Social security assistance - effects of inflation: report

8. Carer's Allowance Supplement Statement

8.1 As Carer's Allowance is the lowest of all working age benefits, the Carer's Allowance Supplement was designed to increase Carer's Allowance to the level of Jobseeker's Allowance. The supplement is a temporary measure until the Scottish Government is delivering Scottish Carer's Assistance under the powers in the 2018 Act.

8.2 Section 81 of the Act provides a formula for determining the rate of Carer's Allowance Supplement by calculating the difference between the weekly rate of Carer's Allowance and Jobseeker's Allowance. To ensure the support provided through the Supplement is protected as prices change, Section 81 provides for the amount of Jobseeker's Allowance used in this calculation to be uprated for inflation, while taking into account any changes in the rate of Jobseeker's Allowance since the introduction of the Supplement.

8.3 As no legislation is required to uprate Carer's Allowance Supplement, Scottish Ministers are to publish a statement before the start of each new tax year, explaining how inflation has been calculated for this purpose. It is appropriate to include this statement within this report.

8.4 In 2019-20, the rate of Jobseeker's Allowance was not uprated from the 2018/19 rate of £73.10. The rate of Jobseeker's Allowance used in calculating Carer's Allowance Supplement was therefore adjusted for inflation, using the September 2018 CPI of 2.4%, giving a rate of £74.85, and increasing the amount of the Supplement from £221 to £226.20.

8.5 For 2020-21, Scottish Ministers will use the rate of Jobseeker's Allowance calculated for 2019-20 (£74.85), uprated by September 2019 CPI of 1.7%, in the calculation of Carer's Allowance Supplement – giving a rate of £76.10.

8.6 The effect of this will be to uprate the Supplement, increasing the weekly rate from £8.70 to £8.85, so that the bi-annual payment will increase from £226.20 to £230.10.