Scottish independence: Scotland would reform Universal Credit ‘within five years of independence’, new paper says

Shirley-Anne Somerville, the social justice secretary, said ten key actions would be prioritised

Scotland would seek to remove the two-child benefit cap and scrap the bedroom tax within five years of independence as part of a suite of urgent reforms, SNP ministers have said.

Shirley-Anne Somerville, the social justice secretary, said the Scottish Government would prioritise ten key actions to immediately reform Universal Credit, at an estimated cost of more than £250 million. These would include removing the benefit cap and ending the sanctions regime, as well as scrapping the existing young parent penalty.

Responsibility over some benefits transferred north under the Scotland Act 2016, but Universal Credit is a UK-wide benefit reserved to Westminster. The devolution of benefits to Scotland has previously been beset with delays.

Shirley-Anne Somerville

The Scottish Government spends more on social security than it gets from the UK Government in funding. The Scottish Parliament Information Centre, which provides impartial analysis, said the gap was around £500m more this year (2022/23) and is forecast to rise to £1.3 billion in 2027/28.

Ms Somerville insisted the ten key reforms could be done “in the very early years” of independence. Pushed on what this meant, she told journalists: “You could absolutely have that done within five years.”

She said the reforms were chosen as they would make “a significant impact” and “with full control of the Universal Credit system, they are relatively simple to implement”.

It came as the Scottish Government launched its ninth paper in the Building a New Scotland series, which set out an updated independence prospectus. The latest document argues independence would give Scotland the opportunity to take a new approach to social security.

This could include the introduction of a minimum income guarantee, it says, which would ensure no one fell below a set income level.

"Over time, there would also be potential for future governments to build on this further should they wish, towards a Universal Basic Income,” the paper adds. “A Universal Basic Income would provide a basic level of income to all, without condition and regardless of other income and resources.”

Ms Somerville said: "With limited powers, the Scottish Government has already demonstrated that things can be done differently with an approach to social security that treats people with dignity, fairness and respect. An estimated 90,000 fewer children are expected to live in relative and absolute poverty this year as a result of actions we have taken.

“With the powers of an independent nation, Scotland could do more to make our system fairer and move away from the UK Government’s system of benefit freezes, caps and punishment. We could move away from the UK Government’s system that offers inadequate levels of financial support and is pushing people into poverty.”

Pensions are expected to be covered in a future document.

Tory MSP Miles Briggs said the latest paper “should be filed under fantasy fiction”. He said: “Ministers have a brass neck to be wasting yet more taxpayers’ money and resources publishing this paper when they are failing right now to use the extensive welfare powers they have at their disposal.”

Liberal Democrat MSP Willie Rennie said: “If this paper was a rare moment of honesty from the SNP, listing their string on failures on social security, I might see the point in it.”