UK government to step in if Scotland fails to deliver on welfare

16 Apr 18

Contingency plans have been put in place to deal with the potential failure of the Scottish Government to deliver key welfare powers under devolution.

Work and pensions secretary Esther McVey told members of the Scottish Parliament that more information was needed on how the Scottish Government planned to deliver these benefits, particularly in relation to £1.8bn in disability assistance each year.

“We need to know at pace and quicker what it is the Scottish Government would like to do with these benefits…for them to be able to deliver things in a safe and timely manner,” she said.

Pressed by Conservative MSP Adam Tomkins on whether the Scottish Government would be in a position to deliver disability assistance before the next Scottish election in three years’ time, McVey said measures would be put in place to ensure continuity of benefits in the event of a delay in the transfer of powers.

“We need to make sure claims in Scotland get the support they need,” she told the social security committee at Holyrood this morning.

“We will have to put measures in place to ensure that if the Scottish Government can’t do it, we will no doubt end up continuing to do it through agency agreements,” she said.

Mary Pattison, director for ageing society, state pensions and devolution at the Department for Work and Pensions, said the information was needed to ensure essential IT changes and staff training could take place within DWP.

Without it, there was a risk of inaccurate or duplicate payments for claimants, she said.

“It’s low level, but really fundamental,” she said. “The detail of what might need to happen and when…is really important so that we’ve got a proper plan and it’s integrated.”

The debate over devolution of welfare powers was accompanied by a call from a leading think-tank for Holyrood to receive new tax levers.

Reform Scotland said in a briefing today that Brexit opened up the opportunity for the devolution of VAT, which would have been illegal under EU law.

Such a move would see the Scottish Parliament responsible for raising 60 % of what it spent and, it said, provide greater flexibility to promote economic growth.

Alan McFarlane, chairman of Reform Scotland chairman, said the transfer of VAT would reduce the Scottish Government’s current heavy reliance on income tax revenues.

“Devolving VAT would rapidly focus minds at Holyrood on promoting economic growth because of its direct link to tax revenue, and it would also give the Finance Secretary an important extra tool to change outcomes through tax policy,” he said.

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