Winter Heating Assistance for Children and Young People (Scotland) Amendment Regulations 2021: ICIA

Winter Heating Assistance for Children and Young People (Amendment) (Scotland) Regulations 2021 - Draft Island Communities Impact Assessment (ICIA)

Introduction

1. The importance of island-proofing was recognised in the "Empowering Scotland's Island Communities prospectus" published in June 2014. The principle of island-proofing is one of building a broad-based islands awareness into the decision making process of all parts of the public sector.

2. The Islands (Scotland) Act 2018^[1] places a duty on the Scottish Ministers and other relevant authorities, including a number of public authorities, to have regard to island communities in exercising their functions, and for the Scottish Ministers this will also include the development of legislation. This duty is often referred to as 'island-proofing'. The Scottish Government is also committed to island-proofing the legislation required in support of the devolution of social security powers to Scotland.

3. If the Scottish Ministers are of the opinion that any piece of proposed legislation is likely to have an effect on an island community which is significantly different from its effect on other communities, then the duty to island-proof legislation requires the Scottish Ministers to:

• describe the likely significantly different effect of the legislation;
• assess the extent to which the Scottish Ministers consider that the legislation can be developed in such a manner as to improve or mitigate, for island communities, the outcomes resulting from the legislation; and
• set out the financial implications of steps taken under this subsection to mitigate, for island communities, the outcomes resulting from the legislation.

Executive Summary

4. This ICIA has considered the potential effects of the Winter Heating Assistance for Children and Young People (Amendment) (Scotland) Regulations 2021 and how they impact on people living in island communities, presented below in the Key findings section. The findings here are based on desk research, engagement with and feedback from disabled people with lived experience of the current social security system^[2], and the Consultation on Disability Assistance^[3]. This ran between 5 March and 28 May 2019 and received 263 replies, of which 74 were from stakeholder organisations and 189 were from individuals.

5. We are extending the ICIA by considering rurality and remoteness in the same spirit of the Act to gauge evidence at to whether the policy and regulations will impact rural/remote communities differently to other communities.

6. In accordance with section 13 of the 2018 Act, this ICIA has:

• Identified and described areas where CWHA amendment regulations will have an effect on an island community which is likely to be significantly different from its effect on other communities (including other island communities);
• Assessed the extent to which the Scottish Ministers consider that CWHA can be developed in such a manner as to improve or mitigate, for island communities, the outcomes resulting from it;
• Considered and proposed mitigation or actions to support the aims of CWHA within the island communities; and
• Considered any financial implications of the above.

7. We have found that this policy will have a positive impact on families of disabled children and young people living in island communities. We do not believe that it will have a negative impact on island communities.

8. We recognise that fuel costs are on average higher for island communities and that this payment does not adjust for this factor. We believe that the particular challenges for island communities are better addressed by these measures and take into account rural and remote areas of Scotland simultaneously.

Policy Background

9. The policy background to the Winter Heating Assistance for Children and Young People (Scotland) Amendment Regulations 2021 is set out in the accompanying impact assessment.

10. 14,015 CWHA payments were made in winter 2020/2021, with a total value of £2.8 million. 1,235 of these were made to families living in island local authorities, representing just under 9% of the total payments^[4].

11. The policy aligns closely with the Scottish Government Healthier, Wealthier and Fairer Strategic Objectives, but also links with the Smarter Objectives.

12. The policy contributes to the following National Outcomes:

• We respect, protect and fulfil human rights and live free from discrimination;
• We tackle poverty by sharing opportunities, wealth, and power more equally;
• We live in communities that are inclusive, empowered, resilient and safe;
• We grow up loved, safe and respected so that we realise our full potential.

Scope of the ICIA

13. The scope of this ICIA is the impact of extending eligibility for CWHA to young people aged 16, 17 and 18 who are entitled to receive payment of the enhanced rate of the daily living component of PIP.

Key Findings

14. This section provides an overview of issues for Scottish rural/remote and island communities that are relevant for CHWA amendment regulations.

15. Island stakeholders have emphasised the importance of understanding the island experience. Every island is uniquely different with regards to its infrastructure, geography and demography and therefore each island has its own specific considerations and constraints.

16. Rural Scotland accounts for 98% of the land mass of Scotland and 17% of the population are resident there.

17. Scotland had 93 inhabited islands with a total population of 103,700 (2% of Scotland's population) as per 2011 Census.^[5] Of these islands, only five are connected to the Scottish mainland by bridge or causeway. ^[6]

18. The Islands Act identifies 6 local authorities representing island communities in Part 4 of the Act (Section 20 (2), which are Argyll and Bute Council, Comhairle nan Eilean Siar/ Western Isles, Highland Council, North Ayrshire Council, Orkney Islands Council, Shetland Islands Council. Amongst them, Orkney, Shetland and Western Isles are entirely island authorities, while Highland, Argyll and Bute and North Ayrshire local authorities cover island regions as well as mainland regions.

Figure 1: Map highlighting all 6 local authorities representing Island Communities (islands in darker shades where islands are part of mainland Local Authorities)^[7]

Geography

19. Geography, crofting culture, climate and the remoteness of island and rural communities present different challenges to those experienced by families living in the mainland, often resulting in higher levels of fuel poverty in these areas. Citizens Advice Scotland^[8] have specifically identified issues regarding being off the gas grid as key barriers for people in accessible rural, remote rural and remote small towns.

20. Comhairle Nan Eilean Siar stated in their written evidence to a fuel poverty strategy consultation undertaken by the Scottish Government, "it is essential to factor in higher living costs to an understanding of poverty in remote and rural areas. Poorer households in the islands are likely to be significantly worse off financially than an equivalent-earning mainland household because of the higher cost of living"^[9].

21. This sentiment was echoed by Stornoway stakeholders, who highlighted extreme fuel poverty levels as one of the main challenges of the islands^[10].

22. Best estimates of fuel poverty and extreme fuel poverty rates under the new definition of fuel poverty, following amendments agreed at Stage 2 of the Fuel Poverty (Targets, Definition and Strategy) Bill, were published in February 2020 by local authorities^[11]. Five local authorities had significantly higher fuel poverty rates than the national average of 25% in the period 2016-2018, including the island communities of Highland (32%) and Na h-Eileanan Siar (36%). Five local authorities had significantly higher extreme fuel poverty rates than the national average of 12% in the period 2016-2018, including the island communities of Shetland Islands (19%), Highland (20%), Orkney Islands (22%) and Na h-Eileanan Siar (23%).

23. There are a higher proportion of dwellings off the gas grid in island communities: 51% in Argyll and Bute; 85% in Na h-Eileanan Siar; 100% in Orkney and Shetlands; and 63% in Highlands; compared to 17% Scottish average (2016-2018 figures)^[12]. Off-gas grid properties have a more limited set of alternative fuel suppliers, constraining the ability to deliver reduced heating costs.

24. A higher proportion of dwellings with 3 or more bedrooms in Na h-Eileanan Siar (67%), Highland (62%), Orkney (68%) and Shetland (70%) compared with the national average of 49%^[13], means higher fuel bills and potentially greater costs to improve the energy efficiency of these homes. Larger dwellings also necessitate higher fuel bills to reach requisite comfortable ambient temperatures^[14].

25. The colder climate and wind chill factor on the islands means that for many residents, homes may have heating on throughout the whole year. If the household is also on a low income, such as is often experienced by those with one or more disabled members of the family, then they are more likely to be in extreme fuel poverty.

26. According to Highlands and Islands Enterprise (HIE), household budgets in remote rural Scotland are typically 10-40% higher than elsewhere in the UK^[15]. For households in the most remote parts of Scotland, additional costs can be greater than 40%. HIE attribute these extra costs to three principal sources:

• the higher prices that households must pay for food, clothes and household goods;
• much higher household fuel bills, influenced by climate and fuel sources;
• the longer distances that people have to routinely travel, particularly to work.

27. According to the Joseph Rowntree Foundation, levels of poverty among people with disabilities are generally underestimated^[16]. Because disabled people's needs are often greater than for those without a disability, the cost of living for disabled people is frequently higher. Families with one or more severely disabled children, for example, will of necessity spend far more time in the home and will generally require an even temperature to be maintained in all rooms of the house throughout both day and night, resulting in higher energy bills than other families^[17].

28. Thus the cost of living and fuel costs for families with a disabled child or young person is higher for those living in island and remote communities. Therefore, we recognise that both being disabled and living in a remote rural area make it more expensive to meet material need and participate in society.

29. The CWHA amendment regulations will ensure that young people with the most severe disabilities receive extra assistance to ensure they can maintain a comfortable temperature in their homes through the Winter. It is our view that winter heating assistance will particularly benefit those eligible children and young people living in remote communities, due to the challenges posed by geography cited above.

30. Extending the eligibility criteria to include young people in receipt of the enhanced daily living component of PIP will increase the number of young people living in island communities who will be able to receive extra assistance. There were 180 16- to 18-year olds living in Island Communities entitled to enhanced daily living component of PIP in July 2021^[18] who would be entitled to CWHA under the new eligibility criteria.

Cost of Living

31. The cost of many amenities and activities are higher for people living in island communities than those living on the mainland. A lack of choice and accessibility means that shopping, mobile phone services and broadband can be more expensive for young people living in island communities compared to those on the mainland. The greater distances and remoteness means that day to day travel, postage, fuel, day-trips and holidays are also more expensive for young people in remote communities.

32. Citizens Advice Scotland^[19] have identified issues of grid, utilities, digital and travel as key barriers for people in accessible rural, remote rural and remote small towns. Furthermore, a typical food basket can cost as much as 50% more on island communities in Scotland, while transport can be up to £40 a week more expensive due to longer distances for commuting and a higher price for petrol^[20].

33. According to Highlands and Islands Enterprise (HIE), household budgets in remote rural Scotland are typically 10-40% higher than elsewhere in the UK^[21]. For households in the most remote parts of Scotland, additional costs can be greater than 40%. HIE attribute these extra costs to three principal sources:

• the higher prices that households must pay for food, clothes and household goods;
• much higher household fuel bills, influenced by climate and fuel sources;
• the longer distances that people have to routinely travel, particularly to work.

34. The Scottish Government recognises that both being disabled and living in a remote rural area make it more expensive to meet material need and participate in society. A range of work is being undertaken by the Scottish Government to address the challenges that people in island and rural communities face. For example the Islands Strategic Group was established in August 2016. The group considers strategic issues affecting the island communities of Scotland, and to ensure greater involvement of the relevant councils in helping to identify and design solutions to the unique needs and challenges these communities face.

Demography and health

35. Scotland has 93 inhabited islands with a total population of 103,700 (2% of Scotland's population) as per the 2011 Census^[22]. The population of the islands increased by 4% (3,963) between 2001 and 2011. This reversed a decline in the population of the islands by 3% between the 1991 and 2001^[23].

36. Remote rural areas have a higher (25%) proportion of older people (65+) than the rest of Scotland (18%)^[23]. For males, the life expectancy in remote rural and accessible rural areas is around 79 years, nearly 3 years more than life expectancy in the rest of Scotland. For females, the life expectancy in rural areas is around 82 years, nearly 2 years more than in the rest of Scotland.

37. According to the 2011 Census, 83% of island residents reported their health as being 'very good' or 'good' compared with 82% for Scotland as a whole. The proportion of island residents with a long-term (lasting 12 months or more) health problem or disability that limited their day-to-day activities was just under 20%, including 9% who reported their daily activities were limited 'a lot'. The corresponding proportions for Scotland as a whole were very similar^[24].

38. 17% of island residents are under age 16, which is the same proportion as per Scotland as a whole^[25].

39. UK wide, disabled people have higher poverty rates than the general population. Disabled people make up 28% of people in poverty. A further 20% of people who are in poverty live in a household with a disabled child.

40. In Scotland 410,000 households in poverty (42%) include a disabled person. Disabled young adults in the UK aged 16-24 years have a particularly high poverty rate of 44%.

41. Across Scotland, 1 in 4 children live in poverty. The longer a child experiences poverty, the greater the damage to their health, wellbeing and life chances. Scotland-wide, there are higher levels of child material deprivation in households containing a disabled person, at 20% compared to households without a disabled person (at 8%). There are higher rates of food insecurity among disabled people (18%) compared to non-disabled people (5%). There is a higher likelihood of living in relative poverty after housing costs with a disabled person in the household (24% of families with a disabled person compared to 17% of families with no disabled members)^[26].

42. As of July 2021 there were 180 young people aged 16 to 18 entitled to the enhanced rate of the daily living component across the six local authorities covering for island communities, compared to 1,579 in Scotland as a whole^[27].

43. The above statistics show that just over 11% of all young people in Scotland entitled to PIP enhanced daily living component live in the island / remote communities. The statistics also show that households containing a disabled person are more likely to be in poverty. Extending the CWHA eligibility to this group will provide financial assistance to families towards their winter fuel bills, thus particularly benefitting families of young people receiving enhanced daily living component in island communities.

Implementation and delivery plan

44. A communications strategy and comprehensive guidance are in place, making eligible children, young people and their families aware of the benefit.

45. All eligible children and young people will receive correspondence from Social Security Scotland, detailing that they are eligible because of their entitlement to the highest rate of the care component of DLA/CDP or the enhanced rate of the daily living component of PIP. This correspondence will outline that a determination without application has been made and that they will receive the annual payment in the winter of that year.

46. In most instances, as long as the child or young person remains eligible for DLA/CDP at the highest rate of the care component or the enhanced rate of the daily living component for PIP, and for every year that they meet the age criteria for the benefit, they will receive an award of CWHA. Recipients are not required to apply for the assistance. Recipients will also not be required to apply for CWHA when their case transfers to Social Security Scotland. Their current award will be honoured with no break in payment to minimise disruption and ensure that people are paid the right amount at the right time.

47. The communications strategy is linked in with wider Scottish Government initiatives for improving outcomes for disabled people and for remote and island communities. This will ensure that CWHA is part of wider efforts to meet the needs of people living in island communities.

Monitoring and Review

48. Monitoring the impact of the CWHA in island and remote rural communities will be a continuous process and where any unintended consequences are identified, steps will be taken to improve the service. The Scottish Government has put in place a monitoring and evaluation plan for the CWHA which takes account of the issues identified within this impact assessment.

49. On-going stakeholder engagement with key organisations will also provide the Scottish Government with an opportunity to monitor the impact of the policy.

50. The Social Security (Scotland) Act 2018 places a duty on the Scottish Ministers to report annually to the Scottish Parliament on the performance of the Scottish social security system during the previous financial year. The report is to describe what the Scottish Ministers have done in that year to meet the expectations on them set out in the charter and will include information on the impact of island-proofing.

51. The Scottish Ministers have also committed to engaging with, and reporting regular progress to, the Islands Strategic Group to ensure that those representing the interests of island communities and others with experience of the current system, are fairly represented in the development and delivery of the Scottish social security system.

Recommendations and Conclusions

52. Through the work undertaken to produce this impact assessment in partnership and consultation with young people with disabilities and island Local Authorities, it is clear that living in island and remote communities present unique challenges for children and young people with disabilities and their families.

53. Through this ICIA, the Scottish Government could not identify evidence that CWHA amendment regulations will directly or indirectly discriminate against those that live in island or remote communities.

54. This ICIA has outlined the ways in which CWHA amendment regulations are likely to have a positive impact on young people in island and remote rural communities. CWHA provides a financial contribution additional to DLA (Child) or PIP to families with more severely disabled children and young people, which can be offset against fuel bills, which it is accepted may be higher throughout the year for those living in island and/or remote communities. The amendment to eligibility criteria will have a direct positive impact on those who were not eligible under the previous eligibility criteria and now under eligibility through the amended criteria will be able to get the financial support they require due to their day and night care needs.

55. Because a disproportionate number of disabled children and young people are from areas of multiple deprivation, it is likely that extending the provision of CWHA to families of young people in receipt of enhanced rate daily living component will increase economic equality and improve health outcomes.

56. There will be continuous review of the impact of CWHA to ensure it meets the needs of all those that it is designed to support.

57. The Scottish Government has concluded that no further changes to CWHA are necessary as a result of the ICIA.

Authorisation

Name and job title of Policy Lead:

Jana Eyssel

Policy Manager

Social Security Policy Division

Name and job title of a Deputy Director or equivalent:

Ian Davidson

Deputy Director

Social Security Policy Division

Date this version authorised:

23 September 2021