Advocates of welfare devolution will be disappointed by Smith Report

Published: 27 November 2014
Author: Nicola McEwen

The devolution of welfare provision has featured large in the public debate leading up to the publication of the Smith Commission's report. Many in civic Scotland had pushed for a significant form of welfare devolution. They are likely to be disappointed says Nicola McEwen.

The recommendations of the Smith Commission represent a compromise which will please some and disappoint others. In welfare, in particular, there had been a strong push from civic Scotland for a more extensive form of welfare devolution than appears in the Commission’s Report.

The report’s recommendations centre on benefits for carers and people with disabilities. Specifically, devolution is recommended for Attendance Allowance, Carer’s Allowance, Industrial Injuries and Severe Disablement Allowance, and Winter Fuel Payments, which together, accounted for just under 6% of social security spend in Scotland in 2012/13. The report also recommended the devolution of Disability Living Allowance/Personal Independence Payments which, assuming it includes DLA/PIP for all age categories, is a more substantial benefit amounting to £1.45bn in 2012/13, or 8.2% of Scottish welfare spend. Around 87% of Scottish welfare spending, including pensions, child and family benefits, tax credits and almost all working-age benefits, will remain reserved to Westminster after the new settlement is implemented.

The report stops short of setting out how the new benefits should be devolved or delivered. These and many other details will have to be negotiated as part of the intergovernmental and legislative process. Yet, decisions over delivery will shape significantly the extent to which the Scottish Parliament can redesign and develop these benefits in distinctive ways.

The Report doesn’t provide a rationale for its recommendations on welfare, though some conclusions might be derived. The UK parties were unanimous in their submissions to Smith that welfare should remain a predominantly UK matter, to reflect and reinforce UK social solidarity. Housing Benefit was initially touted for devolution in both the Labour Party and Conservative submissions. We can only assume that the Commission concluded that completely disentangling Housing Benefit from the rest of Universal Credit would be too complex, and devolving the whole of Universal Credit would be undesirable politically and financially.

This is clearly not a unanimous view among the party representatives on the Commission. The immediate response of the Deputy First Minister, John Swinney, indicates as much. The Scottish Government’s response, coupled with the disappointment that will be felt among many of those organisations who work closely with Scots who are dependent upon benefits and social housing, ensures that debates over the devolution of welfare will continue.

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