Best Start Grant: Fairer Scotland Duty assessment

Summary of assessment findings

The final BSG policy improves and expands on the UK Government's SSMG by:

• Providing eligible families with £600 on the birth of their first child and £300 on the birth of any subsequent children;
• Not putting a limit on the number of children that are supported;
• Giving eligible families 2 further payments of £250 around the time of nursery and a child starting school, to recognise the additional financial costs during these key transition periods;
• Expanding on the DWP eligibility to include anyone on a tax credit or housing benefit, as well as any parent under 18; and
• Extending the application window for the BSG Pregnancy and Birth Payment to 24 weeks pregnant to 6 months after birth, giving parents longer to apply.

Extended eligibility and the introduction of payments to subsequent children means a significant additional investment in families in their early years. Scottish Fiscal Commission's (SFC) estimates show that the total number of payments annually will be in the region of 40,000 at a cost of £12m, based on 2019-20 figures. This is an estimated additional investment of £10m by comparison with projected DWP spending on SSMG for the same period.

When developing BSG policy we took the current SSMG criteria as a starting point and modelled a number of different options for eligibility and looked at the characteristics and income of the people who would be likely to qualify. We also looked at the impact of eligibility on vulnerable groups. In keeping with Social Security principles and operating within budget constraints, we sought to identify eligibility criteria that:

• reach families in poverty or at risk of being in poverty, both in and out of work, and respond to stakeholder concerns about groups that may be disadvantaged under existing SSMG criteria
• align and support SG priorities e.g. other provision in early years such as nursery provision for eligible 2s, mitigation of the impacts of welfare reforms and support for kinship carers.
• are simple, to make sure that the BSG is easily understood and accessible, improving take up and ensuring that complexity does not mean disproportionate spend on administration; and
• align where possible with Healthy Start Vouchers eligibility, to facilitate integration of the application process.

Officials worked closely with analysts to model options and look at the reach and effectiveness of the BSG criteria. We also worked with the BSG Reference Group which includes the Poverty Alliance and Child Poverty Action Group and One Parent Families Scotland, to help ensure we designed an effective benefit.

Under the final eligibility criteria, BSG has the potential to reach (where there is a birth/child at the appropriate age for payments):

• Almost 90% of families in the bottom 3 income deciles, both in and out of work;
• 90% of workless households;
• More than 80% of households with no full time work (i.e. one or more working part time)
• Potentially more than 90% of lone parent h ouseholds
• More than half of families with 3 or more children.^[14]