Welfare in Working Order: Points and Principles for the Scottish debate

Overview

This paper is written by one of Scotland’s leading social policy experts Jim McCormick. It examines the impacts of the UK Government’s welfare cuts and reforms. SCVO’s starting point is that the UK coalition Government’s welfare cuts are unmerited and unjust. They are cuts masking as reform. They are an active choice hurting the most disadvantaged in our society. They will take over £2.5 billion out of the Scottish economy and from communities already reeling as a result of the recession. That this is at a time of the biggest economic crisis in generations will lead to significant negative and possibly long term social and economic impact. Any reversal looks unlikely, and further cuts have been proposed. The third sector is already picking up the pieces and the poorest in all parts of society – working or not - will be hit the hardest. In this context, this paper assesses the impact of the UK welfare reforms and suggests remedial policy solutions in a Scottish context. The layout of this paper is as follows:

1. Wanted: Better welfare reform… This section sets out the UK context, including reform over the past 10 years.
2. …to reduce poverty not increase it This section sets out the projected impact reforms on will have on poverty levels.
3. Welfare reform and mitigation This section highlights in detail the manner in which current UK reforms will impact on Scotland and suggests some policy solutions. It also looks at devolution of council tax rebates and passported benefits, highlighting some of the key challenges that need to be addressed in these areas.

One of the main recommendations is that a Financial Security Change Fund should be  established. This would integrate existing support for income maximisation, welfare and money advice programmes; boost the capacity of credit unions; and seek to extend effective approaches more widely. It would also seek to maximise the contribution of the financial services sector and domestic energy suppliers. Download the report (PDF)