Minimum Income Guarantee Expert Group: interim report

First steps and actions

One of the earliest findings of the Expert Group was that a Minimum Income Guarantee does not need to wait. While it is incredibly ambitious, we are clearer now on what this might look like for Scotland and have identified early steps that could move Scotland towards the ambitions underpinned in the principles for a Minimum Income Guarantee.

However, we also acknowledge the impact the pandemic and the current cost of living crisis has had on public spending and the Scottish Government’s fiscal position.^[55] It is also acknowledged that it is unlikely that a full Minimum Income Guarantee could be delivered within the current devolution settlement. With this in mind, in this chapter we set out the early actions required to pave the way for implementation of our final recommendations towards a Minimum Income Guarantee following our full report in 2024. These initial recommendations have been informed by our work so far including commissioned research, expert advice from the third and public sector, academia and trade union.

Initial actions

The Expert Group agreed that a Minimum Income Guarantee should have a clear focus on tackling poverty, inequality and financial insecurity. The ongoing cost of living crisis requires an increased focus on this principle and this underpins the early actions identified.

Ultimately any Minimum Income Guarantee will be made up of a number of complementary parts, from solutions that reduce costs for households to cash and practical support. Additional action now to ease pressures on households by the Scottish Government will mean that the transformational impact of the Minimum Income Guarantee can start to be realised sooner, while longer-term action is planned to realise it in full.

1. The Scottish Government should prepare to implement the findings from the Expert Group’s full report by considering what legislative powers the Scottish Parliament may require to deliver or create new benefits which are not currently legislated for. It is our early view that even a pilot or initial roll-out of Minimum Income Guarantee will likely require legislation.

2. The Scottish Government should change the legislative basis for Scottish Child Payment so it’s not tied to a UK Government qualifying benefit. This will provide more flexibility to reduce the award, provide additional support for some groups, and support households to avoid cliff edges in income as they transition into higher incomes. This could be important in forming a basis for initial work to roll out a Minimum Income Guarantee.

3. A Minimum Income Guarantee cannot be delivered in a system that sees punitive conditions and sanctions. The Scottish Government should pledge to abolish the punitive conditions and sanctions regime in rolling out a Minimum Income Guarantee – as powers allow – and seek to ensure that the Minimum Income Guarantee is not lost or undermined by benefit or wider public sector debt recovery.

4. A Minimum Income Guarantee cannot be delivered in a system that sees significant holes in the safety net, for example, through caps, waits, freezes and limits, that impact different groups disproportionately (often deliberately and systematically). The Scottish Government has introduced some measures to repair these holes in Scotland, through for example mitigation of the ‘bedroom tax’ and the benefit cap. The Scottish Government should pledge to abolish the rest of these features of the existing UK-wide system when powers and finances allow and should monitor the success and take-up of existing efforts to do so.

a Minimum Income Guarantee should focus on tackling poverty, inequality and financial insecurity

As well as these earlier steps, the Scottish Government should also lay down crucial foundations for a broader Minimum Income Guarantee infrastructure in the future.

5. Increased support and encouraging uptake of entitlements for childcare will be crucial as part of the initial roll-out of a Minimum Income Guarantee. The Scottish Government should consider how additional support for childcare costs could be provided through existing powers to low-income families with children. Support for childcare costs should be provided through a clear entitlement rather than on a discretionary basis.

6. The Scottish Government should ensure the council tax reduction and water rates discount for households on the lowest incomes are reviewed with a view to taking significantly greater numbers of low-income families out of paying these charges. The review should be undertaken in time for consideration for the 2024/25 Scottish Government draft budget. It will be important to consider how we can decrease costs facing people and households underneath the level of a Minimum Income Guarantee.

7. The Scottish Government should undertake a review of the means-tests used for existing income-assessed payments and discounts delivered at the Scotland and local level with a view to aligning means-tests and moving closer to automation. This should aim to ensure greater numbers of low-income families receive this support and to enable automation and greater take-up. This should include review of means-tests used for Scottish Child Payment, Best Start Grant, Council Tax Reduction, Water discount, Free School Meals, School Clothing Grant and others. Beginning to knit the existing Scotland and local level social security system more closely together will be an important step towards a Minimum Income Guarantee.

8. The Scottish Government should accelerate the review of adequacy of disability assistance to address the issues of additional costs facing disabled people. This is an area where the Minimum Income Guarantee Expert Group will also plan additional work in year two.

9. To promote the living wage the Scottish Government should extend its commitment to setting conditions that ensure public sector contractors pay the real living wage to their staff to all public authorities and through procurement, and widen the scope of this commitment to include a requirement to provide ‘living hours’ – a guarantee for workers of a set number of hours each week.