The Welfare Foods (Best Start Foods) (Scotland) Amendment Regulations 2023: business and regulatory impact assessment

Purpose and Intended Effect

Background

Best Start Foods

The Scottish Government replaced the UK Healthy Start Voucher scheme in Scotland with Best Start Foods (BSF) on 12 August 2019. BSF supports low income families with a pregnant person and/or a child or children under the age of three. The payments are delivered via a pre-paid card.

Initial policy development of BSF was informed by a 2016 report by Nourish Scotland entitled Living is More Important than Just Surviving - Listening to what children think about food insecurity.^[1] It was also informed by the report produced by the Children’s Parliament in 2017 entitled What Kind of Scotland? which identified poverty as the most important barrier to a good life. ^[2] It affects children day to day, in terms of practical things like having enough food to eat and a house that is warm, but also because children may notice the stress money concerns cause the adults at home.

BSF is a weekly payment which amounts to £19.80 every four weeks throughout pregnancy, £39.60 every four weeks from birth until a child turns one to support breastfeeding mothers or help the child’s parent or carer with the costs of providing first infant formula milk, then £19.80 every four weeks from one until a child turns three.

BSF targets support to low income families. Under the current regulations, for most eligible individuals qualifying benefits are used as a proxy for means testing and there are income thresholds which apply to some of these benefits. Pregnant persons who are under 18 and their partners are automatically entitled to BSF, without the need for a qualifying benefit, as long as they meet the residency conditions. This is also true for children who are under one and whose parent or carer is are under 18, provided the residency requirement is met.

For a child to be eligible for BSF, an individual looking after the child must also be able to evidence child responsibility. For most individuals, the evidence will be receipt of a child responsibility benefit for the child but other forms of evidence can also be accepted, e.g. proof of a kinship care relationship.

Between launching on 12 August 2019 and 30 June 2023, more than 156,000 applications had been authorised for BSF. In total, over £44 million has been provided to those families who need it most. In the 2022-23 financial year around 46,425 people were paid BSF.^[3]

Five family payments

BSF is part of a wider group of social security benefits that are intended to support low income families with the costs of raising a child. Scottish Child Payment (SCP) and the three Best Start Grant (BSG) payments – Pregnancy and Baby Payment, Early Learning Payment and School Age Payment – together with BSF are known collectively as the five family payments (FFP). All five payments are aimed at tackling inequality, improving outcomes and making a positive impact on all of the priority family types identified in Best Start, Bright Futures^[4] – the latest Tackling Child Poverty Delivery Plan. To some extent, all of the payments use qualifying benefits and child responsibility benefits to target eligibility.

BSG replaced the Sure Start Maternity Grant in Scotland. It aims to help alleviate material deprivation, tackle inequality and contribute to closing the educational attainment gap. The grants provide support to low income families at three key transition points in a child’s early years. BSG Pregnancy and Baby Payment opened for applications on 10 December 2018 and currently provides £707.25 for a first child and £353.65 for second and subsequent children. An additional payment of £353.65 is payable in the case of a multiple birth. The payment also provides support for people who have had a stillbirth. BSG Early Learning Payment opened for applications on 29 April 2019 and the BSG School Age Payment opened for applications on 3 June 2019, both currently provide £294.70 per child.

SCP launched on 15 February 2021 and was introduced by the Scottish Government to tackle child poverty for low income families in receipt of certain reserved benefits. It currently pays £25 a week per child every four weeks in arrears to families with no cap on the number of eligible children a family can claim for. SCP is paid to families with children under the age of 16.

The FFP could be worth around £10,000 by the time an eligible child turns six years old, and over £20,000 by the time an eligible child is 16 years old. This is a significant investment in tackling child poverty and we want all low income families to take up their eligibility. We know from work undertaken to develop the second Benefit Take-up Strategy, published in October 2021, that the complexity of accessing entitlements is a key barrier to benefit take-up.^[5] That is why we are keen to make sure accessing the benefits is simple and straight forward. To make it easy to apply for the FFP, there is already a single form to apply for them all. We also promote the benefits as part of a joint FFP campaign which focuses on the full package of support available to low income families. It includes television, radio and digital advertising.

While many people will be able to get all five payments as their child ages, there are some differences about who can receive them. This means that some families will not be able to get all of the payments. There are also some differences in the rules for processing applications for the different benefits.

We know that greater alignment of Scottish benefits could make it easier for people to understand what they are eligible for and simpler for Social Security Scotland to communicate. This in turn could result in higher take-up of the FFP and make it simpler to potentially automate payments in the future.

Objective

These amendment regulations will make the following changes to BSF:

• Ensure entitlement to BSF continues for a period of eight weeks when entitlement to Child Tax Credit, Working Tax Credit, Income Support, Income-based Jobseekers Allowance, Income-related Employment and Support Allowance, Pension Credit or Housing Benefit ends.
• Make 18 and 19 year old dependants who are pregnant eligible without the need for a qualifying benefit, as long as they meet the relevant residency conditions. If the pregnant person stops being a dependant before the end of the pregnancy, eligibility will continue until the end of that pregnancy.
• Align the eligibility criteria for partners of pregnant persons with that of pregnant persons.
• Make the individual who an eligible pregnant person is dependent on and the partner of that individual, entitled to receive Best Start Foods. If the pregnant person stops being a dependant before the pregnancy has ended, the individual will remain eligible until the end of the pregnancy.
• Amend the eligibility rules for children so that children under three are eligible if the individual responsible for them or the partner of that individual:
  • is under 18,
  • is a dependant aged 18 or 19 years old, or
  • was eligible to receive Best Start Foods during pregnancy due to being under 18 or a dependant aged 18 or 19 years old.

If the individual responsible for the child turns 18 or ceases to be a dependant aged 18 or 19 years old before the child turns one, the child will continue to be eligible up until the child turns one or reaches the first anniversary of its estimated delivery date, whichever is later.

• Amend the residency requirements so that the individual responsible for a child under three or the partner of that individual must meet the residency conditions set out in regulation 9 in order for the child to be eligible for BSF.
• Amend the residency requirements so that whomever is acting on behalf of an entitled child who is under three must meet the residency conditions set out in regulation 9.
• Amend the residency requirements so that individuals who are 18 or 19 and a dependant must meet the further residency conditions set out in regulation 9(2).
• Remove the income thresholds which apply to certain qualifying benefits.
• Make Working Tax Credit a qualifying benefit in its own right.
• For BSF applicants who are in receipt of any qualifying benefit, ensure that any deductions made from their qualifying benefit award due to sanctions or to pay any liability are disregarded. This will ensure that if an individual has a nil award because of these deductions, they will still be treated as being in receipt of the qualifying benefit and they will, therefore, be eligible for BSF. In all other circumstances, where the individual has a nil award or where the individual has received a qualifying benefit in error, the individual is not entitled to BSF.
• Ensure that where BSF is being paid to the individual the pregnant person is dependent on or the partner of that individual and an application is received from the pregnant person and they are eligible, the pregnant person’s claim will be approved and the claim from the individual the pregnant person is dependent on or the partner of that individual will be ended.
• Where applications are received from two eligible individuals and neither is the pregnant person, allow Scottish Ministers to decide who should be entitled to BSF, having regard to the circumstances of the pregnant person.
• Make clear that where they have legal capacity to be paid, entitled young persons can be paid in their own right and young parents of an entitled child who is under three can be paid on behalf of the child.
• Allow payment on behalf of an entitled child who is under three to be made to the partner of the person who is responsible for the child.
• Allow Scottish Ministers to pay whoever they consider appropriate on behalf of an entitled person.
• Amend the duty to report a change of circumstances so the duty is on the individual who is being paid BSF on behalf of the entitled person or the entitled person if they are being paid in their own right.
• Allow Scottish Ministers to make an appointee for an individual who is under 16 and is an entitled pregnant person, partner of a pregnant person or person responsible for a child under three. Such an appointee can only be made where there is no person who has authority to act on behalf of the individual, resides with the individual and is willing and practicably able to act on the individual’s behalf.
• Specify that the higher payment of BSF paid from the date the child is born until the child turns one or reaches the first anniversary of its estimated delivery date, whichever is later, is double the lower payment.
• Allow payments to be made in a way other than the prepaid card, where appropriate.
• Give the Scottish Ministers a discretion to treat an application as having been made at a later date where Social Security Scotland can see that the individual who applied will become eligible within 10 days of their application date.
• Allow a new decision to be made without having to receive a new application or review request where an individual has previously been determined as ineligible due to the lack of a qualifying benefit or child responsibility benefit and they have subsequently received a backdated award of their qualifying benefit or child responsibility benefit which covers the date of their original application.

The aims of the policy changes being introduced are to:

• Support more low income families to access healthy food and milk;
• Further align eligibility and procedures for BSF with BSG and SCP. This will:
  • make it easier for clients to understand the eligibility criteria;
  • reduce the need for re-applications and review requests;
  • make it easier to potentially automate payments in the future;
  • improve access to BSF for young parents;
  • make it easier to administer and promote the benefits; and
  • address stakeholder concerns regarding the need for better alignment across the FFP.
• Make other technical changes to how we make payments. These will:
  • simplify the uprating process; and
  • make clear that we can pay BSF to individuals in another way where it is not appropriate to provide a prepaid card.

Rationale for Government intervention

As identified in the first Tackling Child Poverty Delivery Plan,^[6] there is a strong rationale for intervention to tackle child poverty and improve children's outcomes. It is estimated that 24% of children (250,000 children each year) were living in relative poverty after housing costs in 2019-22. Before housing costs, it is estimated that 22% of children (230,000 children each year) were in relative poverty.^[7]

Eligibility for BSF is targeted at low income families with a pregnant person or child under three, recognising that the early years are key to improving long term outcomes with socioeconomic differences having implications in later decades.^[8] Children in low income households tend to experience a range of disadvantages which can accumulate throughout their lives. For example, poverty negatively affects children's health, social, emotional and cognitive development and also their behavioural and educational outcomes.^[9] 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.^[10]

BSF also contributes to the Scottish Government’s efforts to tackle food insecurity. In 2019-22, 21% of children lived in households with marginal, low or very low food security.^[11] Children in poverty were less likely to have high food security: just 65% of those in relative poverty and 65% of those in severe poverty lived in high food security households.^[12] By providing eligible families with a child under three support to purchase healthy foods and milk, BSF helps make accessing healthy food more affordable.

Eating well, having a healthy weight and being physically active also form part of the public health priorities we have jointly created with the Convention of Scottish Local Authorities (COSLA). We published A Healthier Future: Scotland’s diet and healthy weight delivery plan^[13] in July 2018. This plan sets out our vision for a Scotland where everyone eats well and has a healthy weight. Replacing the UK Healthy Start Voucher scheme in Scotland with BSF was one of the actions in the plan. The plan sets out our ambition to halve childhood obesity by 2030 and significantly reduce diet-related health inequalities. One of the key outcomes for this plan is that children have the best start in life - they eat well and have a healthy weight. Dealing only with the consequences of poor diet and higher weight is not enough, we also need to address the underlying causes. There is some evidence to show that BSF may be contributing to better health and wellbeing for children. Recipients report observing their children eating more and a greater variety of fruits and vegetables and feeling positive that they can provide their children with more nutritious foods.^[14]

BSF policy is supportive of the National Outcomes in the Scottish Government’s National Performance Framework.^[15] The following table sets out the impact of the changes.

National Outcome and Impact of Changes

Poverty: we tackle poverty by sharing opportunities, wealth and power more equally. Social security has been identified as one of the most effective and immediate ways to boost family incomes. BSF provides families with a pregnant person or child under three who are in poverty with financial support to help make healthy food and milk more affordable.

Health: we are healthy and active. There is evidence of the impact of diet in the early years on longer term outcomes. BSF is designed to support families with a pregnant person or child under three who are in poverty to maintain a healthy diet.

Education: we are educated, skilled and able to contribute to society. BSF is designed to support families with a pregnant person or child under three who are in poverty to maintain a healthy diet. Research has shown that early educational attainment is negatively correlated with poor diet at home before the age of three.

Children and Young People: we grow up loved, safe and respected so that we realise our full potential. BSF contributes to tackling food insecurity in the early years by providing financial support towards the cost of healthy food and milk for children under three who are in poverty.

Human Rights: we respect, protect and fulfil human rights and live free from discrimination. Social Security Scotland takes a human rights based approach to delivering payments. Their Charter[16] sets out how they do this and how they demonstrate dignity, fairness and respect in all their actions.

The provision of financial resources to low income families with children under 16 also contributes to the aim of having a fairer and more equal society as set out in Scotland’s National Strategy for Economic Transformation.[17]