Social Security (Amendment) (Scotland) Bill: business and regulatory impact assessment

Summary and Recommendation

Option 3 – to bring forward primary legislation – is recommended.

This option will incur the most costs but the Bill will bring about the most benefits. Primary legislation will enable the Scottish Government to fulfil its obligations to continuously improve the Scottish social security system and to ensure that the system is efficient and delivering value for money. This approach also supports the Scottish Government’s commitment to “Keep The Promise” by 2030 and would ensure a consistent, national approach is taken to providing financial assistance to people with care experience.

Many of the proposals cannot be progressed without legislation, while a non-legislative approach for others would have a less meaningful impact.

Engagement remains ongoing with businesses, SCTS, third sector support and advocacy services in terms of the potential cost impacts of the Bill.

Summary costs and benefits

Option 1 – Do nothing

Total benefit per annum:

• No need for existing resources, guidance and/ or systems to be updated

Total cost per annum:

• Fails to deliver continuous improvements to the Scottish social security system
• Scottish Ministers do not have powers to make provision for care experience assistance. There is the potential for continued additional societal cost and impact on costs at other points of the system, including social security provision, mental health support and services and housing provision
• Social Security Scotland unable to undertake audit exercises that would meet the requirements under the specific Accountable Officer responsibilities outlined in Part 2 section 15 of the Public Finance and Accountability (Scotland) Act 2000
• Scottish Government unable to recover social security assistance from compensation awards leading to discrepancies with the rest of the UK and failure to live up to commitment in the Social Security Principles to ensure that the Scottish social security system is efficient and delivers value for money

Option 2 – Non-regulatory changes

Total benefit per annum:

• No substantial benefits identified
• Limited scope to make changes to existing challenge processes in the social security system
• Fewer updates to guidance and less training required for Social Security Scotland staff and welfare advice organisations

Total cost per annum:

• Fails to deliver continuous improvement to the Scottish social security system
• Potential for continued additional societal cost and impact on costs at other points of the system, including social security provision, mental health support and services and housing provision as support for care experienced people is not delivered consistently across the country
• Social Security Scotland unable to undertake audit exercises that would meet the requirements under the specific Accountable Officer responsibilities outlined in Part 2 section 15 of the Public Finance and Accountability (Scotland) Act 2000
• Scottish Government unable to recover social security assistance from compensation awards leading to discrepancies with the rest of the UK and failure to live up to commitment in the Social Security Principles to ensure that the Scottish social security system is efficient and delivers value for money

Option 3 – Legislative change

Total benefit per annum:

• Contributes towards the delivery of National Outcomes, particularly those relating to Communities, Human Rights and Poverty
• Makes the social security system more effective in contributing to the Scottish Government’s mission to tackle poverty and protect people from harm
• The care experience assistance provisions support the Scottish Government’s commitment to Keep The Promise by 2030 and the action within the Promise Implementation Plan ensuring that care leavers are provided with person-centred support to enable positive transitions from care to more independent living
• Provides additional flexibility for clients who wish to challenge decisions without limitations of option 2
• May reduce the administrative burden on the Scottish Courts and Tribunals Service and lead to potential savings if appeal cases could be resolved before reaching the Tribunal
• Eliminates the risk of unfair treatment by extending the time to request a re-determination or appeal in exceptional circumstances
• Allows Social Security Scotland to make a new determination after an appeal has been lodged at Tribunal level with the client’s agreement which could reduce the impact on some people who may find a Tribunal process stressful
• Improvements to challenge rights processes align with Social Security Scotland’s rights based approach and allow clients to have increased control
• Mitigates the risk of harmful delays in payments of awards, particularly in cases of terminal illness or where timely assessment and payment is essential
• Clarifies that overpayment liability extends to clients who have a representative acting on their behalf
• Provides protection for vulnerable individuals to recover funds from their appointee in the rare cases where their appointee does not use the money to the benefit of that individual
• Ensures that overpayments can be recovered by Social Security Scotland from representatives in the rare cases where the representative does not use the money to the benefit of the individual they act for
• Introduces compensation recovery as a feature of the Scottish social security system bringing Scotland back into line with the rest of the UK and ensuring the system provides value for money
• Allows the recommendations of the Glen Shuraig review to be implemented

Total cost per annum:

• Welfare Rights organisations and advice and advocacy services may need to increase their knowledge of any new processes in order to support clients
• Costs to SCTS in terms of training and a small potential increase in caseload from the provisions relating to compensation recovery, challenge rights for overpayment liability and information for audit
• Potential costs to insurers, insurance lawyers and personal injury lawyers in terms of computer systems and staff training when the proposal to recover social security assistance from compensation awards is implemented. Costs will be dependent on the eventual delivery method selected
• Implementation costs and running costs for Social Security Scotland as detailed in the financial memorandum