Minimum Income Guarantee: Experts by Experience Panel report

Panel seven: setting the Minimum Income Guarantee level

This panel meeting reflected both the current work of the Expert Group and the desire for Expert by Experience Panel members to better understand the level and costs of the Minimum Income Guarantee. This meeting aimed to:

• Provide members with key information to engage them in discussions and specific considerations around setting the level of the Minimum Income Guarantee.
• Discuss and inform, drawing on members' lived experience, what they believe the appropriate level for the Minimum Income Guarantee should be, against the MIS.

Members who had participated in previous discussions about the MIS and elements of a dignified quality of life were expected to bring valuable perspectives to this meeting, while the contributions of new panel members were also seen as vital in bringing diversity of perspective.

During the panel meeting, members heard and reflected on presentations from:

• Expert Group member, Philip Whyte, on the work towards setting Minimum Income Guarantee levels to date, including the results of modelling options for the Minimum Income Guarantee levels based on the MIS, what this would mean for raising households out of poverty and cost of implementation.
• Expert Group Chair, Russell Gunson, explained the different ways in which a Minimum Income Guarantee can be reached; work, services, and social security payments. Russell additionally explained the tension between setting a Minimum Income Guarantee level that is very tailored to different household types but that may be complex to access, versus a more general level but one that has clarity of access. This presentation formed the basis for the current considerations that the Panel were asked to discuss during this meeting.

Members deliberated on seven specific considerationsaround the Minimum Income Guarantee level, before looking at the setting of the level itself.

The first consideration was the extent to which the Minimum Income Guarantee level should be tailored to individual circumstances. Members felt that the Minimum Income Guarantee should be tailored and this fed into the second consideration on what groups of people should be thought of in tailoring the Minimum Income Guarantee. The need for tailored support for differently affected groups was emphasised as crucial, and included those with disabilities as well as included rural communities, parents, carers, older people, and those affected by regional cost disparities such as housing.

The third consideration asked members to think about how the Minimum Income Guarantee should keep pace with changing household costs, with members supporting regular reviews to respond to changing cost of living and emergency situations such as the pandemic.

The fourth consideration asked members to think about whether there is a role for conditionality and sanctions to require action in order to receive Minimum Income Guarantee payments. In general, members wanted to move away from conditionality and especially sanctions. However, some members felt some form of conditionality would still be required, albeit with less punitive actions than current sanctions.

The fifth consideration was about the responsibility of employers; so the extent to which the Minimum Income Guarantee level should be met through the wages that they pay and the conditions they set. Members felt that being in full-time employment should always meet the Minimum Income Guarantee level, that employers should not pay below the Minimum Income Guarantee level and therefore additional payment top ups should not be necessary for households where full-time paid work is possible. They recognised that to fully achieve the Minimum Income Guarantee through paid work, job security and support to work is vital.

The sixth consideration looked at how by reducing the costs of essentials, the level of the Minimum Income Guarantee for some groups in particular could be lower. This consideration is about the role of services, such as childcare and social care, in meeting the Minimum Income Guarantee level. As with panel meeting six, members remained sceptical about the ability for current services to fairly and equally support people to meet the Minimum Income Guarantee level without significant improvement to services.

The seventh consideration looked at the role of social security payments to meet the Minimum Income Guarantee level. The vast majority of members agreed that social security payments are a necessary route to meeting the Minimum Income Guaranteefor those who are unable to work.

Scottish Government analysts modelled the costs of the Minimum Income Guarantee using 50%, 75%, and 100%, of the MIS after housing costs. Members' views on what the level should be fell across this range in full. Overall, member comments on the pros and cons of these levels of the Minimum Income Guarantee showed a sliding scale whereby at the level of 100% of the MIS, the positive focus was on wellbeing and wider economic benefits, while the negative focus was on narratives of work, incentivisation, and cost.

These pros and cons showed a switch at 50% with the pros at this level being around public acceptability and narratives of work incentivisation, whereas the cons became issues of wellbeing.

80% and 85% of the MIS was suggested a number of times. It was felt that this would give people a little bit more security, dignity, and ability to make choices, while also being likely to benefit the wider economy with a boost to spending - particularly on leisure activities. An 80/85% MIS level Minimum Income Guarantee was also raised as a response to the observation that not everyone is brought above the poverty line at 75% of MIS. A Minimum Income Guarantee at the 80/85% MIS level was seen to leave room for aspiration (to reach 100% of more of the MIS).