Independent Scotland could run welfare systems, say experts

12 Jun 13
Scotland could provide its own pensions and benefits systems immediately after independence, but it would be better to share administration with the rest of the UK for an interim period, Deputy First Minister Nicola Sturgeon said yesterday.

By Keith Aitken in Edinburgh | 12 June 2013

Scotland could provide its own pensions and benefits systems immediately after independence, but it would be better to share administration with the rest of the UK for an interim period, Deputy First Minister Nicola Sturgeon said yesterday.

Her comments followed the first report from the Scottish Government’s expert working group on welfare, set up to assess the practicalities of providing welfare benefits if Scotland voted for independence at next year’s referendum.

The report notes that there are already civil service offices in Scotland processing almost all parts of the UK welfare system, including a wide range of services to England. It concludes that all options are therefore open for continuing to provide benefits after independence – including a self-standing Scottish administration – but that a period of shared provision would be best.

It also accepts as ‘reasonable’ Scottish Government calculations of likely benefits costs post-independence, and notes the interpretation placed by Scottish ministers on the annual GERS figures  (Government Expenditure & Revenue Scotland), to the effect that social protection spending in Scotland as a share of GDP is lower than, and declining in relation to, that of the rest of the UK.

Sturgeon welcomed the group’s findings, which she said would reassure voters that the forecast costs of providing welfare in an independent Scotland were fundamentally sound and that benefits and pensions would continue to be seamlessly provided beyond independence.

‘I tend to agree with the group that a transitional period of shared administration would make sense,’ she said.

‘However, given that many people in Scotland are concerned about the welfare policies of the UK government, I am very clear that a transitional period of shared administration would only be in Scotland’s interests if it allows us, from day one of independence, to address the inequities of the current system and work towards a system that better reflects Scotland’s needs and circumstances.’

The report suggests that Northern Ireland provides a precedent for combining policy flexibility with shared administration. Sturgeon said this showed it was possible for a shared administration to run different policies, but added: ‘I welcome the report’s conclusion that all options for delivery are possible.

‘Almost all benefit payments to people in Scotland – including pensions – are administered from locations within Scotland. In other words, the infrastructure of our welfare system already exists in Scotland.’

But Labour claimed that the report merely confirmed that Scotland gained from being part of a UK-wide social security system.

Shadow Scottish secretary Margaret Curran said: ‘Being part of the UK welfare state allows us to pool risks and rewards. It means that Scotland will be more easily able to cope with an ageing population and the other challenges we will face over the coming years.’

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