant experts to co-produce further evidence.

As part of their work, we asked The Collective to undertake an intersectional analysis of our process as an Expert Group and Secretariat. They emphasised that adequate time and resources should be allocated to enable intersectional analysis, including in the work of Expert Groups and Commissions. It considered the Expert Group’s and Secretariat’s work including what we have done well and what could have been done better. We have also been able to build in several of their recommendations based on a draft version of this report.

The Collective’s report makes several recommendations which we think are an invaluable resource for future commissions and working groups. The report outlined how few social security-related policies have considered intersectionality, in Scotland and internationally. It highlighted that the Expert Group and Secretariat attempted to undertake equalities analysis, looking at protected characteristics and priority family groups side-by-side. We aimed to bring this together into an intersectional analysis but due to capacity and capability constraints, we were unable to do this to the level we hoped. We attempted to build in equality considerations from the start of the process, including through membership of the Expert Group and Experts by Experience Panel. However, we would have ideally liked to go further in our analysis. We hope that a part of the legacy of this work is improving how the Scottish Government facilitates and undertakes intersectional analysis in policy making processes in future.

The need for intersectional analysis to be built into the foundations of any work advising the Scottish Government from the outset was emphasised. The Scottish Government has embedded an equalities approach in all its policies, through legally requiring equalities impact assessments (EQIA) to be undertaken as part of all policy development. However, EQIAs only break down the consideration of impacts of a policy by protected characteristics and are not required to consider intersectionality. To be effective, they also must genuinely consider the impact on protected characteristics, including through consultation, and act accordingly. Intersectional data gaps should be prioritised and addressed. Adequate time and resources should be allocated to enable intersectional analysis including in the work of Expert Groups and Commissions.

The Scottish Government should see implementing our Roadmap as an opportunity to showcase good practice and conduct impact assessments throughout implementation with a focus on compounding inequalities. The lessons learned should be responded to accordingly. The analysis helped us to understand the most important intersections in data for the Scottish Government to consider in implementing this Roadmap and ultimately a full Minimum Income Guarantee examples are:^[132]

• disability/sex/low or no income.
• disability/ethnicity/low or no income.
• disability/lone parents/low or no income.
• disability/rurality/low or no income.
• disability/unpaid care/low or no income.
• sex/ethnicity/low or no income.
• sex/rurality/low or no income.
• sex/unpaid care/low or no income.
• lone parents/rurality/low or no income.
• rurality/ethnicity/low or no income.
• rurality/unpaid care/low or no income.

Recommendation 12: By 2027, the Scottish Government should have invested in the collection of intersectional data in relevant areas: poverty, services and employment that is readily available and competently used in policy design both within government and working groups advising the government.

Step 4: Maximising the fair work agenda

The fair work agenda in Scotland must be prioritised in the early steps towards a Minimum Income Guarantee to make sure that fewer people experience in-work poverty, low-quality work and financial insecurity. We know this is essential for the sustainable implementation of a Minimum Income Guarantee.

Paid work goes a long way to protect against poverty, but the rates of in-work poverty remain too high. In Scotland, 60% of working age adults in poverty live in households where at least one person is in employment.^[133] Over half of workers earning below the real Living Wage are also in insecure work demonstrating that these are inherently linked.134 The focus needs to move beyond the current ‘any job’ approach and prioritise upskilling, quality, security, sustainability and flexibility that responds to people’s lives and circumstances. This should see people thriving.

It is crucial that we see action to improve wages, security in hours, conditions, employment rights, progression, employability and access to work, in which people can also learn and develop. This will help enable people to live a dignified life across different life stages, including older age by increasing opportunities to save for retirement.

Good jobs and fair work will help lay the foundations for the longer-term transformational changes we outline later in the Roadmap. Employers will have a key role in delivering the aims of a Minimum Income Guarantee, especially while options for the Scottish Government to mandate change remain limited. We would call for employers to commit to these fair work principles on a voluntary basis. To move forward, we need to see close cooperation and collaboration between the UK and Scottish Governments, specifically to see the UK Government utilising their powers to legislate and regulate on employment issues. It is promising to see action in this area being taken by the UK Government through the Employment Rights Bill in its first few months in office and we hope to see changes following this, put in place as quickly as possible.^[135] It is also important that our ambitions do not stop here – these should be viewed as first steps to longer-term reform of the labour market.

Ensuring everyone earns at least the real Living Wage and is offered Living Hours

We believe that the real Living Wage should replace the National Living Wage and National Minimum Wage for all age groups, including apprentices. As it stands, the UK Government has agreed to bring those aged twenty-one and above into the higher rate bracket but age discrimination for workers aged 16-20 persists. Similarly, apprentices will only see an increase from £6.40 to £7.55 in April 2025. We also believe action to promote and embed Living Hours should happen at pace to enable people to plan their finances.

The UK Government has committed to ending one-sided and exploitative zero-hour contracts by introducing a right to guaranteed hours and reasonable notice of shifts to allow workers to better plan their lives and finances.^[136] It is positive to see things potentially moving in the right direction but more needs to happen to increase levels of secure work. Living Hours goes further by calling for at least 4 weeks’ notice for shifts with guaranteed payment if these are cancelled within the notice period, a guaranteed minimum of 16 working hours every week (unless the worker requests otherwise), and a contract that accurately reflects hours worked.137 It is positive to see things moving in the right direction but more needs to happen to increase levels of secure work.

Recommendation 13: The UK Government and Scottish Government should work together with employers to maximise the potential for the UK’s ‘new deal for working people’ agenda and for Scotland’s Fair Work agenda to drive reduced levels of poverty, inequality and financial insecurity in Scotland. This includes bringing an end to age discrimination and recognising the value of apprenticeships by working towards all workers receiving at least the real Living Wage and Living Hours by 2030.

Extending Fair Work First conditionality

The Scottish Government’s Fair Work First principles set out to address particular challenges in Scotland’s labour market, with the aim of making a real difference to people and their communities, business, other organisations and the economy.^[138] Fair Work First aims to drive high-quality and fair work, and workforce diversity across the labour market in Scotland. This is by applying fair work principles to grants, other funding and public contracts being awarded by and across the public sector, where it is relevant.

Within the Fair Work Action Plan, the Scottish Government has committed to extend fair work conditionality with clear standards and minimum requirements to cover all forms of Scottish Government support within the limits of devolved competence.

Recommendation 14: The Scottish Government should expand its requirements in public procurement to ensure that all contractors must meet a wider range of fair work first actions (including living hours, being carer positive and action on accessible and flexible work). This should include enforcement and monitoring of these pledges by contractors by 2028.

Employer incentives

Employers have a role to play in ensuring the financial security of those they employ. The Scottish Government should continue to work with employers to support adoption of fair work principles across the economy. However, to drive greater progress, consideration should be given to how the fair work agenda can move beyond a voluntary approach in places.

This could be by incentivising employers through Fair Work First or by local taxes and local tax bonuses to provide fair pay and hours. In essence, businesses would be rewarded for embedding good employment practice.^[139]

Recommendation 15: The Scottish Government should review how local tax powers can be used in new ways to encourage progress on fair work by the end of 2026. This should consider phasing out the Small Business Bonus Scheme to provide new financial incentives to implement fair work practices and disincentives for not doing so.

Fair Work Agreements

Fair Work Agreements, a set of agreed principles, seek to balance the rights of employers and workers, organisations and society. We believe they are a crucial model to delivering fair work, improving job quality and reducing in-work poverty. It is important to consider how these agreements can be brought to life, avoiding the risk of voluntary approaches reaching only the best employers and therefore reinforcing inequalities.

The Scottish Government is pursuing existing commitments to voluntary sectoral Fair Work Agreements in sectors where low pay and precarious work is prevalent. These will act as test cases for future sectoral work. This is a complex task and will take different forms across sectors. Progress in areas such as adult social care, construction and retail has been encouraging and may provide a platform to build upon.

Recommendation 16: The Scottish Government should engage with employers and unions to review the potential for sectoral bargaining mechanisms and Fair Work Agreements across a range of sectors, including social care, childcare and hospitality, in which low pay and insecure work are endemic. These should become key to conditionality within public procurements, public funding and tax policy within Scotland by the end of 2028.

Step 5: Fair, affordable and accessible services

Addressing needs through services and reducing the cost of essentials are key to delivering a Minimum Income Guarantee in two main ways. Firstly, by reducing the level of income needed to reach a dignified quality of life and secondly by helping to increase household earnings by addressing barriers to the labour market and enabling individuals to increase hours in paid work and take on new roles.

We adopted and amended criteria from the New Economics Foundation,^[140] building on the views of our Experts by Experience Panel, to steer the recommendations made in this Roadmap on services and costs. The criteria provides a guideline on what needs are best met through the provision of services, such as the scale and predictability of the cost, risk to society if the majority of households cannot meet costs, which route provides the most effective and high-quality services and consideration of historical or cultural norms. Beyond the criteria, we also factored in what action was within the Scottish Government’s remit, now and in the future, and what costs would make the most significant impact on people’s ability to reach a dignified quality of life. It was agreed that housing, social care, childcare, digital access, energy and transport were within scope for cost regulation and service provision. It must be recognised that food, one of life’s essentials, is not included as we believe this would be best addressed through increasing incomes.

The Scottish Government committed to exploring Universal Basic Services, following the recommendation of the Social Renewal Advisory Board who also called for the introduction of a Minimum Income Guarantee.^[141] Unfortunately, this work concluded in 2022 citing the lack of powers and finances to continue. We recognise that this element of a Minimum Income Guarantee needs to be examined further in lieu of progress on Universal Basic Services. As proposed in the longer-term steps, the Expert Group and Experts by Experience panel agree that Universal Basic Services would complement and enhance the full vision of a Minimum Income Guarantee.

The Experts by Experience Panel also highlighted to us that, to have a genuine impact on quality of life and financial security, services and mechanisms to reduce costs must be efficient, available, accessible, safe, affordable and see high take-up. Reflecting on their experiences of existing services, such as the NHS, childcare and transport, some members expressed concerns about their existing ability to meet people’s needs. Sometimes these services feel chaotic, have long waiting times and access is challenging. Improvements to existing services are essential to building the foundations of a Minimum Income Guarantee.

Recommendation 17: By 2031, the Scottish Government should move more of the population towards a Minimum Income Guarantee income level by reducing the costs, and increasing the range, accessibility and quality of public services such that household costs are reduced for those on low incomes and increasing the progressivity of taxes to support fairer distributions of income.

Housing

Having a safe and sustainable home is a human right, yet housing insecurity and homelessness continues to rise in Scotland. Over 33,000 households were assessed as homeless in Scotland in 2023/24.^[142] More households, and children, than ever are in temporary accommodation and the time spent in that situation is increasing.143 Young people are at greater risk of homelessness, especially LGBT+ young people. For women, homelessness is most likely to be the result of domestic abuse.144 Prioritisation of safe and affordable housing forms part of these initial steps and a proposal for a separate housing payment will follow later on this Roadmap.

The shortage of homes directly contributes to unaffordability and the rise in homelessness. There is a significant lack of affordable housing across Scotland in both the private and social rental sectors. Around 1.5 million people in Scotland report that they struggle with the condition, security, suitability, or affordability of their home.^[145] The percentage of minority ethnic people living in poverty that are in unaffordable housing, compared to white people living in poverty, is higher (51% compared to 44%). For rural and island communities, the lack of affordable housing is a central reason for young people leaving their communities and finding themselves unable to return. There is also a lack of suitable housing for disabled people and their families.146

While it was beyond the Expert Group’s remit to propose a new solution to the housing crisis, it must be recognised that housing is one of the largest and most important expenses a household will face. Urgent action is needed to improve the broken system to ensure all can access a safe, secure and affordable home. This is an essential foundation for building a Minimum Income Guarantee.

Digital

Access to digital services, such as phone and broadband, can enable cultural and social engagement; access to daily essentials like paying bills; access to public services; participation in democracy; education and skills development; applying for and managing benefits; and access to labour market opportunities. We believe that digital access is an essential foundation for a Minimum Income Guarantee but have concerns about the lack of support for people that want to learn how to navigate digital devices. Digital inequalities are most likely to be experienced by those in poverty and at the scale and pace the digital world is growing it is important that people are not left behind.^[147] Around 57% of disabled people were digitally disconnected due to lack of broadband, kit or confidence in using devices.148 This is also a particular issue for rural and island communities in Scotland.149

Cost of digital access is an issue; social tariffs present a more affordable option for low-income households to stay digitally connected; however, awareness and take-up of these are incredibly low. Only 5% of eligible households are currently signed up to a discounted package.^[150] Social tariffs were discussed by the Experts by Experience Panel. Several members agreed that more should be done to promote social tariffs, as they would either benefit from such a service or know someone who would. As part of wider efforts to increase take-up of entitlements across services, costs and social security, the Scottish Government should promote social tariffs.

Childcare

Accessible and affordable childcare is a fundamental part of the design of a Minimum Income Guarantee. Childcare services should ensure that parents, particularly women who are more likely to be primary carers, have genuine choices about whether to take-up employment and education opportunities or carry out other caring responsibilities, alongside having time to rest.^[151] Crucially, childcare needs to be high-quality, affordable and flexible for parents working irregular hours.

The ability to take on additional hours and progression opportunities is particularly important to women, especially Black and minority ethnic women who are more likely to be working part-time and in low-paid and/or insecure roles.^[152] Close the Gap found many Black and minority ethnic mothers did not use formal childcare, largely as it was too expensive. However, a lack of cultural sensitivity and staff diversity also deterred some Black and minority ethnic mothers from accessing services.153

Location is also an issue: there is a lack of suitable childcare in rural and island Scotland which presents a significant barrier to women accessing the labour market.^[154] While the expansion of free childcare is welcome, the physical lack of provision (in particular for disabled adults and children) in many areas, particularly in remote, rural and island areas, means this support cannot be accessed by many people who need it.155

Childcare costs are typically one of the biggest pressures within household budgets for families and so unaffordable childcare will ultimately mean lower living standards. The costs are typically higher for families with younger children and larger families, two of the priority groups.^[156] The burden of these costs is most severely felt by women and lone-parent families.157

We believe that improving access to affordable and flexible childcare services is an essential foundation for a Minimum Income Guarantee. Understanding the needs of parents and children, local demand, infrastructure and workforce will be key to improving access and the suitability of services. Investment in the workforce, as part of recognising the immense value of the profession, will contribute to childcare services being high-quality and will help the Scottish Government meet wider aims around embedding fair work across typically low-paying sectors.

Social care

We know that social care is a lifeline for many and allows people to realise their human rights. It provides essential support for disabled people, those with long-term conditions and people who need help in older age to live fulfilling lives, whilst also providing support and breaks from caring.^[158] However, social care shares many of the challenges seen across childcare services, including high charges. Around 67% of disabled people report issues with the adequacy and access to social care.159 For unpaid carers, 15% report being at risk of reducing their paid working hours to take on caring responsibilities and 77% reporting that they have been less able to take much needed breaks since the pandemic.160 Adequate and high-quality care is essential for a Minimum Income Guarantee. It allows disabled people and their unpaid carers to focus on their wellbeing and potentially participate in society and the labour market.

Social care requires a skilled workforce. However, the profession, who are mainly women, are systematically undervalued as evidenced by low-pay, insecurity and few opportunities to progress. An undervalued workforce inevitably leads to high churn, expensive recruitment costs and most importantly it leads to a poorer-quality service due to low morale and the inability to retain high-quality care providers.^[161]

Health and care are changing as the population ages. As we live longer there will be more of us that need care in the future and the intensity of that care is increasing. This will undoubtedly lead to an increase in the need for paid care services but will also result in higher demand for unpaid care.^[162] The social care system and support for unpaid carers needs to be improved in the nearer term, as well as being future proofed. While many unpaid carers choose to provide care for a loved one, many provide this care, or provide at a level they do not wish to, because existing services do not meet people’s needs, or the costs are too high.163 The social care system in Scotland should provide appropriate services to enable unpaid carers to have a life outside caring including access to employment or education, should they so wish. Such social care should also be provided at a level that enables carers to protect their own health and wellbeing and delivers a right to a break from caring. Support for young carers should help them to be children and young people first and foremost with the same opportunities as their peers.

The social care system should work to support people to have positive lives beyond only having their basic needs met. It is not just about getting washed, dressed, fed and going to the toilet. It is about ensuring that disabled people are treated with and experience dignity, respect and wellbeing. Social care should enable independent living which is about having freedom, dignity, choices and control. It is about being able to lead your own life, which is not something that disabled people can take for granted. This is about being included and involved in your family, community, learning, work and wider society. It is about social, civic and political participation. Independent living, for disabled people, is about being able to choose where and with whom you live and having the support you need to make choices and participate, alongside non-disabled people. Social care should be the springboard to this.

Transport

Affordable and accessible transport is fundamental to a successful Minimum Income Guarantee, supporting access to employment and reducing household costs. These costs are a significant expenditure for many households, particularly for households with children. Transport planning typically prioritises services for non-disabled commuters, working 9-5, and travelling from the suburbs into city centres without dependents. This means that women, disabled people, unpaid carers, people who work atypical hours, and rural and island communities do not benefit from a transport service that is designed to meet their needs.^[164]

The objectives of the existing concessionary travel scheme are: to allow older people and disabled people improved access to services and social networks; reduce household costs; embed sustainable travel behaviours; and increase access to social, educational, and employment opportunities. However, the public transport system is not designed in a way that considers the intersectional needs of different groups. For instance, whilst the expansion of the concessionary travel scheme to under 22-year-olds has been welcome some groups face barriers. Only 48% of LGBT youth felt safe travelling on public transport in 2022, a decrease from 67% in 2017.^[165] Safety is also a key concern for women using public transport and violence against women and girls is more likely to shape women’s travel behaviours. LGBT women, disabled women and Black and minority ethnic women are at a greater risk of experiencing sexual violence and harassment on public transport, including homophobic and racist abuse.166,167

Transport options for disabled people remain limited and as a result transport costs can be higher as people have to rely on more expensive accessible options. Although all trains were to be accessible by 2020, not all train stations are reliably accessible for wheelchair users and de-staffing stations means that there is a lack of support for those needing help getting on and off trains. This lack of access to affordable and reliably accessible transport has a consequential impact on access to services, education, work and leisure.^[168]

The public transport system in Scotland is not designed to meet women’s distinct needs and is failing to deliver the promised opportunity to access work, education and essential services. Women typically have a greater reliance on public transport and are less likely to have access to private transport. Women are also more likely to require it to: undertake unpaid work; require off peak travel to suit part-time and flexible working patterns; and are more likely to experience poverty or low incomes.^[169]

Recommendation 18: By 2031, the Scottish Government should focus on improving the availability, access, quality and take-up of existing services with an effort to minimise barriers to support and inequalities by:

• taking urgent action to ensure that everyone has access to a safe, secure and sustainable home with focus on those most marginalised and experiencing intersecting barriers.
• promoting existing broadband, phone social tariffs, and providing sufficient support to people who are digitally excluded.
• reviewing the affordability of childcare and monitoring how this interacts with people’s ability to reach a Minimum Income Guarantee. Improving the implementation of the current Early Learning Childcare offer by ensuring this is available, accessible, and flexible for all and suitable for children with additional support needs. This should also look at the infrastructure and working conditions of childcare employees that need to be met prior to any expansion of funded hours, paying attention to the availability of funded hours beyond term time, over the medium term.
• establishing a core level of service provision for social care that enables disabled people to live independently and achieve ordinary things that others take for granted, such as participation, learning, education and working if this is an option for them. Similarly, adequate social care will enable unpaid carers to access opportunities alongside their caring responsibilities, where they wish and if able to do so, including by supporting access to employment, community participation and education.
• working with transport providers and Local Authorities to agree an approach to improving safe and equitable access to public transport which meets the needs of communities across Scotland.

Council Tax

In our interim report, we called for the Scottish Government to ensure council tax reduction and water rates discounts for households on lower incomes are reviewed, with the view of expanding eligibility for exemption.^[170]

The current council tax system is flawed, regressive and requires significant reform or replaced entirely longer-term. While the Council Tax Reduction Scheme is in place to support the lowest-income households. Ultimately, the link between the amount a household pays in council tax does not account well enough for household income, household costs (e.g. the costs of a disability or childcare) or the ability to pay.^[171] Equally, council tax does not reflect the current house values.172 The tax burden is unfairly spread with people in less expensive homes paying a higher proportion of their property’s (outdated) value in council tax than those in the most expensive homes.173

The decision to freeze council tax in 2023^[174] further embedded inequality in Scotland.175 Households most able to pay higher council tax rates made most savings. However, lower-income households only saved an average of 50p a week.176 Furthermore, freezing council tax resulted in less money for critical, locally delivered public services.

Lastly, the levels of council tax in Scotland are lower than in Wales or England, with a tax gap estimated of £600-900 million per year.^[177] In Step 7 of this Roadmap, we set out more of our thinking on how council tax could support investment in the initial steps of a Minimum Income Guarantee, if necessary. Firstly, by helping to close this tax gap, secondly, by expanding support for low-income households, and thirdly, by bringing council tax bills closer to being proportionate to house value (ideally accompanied by revaluation). This would not preclude more fundamental reforms to council tax as called for by multiple bodies over the last few years.

Energy

Social tariffs can provide a buffer for low-income households, ensuring access to essentials at an affordable price and protection from the price rises we’re all too familiar with since the pandemic and cost of living crisis.^[178] Targeted measures to reduce these costs can enable more households to live a dignified quality of life and provide a stronger safety net that isn’t dependent on increasing income alone. This can be especially helpful at protecting against uncertain times and unexpected price rises – it means people are less likely to be cut off from vital services.179 However, crucially, social tariffs cannot be fully effective while they are disparate and reactive, rather than nation-wide and proactive. They need to ensure that everyone that is entitled is aware and supported to access social tariffs. Powers to introduce a social tariff are reserved, therefore, cooperation will be needed to see action in this area. We need to see an obligation placed on utility providers to maximise take-up and proactively identify and support households who qualify, ideally through an automated system.

Recommendation 19: The Scottish Government should work with the UK Government to develop and deliver a new automated national social tariff for energy in Scotland, prioritising the reduction of energy costs for low-income households in the first instance and those who face higher costs, including rural and island communities and disabled people. This would see an automated system that proactively targets support to low-income households to ensure no one goes without essential services by 2031.

Step 6: Piloting a Minimum Income Guarantee

Piloting key elements of a Minimum Income Guarantee will be essential to ensure the necessary lessons learned can be built into the later stages of this Roadmap. One later step we would want to test through a pilot is our proposal of a time-limited Minimum Income Guarantee at the relative poverty line, an interim measure, prior to the introduction of a full Minimum Income Guarantee. This interim measure is designed to accelerate progress towards a Minimum Income Guarantee for all. This would be more affordable than a version that is not time limited and would help build public trust in this new form of social contract. It should be accompanied by strengthened service provision. The time-limited payment is one of the recommendations that we spent greater time discussing. Some Expert Group members raised concerns about this. We are therefore clear that a pilot of a Minimum Income Guarantee should inform the implementation of these later steps in general, and in particular, in relation to a time-limited boost in support.

What do we want to test?

A pilot will help us to understand the key elements of a Minimum Income Guarantee and how they would work, including the outcomes for people in receipt, particularly unintended positive or negative consequences. The types of things we would want to test the impact of include:

• a tailored and responsive social security payment which varies by household need and earnings, which would see participants meet at least the relative poverty line.
• a social security payment based on the enhanced understanding, recommended in our early steps, of the costs some households face. In particular, disabled people, unpaid carers and those living in rural or island communities to ensure they benefit from the same standard of living.
• no conditions and sanctions.
• better services to support financial security and dignity. This should include advocacy services to support the management of finances during, before and after the pilot.
• linking up with strengthened service provision in certain areas. Current examples being the Early Adopter Communities^[180] for school age childcare and the child poverty Pathfinder projects181 to provide person-centred and easier access to services. This will build an early understanding of how services can be integrated with social security to support living with dignity.
• the impact of transitioning on/off the higher level of support provided for the duration of the pilot. Building on the learning on transitions from the Basic Income Care Leavers pilot in Wales.^[182] This will ultimately test whether time-limited provision can have a positive impact ahead of any implementation of the time-limited Minimum Income Guarantee.
• the design, including application, assessment and payment mechanisms. This would need to look at how we can best understand who has a caring responsibility or is disabled, an important component of the time-limited Minimum Income Guarantee policy as these groups would be exempt from any time-limit (further detail on this can be found at Step 9 on this Roadmap).

A pilot should consider primary learning outcomes around the impacts of a Minimum Income Guarantee on: financial security; poverty and inequality; and physical and mental health and wellbeing. Secondary learning outcomes could include consideration of the impact on employment and labour market outcomes; education and learning; productivity and the economy; and broader considerations around trust, hope for the future and social cohesion. Furthermore, a pilot may wish to consider administrative-focused learning outcomes around satisfaction levels, performance and take-up. Each of these would need to be designed to fully support intersectional analysis across and within population groups.

Understanding the impact

It will be particularly important to understand the potential intersecting and compounding inequalities faced by some people within and across population groups, which may reduce the positive impact of this type of intervention. The pilot must be designed to overcome any barriers to living with financial security and dignity. It must have the right frameworks in place to learn and adapt from those experiences throughout.

Monitoring should be in place to ensure women are able to continue participating in the labour market and are not disincentivised because of the pilot. We believe that a strengthened social security offering without the accompanying strengthened services to support labour market access could have this outcome.^[183] Understanding this better could be a key element of any pilot design.

There are several different population groups that could be considered for a pilot. The Collective explored a pilot in their intersectional analysis and highlighted four potential population groups:

• unpaid carers – who are disproportionately women (and within that, Black and minority ethnic women and disabled women).
• low-income migrants with no recourse to public funds (within that group women are more likely to be in poverty, those who are survivors of domestic abuse or sexual assault are further harmed, disabled women are often unable to access the support they need).
• disabled adults – with a particular focus on disabled women, disabled single-parents, LGBT disabled adults and Black and minority ethnic disabled adults. This will require engagement with Disabled People’s Organisations.
• young people leaving care – with a focus on those who are most disadvantaged and often not responded to competently within services: Black and minority ethnic young people, LGBT young people, and young disabled people.^[184]

A pilot for unpaid carers has been a consideration more widely. The Poverty Alliance held a seminar^[185] where it was clear that a Minimum Income Guarantee should provide financial resources and strong public services that enable carers to live decent, dignified and fulfilling lives. They recognised that a gendered approach would be vital as most unpaid carers are women. Carers Scotland and IPPR Scotland have created a proposal for a pilot for unpaid carers who are caring for more than 20 hours per week.186 This report highlights the importance of services alongside any pilot.

Care leavers have been another group proposed with the Scottish Throughcare and Aftercare Forum (STAF), proposing a pilot for young people leaving care who are on a Modern Apprenticeship,^[187] offering a great example of how paid work could be brought into a pilot. We were impressed with both projects and how they encompassed other elements beyond social security.

The Poverty Alliance also conducted a seminar considering a pilot for rural and island communities. This group has been raised with us on several occasions due to the increased costs they face, making them an ideal test of the impacts of a Minimum Income Guarantee. The seminar discussion recognised that any pilot would need to be flexible to account for different geographies and infrastructures across rural and island Scotland, therefore running concurrent pilots may be needed.^[188] Both seminars run by Poverty Alliance wanted to see a pilot that was designed for and with those with lived experience of financial insecurity in their communities.

Design considerations

A key concern we have about the design of the pilot and the later step recommendation for a time-limited Minimum Income Guarantee is how it defines, identifies and assesses groups like disabled people and unpaid carers. We know that current definitions are not fit for purpose and could lead to people experiencing hardship. This would need to be considered as part of any pilot undertaken.

We believe there are potential routes to delivering a pilot, particularly using existing powers held by the Scottish Parliament around the Scottish Child Payment, carers benefits and other income-assessed payments (including proposals for financial support for young people leaving care). Furthermore, utilising existing assessments from other parts of the social security system could be a route to reducing administrative costs (for example using Universal Credit monthly statements as the basis of calculating a pilot Minimum Income Guarantee award).

In terms of the structure of the pilot, there is a great deal of high-quality work to draw on, including the feasibility work looking at Citizens’ Basic Income pilots in Scotland,^[189] and the learning and evaluation around the Basic Income pilot for young people leaving care in Wales.190

One of the key considerations of a pilot for a Minimum Income Guarantee would be that it is unlikely to include all elements of a full Minimum Income Guarantee, across paid work, costs and services, and social security. A pilot is most likely to focus on social security and services, with work and costs likely to need to be whole-population interventions. Equally, a pilot could not include the potential impacts of some of the costs of implementing a Minimum Income Guarantee, for example any tax changes that may be needed to invest in delivering it. Lastly, a pilot would likely need to make compromises in terms of the design of the Minimum Income Guarantee compared to the full version outlined in this Roadmap.

Crucially, a pilot would need to consider potential unintended consequences, including any tax and benefit implications for pilot participants. Ideally, a pilot would avoid the risk of clawback through the UK-wide tax or benefit system. This is likely to require primary legislation to use existing devolved social security powers to deliver a Minimum Income Guarantee pilot payment.

The key design features for a Minimum Income Guarantee pilot should be:

• overall duration of three years with learning and evaluation beyond.
• depending on the population group selected, differing durations of social security support could be provided to test the impact of a time-limited Minimum Income Guarantee, recommended later in this Roadmap.
• a simplified assessment process – for applicants and the administrative system.
• a simplified payment – though one that still varies by need and income.
• a clearly defined eligible group.
• a group where we can understand the interaction beyond solely social security so bringing in elements of enhanced services.
• a group with an elevated risk of financial insecurity.
• reducing the risk of Department for Work and Pension and HMRC clawback.

Recommendation 20: The Scottish Government should establish a multi-year pilot of a Minimum Income Guarantee in Scotland by 2029.

Step 7: Financing the first steps of a Minimum Income Guarantee

The first steps of a Minimum Income Guarantee are about building the foundations. We have outlined a number of areas where public spending will be necessary, many are reforms to Universal Credit. They include ending the two-child limit, ending the five-week wait, increasing the government’s childcare contribution for low-income families to 100% from 85% (ending the Parenting Penalty, as outlined above) up to a cap, ending unaffordable benefit deductions from public bodies, and doubling the Scottish Child Payment, by 2030.

It is important to note that there are other areas in our initial steps that are not yet costed or built into this section of the report. Costs for services, piloting and work will need further development before full costings can be undertaken.

Table 3 below sets out the costs and impacts of these first steps.^[191] This is not fully comparable to other modelling presented in this paper because, among other differences, it does not assume full take-up of benefits.

Table 3: Estimated costs and impacts of first steps towards a MIG:

Policy measure	Cost in 2030-31 (2024-25 prices)	Child Poverty impact*
Increase Scottish Child Payment to £55 **	£444m[192]***	3pp[193]
End two-child limit **	£182m[194]	1pp[195]
Increase Scottish Child Payment to £55 and end two-child limit **	£626m***[196]	6pp[197]
End Five-week wait	£175m[198]	N/A
Ending unfair third-party Benefit deductions	£40m[199]	N/A
End the shortfall in Universal Credit childcare costs	£12m[200]	N/A

*Relative poverty impact is the reduction of relative poverty after housing costs (AHC) in percentage points (pp). A household is in relative poverty according to this definition if its disposable income is below 60% of the UK median, with income measured after subtracting housing costs and adjusting for household composition (‘equivalisation’). For more information on how income is measured when measuring poverty, including treatment of housing costs, see Poverty and Income Inequality in Scotland 2020-23.

** Cost and impacts of these measures are based on Fraser of Allander Institute modelling^[201]

*** Figure excludes spend already committed to Scottish Child Payment.

Total additional spend from the measures in this table would amount to around £671 million per year by 2030/31 (in 2024/25 prices). This excludes the additional cost of the two-child limit as it is already committed spend. The UK Government’s forthcoming Child Poverty Strategy may consider ending the two-child limit across the UK, freeing up £182 million of planned Scottish Government spend and there is increasing pressure to end the five-week wait, freeing up a further £175 million. If the UK Government implemented both of these measures across the UK by 2030/31 this could free up £357 million of the spend by Scottish Government calculated in this table. It would take the cost of this package of measures from around £671 million to just under £496 million. Equally, pressure is increasing on the UK Government to act on the Bedroom Tax and Benefit Cap, measures that the Scottish Government has already allocated £82.6 million to mitigating, if this was done this could further reduce financial pressures.^[202]

As outlined above, these measures would have a significant impact on reducing child poverty in Scotland. Combining the ending of the two-child limit in Scotland with an increase in the Scottish Child Payment to £55p/w by 2030/31 (in 2024/25 prices) would result in a decrease in child poverty by 6 percentage points, taking Scotland around half of the way necessary to meeting the legally binding child poverty targets for 2030.

We can raise this additional revenue annually over this time in a few ways. We commissioned analysis^[203] that outlines that an increase in UK Government spending could increase Scotland’s budget, through the Scottish Parliament’s Block Grant. Equally increasing tax revenue per head from devolved taxes in Scotland relative to the rest of the UK could also increase Scotland’s budget, through higher tax revenues in Scotland.

In terms of raising tax rates, the analysis highlights how council tax and income tax powers could be used to raise this broad level of revenue. This includes adjusting Scotland’s income tax thresholds relative to the rest of the UK, raising revenue in a progressive way from higher earners, and increasing council tax in a progressive way, raising revenue from properties in higher council tax bands. The report also notes that it is very rare for specific policies to be accompanied by particular tax rises, given tax revenue is used to fund public spending as a whole, rather than for particular spending areas.

The Expert Group believes revenue for its first steps should come through the following ways.

• Making increased spending on building a Minimum Income Guarantee a protected spending line in the Scottish Government’s budget – this would see spending on this package of measures given priority alongside other protected departments (such as the NHS and schools), from any Block Grant increase and/or increases in tax revenues. This would categorise spending in this area correctly as preventative spend, with departments across Scottish Government budget lines contributing to it through slightly lower increases in spend.
• If tax rises are required beyond this – to fund spending elsewhere in the Scottish Government’s budget – the Expert Group believes these should come from reforms to council tax. This revenue would go straight to local authorities but could reduce some of the central grant they currently receive. Over the medium to long-term, the Expert Group supports reform to council tax to deliver a fairer local tax in Scotland, opening opportunities for further increases in tax revenue in a progressive way. However, we cannot wait for full-scale reform to take place to make changes to council tax in Scotland and so support the following:
  • taking action to begin to close the council tax tax-gap between Scotland and the equivalent level of council tax bills in England. This council tax gap shortfall is estimated at £600-900 million per year in Scotland.^[204] The Expert Group is clear that revaluation of council tax bands is long overdue and must be undertaken as a priority as part of closing the council tax tax-gap.
  • adjusting council tax ratios – known as multipliers – so that increases fall primarily on properties in the higher tax bands, moving council tax bills to be much closer to a standard percentage of assessed value. Analysis shows this could raise up to around £500 million per year. As outlined above, this would require revaluation to take place as a matter of urgency as part of these changes.^[205]
  • taking forward the improvements we recommended in our interim report to the Council Tax Reduction Scheme, which could be funded through some of the increased revenue delivered by these reforms. This would ensure the council tax bills of low-income households in Scotland are reduced, while increasing council tax revenues more broadly. The Scottish Government should work with local authorities to increase take-up of the Council Tax Reduction Scheme.
  • If the Scottish Government wished to take a broader approach to tax rises, the Expert Group believes consideration should be given to reducing income tax thresholds in Scotland relative to the rest of the UK. The UK Government has outlined plans to increase income tax thresholds with inflation from 2028/29 in the rest of the UK. Holding income tax thresholds in cash terms in Scotland instead could raise additional revenue for public services in Scotland, with increases focused on higher earners.

Recommendation 21: The Scottish Government should make investment to deliver the initial steps of a Minimum Income Guarantee a protected spending area in the Scottish budget. If further revenue is required for spending in unprotected areas progressive council tax reforms and changes to income tax thresholds should be considered.

Our people in 2026-31

The following provides an indication of how household income and benefits in kind may change through the gradual introduction of a Minimum Income Guarantee. They are intended for illustrative use only. Note that the additional costs for disabled people, unpaid carers and rural and island communities have not been sufficiently quantified so are not reflected in the graphics. The infographics are on a before-housing-cost basis, meaning housing costs have not been subtracted out.

Samira and her children now live with greater financial security. The introduction of the Essentials Guarantee; the increase in the Scottish Child Payment; and the removal of the two-child limit have drastically changed Samira’s circumstances. She no longer has to choose between heating and eating. The childcare on offer, which is now more flexible to accommodate her irregular working pattern, has allowed Samira to take on more hours at work and she is hoping to find a better paid, stable job in the future. However, she is currently unable to retrain as she cannot afford to lose her current income. Her children can now buy some books and toys and participate in some extra-curricular activities.

Ellie and Lucy had to move further out of Edinburgh to be able to afford accommodation in the period of financial insecurity they faced. However, overall their situation has markedly improved over this period with the introduction of the Essentials Guarantee and the need for affordability checks prior to paying back their Council Tax arrears. This has eased the financial pressures the couple have faced. Ellie is benefitting from being part of one of the pilot areas for the new approach to sanctions and conditions. Her work coach is focused on supporting her longer-term career goals and has found some part-time work with a guarantee of hours which allows her to support them financially, alongside her Universal Credit payment. The couple feel a lot more optimistic about the future and feel better able to plan their finances now they have more certainty over their incomes.

Filip was made redundant from his role and has used much of his savings for retirement to keep him afloat while he looks for a new job. He is currently in receipt of Universal Credit and is glad the level of support has improved with the introduction of the Essentials Guarantee. He would really benefit from employment support as he’s not had much luck finding a job that matches his skills, interests and experience. Since turning 60, Filip has been making use of the free bus travel scheme and is pleased to see there are more regular buses available that allow him to see his family and access local services. He has also signed up for a broadband social tariff which he wasn’t aware he was entitled to before. He is optimistic that better access to transport and the internet will open up more job opportunities as he begins his search.

Mike and Janice have benefitted from a review of the adequacy of both carer and disability benefits, and now believe they are meeting the additional costs they face due to their circumstances. The Essentials Guarantee has also improved their overall finances. A greater focus on accessible travel in Angus, particularly for disabled people, has meant they do not always need to use their car to get about reducing their outgoings on petrol. It has also meant that Janice has been able to take up volunteering again. The couple have also noticed more positive messaging about accessing benefits in the media and this has made them feel more supported and cared for living in Scotland.

Creating aFairer Scotland: 2031-36

Ensuring success through cooperation

Establishing frameworks for cooperation between governments to enable progress.

Interim, time-limited Minimum Income Guarantee

Introducing a time-limited Minimum Income Guarantee on an interim basis which builds on learning from the pilot.

Ensuring everyone has a level of income that promotes dignity

Premiums should be introduced to help bridge any reduced earnings potentially faced by some individuals.

Futureproofing skills and employment

Shifting the focus to futureproofing skills and employment opportunities and supporting people to reach their potential.

Reducing household costs and unlocking opportunities

Expanding services to reduce household costs and allow people to participate in society.

Financing the next steps

Considering reform across VAT, Income Tax Personal Allowance and National Insurance Contributions.