Scotland Bill 2015-16 Report Stage – Monday 9th November

Introduction

As it stands the Scotland Bill is not a coherent piece of legislation and, along with many in our sector, SCVO questions its effectiveness. We consider that this Bill ought to give the Scottish Parliament full policy autonomy over devolved areas, allowing for the integration of services and ideas. Therefore, the wording and scope of the clauses within the Scotland Bill is vital. SCVO believes considerable work still needs to be done on this Bill in order to deliver the genuine transfer of powers to Holyrood, ensuring that successive Scottish Parliaments are able to use the Bill's powers effectually. Our briefing focuses broadly on two things: the need for Gift Aid to be considered alongside the devolution of income tax and the still restrictive nature of the social security and employability clauses. We consider the proposed amendments relating to these issues and note our support for those amendments we believe would improve the Bill.

Gift Aid

Gift Aid is a relief on income tax that benefits charities and community amateur sports clubs. Given the significant financial contribution Gift Aid makes to Scotland's third sector, SCVO firmly believes that Gift Aid needs to be considered alongside the proposed devolution of income tax. SCVO raised this issue in a detailed briefing to MPs ahead of the Second Day of Committee proceedings on the Bill. SCVO appreciates it may not be appropriate to reconcile the issues concerning Gift Aid through primary legislation. Nevertheless, given the sums involved (last year Gift Aid provided over £1 billion to the third sector in the UK) we want to ensure that that the continued concerns raised by Scotland’s third sector since the proposed devolution of income tax are addressed. As a result SCVO very much welcomes NC4 in the name of Ian Murray, calling for a review of the operation of Gift Aid in Scotland within a year of the Scotland Bill 2015-16 coming into force. Such a review would allow any problems with how Gift Aid is functioning under the new arrangements to be identified and resolved. We hope to see support for this amendment from across the Chamber.

Social Security – New Clauses

Power to create New Benefits At present there is no clause in the Bill that would enable the Scottish Parliament to create new benefits beyond discretionary responses (as per clause 23). As such, the Bill fails to reflect the terms of the Smith Commission, which clearly states at Paragraph 54: ‘The Scottish Parliament will have new powers to create new benefits in areas of devolved responsibility...’ As it stands the Bill merely hands over the administration of certain benefits rather than giving the Scottish Parliament the opportunity to create its own. SCVO has previously called for a clause, phrased clearly so that there is no ambiguity, inserted in to the Bill in order to devolve such a power. In his written statement to the House of Commons on 2 November, David Mundell wrote: ‘Paragraph 54 of the Smith Agreement relates to the power to create new benefits in devolved areas. A new clause will be tabled to address this.’ SCVO is pleased to see the UK government making a commitment to new powers over benefit creation and the lodging of NC34 in the name of David Mundell. The third sector is aspirational for the devolution of social security, and it believes that it should offer people "options and opportunities and help them achieve sustainable outcomes” – a key priority identified at a SCVO event focussing on the new social security powers. The ability of Holyrood to create its own benefits, we hope, would support this aim. However, we are disappointed to see that the clause will not allow for the creation of a benefit to support those that have been affected by sanctions. As detailed later, SCVO does not support any form of conditionality and sanctions. As a result, while we are supportive of the general aim of NC34, SCVO would prefer to give its backing to NC2 in the name of Ian Murray which expands upon and clarifies the ability of the Scottish Parliament to create new benefits, including instances where the need for said benefit arises from reduction, non-payability or suspension of a reserved benefit. Full Devolution of Welfare In our response to the Smith Commission SCVO called for the devolution of all social security – excluding pensions. We consider that this would give Scotland the ability to create the coherent, harmonised welfare system to which many in the third sector aspire. Therefore, we welcome NC23 in the name of Angus Robertson which would give the Scottish Parliament powers over working age benefits. This would be particularly welcome as it would give power to Holyrood over those benefits such as Jobseekers Allowance (JSA) and Employment and Support Allowance (ESA) thereby linking the responsibilities the Scottish Parliament will have over employment support to the related benefit. As it stands the Bill will not give the Scottish Parliament this ability thereby limiting the capacity of Holyrood to take a coherent, integrated, approach to employment This amendment would also bring together responsibility for housing benefit with housing policy. In principle, SCVO is supportive of any moves that bring devolved responsibilities into alignment with the related benefit as this allows for more strategic, coordinated policy making. Joint Committee on Welfare Devolution The proposed new clause from Ian Murray (NC3) regarding the creation of a Joint Committee on Welfare Devolution is a welcome, pragmatic, proposal given the need to ensure continuous, timely delivery of social security payments to those who receive them. Also, as our devolution settlement is only going to become more complex, such a committee would reflect the Smith Commission’s call for better, more respectful and visible, inter-governmental working between the UK and Scottish Governments. Significantly for Scotland’s third sector, we note in the accompanying schedule (NS1) the proposed committee would be able to create an advisory panel to support the transfer, implementation and operation of new social security powers in Scotland. We are heartened to see that representatives of third sector and voluntary organisations would form part of any such panel. The third sector has invaluable experience to lend to this process and SCVO has argued from the outset that this breadth of knowledge and significant resource ought to be part of social security discussions. It is important however, that the work of this proposed committee be as visible and transparent as possible. SCVO, Engender and other key third sector organisations, have raised concerns about the closed nature of the current Joint Ministerial Working Group on Welfare. We would hope any new committee would be more open in its working. Child Benefits and Childcare As mentioned above, generally we are supportive of any measures that bring together a devolved responsibility with the accompanying financial support. As childcare is already a devolved matter we consider that allowing the Scottish Parliament the power to establish the rules around the childcare element of Universal Credit (as per NC5) would be appropriate. Given that education and childcare are devolved issues we appreciate the logic of widening devolution to include benefits relating to children to the Scottish Parliament. In our response to the Smith Commission we sought the full devolution of welfare – excluding pensions – so this could be understood to include powers over benefits related to children. However, this is not an issue with which SCVO has had much discussion with members and the wider sector. Therefore, we do not express any particular opposition to, or support for, the clause.

Clause 19 - Disability, Industrial injuries and Carers' Benefits

Since the UK government’s draft clauses were published in January there have been concerns expressed from across the third sector about the restrictive definitions outlining who can receive disability and carers' benefits. In particular the sector has been vocal about the prescriptive nature of a ‘relevant carer’ which, as it stands, would prevent the Scottish Parliament from making any significant changes to carers benefit. We therefore welcome amendments 70 and 71 in the name of David Mundell, which removes this definition, leaving scope for the Scottish Parliament to extend carers benefits to young people (aged 16 and under), full time students and those in employment. We hope these amendments will be supported by opposition members. We note that the clause still refers to the person delivering 'regular and substantial' care. Although we are pleased that the main restrictions have been removed, depending on how this reference is interpreted it could preclude Holyrood giving support to those people who temporarily find themselves with caring responsibilities. In addition, concerns still remain around the definition of disability under clause 19 and agree with colleagues such as CPAG Scotland that the current definition of disability is ‘overly restrictive’. For example, at present the Bill limits the ability of the Scottish Parliament to give benefits to those with particular illnesses (not considered a disability per se) and the terminally ill. We are supportive therefore of amendment 194 in the name of Ian Murray which offers much less restrictive eligibility criteria for disability benefits, and would allow support for those with fluctuating conditions and people with very low level disabilities.

Clause 20 – Benefits for Maternity, Funeral and Heating Expenses

Welcome amendments 72 and 158 which have the same effect of allowing the Scottish Parliament to legislate to provide other, non-financial, forms of support to help with maternity, funeral and heating expenses. Given their mutual aims, we hope that UK government and SNP members will work together to ensure that this change is made to the Bill. The ability of the Scottish Parliament to legislate for provision welfare foods, such as dried milk and vitamin tablets, was discussed at a joint SCVO and Scottish Government on the future of social security held in July this year. Support was expressed for such powers being devolved to the Scottish Parliament; consequently, we very much welcome NC14 in the name of David Mundell on Welfare Foods.

Clauses 21, 22 & 23 - Discretionary Payments

As mentioned in previous briefings, we remain concerned about the exceptions in each of the three clauses on discretionary payments which would prevent payments being made to people affected by sanctions. In relation to clause 23 in particular, we are concerned that the inclusion of this wording could reduce the current scope of the Scottish Government to support people who have had their benefit cut/withdrawn through the Scottish Welfare Fund. We therefore welcome amendments 21-23 in the name of Ian Murray which ask for the omission of the relevant lines in each clause. SCVO does not support any mandatory activity or conditionality including the notion of mandatory work placements. We believe the current conditionality regime should be devolved, at which point SCVO would then call on the Scottish Parliament to scrap conditionality as we consider that this does not incentivise people to move back into work. In regards to clause 22, we welcome amendment 76 in the name of David Mundell which removes the cap on the amount of discretionary financial assistance an individual can receive to help with rental costs. The clause as it stands restricts the amount of financial support the Scottish Parliament can give, so we welcome the Scottish Parliament having more flexibility, especially as rents in Scotland have reached an all-time high. Again, we note similar amendment number 159 from Angus Robertson and hope that there will be mutual support from both parties for their respective amendments. Lastly, we very much support clauses 161-162 in the name of Angus Robertson which would create provision for discretionary payments under clause 23 to be made to individuals ‘who are part of a family facing exceptional pressure.’ This is something third sector colleagues, including Inclusion Scotland, have been calling for as it would help to address the strong concerns of the third sector about the exclusion of families under pressure from the face of the Welfare Funds (Scotland) Act.

Clause 26 - Employment Support

In regards to amendments 165-167 in the name of Angus Robertson we support these as we consider this would better reflect the Smith Commission and fully implement its recommendations at Paragraph 57. Amendment 166 is particularly welcome as it would allow the Scottish Parliament to design and deliver employment support for all individuals who are currently unemployed, not just those at risk of long-term unemployment. However, we do note NC22 in the name of Angus Robertson which would amend the Scotland Act 1998 by omitting Section H3 ‘Job Search and Support’. We would also support this new clause. We also note NC19 which would devolve employment rights and duties and industrial relations powers to the Scottish Parliament. In our response to the Smith Commission SCVO called for those aspects of employment law that directly affect devolved powers to be devolved, for example, those relating to childcare. Reflecting on this and the proposed omission of Section H1 of the Scotland Act 1998, SCVO is supportive of NC19 as it would allow the Scottish Parliament to bring devolved and reserved areas together. For example, as highlighted by Children in Scotland in their response to SCVO’s consultation on the Smith Commission, childcare, although a devolved issue, interacts with reserved areas such as employment rights. The devolution of employment rights would help Scotland to take an integrated and coherent approach to childcare. SCVO also supports NC20 which would give the Scottish Parliament power over the subject-matter of the National Minimum Wage Act 1998. As noted by Nourish Scotland in its’ response to SCVO’s Smith Commission consultation this would align with the Scottish Parliament’s current authority over agricultural wages.   We consider that this would give the Scottish Government, and others, the ability to continue to promote and expand the good work in Scotland regarding the implementation of the Living Wage. In addition, and as noted in our response to the Smith Commission: ‘if employment law were to be devolved it could be considered inconsistent to reserve the National Minimum Wage Act.’ However, in terms of employment support we still consider more needs to be done. The sector would like to have seen amendments which would have transferred powers over Jobcentre Plus to Holyrood. This would align with the current responsibilities the Scottish Parliament has over skills and learning and would be appropriate with the transfer of powers over employability schemes. The full devolution of competence for job search and support to the Scottish Parliament, in order to integrate service provision in the area of employability, was recommended by the Christie Commission back in 2011. Also it is notable that as is stands Access to Work will remain reserved. SCVO agrees with ENABLE Scotland that the devolution of Access to Work is necessary to create the integrated, accessible form of employment support we aspire to create in Scotland. Furthermore, we consider that the devolution of this programme, which provides crucial support both for those in work and looking for employment, would make sense, not only with the devolution of the Work Programme and Work Choice but also given the recent devolution of the Independent Living Fund and the ongoing development of self-directed support in Scotland.

Clause 32 - Equal Opportunities

Alongside a number of third sector organisations, SCVO called for the wholesale devolution of equalities as part of our submission to the Smith Commission, however, as it stands the Bill’s sole clause on equality fails to meet our ambitions in this area. At present, it is unclear what clause 32 means and it is questionable as whether it actually achieves what the Smith Commission intended. Our preference, along with others such as the Equality Network, is for new clause 27 in the name of Angus Robertson which would omit Section L2 from the Scotland Act 1998. This would devolve equal opportunities completely to the Scottish Parliament, giving Holyrood important powers over issues such as equal pay and disability discrimination, and would meet the above desire from the third sector for the full devolution of equalities. Understanding that this would go further than the powers agreed in the Smith Commission we are generally supportive of the NC16 in the name of David Mundell and the other amendments made by the UK government (96-104). However, we note the concern of the Equality Network that amendment 98 with its reference to ‘protected characteristics’ may have unintended consequences. Therefore, we support their preference for amendment 171 in the name of Angus Robertson which is clearer in its intention to give Holyrood powers over equal opportunities in relation to Scottish public authority appointments. Yet, while we are pleased to see a number of proposed amendments to clause 32 we remain concerned that they still do not wholly fulfil the Smith Commission promise under Paragraph 60. We would welcome clarification from the UK government during the Report Stage debate as to the effects of their amendments.

Others

SCVO is not supportive of new clauses 6-9 in the name of Graham Allen. The Scotland Bill must only legislate for the transfer of powers from the UK to the Scottish Parliament. The Bill should not be used to devolve power directly to local government, bypassing the Scottish Parliament. Decisions to further devolve power from Holyrood should be left to the Scottish Parliament and the Scottish electorate.

Conclusion

Broadly speaking SCVO supports the majority of the amendments lodged at Report Stage. If passed, we consider that these amendments will improve the Bill, giving the Scottish Parliament the opportunity to be genuinely innovative in its approach to policy-making and linking together its differing responsibilities. However, there are still some areas of the Bill we feel require attention, in particular the clause on Employment Support, and further clarification on the effect of the equalities clause would be welcome. Finally, we cannot emphasise enough the importance of Gift Aid to our sector and sincerely hope that this issue is given the required recognition and analysis both in terms of the proposed new clause 2 and as financial discussions around the Bill continue.

Contact details

Kate Wane Policy Officer Email: kathryn.wane@scvo.scot Tel: 0131 474 6157 Scottish Council for Voluntary Organisations, Mansfield Traquair Centre, 15 Mansfield Place, Edinburgh EH3 6BB www.scvo.scot

About us

The Scottish Council for Voluntary Organisations (SCVO) is the national body representing the third sector. There are over 45,000 voluntary organisations in Scotland involving around 138,000 paid staff and approximately 1.3 million volunteers. The sector manages an income of £4.9 billion. SCVO works in partnership with the third sector in Scotland to advance our shared values and interests. We have over 1,600 members who range from individuals and grassroots groups, to Scotland-wide organisations and intermediary bodies. As the only inclusive representative umbrella organisation for the sector SCVO:

• has the largest Scotland-wide membership from the sector – our 1,600 members include charities, community groups, social enterprises and voluntary organisations of all shapes and sizes
• our governance and membership structures are democratic and accountable - with an elected board and policy committee from the sector, we are managed by the sector, for the sector
• brings together organisations and networks connecting across the whole of Scotland

SCVO works to support people to take voluntary action to help themselves and others, and to bring about social change. Further details about SCVO can be found at www.scvo.scot.