Draft Disability Assistance for Older People (Scotland) Regulations 2024: Draft Business and Regulatory Impact Assessment

Sectors and Groups Affected, Benefits and Costs

Option 1

Were the Scottish Government to take no action, it is anticipated that there could be a significant impact on individuals in Scotland who are entitled to Attendance Allowance. This would also impact third sector organisations, such as advice and advocacy services and other areas of the public sector, such as local government.

This is because Attendance Allowance is being delivered on the Scottish Government’s behalf by the Department for Work and Pensions by way of an Agency Agreement. If the Scottish Government did not introduce a form of Disability Assistance for those over State Pension age in Scotland, the Agency Agreement would require further negotiation to ensure individuals in Scotland do not lose access to their awards of Attendance Allowance.

There are therefore not considered to be any benefits to this option, and the financial and social cost could be significant, as the Scottish Government may have to act in an unplanned manner to ensure disabled people over State Pension age continue to receive financial support.

Option 2

If the Scottish Government were to replicate Attendance Allowance in its entirety, it is anticipated that individuals entitled to support under the current system as well as third sector and public sector organisations would see no change, therefore having a neutral impact in the short term. However, the Scottish Government would have missed an opportunity to improve processes and systems to benefit both the individuals seeking financial support and the impacted sectors of the economy.

The financial cost of this option is likely to be largely similar to that of Option 3. The Scottish Government would be delivering a replica of Attendance Allowance under this option, however there would still be a requirement to budget for extensive system development, training of staff to administer this benefit and the delivery of a case transfer process.

Therefore, although this option would have a neutral impact on individuals and impacted sectors of the economy in the short term, there are not considered to be any benefits to this option which would see the Scottish Government deliver a benefit that is inconsistent with the social security principles. This option has a significant cost and would fail to deliver improvements like those delivered by the introduction of Child Disability Payment and Adult Disability Payment.

Option 3 (recommended option)

The impact of Pension Age Disability Payment will be dispersed across Scotland and sectors of the economy. Pension Age Disability Payment will have an impact on individuals over State Pension age who have a long-term condition or disability. This impact has been assessed through an Equalities Impact Assessment. The launch of Pension Age Disability Payment will have a short-term impact on advice and advocacy services, as well as some aspects of the public sector, such as local government and the health service, while they adapt to the delivery of this benefit.

However, over the longer term, this initial impact will reduce and will be largely beneficial for individuals as well as the third and public sectors as there will be more consistency and efficiency in the delivery of disability benefits in Scotland than was the case previous to the Scottish Government’s delivery of disability assistance.

For 2024-25, expenditure on Pension Age Disability Payment is projected to be £715.5 million; and the Scottish Government is expected to receive £714.5 million from the Block Grant Adjustment for Attendance Allowance.^[15] The Scottish Fiscal Commission have forecasted that expenditure on Pension Age Disability Payment is expected to increase to £816.5 million by 2027-28. In the same financial year, the Scottish Government is expected to receive £744.5 million from the Block Grant Adjustment for Attendance Allowance.

The reasons for the increase in expenditure is due to the changes the Scottish Government are making as part of Pension Age Disability Payment, such as the introduction of the Scottish definition of terminal illness and provision of Short-term Assistance.

The May 2023 forecast on Pension Age Disability Payment expenditure and the forecast Attendance Allowance Block Grant Adjustment from the Scottish Fiscal Commission are set out in the table below: ^[16]