Social Security (Scotland) Act 2018 (Scottish Adult Disability Living Allowance) (Consequential Modifications) Order 2025

Lord Bruce of Bennachie Excerpts

Tuesday 25th February 2025 Grand Committee

[Baroness in Waiting/Government Whip (Baroness Anderson of Stoke-on-Trent) (Lab)]

My Lords, this draft order is the result of collaborative working between the two Governments of Scotland and supports the Scottish Government’s decision to introduce the Scottish adult disability living allowance in Scotland next month. Discussions on this order began over a year ago under the previous Government. I thank the noble Lord, Lord Cameron, for his previous work in the Scotland Office to facilitate this order.

The Scotland Act 2016 devolved significant powers, including responsibility for certain social security benefits and employment support, to the Scottish Parliament. The Scottish Government’s introduction of the Scottish adult disability living allowance under Section 31 of the Social Security (Scotland) Act 2018 exercises this responsibility. The Scottish Government will administer this new benefit in Scotland through their executive agency, Social Security Scotland.

At introduction, the Scottish adult disability living allowance will operate on broadly the same terms as the disability living allowance that it replaces. It is the intention of the UK Government that those individuals in receipt of the Scottish adult disability living allowance should receive the same treatment in the reserved social security and tax systems as those on the disability living allowance, the Scottish recipients of which will transfer from DWP to Social Security Scotland.

The order before us is made under Section 104 of the Scotland Act 1998, which allows for necessary amendments to legislation in consequence of any provision made by or under any Act of the Scottish Parliament. It is therefore the appropriate vehicle to make these technical—by which I mean “very technical”—but important changes to recognise the Scottish adult disability living allowance in reserved systems. Scotland Act orders are a demonstration of devolution in action, and I am pleased to say that the Scotland Office has taken through over 250 orders since devolution began.

I turn to the effect that this order will have and the provisions that it will make. The order makes amendments to UK legislation to ensure that the Scottish adult disability living allowance is recognised as a qualifying benefit, in the same way as disability living allowance, in the reserved social security system with regard to entitlements to additional reserved UK Government benefits and premiums. This includes the Christmas bonus and the carer’s allowance. This means that recipients of the Scottish adult disability living allowance will be entitled to receive the annual £10 Christmas bonus payment if it has not already been paid via another benefit. Should all other eligibility criteria be met, it will also ensure that the reserved carer’s allowance can be paid to someone caring for someone in receipt of the Scottish adult disability living allowance.

This order also prevents dual entitlement to benefits paid because of the same needs: individuals entitled to Scottish adult disability allowance cannot be entitled to attendance allowance, disability living allowance or personal independence payments. This is in the same way that disability living allowance and PIP are not payable to people in receipt of attendance allowance. It also amends the taxation of trusts with disabled beneficiaries, to treat those with beneficiaries in receipt of Scottish adult disability living allowance in the same way as those with beneficiaries that receive DLA.

Without this order, people in Scotland on Scottish adult disability living allowance would not receive the equivalent tax treatments and entitlements to reserved premia and additions as individuals in receipt of DLA in England and Wales, or Northern Ireland. The Scotland Office, the DWP, HMRC, the Scottish Government and the Northern Ireland Executive have worked closely to ensure that this order can be made, clearly demonstrating cross-government support for it. This Section 104 order is yet another example of devolution in action and I beg to move.

[Lord Bruce of Bennachie (LD)]

My Lords, I am grateful to the Minister for her introduction of this order. As she says, it is technical and complex but there can be the rub in these kinds of things. I also welcome the fact that there is constructive collaboration between the Scottish Government and the UK Government on this. The people of Scotland have two Governments; it is important that they know that they do, and who is doing what and where they are working together. I take it that the same funding transfer will take place as in other social security benefits that have been transferred to Scotland. Again, it is important that the UK Government make that clear and that the Scottish Government acknowledge it, but it obviously gives the Scottish Government the ability to adapt these benefits to local circumstances, which is really the advantage of this.

I think we might all be grateful for the Scottish Commission on Social Security’s analysis. There are one or two aspects of concern which it has raised— I do not intend to pursue them all—that I want to explore with the Minister. In my previous capacity as a Member of Parliament, obviously I saw many circumstances where benefit claimants had problems with the administration. They also had family involved in that too.

Perhaps the biggest issue that happens is that those people who have succeeded in applying for and getting long-term benefit, in particular, have a real anxiety about anything that involves a review, even though they have been told that it is permanent. As the commission points out, the fact that there is an option to apply for adult disability payment—the Scottish adult DLA can effectively continue as if it was DWP—sounds like an improvement on the situation in England, where there is an automatic transfer to PIP. But the problem for many claimants is that if they apply, they really do not know whether they will be better or worse off. That is aggravated by the fact that once they have applied, if they find out that they are worse off they cannot revert to the previous benefit.

To some extent—I expect the Minister will argue this—it is a matter for the Scottish Government, and I accept that. But equally, the Minister wanted to make it clear that the DWP and the UK Government wanted to be sure that there would be no loss of benefit. Nor do I take the view that the Scottish Government have any obvious intention to disadvantage people who may be in that situation.

A particular recommendation of the commission that seems valid is that people must have access to independent, professional advice as to whether it would be in their interests to apply to switch to the new Scottish benefit or stay on their current effective benefit. Why would they want to transfer? In some cases, it will give them access to other related benefits which are triggered by the benefit that they are claiming. On the other hand, by leaving one they may also forfeit benefits that they currently can get, so it really is important that people know what they are going to do. The question of the grace period of two years also arises; the commission has suggested that it should be more flexible, because people really may not know what the advantage or disadvantage of doing it would be.

That is the main point of concern. There are obviously issues relating to those of working age and those of pensionable age. There is also the possibility that one benefit may give you access to related benefits while the other one does not.

So, in sum, to what extent is the collaboration a continuing one as opposed to handing it over and basically saying to the Scottish Government, “There you go. We’ve handed over some account of the money. You now have it and you can do what you like with it”? Alternatively, is there a recognition of good will on both sides and that people should be able to opt for what is best for them? The Scottish Government’s objectives are that benefits should always offer the best that is available for which people qualify. But the danger, sometimes, is that opting for one benefit as opposed to the other may lead to a loss. Why is it not possible to opt for the transfer but if, as a result of that, it becomes clear at the point of swapping over that it is a disadvantage to switch, are people in a position to say, “No, I’m not going to switch”, or are they already too far committed? That is really the point.

I think the Minister will appreciate that people who find themselves on the wrong side of that will be aggrieved and will let people know they are aggrieved, which is surely not what we want. The objective is to ensure that people who have applied for benefits get them on a fair basis and that, once they have secured them, they continue on a fair basis and there is no arbitrary situation where what they can or cannot claim changes simply because they have opted for one benefit as opposed to the other. So the choice is great, but not if people do not know the reason, the benefits and the outcomes.

A number of other issues were raised by the commission, but the Minister will know what they were. It did a very useful report that covered pretty well everything that needed to be covered. The assurances we have are that the British Government will not simply wash their hands but that the collaboration will continue, allowing the Scottish Government to do what they are doing—but perhaps recognising that there are some transitional things here that may require a bit more flexibility than appears to be provided for by the instrument itself.

[Lord Cameron of Lochiel (Con)]

As ever, I am grateful to the noble Baroness for her helpful introductory remarks and for her kind words about me and my brief stint as a Minister in the Scotland Office. I feel somewhat undeserving of those. The July election meant that I never quite got the opportunity to present a Scotland Act order in this Committee, and I now find myself, regrettably, scrutinising them in opposition.

In general terms, this is indeed a sensible and technical order that we will not oppose. Clearly, those who are entitled to the Scottish adult disability allowance should not also be entitled to the UK Government’s disability living allowance at the same time. Further, it is important that the relevant UK legislation is amended to ensure that recipients of the new Scottish DLA are treated in the same way as recipients of DLA in the rest of the UK, in respect of reserved taxes and benefits.

Since 2016, the devolution of some aspects of welfare to the Scottish Government has been complex and certainly not straightforward. It is perhaps a unique policy area, where some elements are reserved and some are devolved. That means that it requires sophisticated operating systems to be in place within both the new Social Security Scotland and the DWP. It also necessitates close and collaborative working between the Scottish and UK Governments at an official level—a point made so well by the noble Lord, Lord Bruce.

With that in mind, I raise the following points. Is the noble Baroness confident that these operating systems are agile and accurate enough to avoid the very duplication that this order seeks to preclude, as well as ensuring that cases that might be complex and difficult do not lead to people being denied payments that they are entitled to?

Secondly, although there has been no formal consultation here, can the Minister update the Committee on what informal consultation has occurred, if any? Has there been a public information campaign of any kind to ensure that those affected by these changes are aware of them?

Thirdly and finally, I return to divergence; I accept that it is a bit of a pet subject of mine, but it is important. There remains the distinct possibility that, in time, the Scottish and UK systems might diverge, whether in terms of rates, payables or benefits in more fundamental terms. Has any assessment been made of the consequences of potential divergence when it comes to eligibility for benefits? I look forward to hearing the Minister’s answers to these points.