Social Security assistance in Scotland: up-rating for inflation - 2025-2026

2. Background

2.1 In 2019, following consideration of evidence from a number of sources including the UK Statistics Authority, the Office for National Statistics, an independent review led by the Director of the Institute of Fiscal Studies^[6] and the House of Lords Economic Affairs Committee’s report ‘Measuring Inflation’^[7], the Scottish Government recommended that the Consumer Prices Index (CPI) 12 month rate for September is used for up-rating devolved social security assistance, with the assistance payment rounded to the nearest five pence.

2.2 A policy paper^[8] which included analysis of potential measures of inflation and set out the Scottish Government’s approach to up-rating was provided to the Social Security Committee and the Scottish Commission on Social Security on 2 September 2019.

2.3 The Social Security Committee noted the Scottish Government’s position on up-rating of devolved assistance and had no further views to report beyond the discussion at the Committee on 10 October 2019^[9].

2.4 Overall, the Scottish Commission on Social Security was supportive of the Scottish Government’s up-rating policy and made recommendations^[10] which the Scottish Government responded^[11] to. These recommendations are reviewed and considered as part of the annual up-rating process and as more forms of assistance are introduced and reported on.

2.5 Although Scottish Ministers retain the flexibility to choose the most suitable measure of inflation used to annually up-rate forms of assistance, on 29 January 2024, the Scottish Government published a report^[12] setting out further analysis of potential inflation measures. It was recommended that the CPI 12 month rate for September remains the most suitable inflation measure for benefit up-rating.

2.6 The following sections provide detail of how the inflation-adjusted levels of assistance were calculated, what the inflation-adjusted levels of assistance would be and what the Scottish Ministers intend to do.