Part 3: Operational policy
This section will be relevant to anyone with an interest in social security in Scotland. Even if you have only answered questions in one of the sections in the preceding part, we would be grateful for your views on the questions in Part 3 as well.
Parts 1 and 2 of this consultation have been about the establishment of a new social security system and the specific benefits it will deliver. Part 3 looks at the strategic functions that the social security system will need to carry out in order to operate competently. This means functions that aren't specific to any individual benefit but could apply to any of the devolved benefits. We refer to these functions as 'operational policy' areas'.
This section asks for your views on the following operational policy areas:
- Advice, representation and advocacy - understanding the impact on advice services
- Getting things right - how we can deal with complaints, reviews and appeals
- Where you live - residency criteria for entitlement to devolved benefits
- Managing overpayments - how we can deal with claimant debt
- Fraud - how we can protect against intentional wrongdoing
- Information assurance - why we need to hold claimants' information, how we will look after it and what we will do with it
- Uprating - how we can maintain the value of benefits, in line with inflation
For each of these areas, we will set out the background, explain our thinking and seek your views.
14. Advice, representation and advocacy
- The Scottish Government has a proven track record of supporting and funding advice services in Scotland.
- We understand that the transfer of responsibility for the devolved benefits, from DWP to a Scottish social security agency will have an impact on the Scottish advice sector landscape.
- We want to understand whether the transfer of responsibility for the devolved benefits can be harnessed to drive holistic improvements to the provision of publicly funded advice in Scotland - for example, by improving the way advice services and a Scottish social security agency might work together.
- We are gathering evidence on the existing system and seeking people's views on the scope for improvement.
The Scottish Government would like to ensure that people who need to access services are empowered to do so. There is a clear consensus that the right advice can have a transformative effect on service delivery by guiding people in need to the right support at the right times, assisting with processes such as applications and appeals and increasing take up. The Scottish Government agrees with the Scottish Campaign on Welfare Reform ( SCoWR), where they say that, "In any time of change the potential for confusion will increase and therefore measures should be taken to mitigate this risk . . . there must be a well-resourced advice sector to ensure support is accessible to everyone  ".
The Scottish Government's intention is to design a social security system that is person-centred, accessible and supportive and we believe that our track record of supporting and funding advice services supports this. However, it is fair to say that the transfer of responsibility for the devolved benefits, from DWP to a Scottish social security agency is likely to have an impact on the advice sector landscape in Scotland and the way in which the Scottish Government supports advice services. In this section, we will discuss the broad framework within which advice is currently provided in Scotland, and seek your views on the ways in which we should approach the provision of advice and information, in the context of a Scottish social security system.
The 11 devolved benefits span a range of issues, needs and circumstances; they have different eligibility criteria and interrelate with other aspects of the social security system in various ways. Many people, therefore, will access advice services to support them to understand their entitlement and to resolve issues.
There is currently a range of publicly funded, free at point of access information and advice available in Scotland, covering matters which could be relevant to individuals claiming one or more of the devolved benefits. This includes welfare rights, money and financial capability, debt, energy efficiency and health. For each of these topics, different types of advice are offered. The Scottish National Standards for Information and Advice Providers  ( SNSIAP) defines these as: signposting, casework and representation. Further details of these three types are shown in the diagram below.
Notes for the above graphic
A pyramid diagram providing more information on signposting, casework and representation. Type 1: signposting is at the base of the pyramid. This involved actively providing information either orally or in writing, and providing an explanation of technical terms or clarifying an official document, for example, a tenancy agreement. At the centre of the pyramid is type 2: Casework. This involved setting our options or courses of action, encouraging the user to take action on their own behalf and providing practical aid with letters or forms. This also includes negotiating with third parties on the user's behalf, referring users to another source of help and supporting users to make their own case. At the top of the pyramid is Type 3: representation. This involved mediation at tribunal or court action level.
Type I and II advice - Signposting and Casework
Various organisations in Scotland, such as Shelter and Citizens Advice Scotland, provide Type I and II advice. DWP also provide a range of level 1 information on the devolved benefits and related services via the Gov.uk web platform. This includes:
- Contact information for on-line, telephone and postal enquiries
- An overview of each of the devolved benefits, along with information on eligibility, entitlement and how to claim
- General advice on entitlement to other government benefits and some local government services, categorised by a person's circumstances e.g. parent, pensioner, etc
- On-line application forms and guidance notes for most of the devolved benefits except for PIP, Severe Disablement Allowance and Cold Weather Payments
- Advice on further support which includes signposting people to local authorities, Citizens Advice, some charities who may be able to help (such as Carers UK and Family Fund Trust) and other government departments (e.g. Jobcentre Plus and HMRC, etc.)
- Free on-line benefit calculators
In addition, local authorities and a wide range of third sector organisations provide casework services in one or more of the different areas covered by the Standards, and may also signpost to other services for enquiries outside their area of specialism. Casework can involve developing a detailed understanding of a particular area of the law.
Type III advice - Representation
Some of these organisations will also provide Type III representation services. This involves applying a detailed knowledge of a particular area of the law in the context of a tribunal, court or medication setting. The role of the representative is often similar to that of a lawyer in court, although advisers may not be legally trained. It is important not to confuse representatives with 'advocates' working for advocacy services, as described later in this section.
Impact of the devolved benefits
The transfer of responsibility for the devolved benefits will place new requirements on the advice sector in Scotland that will need to be understood and managed. We also need to ensure that - once our new Scottish social security system has been established - our approach to the provision of advice and information reflects our overall principles. This means:
- Providing the right advice for individuals' needs and circumstances is an investment in the whole of Scotland and an important tool for tackling poverty and inequality
- Providing the right advice for individuals' needs and circumstances, to help ensure that users of the Scottish social security system are treated with dignity and respect
- Ensuring that the processes and services which are put in place to deliver the right advice are evidence based and designed with the people of Scotland
- Putting the user experience first to ensure continuous improvement of national and local policies, and processes and systems that support delivery of advice, demonstrating that processes and services put in place to deliver the right advice are efficient and offer value for money
The Scottish Government intends to work closely with the publicly funded advice sector to assess its current capacity and capability and identify strengths, weaknesses, opportunities and key risks. This will help us to:
- Understand the key drivers affecting advice services now and in the future
- Identify ways in which organisations and individuals can make the most of new opportunities, and manage any additional complexity resulting from the transfer of responsibility for social security to Scotland
As part of this work, we want to use this consultation to ask for peoples' views on the publicly funded advice that is currently provided. We aim to find out if we can harness the transfer of responsibility for the devolved benefits to drive improvements to the provision of publicly funded advice in Scotland, to better support vulnerable people and help deliver holistic advice services. This will ensure people seeking to access the social security system are not only given the right information, according to their needs and circumstances, but are also offered support in other aspects of their lives that could make a difference - for example, support with housing issues, energy efficiency measures or debt management.
What role[s] should publicly funded advice providers to play in the development of a new Scottish social security system?
What steps need to be taken, to understand the likely impact of the transfer of the devolved benefits on publicly funded advice in Scotland?
How could the transfer of the devolved benefits to Scotland be used to drive improvements in the provision of publicly funded advice?
The Scottish Government recognises that applying for and being assessed for social security benefits is a challenging process for people, especially for those with long-term health conditions and impairments. We also know that those with particular needs will always need additional support that sometimes goes beyond what can be expected of the advice sector. Advocacy, for those most at risk, has proved to be of significant assistance in providing one-to-one tailored support.
We have purposefully separated this section on advocacy from the sections on advice, signposting, casework and representation. This is because independent advocacy organisations are usually separate from organisations that provide other types of services, and also provide support in all areas of a person's life. There is usually a sequence of support - individuals with particularly intense or complex needs will be transferred by information and advice workers onto an advocacy service.
For those people most in need of support, it is important to ensure that they are fully supported to engage effectively with the process. For some, levels of anxiety can be such that opening mail when it arrives or making telephone calls to initiate the claim process are intimidating, and attending meetings or interviews completely overwhelming. The resultant anxiety can have the effect of exacerbating mental and physical health conditions. Independent advocates provide the very individualised support required in such situations, taking the time required to get to know the person and build a trusting relationship with them. Advocacy also aims to empower individuals and support increased confidence and knowledge of rights so that, in the longer term, some individuals will no longer require such support.
Do you think that Independent Advocacy services should be available to help people successfully claim appropriate benefits?
Please explain why
What next steps would you recommend that would help the Scottish Government better understand the likely impact of the transfer of the devolved benefits on independent advocacy services?
15. Complaints, reviews and appeals
- We want to provide high quality services and information to all who interact with Scotland's social security system. We recognise, however, that there will be occasions when people's experience falls short of this vision. It's important, therefore, that an effective complaints handling procedure is put in place.
- In this section, we will seek your views about the best way to handle individuals' comments, concerns and complaints.
- We highlight where best practice already exists, through the work of the Scottish Public Services Ombudsman and the Complaints Standards Authority.
- We ask for your views on whether the principles and model for handling comments, concerns and complaints developed by the Complaints Standards Authority should be adopted for use by our agency as part of our Scottish social security system.
We want as many individuals claiming devolved benefits in Scotland to receive the service they expect, to the standards they expect at the first time of asking. However, we recognise that - as with any system providing services to over a million people - there will be disagreement over some decisions and we will need a further opportunity to ensure that we get things right. The Scottish Government entirely supports the user's right to comment on, or complain about our conduct, processes and to appeal decisions. That is why one of our underlying principles is that, "we will strive for continuous improvement in all our policies, processes and systems, putting the user experience first".
We recognise the value of users comments and complaints, and we want to ensure that the lessons learned in handling complaints are used to improve overall delivery of our services. By handling comments and complaints in the right way, we hope to be able to show improvement, from the point at which the issue is first identified, to be the point at which it is resolved. This is why we will develop a Complaints Handling Procedure ( CHP) for our new agency. The CHP will help to address dissatisfaction by providing clear, fair and reasoned responses in a timely manner. The CHP will be owned by our new social security agency, which will be responsible for keeping it up to date and fit for purpose.
There is already a great deal of valuable practice in complaints handling, available across the Scottish public sector including a dedicated public body, the Complaints Standards Authority, which has been set up to act as a centre for excellence  . This organisation publishes model complaints handling procedures, guidance, best practice and training resources.
In line with this, we believe that there will always be at least two opportunities to resolve complaints promptly through internal action by our officers: ' frontline resolution' (aiming to resolve complaints at first contact through apology, explanation or action) and ' investigation' (for complex or serious issues requiring further investigation). This is already the practice in other areas of the Scottish public sector - for example, local authorities have a two-stage process for complaint handling.
In developing our CHP, we propose following the Scottish Public Services Ombudsman's 'Statement of Complaints Handling Principles'. This states an effective procedure should be:
- User-Focused: it puts the person who is complaining at the heart of the process
- Accessible: it is appropriately and clearly communicated, easily understood and available to all
- Simple and timely: it has as few steps as necessary within an agreed and transparent timeframe
- Thorough, proportionate and consistent: it should provide quality outcomes in all complaints through robust and proportionate investigation and the use of clear quality standards
- Objective, impartial and fair: it should be objective, evidence-based and driven by the facts and established circumstances, not assumptions and this should be clearly demonstrated
We believe that an effective CHP should also:
Seek early resolution: it aims to resolve complaints at the earliest opportunity, to the service user's satisfaction wherever possible and appropriate.
Deliver improvement: it is driven by the search for improvement, using analysis of outcomes and support service delivery and drive service quality improvements.
Where complaints cannot be resolved internally, we would encourage complainants to take the matter to the Scottish Public Services Ombudsman. This is the final stage for complaints about public bodies in Scotland, is independent and provides its services free of charge.
Do you agree that we should base our CHP on the Scottish Public Services Ombudsman's 'Statement of Complaints Handling Principles'?
Please explain why
Internal reviews of decisions are normal practice across government and the wider public sector. Local authorities, NHS Scotland, the Scottish Government, the Scottish Parliament, HMRC and the Student Awards Agency for Scotland are all examples of bodies that carry out an internal review before allowing an onward appeal. When the right processes, and the necessary checks and balances are in place to ensure that they are carried out appropriately, internal reviews can provide an efficient, affordable way for an organisation to correct mistakes.
DWP carries out internal reviews of decisions. When an individual disagrees with a decision made by DWP, and before that person can appeal the decision at a tribunal, they must ask DWP to carry out an internal review. This process is known as a 'mandatory reconsideration'  . We recognise that there are differences of opinion on how well these existing arrangements work. That is why we are consulting on ways in which we can make an internal review process work for Scotland, rather than on adopting the existing arrangements.
We believe that internal reviews would present an opportunity to improve decision making, by allowing the agency to scrutinise the initial decision. We recognise that there are other ways to allow decisions to be reconsidered - for example, under the arrangements that are still in place for Housing Benefit decisions, the decision maker has the power to reverse a decision at the point at which the applicant requests an appeal. However, we believe that making it absolutely clear that individuals can request an internal review without making an appeal, would be an accessible, efficient and cost-effective route to the resolution of disagreements, and would enable the agency to identify and address issues at an early stage.
However, internal reviews could also place an additional administrative requirement on service users, by placing the burden of obtaining the reconsideration within strict time limits (for example within one month of the date of the decision) onto the individual who is making the claim. Internal reviews could also contribute to delays in getting a decision right, if there is a lack of monitoring or oversight of the amount of time it takes the agency to review their decision. There is currently no official time limit for the mandatory reconsideration of DWP decisions, although a UK Government Minister has stated that, "if no further information is needed and the case is straightforward, the mandatory reconsideration process... could be completed relatively quickly. We would usually expect this to take around 14 days"  .
How should a Scottish internal review process work?
What would be a reasonable timescale for the review to be carried out?
If an individual still disagrees with a decision, after it has been reviewed internally by the organisation that made the decision, then the individual should have the right to appeal. At the moment, if an individual still disagrees with DWP's position following mandatory reconsideration, they can then appeal to a tribunal. We recognise that there are other examples in the Scottish public sector, of ways in which decisions can be challenged - for example, if an individual disagrees with a decision made by a local authority in relation to the existing Scottish Welfare Fund, then they have the right to an independent review by the Scottish Public Sector Ombudsman - and we think that this is the right approach for a discretionary scheme like the Scottish Welfare Fund.
The Scottish Government proposes to proceed on the basis that it would be appropriate for appeals against decisions made in relation to the devolved benefits to be decided by a tribunal. This is because we believe this will support a safe and secure transition, and will be a fair and proportionate approach because the decision could be about the individual's long-term entitlement to a benefit, rather than their need for a one-off payment
In Scotland, appeals against decisions by DWP are heard by the Social Security and Child Support Tribunal which is currently part of Her Majesty's UK Courts and Tribunals Services, which means it is operated by the UK Government. However, control over the administration and management of the tribunal is being transferred to the Scottish Government - although the underlying legislation on which appeals to the tribunal are based will mostly remain reserved. This is happening under the same legislation (The Scotland Act 2016) which allows for the devolution of some social security benefits and the establishment of a Scottish social security system.
In thinking about the design of an appeals process for social security in Scotland, therefore, we also have to bear in mind that responsibility for the administration of tribunals is being devolved at the same time. This raises particular issues and challenges for our work to ensure that individuals claiming devolved benefits have a transparent and accessible appeals process with adequate access to independent representation, to support them in the event that they want to challenge a decision.
Current arrangements for appeals
The default position following devolution is that existing appeal mechanisms will be retained, unless alternative processes are put in place. This means that there would be an internal review and then, potentially, an appeal to the Social Security and Child Support Tribunal. However, establishing a Scottish social security agency presents an opportunity to consider and evaluate the design of the appeals process.
The existing Social Security and Child Support Tribunal currently hears appeals in Scotland from a multitude of benefits, all of which are currently reserved. Some are due to be devolved, but others will remain reserved. Once the tribunal has transferred into the Scottish Courts and Tribunals Service, it will continue to hear appeals on reserved benefits. There is a decision to make about whether the tribunal should also hear appeals from the devolved benefits, and how this should be done.
Should a tribunal be used as the forum for dispute resolution for the Scottish social security system?
Please explain why
If no, are there any alternative methods of dispute resolution that you think would be preferable to a tribunal?
An appeal process based on values
In earlier sections of this consultation paper, we have talked about the key principles which will guide the decisions we will make about social security in Scotland. We believe that these key principles mean that we should ensure that our appeals process embodies the following values:
- Right first time - a strong focus is placed on initial decision making to minimise erroneous decisions
- Access to independent scrutiny - when a service user has concerns which are not resolved after an internal review, then they should to be able to appeal
- Learning from experience - lessons are learned from experience to ensure continuous improvement
- Transparency - service users fully understand and are kept informed at each stage of the process
- Certainty of timescale - service users can predict with a degree of certainty the likely timescale for resolution
- Accessibility - the needs of the service user are central and the administrative burden placed on them is minimised
- Minimising the burden on the user - the process of challenging and appealing decisions does not place an excessive administrative burden on applicants
How can we ensure that our values underpin the appeals process for a Scottish Social Security agency?
Are there any other values that you feel should be reflected in the design of the appeals process?
We believe that there should be clear and understandable timescales for appeals to be resolved. A key part of avoiding undue delay in resolving appeals is ensuring that the tribunal (or other body) hearing appeals has sufficient capacity to deal with the volume of appeals. The number of appeals (for all benefits) in Scotland fell significantly between 2012-13 and 2015-16, though this is expected to rise again in 2016-17.
There is an inherent tension between improving access to the appeals process for service users and resolving appeals without delay. The latter requires sufficient capacity to hear appeals, which means accurately predicting the volume of appeals in advance. We are seeking views on the best way to balance these requirements.
What do you consider would be reasonable timescales to hear an appeal in relation a decision on a devolved benefit?
In order to ensure a transparent appeals process, what steps could be taken to ensure that those appealing fully understand and are kept informed at each stage of the appeals process?
How could the existing appeals process be improved?
16. Residency and cross-border issues
- The Scottish Government will need to set out who is entitled to the benefits it will deliver. This includes setting eligibility criteria about residency.
- This means:
• residency status for those who have come to the UK
• residency status within Scotland and how we define that someone receives devolved Scottish benefits rather than reserved UK benefits where appropriate
- The Scottish Government expects that a residence test will be based on "habitual residence", rather than where a person happens to be living on a particular day.
- Cross border issues will occur when Scotland begins delivering devolved benefits. We will need to manage new administrative borders between the different social security systems in the UK - between the social security systems in Scotland and England and Wales and between Scotland and Northern Ireland.
Residency and 'habitual residence'
When we start to operate our Scottish social security system, it will be important to be able to identify where a person is resident at the time they make their claim. This cannot be something that an individual can choose. It should be assessed based on where a person is residing, and the reasons why they are residing there. The Scottish Government expects that all devolved benefits will include residency status criteria, amongst the eligibility criteria which will determine entitlement to each benefit.
In most circumstances, this will be straightforward, but rules will be needed for people who, for example, live on one side of the Scotland-England border, but work on the other, or who have moved across the border to study or for medical treatment. Consideration will also need to be given to how we ensure that a Scottish social security system treats people from outside the UK fairly and in a way that reflects our principles. We will need to clearly define who qualifies for Scottish benefits and who qualifies for UK Government benefits- while making sure that no-one falls between the gaps or is able to benefit unfairly from both systems.
The Scottish Government expects that a residence test will be based on "habitual residence", rather than where a person happens to be living on a particular day. Determining this will take into account things like their family situation, the reasons why they have moved across the border, and how long they appear likely to remain where they currently are living. A final definition of a 'Scottish Claimant', i.e. a person who qualifies for Scottish benefits will also need to be discussed and agreed with the UK Government.
There are already habitual residency tests which are used in the UK which could be adopted for use in a Scottish social security system. For example, DWP carries out a habitual residence test to determine whether someone can access benefits. Factors which are currently taken into account by DWP, in determining if an individual is habitually resident may include:
- The length and continuity of residence
- The person's future intentions
- Their employment prospects
- Their reasons for coming to the UK
- Where the person's 'centre of interest' lies
Should Scottish benefits only be payable to individuals who are resident in Scotland?
Please explain why
What are your views on the 'habitual' residence test currently used in the UK by DWP?
Are there other issues that the Scottish Government should take into account when it comes to residency rules?
Cross border issues
At present, benefits are paid on the same basis throughout the
UK. In certain cases,
some benefits can be paid to people who live outside the
With the devolution of some social security responsibilities to the Scottish Parliament, we will need to manage new administrative borders between the different social security regimes within the UK- that is between the social security systems in Scotland and England and Wales and between Scotland and Northern Ireland. There is also a need to consider whether social security benefits for which the Scottish Government is responsible should be paid to persons who are not resident in Scotland.
With devolution of some social security responsibilities to the Scottish Parliament, the principles of free movement, while ensuring no-one either falls through the cracks or is able to make a 'double-claim', will need to work within the UK. Where identical benefits are provided by the administering bodies in Scotland, England and Wales, and Northern Ireland, it will be important to ensure that people who meet qualifying rules receive their benefit from one of these administering bodies, and only one of them. This means ensuring that people receive their benefit from the right body - that is, the administering body operating the scheme for which they properly qualify. Deciding which is the right body is likely to depend on which of the areas is the one with which the person has the strongest link at the time of their claim.
Cross-border issues will be easier to manage in instances where the qualifying criteria operated by each Government are identical. The situation becomes more complex in instances where the rate at which a benefit is paid on one side of the border is higher than on the other, or if a benefit is paid in Scotland that has no equivalent in the rest of the UK. It is not our intention to standardise social security provision in Scotland by simply matching what is provided elsewhere in the UK - and the Scottish Government has already indicated areas in which it wants to set different rates for certain benefits. For example, the Scottish Government has already proposed to increase in the rate at which Carer's Allowance is paid in Scotland, so that will match the rate of Jobseeker's Allowance and, consequently, will be higher than the rate of Carers Allowance paid in England and Wales. We are also proposing to introduce a Best Start Grant which will have elements that are not currently paid under the UK Sure Start Maternity Grant scheme.
Having different rates for certain benefits on either side of the border will present challenges - for example, where people move from Scotland to England or Wales (or vice-versa) during an application or when they are receiving payments. The Scottish Government is aware of these challenges and intends to work with users and other partners, including DWP, to ensure that its services are fair and that decisions made on whether or not an individual is entitled to a particular benefit or a particular amount of benefit are in line with our principles.
Our social security systems (both Scotland's and those in other UK administrations) will need to coordinate. Coordination will ensure that if, for example, a person who is receiving a benefit in Scotland moves to reside in England and Wales, the transition is smooth. There will also need to be coordination between the benefit system that the UK Government will continue to operate, and the new benefit system in Scotland.
There are also some benefit specific issues to consider. For example, payment of Carer's Allowance is dependent on the cared for person receiving a disability benefit. We will need to develop an approach to deal with the situation where the disabled person and their carer live on different sides of the border.
What factors should Scottish Government consider in seeking to coordinate its social security system with other social security systems in the UK?
How can the Scottish Government ensure that no-one either falls through the cracks or is able to make a 'double-claim'?
17. Managing overpayments and debt
- Errors which result in overpayments reduce the amount of public money available to be spent on those who need it. Therefore, there must be controls in the system, to spot errors and put them right.
- We are clear that, when talking about overpayments, we are talking about circumstances in which an error has been made which has led to an individual being paid more than the amount of benefit to which they are actually entitled.
- We recognise that overpayments made by the social security system are often made as a result of error, either by public sector officials or by individuals themselves. Overpayments of devolved benefits which are not the result of an error by the individual making the claim should not be recovered.
- If we seek to recover an overpayment, this does not mean that the individual is being sanctioned and it does not mean that we think the individual has attempted to commit fraud.
- Nothing in this section should be taken to mean that the Scottish Government will necessarily seek to replicate current DWP arrangements and processes for dealing with overpayments, only that we wish to gather users' views on the current arrangements so that we can make an assessment as to what might be appropriate for Scotland.
In other parts of this consultation document, we have talked about the first of our guiding principles, that social security is an investment in the people of Scotland. We have said that this investment will eventually be worth around £2.7 billion in payments and support and that it must be protected so that public money can be spent on people who need it.
One of the ways in which we can protect this investment is by recovering overpayments, as DWP currently do. This is not the same as applying a sanction. 
In this section, we will discuss the recovery of overpayments. This does not mean fraud. (Fraud is discussed in a later section of this document.) Overpayments refer to circumstances in which an error has been made which has led to an individual being paid more than the amount of benefit to which they are actually entitled. This can occur as a result of an error by the individual themselves or someone else, including those operating the benefit system. We accept that, however well the system and processes are designed and, however careful people are, there will always be scope for human or system error.
The challenge, at this stage, is to develop an approach to dealing with error which reflects our principles, specifically that, at every step of our engagement with individuals, we will treat people with dignity and respect. We want to balance the rights and responsibilities of the individual with the responsibilities of the agency. This means, for example, being clear that we expect individuals applying for benefits to only provide information that they know to be true.
If an individual provides information which is later shown not to be true, then we will need to decide what further action needs to be taken. Making these kind of decisions is normal practice across government and the wider public sector. For example, local authorities, HMRC, DWP and the Student Awards Agency for Scotland make decisions as to whether or not money has been paid out in error and who is responsible for the error. When we begin to operate our Scottish social security system, we will design our services based on the best practice available, to ensure that our decisions are fair and transparent and that they reflect our principles.
Current arrangements for overpayments
No matter how careful people are, it is a fact of life that everyone makes mistakes sometimes. In terms of a social security system, this means that amounts of money are sometimes overpaid in error. Currently, when an overpayment has been made, DWP will decide whether it can be recovered or not. This will usually only happen when the overpayment has been made as a result of an error by the individual making the claim - for example, if the individual has not provided all of the right information at the right time. People can appeal if they disagree with this. DWP will then seek to recover the overpayment and will notify the individual of the amount to be recovered and the reasons for the overpayment decision. If the individual has any further queries, they will be directed to contact DWP's debt management information service. 
Where the individual's circumstances are deemed suitable for recovery directly from their benefit payments, they are notified about the amount they have to repay and how to repay the overpayment and that a deduction from their benefit can be applied. (The overpayment does not have to be recovered from the individual's benefit payments - other recovery methods, such as payment by Direct Debit are also available.) Recovery from benefits will normally commence after 1 month, unless an appeal is lodged. If the customer is receiving Universal Credit, then recovery can commence immediately.
Could the existing arrangements for recovering social security overpayments be improved in the new Scottish social security system?
If yes, please explain your answer
We recognise that people receiving benefits may be at risk of financial hardship and that this risk may be exacerbated during a period when their benefit payments are reduced to recover an overpayment. We understand that even a relatively small reduction in benefit has the potential to negatively impact an individual's financial wellbeing. For this reason, we are considering the role that financial advice might play in supporting individuals who are being asked to repay overpayments from their benefits.
What are your views on the role that financial advice can play in the recovery of overpayments?
- We believe that social security is an investment in the people of Scotland and we will take a zero-tolerance approach to fraud in order to protect that investment.
- We want to raise awareness of the individual's responsibilities in relation to social security fraud whilst, at the same time, designing processes which will be accessible and simple to use.
- In order to protect against fraud, we propose that officials working for the Scottish Government or its agency, should investigate fraud in the same way as "Authorised Officers" currently investigate fraud for DWP - and we are seeking views on the powers that should be granted to these officers and the code of practice which should govern their work.
- We are clear that people who have knowingly committed fraud should be punished - and we are seeking views on the appropriate penalties for fraud offences.
The first of the key principles which we set out in our paper, "A New Future for Social Security in Scotland", was that social security is an investment in the people of Scotland. An investment which will eventually be worth roughly £2.7 billion in payments and support. This investment must be protected so that public money can be spent on people who need it. One of the ways in which we will protect this investment is by guarding against attempts to knowingly commit fraud, either by individuals or by organised groups.
In this section, we will talk about the Scottish Government's counter-fraud strategy, which already applies across all of the areas where the Scottish Government makes payments. We will then go on to look at the ways in which DWP, specifically, investigate and protect against fraud. This is because DWP's current approach is an example of how fraud investigations are carried out in relation to social security benefits.
Scottish Government counter-fraud strategy
The Scottish Government already has a counter-fraud strategy  . We have a zero-tolerance attitude to individuals who knowingly commit fraud and we believe that there is no acceptable level of intentional or organised fraud. Our approach to countering fraud has five objectives. These are:
- Awareness: to prevent fraud by raising awareness of fraud and its safeguards
- Prevention: to prevent fraud through improving our systems and controls
- Teamwork: to prevent fraud by working together across the public sector
- Investigation: to handle fraud by being proactive in analysing data to identify areas at risk of fraud
- Enforcement: to handle fraud by being tough on fraudsters by punishing them effectively
We propose to either adopt or adapt this existing Scottish Government counter-fraud strategy for use in social security. This means that we will:
- Commit to clear ethical standards
- Communicate our attitude to fraud
- Support all of our staff in their responsibilities in preventing and detecting fraud
- Provide managers with specialist support
- Maintain comprehensive procedures for preventing and detecting fraud
- Put in place robust processes for reporting suspicions of fraud
- Respond to fraud effectively through a comprehensive fraud response plan
- Use data and technology efficiently to combat fraud
- Sharing knowledge of vulnerabilities and lessons learned
Should the existing Scottish Government approach to fraud be adopted for use in our social security system?
If no, what else should be used instead?
If yes, should our existing counter-fraud strategy be adapted in any way?
Please explain your answer
How could the new Scottish social security system 'design out' errors and reduce the potential for fraud at the application stage?
Under section 109A - 109C of the Social Security Administration Act 1992  , the UK Secretary of State has granted a range of powers to officers working for DWP. These investigators are referred to as "Authorised Officers" because they must have specific authorisation, conferred by the Secretary of State, to use their powers and are given appropriate training.
Authorised Officers are governed by a statutory code of practice on obtaining information  , which is published by DWP and laid before the UK Parliament. This code of practice sets out how Authorised Officers should exercise their powers. We propose to publish a Scottish code of practice, which will set out how investigators in Scotland should use the powers granted to them, to protect against fraud.
The powers allow for enquiries to be made by authorised officers in order to:
a) Establish whether benefit has been paid in accordance with
b) Prevent or detect the social security offences
Authorised Officers can also:
c) Require information to be provided
d) Enter premises
e) Require persons keeping electronic records to give authorised officers access to those records
It is currently the practice, as part of an investigation, for individuals to be interviewed under caution. This practice provides important protection for individuals. The individual is not legally bound to provide evidence that could incriminate them - and this would be made clear at the start of the interview. An interview is also an opportunity for the investigator to gather information, to help them fully understand the circumstances of a case.
We propose that the practice of conducting interviews under caution should continue as part of investigations into social security fraud in Scotland. However, we also understand that a formal interview can be stressful and we want to make sure that the practice respects the individual's rights and that they are treated with dignity and respect.
Should the Scottish social security system adopt DWP's existing code of practice for investigators?
Please explain your answer
What are your views on the existing range of powers granted to investigators?
What are your views on conducting interviews under caution?
What improvements could be made around conducting interviews under caution?
Fraud is an offence which carries serious penalties, which can have a long-term impact on an individual's personal circumstances. So, it is important to ensure that no-one is penalised unjustly. That is why the standard of proof required to prove that an individual has committed fraud is the criminal standard. This means proving beyond reasonable doubt that a person had knowledge (which means that they knew that what they were doing was fraudulent) and intent (which means that they deliberately intended to mislead someone, by doing something that they knew was fraudulent).
Sections 112(1)(a) and 112(1)(b) of the Social Security Administration Act 1992  specifies that - if it is proved that a person had the knowledge and intent to commit fraud - they may be found guilty of certain specific offences. These are:
1. Making a statement which the person knows to be false
2. Producing information which the person knows to be false in a material particular
3. Failing to notify a change in circumstances, when the person is aware that the change affects their benefit entitlement
4. Failing to notify a change in a person's circumstances, when the person is aware that the change affects another person's entitlement
Social security payments and support are an investment which must be protected so that public money can be spent on people who need it. One of the ways in which we can protect this investment is by deterring people from committing fraud. We can do this by having systems and controls which will identify attempts to commit fraud and also by setting appropriate penalties, which will make it clear that attempting to commit fraud could have serious consequences. This is in line with the Scottish Government's existing counter-fraud strategy, which is clear that we should be tough on people who have committed fraud.
Section 112(2) of the Social Security Administration Act 1992  also provides that the penalty for committing benefit fraud will be a fine of not more that £5,000, imprisonment for a term not exceeding three months, or both. Proceeds of benefit fraud may be made subject to a confiscation order in Scotland under part 3 of the 2002 Proceeds of Crime Act.
Should the Scottish Government retain the same list of offences which people can be found guilty of in terms of social security fraud?
Please explain your answer
Should the Scottish Government impose the same level of penalties for social security fraud as are currently imposed?
Please explain your answer
19. Safeguarding your information
- The Scottish Government believes that every individual has the right to privacy and that personal information should be protected.
- We propose to take a 'Privacy by Design' approach to information handling to promote privacy, security, and compliance with Data Protection Act 1998 ( DPA) - from the initial stages of setting up the agency and registering with the Information Commissioner's Office, through to service delivery.
- We want to take advantage of advances in technology, to store and share personal information safely and securely, in order to better support claimant applications by putting the user experience first.
- We will securely source the minimum amount of personal information we need from other public sector organisations where there is a legal basis to do so and the appropriate Data Sharing Agreements are in place, to support and assess applications, instead of collecting and storing large amounts of information in a 'data warehouse'.
- We will be open and transparent in our approach to information sharing.
In this section, we will discuss our approach to ensuring that individuals' privacy is protected and that the personal information, which we will need in order to operate a social security system, is transferred and held securely.
Our approach to protecting individuals' personal information builds on the key principles which we set out in our paper, "A New Future for Social Security in Scotland". In particular, our principles respect for the dignity of individuals is at the heart of everything we do; we will strive for continuous improvement in all our policies, processes and systems, putting the user experience first; and we will demonstrate that our services are efficient and value for money.
Our overriding priority will be to ensure a smooth transition from the existing UK benefits to our new Scottish arrangements, so that people continue to receive the support to which they are entitled. This means sharing information, when there is a legal basis to do so, between DWP, the Scottish Government, other public sector organisations in Scotland and our new social security agency. It is important to note that, given the relationship between devolved and reserved benefits, controlled by the Scottish and UK Government's respectively, we will still be reliant on some of DWP's existing information, at least in the early years. This may place practical limits on the pace at which change can happen.
It is clear that our Scottish approach needs to build a new foundation of trust and our approach to protecting individual's personal information will be key to this. In the long term, our ambition is to have a Scottish social security system that is fully aligned with other devolved services, to provide an holistic approach that best supports the outcomes for individuals and wider Scottish society. We believe that our approach to information assurance will help to build a solid foundation upon which we can achieve this ambition.
Our systems will evolve and respond to the way that Scotland and its people change over time. We will listen to users' feedback, to ensure that our systems remain fit for purpose and we will take a transparent approach to monitoring and review which is fully compliant with the Data Protection Act, and the Information Commissioners Office code of practice on data sharing.
Identity Management and Privacy Principles
DWP publish a Personal Information Charter that outlines the standards that welfare claimants can expect when asked for their personal information. It includes what DWP can ask claimants to do to help keep their information up to date, how claimants can make a subject access request under the Data Protection Act, (i.e. ask for a copy of the information held about the individual by DWP) and how DWP may share information with certain other organisations.
The Scottish Government has published "Identity Management and Privacy Principles" for Scottish Public Services. These were developed to support public service organisations to comply with data protection and human rights legislation and enable them to build on these requirements to deliver services that are secure, efficient and value for money. There are six principles for handling personal information. These are:
- Proving identity or entitlement: to minimise information sharing and identification of individuals while ensuring authentication is effective and reliable
- Governance and accountability: to ensure that privacy and security policies and procedures are proportionate and transparent and that persons responsible at each stage within a process can be held to account
- Risk management: to undertake and publish Privacy Impact Assessments and audit existing initiatives
- Data and data sharing: to minimise the collection and holding of personal information and avoiding the creation of and risks associated with a centralised database
- Data use for research and statistics: to recognise that appropriate protection of privacy (for example anonymising information), efficient use of information, and scientifically sound and ethically robust research and statistics are all in the public interest, and that information should be held securely with projects being open and accountable to the public
- Education and engagement: to inform and consult with the public on identity management and privacy issues, and provide easy access to those wishing to view the information held on them and make any necessary changes
We propose to either adopt or adapt these existing Scottish Government Identity Management and Privacy Principles for use in social security delivery. This means that we will:
- Ask for the minimum amount of information necessary to assess a claim
- Ensure (that information used to assess a claim is up-to-date and accurate
- Present a Privacy Impact Assessment to the Scottish Parliament and publish this to ensure transparency in our approach to information assurance
- Avoid creating a single, centralised database of personal information, instead using information held across the public sector to support applications and ensuring personal and transactional information is held separately
- Establish strict access policies to limit the number of people assessing personal information
- Apply identity management and security principles to any third party contracts and ensure there is a written data controller/ data processor contact
- Support subject access requests and have supportive policies in place should information need to be repaired or redressed
- Staff training and awareness - to foster a culture that values and protects information
Responses to this consultation will help to inform the Privacy Impact Assessment, as will planned consultations with users.
Should the existing Scottish Government approach to Identity Management and Privacy Principles be adopted for use in our social security system?
Please explain your answer
If yes, should our existing Identity Management and Privacy Principles be adapted in any way?
Please explain how
Who do you consider should be consulted in regard to the Privacy Impact Assessment and what form would this take?
What are your views on privacy issues that may affect the new agency?
Do you perceive any risks to the individual?
What solutions might be considered to mitigate against these?
Better information sharing
Scotland has a wealth of publicly-held personal information that is already collected and held by a number of public sector organisations as part of their statutory functions. For example:
- the National Records of Scotland records births, deaths and marriages
- National Services Scotland (part of NHS Scotland) collects information on hospital admissions, maternity and births, and prescribing and medicines information
- Scottish local authorities hold information on housing benefit and social work services
The Scottish Government believes that this publically-held personal information could support a decentralised network for delivering social security across Scotland. This would not only remove the need to store information in one single data 'warehouse', reducing risks to individuals' privacy if the 'warehouse' was compromised, it would also support a more integrated and efficient approach to service delivery, demonstrating value for money by using information which has already been collected, when there is a legal basis to do so. This would build additional security check-points into the process, to help minimise the potential risks to individuals' privacy that are associated with large data 'warehouses'. It would mean that there would be multiple people responsible and accountable for the different information they hold across a number of organisations rather than one person in one organisation with overall control.
No system is risk-free, including paper-based systems. The main risk to a decentralised approach lies in the transfer of information between organisations and the new agency. However, there are a number of ways in which we could reduce this risk. For example, we would only share the minimum amount of information needed to assess an application; outgoing information, sent from one organisation to another, could be digitally signed and encrypted; incoming information could be authenticated and logged; strict rules could be put in place to control who could access information, preventing unrestricted access by any single person; and personal and transactional information could be stored separately.
Would you support strictly controlled sharing of information between public sector bodies and the agency, where legislation allowed, to make the application process easier for claimants? For example, this information could be used to prepopulate application forms or to support applications, reducing the burden on applicants.
Please explain your answer
Would you support strictly controlled sharing of information between a Scottish social security agency and other public sector organisations (for example local authorities) to support service improvements and deliver value for money?
Please explain your answer
Advances in information communications technology ( ICT), including the internet and the use of mobile devices such as tablets and smartphones mean that systems which would once have been paper-based may now be accessed securely online. This technology could provide the best available and most cost-effective way for a new Scottish social security agency to ensure that individuals' personal information is protected. The digitalisation of public services and use of distributed publicly-held information sources offers great potential to save costs, time and effort for users and service providers alike.
The systems required to process social security transactions in Scotland could be operated in a convenient, online environment, in order to make the application process easier for claimants and reduce government infrastructure costs. For example, claimants could make applications safely and securely online, from the comfort of their own home.
Using the right technology and systems could also enable forms to be pre-populated with the claimants' information, reducing the amount of form-filling required. The process would be quick, convenient and based on the most up-to-date information. It would allow for digital authentication and could reduce the need to provide paper copies of evidence in support of applications.
This reduction in bureaucracy would mean that application turnaround times could be reduced, communications could be sent electronically to avoid delays and claimants could receive their benefits sooner. A digital approach could also benefit people with restricted mobility, people who suffer from depression or anxiety disorders and people living in remote locations.
There is no doubt that alternatives to online applications and communications must be made for those who are unable to use or access a computer or mobile device. However, the benefits of a 'digital first' approach cannot be underestimated for many claimants, those supporting claimants and efficiency savings for the agency.
What are your views on having the option to complete social security application forms online? Can you foresee any disadvantages?
What are your views on the new agency providing a secure email account or other electronic access to check and correct information for the purposes of assessing applications (noting that any such provision would need to be audited and regulated so that the security and accuracy of the information would not be compromised)?
- We discuss the annual process by which the value of some of the benefits which people currently receive is increased. This process is referred to as 'uprating'.
- We make it clear that we will maintain spending on disability benefits, uprating them in line with inflation.
- We ask if there should be a general, Scottish uprating policy for devolved benefits and payments which could simplify the system overall and make it easier to understand.
Six devolved benefits - Attendance Allowance ( AA), Carer's Allowance ( CA), Disability Living Allowance ( DLA), Personal Independence Payment ( PIP), Severe Disablement Allowance ( SDA), and Industrial Injuries Disablement Benefit ( IIDB) - are currently uprated. This means that the values of these six benefits are all directly linked by legislation to the rate of inflation.
Uprating does not apply to all of the devolved benefits. It does not apply to Sure Start Maternity Grants, Funeral Payments and the amounts of Cold Weather Payments and Winter Fuel Allowance, as these are only uprated at irregular intervals. The amounts provided to local authorities for Discretionary Housing Payments are non-statutory, so uprating is not relevant to them. The UK Government has decided that benefits which are not linked to inflation should be frozen for four years from April 2016.
At present, the UK Government uprates benefits by measuring the rate of inflation using the Consumer Price Index, which tracks the changing cost of a fixed 'basket' of goods and services over time. In practice, this means that the amount paid out for each of these benefits is increased in April based on the Consumer Price Index in the previous September, if there has been an increase in prices. However, if the Consumer Price Index falls, the uprating mechanism does not operate to increase the value of benefits. This happened in April 2016 - the Consumer Price Index fell by 0.1% over the 12 months to September 2015, no indexed-linked increase was applied in April for the year 2016-17.
The amounts paid out in AA, CA, SDA and IIDB can only be altered either through the uprating link with the rate of inflation, which operates through legislation. The amounts paid out for DLA and PIP can be altered either through the uprating link with the rate of inflation or by legislation.
For these six benefits, the Secretary of State for Work and Pensions must uprate the amounts whenever inflation is positive. He is not required to uprate by only the value of inflation, and can set any higher percentage increase he likes provided there has been some increase in prices. He is obliged to uprate annually where there has been inflation, unless he considers that the increase would be "inconsiderable" (he is also allowed to round figures up and down "as he thinks appropriate").
The block grant adjustment methodology detailed in the " Agreement between the Scottish government and the UK Government on the Scottish Government's fiscal framework" published on 23 February 2016  , continues to link adjustments to the Scottish block grant in respect of welfare to spending on equivalent policy areas in England and Wales. This means the Scottish Government is funded to provide the same level of benefits as in England and Wales. At the moment the UK Government uses the Consumer Price Index to link benefit payments to the general cost of living. If Scotland was to use a more generous measure then the extra funding would need to be found from within existing Scottish resources, limiting the amount which could be spent on other policies.
The Scottish Government has committed to maintain spending on disability benefits, uprating them in line with inflation, and ensuring they are not means-tested when they are devolved. As long as inflation increases, the current legal arrangements will allow the Scottish Government to set amounts for the indexed linked benefits, provided the amounts it sets are higher than the amounts currently paid out. The Scottish Government could also set the amounts for DLA, PIP and the non-indexed payments through regulations.
A general, Scottish uprating policy for devolved benefits and payments which is linked to the rate of inflation could simplify the system overall and make it easier to understand. However, it could be that other policy requirements are more important - for example, the ability to respond to changes which impact on people claiming devolved benefits flexibly and quickly. Also, automatic uprating might not be the best way to address issues such as families living in poverty because it may be that the gap between families in poverty and better off families will only be closed by targeted increases, rather than uprating across the board.
What are your views on the best way to ensure that devolved benefits keep pace with the cost of living?
Are there any devolved benefits in particular where
uprating based on a measure of inflation would
If so, please explain which benefits and why.
Email: Edward Orr, firstname.lastname@example.org
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