1 Introduction
1. Of all the issues Scottish voters
will have to consider ahead of September's referendum, few can
be more important—or more emotive—than pensions and
benefits, and the social security system as a whole.[1]
Virtually everyone in the UK, at some point in their lives, will
receive help from the UK's long-established system of provision,
whether in the form of a pension or working-age benefit. A 'yes'
vote in September will have a major impact upon social security
in Scotland. Scotland would leave the long standing system of
sharing risks and resources that underpins the UK welfare state,
and be responsible for organising and funding its own welfare
system. The Scottish Government say they would move towards a
new system based on different principles by 2018, which they claim
would be preceded by a transition period of shared administration
with the continuing UK, during which time social security policies
in the two states would start to diverge.[2]
This report discusses what would happen in the event of separation,
and the possible effects of these plans.
2. Aside from the vote on separation
itself, the unavoidable context for this report is one of historic
changes to the UK social security system. The mounting pressure
of an ageing population—a phenomenon being felt in many
parts of the world—has led to reform of the State Pension,
including the first rise in the State Pension Age (SPA) for over
sixty years. Meanwhile, major reforms are also being made to working-age
welfare, with a number of benefits being combined with the new
Universal Credit (UC) system, the primary aim of which—according
to the UK Government—is to help improve incentives to work.[3]
3. The Government's reforms to social
security have proved controversial throughout the UK. Some have
welcomed what they see as a tougher stance that properly incentivises
work, while others attack the perceived harshness of the Coalition's
reforms. The Holyrood Government's statements on these issues
tap into this wider public debate and paint a picture of a future
Scottish state that would follow some different path to that currently
pursued by the UK.[4] The
Scottish Government say that there would be changes to the system
which would, on the face of it, make it more generous, with a
possible higher pension rate or even earlier retirement age; but
they would also make it more expensive. The potential costs are
nowhere discussed or detailed in the White Paper.
- The Scottish Government's White
Paper says much about fairness and social justice, but there is
a noticeable lack of facts, clear commitments, and consequences
for the people of Scotland. This report therefore draws attention
to some of the unanswered questions about the commitments that
are being made on pensions and working age benefits by the Scottish
Government, and calls for clarification of a number of specifics.
1 In this report, the term 'social security' is used
to encompass pensions and a range of working-age benefits and
welfare payments. Back
2
Scottish Government, Scotland's Future: Your guide to an independent
Scotland (November 2013), p.165. Back
3
https://www.gov.uk/government/policies/simplifying-the-welfare-system-and-making-sure-work-pays Back
4
"With independence…we can afford to choose a different
path for Scotland, with an approach to social justice that is
based on our view of what a healthy and flourishing society should
be. This is an opportunity for us to create a new Scotland."
Scotland's Future,p.151. Back
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