The Social Security (Miscellaneous Amendment and Transitional Provision) (Scotland) Regulations 2022: business and regulatory impact assessment

Rationale for Government intervention

As identified in the first TCPDP,^[9] there is a strong rationale for intervention to tackle child poverty and improve children's outcomes. It is estimated that 24% of Scotland’s children (240,000 children each year) were living in relative poverty after housing costs in 2017-20.^[10] Prior to the outbreak of COVID-19, it was predicted that if no further action were taken to tackle child poverty one in three children in Scotland would grow up in poverty by 2030, damaging society and the economy.^[11] The impact of COVID-19 on child poverty levels is still largely unknown, particularly the long term effects on families and our economy, however we know that the impacts have been felt most acutely by the most disadvantaged in our society. Children in low income households tend to experience a range of disadvantages including lower educational attainment and poorer health which will shape their future life. Poverty can have lasting impacts long into adulthood such as increased risk of homelessness, lower earning potential and greater likelihood of limiting illness. The growing evidence in developed economies suggests that gaining additional income has positive causal effects on health, behavioural development and educational attainment for children in households at the lower end of income distribution.^[12]

The first TCPDP identified three main drivers of child poverty reduction: increasing incomes from work and earnings; reducing household costs; and maximising incomes from social security and benefits in kind.^[13] As a result, social security was identified as one of the most immediate ways to boost family incomes utilising the new social security powers under the Social Security (Scotland) Act 2018.^[14] The COVID-19 pandemic has only increased the importance of using the devolved social security powers to tackle child poverty, with early data showing an increased reliance on the social security system.

The extension to the eligibility criteria for SCP will provide additional financial support to parents of children aged 6-15 and will increase the level of support for all recipients of Scottish Child Payment from £20 a week per eligible child to £25. This support is specifically targeted at low income families. Scotland is the only part of the UK to offer this type of support.

In the unfortunate situation where a child to whom a claim relates dies, these amendments will also provide for a payment, equivalent to the value of Scottish Child Payments made in the 12 weeks prior to the child’s death, to be made. This will bring the payment closer in line with the reserved benefits which act as qualifying benefits for SCP.

Introducing auto-award for elements of BSG will make it easier for eligible families to receive their entitlement.

Providing new exceptions to the general rule that an individual is only entitled to the higher Pregnancy and Baby Payment when they are applying in respect of their first child, will provide greater support for families who are more likely to be starting from scratch without the items that the Pregnancy and Baby Payment is intended to provide.

Removing the condition for BSG that the child is not looked after by the local authority in residential care allows more low income families to benefit from this support. This change aligns BSG with both BSF and SCP, which do not have this condition.

Widening the meaning of surrogacy for both BSG and BSF will ensure that all individuals who are responsible for a child through formal surrogacy arrangements can be classed as having responsibility for the child and therefore allows more low income families to benefit from this support..

Widening the meaning of kinship care for BSG, BSF, and SCP will ensure that, as we roll out Scottish Child Payment to children aged between 6 and 15, all eligible kinship carers who are not related to the child but are known to them and have a pre-existing relationship with the child are included.

The FFP policies are supportive of the National Outcomes in the Scottish Government’s National Performance Framework.^[15]

National Outcome

Children and Young People: we grow up loved, safe and respected so that we realise our full potential

Impact of changes

SCP and BSG are flexible payments that can be used to best meet the needs of the eligible child. For example, it can be used to fund hobbies and interests that help them realise their potential.

National Outcome

Poverty: we tackle poverty by sharing opportunities, wealth and power more equally

Impact of changes

Social security has been identified as one of the most effective and immediate ways to boost family incomes.

National Outcome

Human Rights: we respect, protect and fulfil human rights and live free from discrimination

Impact of changes

The principles, legislated within the Social Security Act (2018), enshrine social security as a human right.^[16]

National Outcome

Education: we are educated, skilled and able to contribute to society

Impact of changes

The BSG Early Learning and School Age Payments are paid around the time a child starts nursery or school. These payments can be used to fund nursery and school trips and educational toys.

National Outcome

We are healthy and active

Impact of changes

There is evidence of the impact of diet in the early years on longer term outcomes. Research has shown that early educational attainment is negatively correlated with poor diet at home before the age of three. BSF is designed to support low income families with a pregnant woman and/or a child or children under the age of 3 to buy healthy foods.

The provision of financial resources to low income families with children under 16 contributes to the aim of having a fairer and more equal society as set out in Scotland’s Strategy for economic transformation.^[17] The FFP are an investment in children ensuring they grow up to be well-skilled, healthy and resilient.