A version of this blog appeared in the Guardian, 11 March 2014
At its height, the welfare state was a symbol of nationhood and solidarity that helped Scots to feel at home in Britain. Nowadays, much of the core welfare state functions have been devolved to the Scottish Parliament. The one that remains at Westminster - social security - is taking a battering.
UK welfare reform has helped to make welfare and ‘fairness’ a central feature of the independence referendum. For the Scottish Government, independence would mean having the power to create a more equal society. But how distinctive would an independent Scottish welfare state be?
Not very, if we look to last year’s report by the Expert Working Group on Welfare. It recommended Scottish/rUK co-operation to deliver pensions and benefits for a transitional period to avoid any disruption in benefit pay-outs. The report also pointed to the complex arrangements for delivering pensions and benefits: most – though not all – benefits paid to Scots are processed in Scotland, but these DWP offices also process payments for claimants in the north of England, Yorkshire and London. Sharing service delivery would limit the scope for the two governments’ policies to diverge.
The independence White Paper hinted at more radical change. It included a commitment to immediately scrap the bedroom tax and halt the roll-out of universal credit and PIPs, pending the design and implementation of a new system of social protection. The expert group will set out its welfare vision this spring. Expect it to look more Nordic than British.
Change, however, won’t come easy. Independence would not be a ‘year zero’. Scotland would inherit existing institutions and services. These come with vested interests and modes of operation that can stymie change. Shifting resources from one group to another is always difficult politically, especially since rUK would remain Scotland’s main point of reference. The pressure would be for all Scottish public services and benefits to be at least on a par with those in England, if not more generous.
Scottish policy choices would also be constrained by the demographic and economic pressures that have made social protection the highest proportion of government expenditure across Europe. It’s far from clear that the Scottish government would have the fiscal resources and policy freedom to match its welfare ambition.