SNP 'not using powers fully' to lift Scots out of poverty

The charity has also pointed to stalled efforts to reform council tax and called for efforts “to start that work properly” as those on low incomes are set to be hit by the UK Government decision to cut the £20 Universal Credit uplift.

READ MORE: UK ministers warned Universal Credit cut 'may breach human rights law'

Speaking ahead of a debate this afternoon, SNP Social Justice Secretary Shona Robison has called on UK ministers to take a “last chance” to reverse the plans.

Ms Robison said: “The decision to withdraw the Universal Credit uplift is senseless and harmful, a hammer blow of hardship as we begin to emerge from the enormous social and economic disruption of the Covid-19 pandemic.

Shona Robison

“It comes at a time of rising food and fuel bills, imminent increases in national insurance payments and the end of the self-employment and furlough schemes.

“This is a conscious decision to remove support from people on the lowest incomes who rely upon this uplift as a lifeline to allow basic needs to be met.

“This will be the biggest overnight reduction to a basic rate of social security for over 70 years.”

Reducing Universal Credit is expected to lower welfare spending in Scotland by £461 million a year, which the Scottish Government says will push 60,000 people into poverty.

MSPs will debate a motion from Ms Robison on Tuesday afternoon which says the cut “reflects the UK Government’s uncompassionate approach to welfare”.

But in stark evidence to MSPs ahead of December’s budget, the Joseph Rowntree Foundation has warned “the main revenue-raising means of the Scottish Government” being “concentrated on income, rather than on wealth”, warning that “while income inequality is stubbornly high in Scotland, wealth inequality is even worse”.

The submission adds that by failing to use devolved powers “to their maximum extent”, SNP ministers are “not unpicking some of the inherent inequalities in our society”.

The charity has specifically pointed to “regressive” council tax, warning the charge is “a huge burden on low income families”.

The Programme for Government stressed that the SNP-Greens administration is “committed to reforming council tax to make it fairer” while the SNP manifesto warned that “cross-party talks on a replacement for the council tax were underway but had to be postponed due to the pandemic”.

The Greens manifesto labelled council tax “regressive and woefully outdated”, adding “it leaves councils struggling to pay for essential services”.

The party committed to “seek to replace it with a new residential property tax that is related to actual value rather than outdated valuations”, stressing that “under our proposals most households would pay less while the wealthiest will pay a bit more”.

READ MORE: SNP to pledge to 'eradicate poverty' despite child poverty struggles

Finance Secretary Kate Forbes has told MSPs that plans to reform council tax “should be seen in the wider context of local government flexibilities and taxation”, adding that "the commitment is to conduct a review of council tax as part of a wider consideration of local government fiscal powers”.

The JRF evidence adds: “There appears to be much political consensus that this is an unacceptable situation, which it is, but little impetus for change.

“For some families in Scotland, the planned cut to Universal Credit and working tax credits will be equivalent to their monthly council tax bills - compounding the underlying unfairness and, more importantly, the challenge to make ends meet.

READ MORE: Benefits cut warning as 40 per cent of Scots on Universal Credit are in work

“If the political consensus, therefore, exists for council tax to be reformed from its present format, with the enormous pressures on low-income families' incomes perhaps the time is now to start that work properly.”

The Joseph Rowntree Foundation has also told MSPs that the focus of the next budget should be “on activity that will put us on a path to meet our child poverty targets”.

It added: “At present, we are going to miss those targets by quite some way, so the forthcoming budget will need to show action at pace and scale to do so.

“In particular, it will need to show a deepened commitment to helping people in families most at risk of poverty.”

Labour’s social justice and social security spokesperson Pam Duncan-Glancy said that Scots are being failed by both “a callous UK Government” and a Scottish Government “that is sitting on its hands”.

Pam Duncan-Glancy (Image: Colin Mearns)

She added: “The SNP are always quick to point fingers and rightly criticise the Tories, but ultimately, when it matters the most, they are not using the powers or money they have to address the stark poverty and inequality in Scotland.

“Poverty has been climbing for years on their watch. If that doesn’t stop, they’ll not only fail future generations, but they’ll fail this one by undoing the progress made under the last Labour government.

“Time and time again the SNP dismiss plans from Scottish Labour, while their own election promises are watered down or abandoned altogether. They talk a good human rights game, but, as the evidence shows, they do not walk it. They do not put their money where their mouth is.

“We have the powers here in Scotland transform lives, here and now. With the stakes higher than ever, the SNP must prove that they will do what it takes to end poverty and inequality, and fast.”

A Scottish Government spokesperson said: “We are using our tax powers to deliver a fairer and more progressive tax system, protecting lower and middle income earners whilst raising revenue to support Scotland’s essential public services, delivering the widest range of public services available anywhere in the UK.

“As the JRF acknowledges, we have taken a progressive approach in setting rates and bands for residential Land and Buildings Transaction Tax. We committed in Programme for Government 2021-22 to maintaining the current rates and bands for residential LBTT for the full parliamentary term, which provides certainty for taxpayers.

“We will establish a working group to oversee the development of effective engagement on sources of local government funding, including council tax, that will culminate in a citizens’ assembly.”