Draft Disability Assistance for Working Age People (Transitional Provisions and Miscellaneous Amendment) (Scotland) Regulations 2022: SCoSS scrutiny report

6. Winners, losers and options for transitional protection

PIP was designed with a view to re-focusing support with the extra costs of disability on those with the greatest need, one of the underlying objectives of which was to reduce expenditure.^[20] Many of the UK's leading social security experts expected that the move from DLA to PIP would create 'absolutely no winners … just losers' in terms of entitlement.^[21] This has not been the case in practice: while there have certainly been 'losers', many claimants have seen their award increase and the overall case load is also larger than would have been the case had DLA remained in place for people of working age. ^[22]

The eligibility criteria for ADP are, for the most part, closely modelled on those for PIP. They therefore, differ from DLA in a number of important ways that will create 'winners' and 'losers' (that is, individuals who receive a higher award and individuals who receive a reduced or no award) on completion of post-transfer reviews. The key differences are as follows:

• The care component of DLA has three rates – lowest, middle and highest. The daily living component of PIP and ADP has only two components – standard and enhanced. Many individuals who are only entitled to the lowest rate care component will not satisfy the eligibility criteria for the daily living component, at either rate.
• People who can only walk a very short distance are entitled to the mobility component of DLA at the higher rate. The legislation does not stipulate what counts as a very short distance, but in practice this means less than 50 metres. In PIP and ADP, access to the mobility component at the enhanced rate on the basis of a physical impairment depends on inability to walk more than 20 metres.
• The DLA care component is only payable at the highest rate to individuals who have overnight care needs. The PIP/ADP daily living component at the enhanced rate is available to anyone who has severely limited ability to carry out daily living activities, regardless of time of day.
• An individual whose mobility is restricted by a cognitive impairment or mental health condition is more likely to qualify for the mobility component at the higher rate under PIP or ADP than DLA.
• An individual with a diagnosis of a terminal illness is immediately entitled to both components of ADP at the enhanced rate. Terminal illness only confers automatic entitled to the DLA care component, and only if the individual has a life expectancy of six months or less. ^[23]

6.1 Individuals who would be better off on PIP or ADP than DLA

Stopping migration from DLA to PIP in April 2020 may have resulted in some individuals remaining on DLA who might have moved to PIP, and been financially better off as a result, had this not occurred.

Anyone who has informed the DWP of a change of circumstances will already have been invited to apply for PIP; if they did not do so, they will now migrate to ADP under the transitional provisions (natural migration). If, on review, they are found to be entitled to ADP at a higher rate than their DLA award, the increase will be applied from the date of transfer and a back payment made. However, there is no provision for back payment to cover the period between the date when the change of circumstances was reported and the date of transfer. It could be that stopping migration from DLA to PIP, with a view to putting the needs of those who require assistance first (in accordance with principle g) by avoiding the need for PIP assessments, may have resulted in some continuing to receive a lower award than would otherwise have been the case. It might also have the effect of reducing the contribution to reducing poverty (principle e).

Individuals whose ADP or PIP award would likely be higher than their DLA award for reasons other than a change of circumstances – for example, because their condition has a serious impact on their daily living activities but they have no overnight care needs – will not be among the group selected for transfer to ADP after the draft Regulations have been made. They would have been entitled to voluntarily apply for PIP in the period since April 2020 and will be entitled to request transfer to ADP once the regulations have been made. As with the 'natural migration' cohort, any increase in entitlement following review will be applied from the date of transfer. However, social security rules are complex and there is no guarantee that people will know they are in this position. Indeed, it would be unwise to imagine that someone who has not in the last two years realised they would be better off on PIP will now realise that they would be better off on ADP, unless a concerted effort is made to educate the remaining adult DLA claimants about the differences between it and ADP and encourage them to seek advice.

The Scottish Government has told SCoSS that up to half of DLA-ADP transfers could be voluntary, chiefly because individuals transferring from DLA to ADP can claim the mobility component for the first time after reaching pensionable age, while those who remain in receipt of DLA cannot. Even for this group, though, assessing the benefits and risk of transferring will be difficult. The day to day impacts of disability are assessed under different qualifying criteria for ADP than DLA, and there may be a fear factor since some people will get less in a new ADP award than in their old DLA award. People will need very clear information and access to advice and advocacy, delivered as simply and clearly as possible.

Recommendation 4: The Scottish Government should explain why an increase in award flowing from a change of circumstances is only backdated to the start of the ADP claim and not to the date when the change of circumstances was reported to the DWP.

6.2 Individuals with reduced or no ADP entitlement

Ultimately, some transferring individuals will end up with a reduced or no ADP award following review. This will pose a new challenge to Social Security Scotland, although one that will continue to arise as disability and carer's assistance roll out and awards reach the point of review. While Social Security Scotland has always had to reject a proportion of applications that do not meet the eligibility criteria for the various forms of social security assistance it delivers, the launch of the various forms of disability assistance raises the prospect of individuals with an existing award being disentitled or having their award reduced. In the context of these transitional provisions, individuals' inevitable disappointment could be all the greater because of the emphasis that has been placed on developing a 'better' approach to social security under devolution. The availability of STA means the cliff-edge will be somewhat less stark than in the UK system, albeit that passported awards could still be immediately lost even if the individual requests a redetermination. Ultimately, though, there are adults in receipt of DLA who will receive less money through ADP, or no award at all.

Social Security Scotland is required to deliver a service on the basis of dignity, fairness, respect and the various commitments in Our Charter.^[24] This means a plan needs to be in place for dealing sensitively with these individuals and ensuring they can access support with budgeting in their changed circumstances and possibly with the emotional impact of the change.^[25] SCoSS highlighted the need for Social Security Scotland to consider its role in 'aftercare' in our previous report on the Suspension of Assistance (DACYP) (SCP) (Scotland) Regulations^[26] and the point is equally relevant here.

Having to disentitle people who do not, or no longer, fulfil the eligibility criteria for an ADP award at the level of their previous disability benefit means that determinations in the Scottish social security system will put some people at an increased risk of poverty. There is a tension here with principle (e),^[27] and possibly with articles 19 and 20 of the Convention on the Rights of Persons with Disabilities,^[28] since both the loss of income and in some cases the loss of a vehicle via the Motability scheme may affect people's mobility and their ability to live independently and be included in the community. However, the Scottish Government has long made clear its reasons for prioritising a smooth transition from UK disability benefits to Scottish disability assistance and preserving the passporting function of disability benefits. Each of these put significant constraints on diverging from the eligibility criteria of their UK equivalents during the transitional period. To put the safe and secure transition or passporting function at risk could potentially expose greater numbers of people to an increased risk of poverty through loss of benefit, in addition to making the transition less efficient. The Commission understands the reasons for the Scottish Government taking this approach in the short to medium term,^[29] although the evident tension with principles and human rights underlines why there is a need for the Scottish Government to consider whether there is action it might take to prevent or mitigate loses, or soften the blow where they occur.

If there were a desire to adopt a 'no-one worse off' principle, whether on a short-term or ongoing basis, a number of 'mitigation' options are available to support individuals who would otherwise end up with a lower or no award following review. There is precedent for such an approach following social security reforms, notably the introduction of universal credit, but it would be unusual to offer transitional protection to individuals who naturally migrate due to a change of circumstances (as their award might reduce even if they remained on their previous benefits, in this case DLA). Transitional protection might be more relevant to voluntary migration or future managed migration.

• Individuals could be held on the award made at the point of transfer until completion of the scheduled independent review of ADP (see below). This might also preserve passported awards in the UK system, for which the Scottish Government would presumably have to recompense the UK Exchequer.
• Individuals could be held on STA until completion of the independent review. This option appears to be ruled out at present by draft Regulation 8, which stipulates that re-determinations must be completed within 182 days.
• In Northern Ireland, anyone who received a lower award on migration from DLA to PIP was given a payment equivalent to 75% of the loss for a period of one year, allowing more time to prepare for the drop in income.^[30] This could be replicated in Scotland.
• In line with transitional protection for claimants moving to universal credit through managed migration from one or more of the 'legacy' benefits,^[31] eligible individuals (most likely those whose circumstances have not changed) could continue to receive a payment equivalent to their DLA award. This would not be subject to annual uprating, so in many cases the ADP award would eventually catch up with and exceed the transitionally protected award.

Adoption of any of these models, and identification of eligible individuals, could only be a political decision due to the additional costs and administrative complexity implied. These would be even greater if there were aspirations to maintain passported entitlements from DWP or compensate for their loss through a top-up payment under section 79 of the 2018 Act. There would be trade-offs between principles, most obviously poverty reduction (principle e) versus efficiency and value for money (principle h). In the absence of any statutory hierarchy of principles, which should prevail must also be a political decision. It is also worth noting that transitional protection for this cohort would prolong the inequality of treatment (noted below) between individuals migrating directly from DLA to ADP and those who have already migrated to or been refused PIP.

A final issue for this section is that a transferring individual who is now older than state pensionable age, who fulfils the eligibility criteria for the DLA care component but not for either ADP component, is likely to be entitled to Attendance Allowance (AA). This is a complex scenario. Our Charter requires Social Security Scotland to alert service users to other social security entitlements they might have.^[32] However, if an individual found ineligible for ADP on review then requests a re-determination and claims STA, while simultaneously applying for AA, they could effectively end up receiving awards of STA and AA for the same condition. There does not appear to be any legal obstacle to this, although such duplication might be argued to run against the spirit of what STA is intended for and of principle (h), which requires the Scottish social security system to deliver value for money. If Social Security Scotland decided on re-determination that the individual was in fact entitled to ADP, they would no longer be entitled to receive it had they been awarded AA in the meantime. The individual could then end their AA claim and reapply for ADP, but at the risk of being found again not to be entitled to ADP, this time with no entitlement to STA either.^[33] Evidently there is a risk of gaps in entitlement, not only to the disability benefit but to any passported awards, as well as confusion.

In correspondence with SCoSS, the Scottish Government has acknowledged the complexity of the situation and said it will consider the interaction of ADP with reserved benefits. The Commission welcomes this commitment and hopes that some means – whether legal or practical – can be devised to remove the risk of an AA claim preventing someone from claiming ADP or at least to help transferring individuals navigate what has potential to be something of a minefield.

Recommendation 5: The Scottish Government and Social Security Scotland should develop an approach to supporting individuals who receive a reduced or no award following review of their transitional ADP award, as in other circumstances.

Recommendation 6: SCoSS asks the Scottish Government to outline any consideration it has given to applying a 'no one worse off' principle to some or all groups of transferring individuals – whether those intended to migrate under the draft Regulations or those subject to managed migration in the future.

Recommendation 7: The Scottish Government should share its plans for supporting transferring individuals to avoid or cope with problems resulting from the interaction of reserved and devolved disability benefits/assistance, for example the mutual exclusivity of ADP and Attendance Allowance awards.

6.3 Independent review of ADP

An independent review of ADP is scheduled to commence later in 2022.^[34] This will be an opportunity for the Scottish Government to consider its response to negative comments from stakeholders on its decision to base the descriptors used to determine entitlement to ADP on those for PIP.^[35] Retention of the '20 metre rule' for entitlement to the enhanced rate mobility component was particularly controversial and the review will commence with a focus on the mobility component. Several of the stakeholder submissions during SCoSS's scrutiny of the draft Regulations included statements about the desirability of the future revision of ADP eligibility criteria and/or rates of payment. Such matters are beyond the scope of the draft Regulations, and therefore of this report, but there are possible implications for the migration process, particularly for decisions on the availability of transitional protection.

On one hand, the imminence of the review might be seen to strengthen the case for transitional protection. If, following the review, the Scottish Government were to decide to allow individuals to access the enhanced rate mobility component if unable to walk 50 (as opposed to 20) metres, then some form of transitional protection for those able to walk between 20 and 50 metres could avoid the loss of mobility, administrative .burden and ill-feeling that would be associated with removing and then quickly restoring access to the Motability scheme. On the other hand, there is uncertainty around how long the review might take, what it might recommend and whether its recommendations would in fact be accepted by the Scottish Government. 'Transitional' arrangements could end up remaining in place for longer than necessary, only for ADP to continue to resemble PIP, or even to diverge further from DLA. Additional money would continue to be paid to some individuals for longer than necessary. Others might miss out on higher awards for longer than necessary because they did not realise they would be better off following review, although this risk could be reduced through an effective communication strategy.

6.4 Potential for unequal treatment of transferring individuals

The transitional provisions necessarily create an inequality of treatment between adults who migrate to ADP, depending on whether they were previously in receipt of PIP or DLA. Principle (b) acknowledges that 'social security is itself a human right and essential to the realisation of other human rights'. Article 2(2) of the International Covenant on Economic, Social and Cultural Rights, article 14 of the European Convention on Human Rights and similar provisions in other treaties prohibit discrimination in the enjoyment of human rights. Principle (g) requires the Scottish Government to seek opportunities to improve the devolved social security system in ways that 'put the needs of those who require assistance first' and 'advance equality and non-discrimination'. These principles require SCoSS to consider whether this unequal treatment is justified. According to the approach of the European Court of Human Rights and UK courts, unequal treatment flowing from the decisions of the legislature or executive on matters of social or economic policy will only constitute discrimination contrary to article 14 if the difference of treatment is 'manifestly without reasonable foundation'.^[36]

Those entitled to a reduced or no award in either component following migration may already have retained their (higher) award for longer thanks to the halting of DLA-PIP migrations in Scotland. Until their ADP claim is reviewed post-migration (and possibly longer if they subsequently receive STA), they will continue to receive payments for which they do not satisfy the descriptors that apply to individuals moving from PIP to ADP. Such payments are not regarded as overpayments, presumably because the review will be the first time the individual has their entitlement determined against the ADP or PIP criteria.^[37] This places some people in Scotland who had already migrated to PIP as well as new ADP applicants who are not migrating from DLA or PIP at a relative disadvantage, as they will be unable to access the lowest rate daily living component at all or qualify for the higher rate mobility component if they can walk more than 20 metres. However, it seems likely that the Scottish Government could point to various reasonable justifications for this difference in treatment. These include the administrative expediency of the two-stage migration process, the need to ensure that disabled people who have never been assessed for PIP are not arbitrarily disentitled as a result,^[38] the prevalence of transitional arrangements when any new social security benefit is introduced, which often involve some sort of advantageous treatment for a particular group of claimants, and the policy intent of avoiding the need for Scotland residents to go through the PIP assessment process.^[39] The proportionality of the unequal treatment is arguably increased by the commitment to completing reviews as quickly as possible following transfer. Although the draft Regulations only require completion of reviews within a year of transfer, this political commitment emphasises the temporary, transitional nature of these initial awards.^[40]

Observation 4: The transitional provisions imply differential treatment of people who migrate to ADP depending on whether they previously received DLA or PIP, particularly if their ADP or PIP award is lower than their DLA award. SCoSS notes the difficulty of avoiding this unequal treatment given the commitment to a safe and secure transfer, the maintenance of parity in the eligibility criteria for ADP and PIP, and the necessity of completing case transfers within a short period.