Scotland Act 2012 and 2016: annual implementation report 2021

Report to inform parliament of the implementation work that has been carried out on fiscal powers as required by Section 33 of the Scotland Act 2012 and paragraph 107 of the Fiscal Framework.

Social Security

The Social Security Directorate is responsible for ensuring the safe and secure transition of the benefits being devolved to Scotland, for the new benefits created, and the implementation of powers under the under the Scotland Act 2016. To achieve this, a Social Security Programme was established, and a new agency, Social Security Scotland created.

Social Security Scotland operates in accordance with the eight principles set out in the Social Security (Scotland) Act 2018 and Social Security Charter. This gives the Scottish Parliament greater powers to ensure that social security in Scotland is tailored to the needs of Scottish citizens.

Social Security Scotland is already successfully delivering ten benefits and onc fully transferred, the Scottish Parliament and the Scottish Government will be responsible for delivery of social security benefits ultimately worth over £4 billion of spending each year in Scotland.

Key developments

103. During 2020-21 the Social Security Directorate adapted to the challenges of COVID-19 through re-planning the safe and secure delivery of the remaining devolved benefits. Together with Social Security Scotland, three new benefits have been successfully launched in 2020-21, while the systems and capability continue to be developed to deliver the higher-volume and more complex disability benefits, starting with Child Disability Payment in 2021-22.

104. Social Security Scotland is now well established and directly employs just over 1,000 people across its various sites. It is forecast to deliver £3.3 billion of payments by the end of 2020-21, £3 billion through Agency Agreements and around £300 million directly

105. Executive Competence for Attendance Allowance, Disability Living Allowance, Personal Independent Payment, Industrial Injuries Disablement Benefit, and Severe Disablement Allowance transferred to the Scottish Government on 1 April 2020. The Department for Work and Pensions (DWP) continues to administer these benefits through six Agency Agreements on behalf of Scottish Ministers. For 2021-21 the Programme Business Case (PBC) includes a forecast of £82 million will be spent on Agency Agreements. Covering the lifecycle of the agreements could require investment up to an additional £300 million. The actual agency agreement costs that the Scottish Government accepts from DWP are subject to negotiation, and these are scrutinised in detail. These costs will reduce over time as Social Security Scotland begins to fully administer more benefits and reaches steady state.

106. In response to the COVID-19 pandemic, Scottish Government increased investment in the Scottish Welfare Fund, distributing £57.5 million to ensure support is available for those in need. A one-off Coronavirus Carer's Allowance Supplement payment of £230.10 was made, doubling the payment which eligible carers received in June 2020.

107. The first payments of Child Winter Heating Assistance were made in December 2020, helping an estimated 14,000 children and young people in 2020-21. Job Start Payment was also introduced, supporting around 5,000 young people a year starting a new job after a period of unemployment.

108. The Scottish Child payment has been introduced with the first of these payments being made on 23 February 2021. Families will be paid £10 per week for every eligible child, with no limit on the number of children that can be claimed for.

109. The Scottish Government's immediate priority is ensuring that people in Scotland in receipt of disability benefits experience a safe and secure transition to devolved disability assistance. Households must continue to receive their benefits on time and in the right amount. The Scottish Government hold ambitions to create a system of disability assistance that works for people; and improvements are being made upon the current UK Government system in a number of important areas, including doing away with DWP-style assessments to access disability assistance.


Table 8
£m 2018-19 2019-20 2020-21
Implementation 55 82 125
Administration/Operation 46 67 225

110. The costs above, which have been updated following last year's report, are based on the Programme Business Case which was published in February 2020[25] and will be revised in due course. These do not include the impacts of COVID-19 which have had a significant impact on costs within this financial year whilst the timeline for the safe and secure delivery of the remaining benefits is planned.

111. The PBC provides a view on the whole life costs and benefits of the Scottish Government's Social Security Programme, over a 30-year timeframe to 2050. It shows the Scottish Government's investment in creating a new public service for Scotland, built from scratch with dignity, respect and fairness at the heart and will deliver for the people of Scotland for years to come. The system is being co-designed with clients on the basis of evidence. It is the largest and most complex exercise in devolution undertaken since the Scottish Parliament was reconvened twenty years ago.

112. The Scottish Government funds implementation costs incurred by the UK Government as a result of the devolution of welfare powers. For 2020-21 the Programme Business Case includes a forecast of £13 million for implementation recharges. If the current arrangement continues across the remainder of the life of the Programme, implementation charges could reach £70 million.

Social Security (Scotland) Act

113. In 2020-21, the Scottish Government passed legislation to underpin the delivery of the Social Security (Scotland) Act 2018[26], which sets out the over-arching legislative framework for the Scottish Government's Social Security powers. The Scotland Administration and Tribunal Membership (Scotland) Act 2020 contains specific provisions in a number of areas in relation to social security.

114. The Act contains provisions in relation to Appointees, non-disclosure of information in determination of assistance, offences, investigations, overpayment of recovery, and uprating in relation to 'top-up' assistance provided under Section 79 of the 2018 Act. It also contains provisions in relation to: the duty to inform clients of possible eligibility; to support persons who can give diagnosis in relation to terminal illness; suspension of assistance; and the ability to set the value of assistance to nil in certain circumstances. Finally, the Bill allows for the recruitment of members from the Reserved Tribunal to sit on the Scottish Tribunal.

Social Security Scotland

115. Social Security Scotland delivers its services in accordance with the eight principles set out in the Social Security (Scotland) Act 2018 and the Social Security Charter[27]. Foremost amongst these principles is the requirement that people be treated with dignity, fairness and respect. In February 2021 the results of the first client survey[28] were published. It showed that 90 per cent of clients said their experience was "good" or "very good" and feedback has also been provided that can be used to improve Social Security Scotland's services.

116. In the 2019-20 financial year, Social Security Scotland provided £346.7 million in payments to people across Scotland, making a total of around £540 million in payments since launch in September 2018 up to 31 March 2020. In the financial year 2020-21, Social Security Scotland expects to administer payments worth around £3.3 billion, £3 billion through Agency Agreements and around £300 million directly. Further details of this spending will be provided in Social Security Scotland's Annual Report and Accounts for the period, which will be published in winter 2021, in accordance with Statutory timescales.

117. With the launch of the Scottish Child Payment in February 2021, Social Security Scotland's service has now expanded to include ten separate benefit payments. It will continue to build capacity in 2021-22 in preparation for the launch of a range of disability benefits, which will become the major part of future operations.


118. Throughout the pandemic, the Scottish Government and Social Security Scotland have continued to ensure people are paid the money they rely on, while responding to the challenges of COVID-19 through re-planning the safe and secure delivery of the remaining devolved benefits. Scottish Government and Social Security Scotland continue to work jointly with the DWP and wider UK Government to ensure citizens receive the full range of support available.

119. The COVID-19 pandemic has had a major impact on the Scottish Government, on Social Security Scotland, and on DWP, whose support is needed to transfer social security powers. A timeline is being agreed between the Scottish and UK Governments to agree a revised timetable to deliver the remaining devolved benefits, and a process to complete case transfer, as soon as it is safely possible to do so.

Self-Isolation Support Grant

120. The Self-Isolation Support Grant (SISG) is a new grant of £500, offered through the Scottish Welfare fund, to ensure that people who are isolating don't have to choose between this and supporting themselves and their families financially, while helping to break the chains of transmission of COVID-19, and protect public health. Applications for the SISG opened on 12 October 2020 providing £500 grant to people required to self-isolate as a result of being contact traced and who:

  • are in receipt of Universal Credit or other low-income benefits;
  • are in employment; and
  • will have reduced employment income as a result of having to self-isolate.

121. Since it was launched, the Scottish Government has extended the SISG to better support those it is intended to support. This includes parents of children who are required to self-isolate, and people who are not in receipt of Universal Credit but whose usual income is at a level where they would qualify for this benefit if they applied for it.

122. From February 2021, the Scottish Government extended the eligibility criteria to those earning below the Real Living Wage, including those who receive council tax reduction. Also eligible are people with caring responsibilities for someone over 16, where the carer themselves meet the other eligibility criteria, and workers who earn less than £120 per week, meaning their level of income does not entitle them to statutory sick pay. In addition, the period during which people can apply for the grant has been lengthened to within 28 days of being told to self-isolate. This will significantly increase the number of people eligible for the grant and help remove financial barriers to isolating.

Scottish Welfare Fund

123. The Scottish Government increased investment in the Scottish Welfare Fund, distributing £57.5 million to ensure support is available for those in need. This included £22 million being distributed to local authorities in response to the COVID-19 outbreak which is in addition to the £35.5 million already committed to the Fund for 2020-21. To enable local authorities to meet the need in their areas and tackle financial insecurity, an additional £20 million of flexible funding was provided across the winter period. This funding has been utilised by councils in a number of different ways, including making cash grants for food and fuel to individuals and topping up Scottish Welfare Fund allocations to ensure demand is met in full.

Discretionary Housing Payments

124. In response to COVID-19 the Discretionary Housing Payment (DHP) budget was increased to more than £80 million in 2020-21 for councils to safeguard tenancies and prevent homelessness. Almost £60 million of the DHP budget was provided to ensure no one had to pay the bedroom tax; helping over 70,000 households in Scotland to sustain their tenancies. The cost of mitigation will increase as the numbers in receipt of Universal Credit increase since the Scottish Government remains committed to mitigating the impact in full. An additional £18.9 million was used to mitigate against the damaging impact of other UK Government welfare cuts, including the Benefit Cap and changes to the Local Housing Allowance rates, with a further £2 million budgeted to support care experienced young people through DHPs.

Coronavirus Carer's Allowance Supplement

125. A one-off Coronavirus Carer's Allowance Supplement payment of £230.10 was made this year, doubling the Carer's Allowance Supplement eligible carers received in June 2020. Along with December's 2020 Carer's Allowance Supplement, this means around 83,000 of Scotland's unpaid carers with some of the most intense roles and on some of the lowest incomes, received up to £690.30 more than carers south of the border. This extra investment of £19.2 million, brings our total investment through Carer's Allowance, the Supplement and this payment to around £350 million in 2020-21.

Carer's Allowance

126. Changes were introduced to Carer's Allowance to ease the burden on carers during the COVID-19 outbreak. These included temporarily relaxing the rules regarding how long a carer can take a break from care and whether care needs to take place in the physical presence of the cared for person.

Young Carer Grant

127. Rules about the timing of applications for Young Carer Grants were relaxed so, for example, if someone applies after their nineteenth birthday, their application will be treated as though it was made on time if the delay was caused by COVID-19.

Benefits launched

Job Start Payment

128. Job Start Payment was introduced in August 2020, providing £250, or £400 for people with children, supporting around 5,000 young people a year starting a new job after a period of unemployment. In the current crisis, getting a job will represent a massive turning point for many young people – this payment will help ensure it does not also bring financial pressures.

Child Winter Heating Assistance

129. Social Security Scotland paid Child Winter Heating Assistance in December 2020 and Scotland is the only part of the UK to do this. This annual payment of £200 to each child who is receiving the highest rate of the care component of Disability Living Allowance will help up to 14,000 children and young people in 2020-21. This payment represents a £2.9 million investment in the well-being of the most severely disabled children and young people, helping to ease household financial pressures as a result of needing to heat the home throughout the day and night. Payments are made automatically each winter to eligible children and young people by Social Security Scotland.

Scottish Child Payment

130. The Scottish Child Payment (SCP) started being made on 23 February. Families will receive £10 per week for every eligible child, with no limit on the number of children that can be claimed for. It is the highest-volume benefit introduced to date by the Scottish Government, and could support up to 194,000 children this financial year – an increase of around 34,000 children since the pandemic began (Scottish Fiscal Commission forecasts of February and September 2020[29]). The Scottish Child Payment together with the Best Start Grant and Best Start Foods will provide over £5,200 of financial support for families by the time their first child turns six. For second and subsequent children, this will provide over £4,900.

Disability assistance

131. In 2021 Child Disability Payment (CDP), the first of new Disability Assistance benefits[30], will be introduced. This replaces the UK Government's Disability Living Assistance for Children in Scotland. Adult Disability Payment will follow in 2022, replacing Personal Independence Payment.

132. A main priority is the safe and secure transfer of Disability Assistance, including existing Scottish clients, from the UK Government to Social Security Scotland, which means that in the immediate future fundamental changes will not be made to the existing benefit structure or rules. However a number of ways have already been identified to provide disabled people with a different experience when accessing the support they are entitled to.

133. CDP will be introduced in summer 2021 as part of a pilot, with full rollout by autumn 2021, extending to the upper age limit of CDP from age 16 to 18 for clients entitled to CDP immediately before reaching age 16. Meanwhile, ADP will be piloted in spring 2022 and available across the country by summer 2022. Work is ongoing with stakeholders to make changes to ADP, including to better assess the impact of an individual's condition, particularly in relation to mental health, hidden or fluctuating conditions. DWP-style assessments will not be undertaken to allow people to access to Disability Assistance.

134. Pension Age Disability Payment is currently delivered by DWP in the form of Attendance Allowance, a benefit for people over 65. It is awarded to help with extra costs if a person has a disability severe enough that they need someone to help look after them. It is the Scottish Government's intention to provide this form of assistance for the same purpose, to provide mitigating costs for the additional costs incurred as a result of having a disability. The Scottish Government will work with delivery partners including the UK Government in coming months to re-plan delivery of Pension Age Disability Payment and agree when it will be possible to launch the new benefit in Scotland.



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