£58m to combat UK government welfare cuts in Scotland
Almost £58 million will be spent mitigating the impact of the UK government’s welfare reform on households across Scotland, it has been announced, as Westminster vows to press on with plans for further cuts to housing benefit.
Over £47m of this will be allocated to counteract the ‘bedroom tax’ via the Discretionary Housing Payments (DHPs) fund with the rest of the cash, around £10.9m, helping to mitigate other policies such as the benefit cap and local housing allowance rates.
The £7.7m increase in funding for DHPs next year comes as the Scottish Government takes full responsibility for DHP funding, including £18.5m transferred from the Department of Work and Pensions (DWP) as part of a negotiated three year settlement.
Social security minister Jeane Freeman has written to all local authorities confirming their funding for the coming year.
Between April 2013 and March 2016, local authorities have made 321,000 DHP awards totalling £129m.
Ms Freeman said: “We realise how damaging the UK government’s punitive policies are, particularly the bedroom tax. That is why we have taken action to ensure DHPs are available to all affected households so no one has to pay it and we are committed to abolishing it as soon as practically possible.
“The UK government’s ill-thought reforms target the most vulnerable in society and the money we are making available is a lifeline for those people who are already struggling to make ends meet.
“We want to protect low income families and households across Scotland which is why we have increased the funding available in the first year we have had full responsibility for Discretionary House Payments. However we would much rather be using this money to positively lift people out of poverty.
“It is abundantly clear the approach the UK government is taking to welfare is causing real damage and pushing people into poverty. We will continue to stand up for families across Scotland fight any further damaging UK welfare changes.”
The funding announcement comes as the UK government confirmed plans to axe housing benefit for 18-21 year-olds from next month.
The new Universal Credit regulations, which will affect new claimants, state that jobless under-22s will no longer qualify for help with their rental costs.
The policy was first unveiled by former chancellor George Osborne as part of his 2015 Budget and was a key part of the Conservatives manifesto.
The manifesto said: “It is also not fair that taxpayers should have to pay for 18-21 year-olds on Jobseeker’s Allowance to claim Housing Benefit in order to leave home.
“So we will ensure that they no longer have an automatic entitlement to Housing Benefit.”
Following the arrival in No.10 of Prime Minister Theresa May, housing charities had hoped that she and work and pensions secretary Damian Green would scrap the plans amid fears they could force thousands of youngsters onto the streets.
But on Friday, the DWP laid the regulations before Parliament and made clear that while some exemptions would be made, the change would go ahead and come into force on April 1.
Vulnerable people will continue to be protected, as will carers, families and those who have been in work for at least six months prior to claiming will be exempt, and those working at least 16 hours at the National Minimum Wage.
Ministers from Holyrood sought assurances from their Westminster counterparts last month that the UK government would not reduce the benefits of claimants in Scotland when the Scottish Government reinstates the housing benefit for younger people and abolishes the bedroom tax.
In a letter to Mr Green, social security and equalities secretary Angela Constance expressed her anger at the UK government’s short timescale for change despite assurances that options for Scotland would be considered further.
An assessment by the DWP said the move will affect around 11,000 young people and cut £105 million from the benefits bill by 2020.
But 2015 research by Heriot Watt University claimed the policy will save just £3m due to the knock-on effect on those involved.
Guidance will be issued to staff ahead of the policy coming into force.
A spokesman for the DWP said: “We want to make sure that 18 to 21-year-olds do not slip straight into a life on benefits, which is why we are helping young people get the training, skills and experience they need to move into a job and build a career.
“This government is delivering on its commitment to ensure young people in the benefit system face the same choices as young people who work but may not be able to afford to leave home.
“We know that personal circumstances will differ so we have worked closely with charities and the housing sector to develop a fair and robust set of exemptions to protect the most vulnerable young people.”
Housing and homelessness charity Shelter Scotland said it was “deeply concerned” by the plans to exclude 18-21 year-olds from receiving housing benefit at a time when rough-sleeping is on the rise and homelessness is far from fixed in Scotland.
Commenting on the new regulations, Adam Lang, head of communications and policy, said: “Not all young people have the option of living with their parents and for those in desperate or difficult situations and facing homelessness – housing benefit is a vital lifeline that helps put a roof over their heads and provide them with stability and security.
“Removing the safety net that protects some young people from having to choose a life on the streets is a disgrace and an attack on some of the most vulnerable people in our society.
“If we don’t want to see more 18-21 year olds at risk of homelessness or forced to sleep rough, then the UK government should think again and abandon these unfair and dangerous cuts which put lives at risk.”
Adam Lang added: “We are aware that the Scottish Government has been working to find a way to effectively mitigate the impact of these changes in Scotland and we hope that ministers in Whitehall and St Andrews House can come together and find a way to make this happen as quickly as possible.”