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Poverty Alliance - 30th anniversary conference: First Minister's Speech - 25 November 2022

Speech given by the First Minister at the Poverty Alliance 30th Anniversary Conference in Glasgow on 25 November 2022.

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Thank you to all of you for inviting me here this morning.

It is lovely to be back in a room full of people after a short interval of two and a half years, but genuinely a joy I think that everybody is experiencing right now to be back with people, having discussions and interactions, and just enjoying each other's company.

So I hope you very much enjoy the discussions and networking that you're going to be able to do here today.

I'm really pleased to be here with you today to help mark the 30th anniversary of the Scottish Poverty Alliance. I think, as Peter has just alluded to actually, in so many ways this is a very timely conference. And as you might expect this morning, my remarks will talk about the ways in which the Scottish Government is working to tackle the current cost crisis.

I'll also put these comments and actions in the context of our continuing commitment to tackle poverty. That is a key mission for me personally, and a key mission for the Scottish Government.

And, of course, in setting out how we can collectively - working together - achieve that mission, I will also inevitably and inescapably highlight the limitations of Scotland's current constitutional position, and briefly set out why I think constitutional change - independence - isn't, as is sometimes by some suggested, a distraction from issues such as tackling poverty. It is actually, in my view, fundamental to the question of how we can better and more effectively tackle poverty - not just the impacts of poverty, but the root causes of it as well.

But I want to start this morning by reflecting on this 30th anniversary. For me, and I suspect - I strongly suspect this will be the case for all of you - it's an anniversary that prompts some mixed feelings. Positivity about the fantastic work of this organisation, which I'll come on to talk about; but a deep frustration, that an organisation like this - 30 years on - is still necessary.

I have - like many of you will, I'm sure - very vivid memories of 1992 - the year when the Strathclyde Poverty Alliance, as you were then known, was established. That was the year I graduated from Glasgow University.

It was also the year that I first stood for parliament, for the Westminster parliament in the general election of that year. I was, in that election, the youngest candidate in the UK - something that nobody could ever say about me these days. I'll skirt over the outcome of that election because it's not one that I really care to think about.

But when I think back on that year, and all of the things I was up to that year, it is the case that so many of the things that I was involved in back then - the factors that drove me into politics - are the same factors that prompted and led to the establishment of this organisation.

And, you know, when I think back to 30 years ago, the stage I was at - and that makes me think about my experiences of growing up, and therefore understand the context in which this organisation came into being – you know, I remember, I grew up in Ayrshire, not far from here. And I remember to this day, the poverty and the lack of opportunity of the people that I was growing up with, the people I was at school with. I remember vividly to this day, the ever present fear of unemployment, what would happen to you if your mum or your dad lost their job – the sense that if that happened, they would never get another one, so rampant and so embedded was unemployment and the poverty that it caused.

And of course, all of that back then, was the result of a government that was allowing some may say - I would say, let me just be blunt - in many ways, encouraging a process of deindustrialisation to happen without any regard at all for the lives or the livelihoods that were being impacted by it.

And I mention that because there's a big lesson of that for us today as we embark upon, and try to accelerate, the process of decarbonisation, as we lead the just transition to address the climate emergency. We must make sure that we don't allow that process to happen in the same way that deindustrialisation was allowed to happen back then.

I also remember very clearly from those days, protests against the poll tax - of course, I participated in the protests against the poll tax - and also that far wider sense of discontent at the way in which government policies were contributing to poverty and deprivation, or, in as some may say, in a way that was deliberate and not accidental.

Indeed, one of the very first reports published by the Poverty Alliance back in 1992, a study of youth poverty in Strathclyde, highlighted what it called the devastating consequences of the abandonment of young people by the state. And I saw that with my own eyes every day as I was growing up, as many of you will have done, in the people around me that I was at school with.

So, in so many ways, these were the factors that drove me to become involved in politics, and the factors that led to me standing here right now. And these are the same factors that the Poverty Alliance came into being to help address and combat.

Now in many ways, and I think it is important to say this, things are better now than they were 30 years ago. And that is often - very often, at least in part, but I would say in large part – down to the hard work and the sheer commitment and dedication of the Alliance. One of your early campaigns was for the introduction of cold weather payments, which back then didn't exist at all. They’re now, I'm glad to say, well established across the UK. Indeed, in February, we will introduce in Scotland, our 13th social security benefit - the eighth that is available only here in Scotland - the new annual winter heating payment will be automatically paid to 400,000 low income households. And of course, we already provide a heating payment to the families of almost 20,000 severely disabled children.

Another early Poverty Alliance campaign was for the minimum wage, finally introduced in 1998, and since then you have campaigned for the living wage - the real living wage – an issue that has - rightly - got far greater profile now than it did even just a decade ago.

You have also influenced how policy is made, consistently and rightly arguing the people who experience the impact of policy must be much more centrally involved in the making and developing of that policy. And that's a point that my government has tried - not always perfectly, I readily concede – but has tried to take to heart and to make sure that we implement in how we go about making policy, and perhaps the best example of that is the establishment of the social security experience panels - people who influence every aspect of the development of our social security system, from policy right through to the form of the applications and the various application forms that people have to complete.

So, through these efforts, and countless more along the way, the Poverty Alliance has helped secure significant and lasting change. So one of the first things that I really want to say to all of you today is a very heartfelt thank you for all of that work that you have done. Throughout virtually my entire political career, I've seen with my own eyes first hand just what a big difference the Poverty Alliance has made.

You have changed the lives of very many people for the better, and I think that is something to be really proud of. Not every organisation can make that claim - this organisation certainly can.

Despite all of that hard work, though, all of us know that we live in a society today where too many people still suffer the effects of poverty, and that is not something any of us should ever be comfortable with.  And so as long as we have anyone in our society living in poverty, particularly children living in poverty, all of us, not least those of us privileged to hold positions of government office, have a big job of work still to do.

That job or work today is possibly harder than it has been for some time, just as was the case in the early 1990s. We now are in an era of double digit inflation. The country is again in a recession, the Bank of England predict that that recession may last for some time.

Last week, the Office of Budget Responsibility predicted that average disposable household incomes will fall by 7% - 7% in real terms in the next two years. That's an extra ordinary burden that so many people across the country are going to have to bare, and it’s a price that is being paid by everyone across the country, but disproportionately by those who are already the poorest – for what I would argue very strongly is the economic, financial, and fiscal incompetence of the current UK Government.

It is the price of underinvestment in public services and underinvestment in sustainable economic growth, particularly during the years of deeply damaging austerity.

It is also the price, not just of Brexit, but of a very hard Brexit, that is damaging the economy and contributing to much of what we are dealing with today. And it is of course a price that will fall especially heavily on people in poverty, or who are about to be pushed into poverty as a result of all of these factors.

Now, as all of you know, and I don't say this as an excuse - I'm going to come on to talk in some detail about the work the Scottish Government is doing to try to combat poverty and lift people out of poverty. But as you know, our powers are not unlimited. We have a largely fixed budget, which has been eroded quite substantially this year by inflation. We don't have extensive borrowing powers. We don't control the energy markets, we don't have the ability to tax windfall profits or introduce, for example, a wealth tax in our society.

So we are to a large extent - far too large extent, it won’t surprise you to hear is my view - dependent on the actions and the decisions and the priorities of UK governments.

The UK Government, in the autumn statement set out by the Chancellor last week I’m pleased to say, showed a bit more concern for equality than had previously been the case. For example, it finally confirmed that social security benefits would rise in line with inflation. But given the scale of the crisis that we're facing right now, for far too many people in communities across the country, what was announced last week was woefully inadequate.

And I do think there is a contrast here. Last week, at the start of the week, I visited Whitehill Secondary and Golfhill Primary School in a shared campus here in Glasgow, and that visit was to mark the extension of the Scottish Child Payment to all eligible children up to age 16.

The payment, at the start of last week, was also increased to £25 per week for every eligible child, and remember not that long ago we introduced the Child Payment at the value of £10 per week.

That has been widely hailed, and I think rightly hailed, as a game changer in the fight against child poverty, including by this organisation, which has rightly urged the UK Government to follow suit. And, taken together with other policies, such as the expansion of child care, the ongoing extension of free school meals – it is a real cornerstone of our commitment to tackle poverty, and child poverty in particular.

And we've prioritised this payment as far as we can in some of the toughest financial circumstances imaginable, and we've done that because we recognise how fundamental it is to the lives of children right now, but also to future generations of children.

This is perhaps the biggest and most important investment in the future that any government could be making.

I wish the UK Government would follow suit, and will continue to press them to do so, but because it's not yet doing so, we're having to do that within, as I say, a fixed budget. And to achieve that we've had to make some difficult choices.

The budget that we have this year, as I said earlier on, is right now worth £1.7 billion less than it was when we set that budget at the start of this year. That's the impact of inflation, and we don't have any levers to try to mitigate that in-year.

Although we have limited tax varying powers, which we will consider in terms of setting our budget for next year, we are legally not allowed to use them in the middle of a financial year. So we don’t have the option to increase income tax for example, to raise more revenue.

We can’t  borrow money for day-to-day spending, and all of our reserves are fully allocated. So to balance the books and deal with that £1.7 billion inflationary impact - and to enable us to continue to allocate the money for policies like the Child Payment - we've had to take some really difficult decisions.

We did an emergency budget review. One of the things we did in that which was difficult and controversial and attracted criticism, understandably, was to reduce some of our support for employability services.

As I say, that was not an easy decision, but given the immediate difficulties people are facing, we took the view that it was right to prioritise even more urgent forms of support.

So that decision, along with the others we had to take, has helped us not just ensure we can move ahead with the extension of the Child Payment -  it also helped us double the final bridging payment for about 150,000 families ahead of the extension of the Child Payment. It allowed us to maintain other forms of support, make more money available for public sector pay settlements, and take some other additional steps - such as doubling the fuel insecurity fund, and providing councils with more money for discretionary housing payments.

So these are, I think, important decisions for us to have taken - but in a fixed budget, we do have to make some difficult choices in order to support decisions that get help and support to people who need it most.

Now, those decisions we're taking to try to help people as far as we can with the cost crisis now are consistent with that longer term approach to help lift people out of poverty. Right now, in any year, the Scottish Government invests around £3 billion on measures to mitigate the impact of rising costs, but also to help us with that longer term objective of lifting people out of poverty.

And it's worth noting that more than £1 billion of that £3 billion annual allocation is on measures that are not available in any other part of the UK, which is an indication of the priority we are attaching to lifting people out of poverty.

Child Payment is the most obvious example of that, but that is one of five family benefits we've introduced. Another is the carers’ allowance supplement, which means that for 90,000 carers across the country, there's almost £500 a year more available in support than is the case for carers elsewhere in the UK.

And these new social security payments come with a new approach that we have sought to introduce - one that doesn't rely, in our social security system, on the cruelty of sanctions, but instead seeks to respect the dignity of people who rely on social security.

Earlier this month, when we published a review of what service users thought about Social Security Scotland, that found that 94% believed they had been treated with kindness - and considering that system will reach around a million people through Scottish benefits, that is really important.

And that's as it should be - everybody contributes, in some way or another, to the society that we're all part of. We all contribute in different ways at different times in our lives. And everyone, every single one of us, don't know the moment when we might need

support from the social security system. So it's really important that we see it as something belonging to all of us.

It's not about charity or handouts - it's our collective investment, and what it means to be part of a civilised society, and therefore dignity and kindness and respect should absolutely be the cornerstone values of any system.

Now, I spent a bit of time talking about social security and direct payments so far because they are vital tools in tackling poverty, but a true national mission to tackle poverty - which this organisation has at its core - has to be much more all-embracing than that.

It has to cover all parts of the public sector and all parts of society. So housing policy, for example, is absolutely vital.

One of the reasons we recently introduced emergency legislation to freeze rents temporarily and introduce a moratorium on evictions is because we know how vital housing is to people's health, wellbeing, and their life chances.

It’s also why housing supply matters, and why we've made significant investment in homes for social rent. Last year - just to put this into context - per head of population, the number of homes built for social rent in Scotland was nine times the number in England, again an indication of the sense of priorities that we're bringing to bear.

We're also taking steps to ensure that people from backgrounds that might traditionally be seen as deprived know that they can have a fair chance in life. The promise that we've made to people with experience of care is an example of that, so is our work on closing the educational attainment gap and our decision to set widening access targets for higher education.

And we also recognise, as the Poverty Alliance has been saying for 30 years, that pay - how much people get paid for the work that they do - is absolutely crucial in addressing poverty, lifting people out of poverty, and giving people a decent standard of living.

That's why we are doing everything we can right now to support fair public sector pay settlements. Paying higher wages is the biggest contribution we can make to help households with soaring costs, but it also helps government - people who get paid more pay more taxes; more taxes means more revenue to government - it is a virtuous cycle, which is why in the emergency budget review we reprioritised £700 million to support the fairest possible pay deals.

Now many of these negotiations are ongoing - they are difficult, because trade unions are rightly demanding the best for their members. But the benefit of that is today, as nurses announce strike dates in England, their union here in Scotland has a new and improved pay deal to consider.

So that's the benefit of prioritising the things that matter most to people.

We encourage fair pay in the private sector as well, through living wage accreditation schemes. We're now applying fair work criteria, including payment of the living wage, when we make - as government - choices about which businesses should get public sector grants or contracts.

Recent data suggests that 90% of employees in Scotland are now being paid the living wage - more than any other part of the UK. That's good progress, but there's still so much to do.

That said, it does suggest the steps we are taking - as government, but in partnership with organisations like this one - are having an impact, and they should motivate us to go further.

Now that promotion of fair work and a living wage possibly also demonstrates what I would see as one of the key lessons of the past 30 years: to truly tackle poverty, we do need to reshape the economy. That's how we address not just the impact and consequences of poverty, but address the root causes - attack the problem at source.

Now I know you'll explore some other approaches later this afternoon which have the potential to do that, for example, looking at ongoing work which I am very, very committed to - to develop a minimum income guarantee and to support community wealth building. These are all really important initiatives.

But our ability to do all of this is constrained by the limitations on the powers of our parliament right now.

We are dealing with a cost crisis just know that has been made worse by the UK Government's economic approach, years of austerity that Scotland didn't vote for, Brexit that Scotland didn't vote for, an autumn of what I can mildly describe as economic chaos from a government that Scotland didn't vote for.

In addition, the Scottish Government is so frequently having to mitigate the impact of UK Government policies that people in Scotland don't support.

Let me give you just one example of that - we're currently spending £87 million a year to ensure that the bedroom tax doesn't impact anybody in Scotland. Far better to have a situation where we don't have these policies introduced in the first place, rather than have to spend money to mitigate the consequences of them.

So all of that leads, in my mind, to an obvious point - if our economy and our public services are suffering from policies we didn't vote for; if the Scottish Government is having to spend millions of pounds mitigating the impact of these policies; if we fundamentally disagree with how UK governments are treating those who most need help - for example, in the sanctions regime in social security, and its frequent and quite shameful hostility to asylum seekers - then why should we settle for simply mitigating these things?

Wouldn't it be better if we could influence and take these decisions ourselves in the first place. Especially as we have demonstrated already, in the shape of policies like the Scottish Child Payment, how much better we can do when we have the ability to take these decisions.

Back in the 1990s, one of the reasons that Scotland voted for devolution so decisively was to stop damaging policies being imposed on us. But damaging policies are still being imposed on us, and that democratic deficit has an impact - in very real and very tangible ways - on our ability to tackle poverty.

So I think the best way to do that is to make sure that more of these powers of decision lie in our own hands.

For the moment, however, and regardless of constitutional views and of our constitutional future, my commitment and my message is clear. At the start of my remarks I mentioned that early Poverty Alliance report and its reference to the consequences of abandonment of young people by the state.

I think in many ways that phrase - the consequences of the abandonment of young people by the state - that phrase represents, if I was looking for a way to summarise, that is the phrase that represents everything that I came into politics to try to play a part in changing.

And standing here, 30 years later, as First Minister, it also remotivates me to do everything I can, and everything my government can, to support those who need it most.

That's why we've introduced policies like the Child Payment, reprioritised resources to help those in crisis, and why we seek to put such a focus on measures that will tackle poverty in the long term.

But it's also why I'm conscious of how much more we still need to do to help people - not just through these current challenges, but for the longer term. And as we continue with that mission as a government, the Poverty Alliance I know is going to continue to play a vital role, just as you have done for these past 30 years.

So I'm really grateful to all of you for your insights, your expertise, for your challenge, and for your criticisms – at times, a crucial part of the scrutiny that is necessary to push any government forward in the right direction.

You have changed lives over these past 30 years - that's something you should take great pride in. But there is still much for all of us to do.

So please, keep doing what you're doing, including the challenge and the criticism, so that together collectively, we can continue to make progress to change lives for the better. Thank you all very much indeed.

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