Warning on welfare costs

Political Editor

Tuesday 19 February 2013

THE SNP Government has yet to present a "clear, costed vision" of an independent Scotland's welfare system, a leading economist has warned.

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Magnus Gardham Political Editor.

Professor David Bell, of Stirling University, said welfare provision would continue to face significant constraints if Scotland left the UK.

And he claimed the SNP and others calling for benefits and pensions to be devolved to Holyrood had not acknowledged difficulties around expanding or re-prioritising the system.

He warned a return to healthy economic growth – or tax rises – would be required to maintain pensions and other benefits for the elderly at present levels.In 2010/11, the most recent year for full figures, £21 billion was spent on social protection in Scotland. Three-quarters of that was spent by the UK Government, most through the Department for Work and Pensions.Spending per head was £3972 in Scotland compared with £3658 in the UK as a whole, partly due to the relatively high numbers of disabled people and pensioners living north of the Border.In a paper for a David Hume Institute seminar on welfare in Edinburgh last night, Mr Bell said benefits were already targeted towards households with no other source of income, showing "the difficulties a Scottish Parliament with enhanced powers would have in making significant alterations to the existing structure of welfare benefits".He added: "The future costs of state benefits will be largely driven by demographic change, independent of the constitutional arrangements. "While supporters of increases in the powers of the Scottish Government, including full independence, have indicated a desire to take greater control over the welfare budget, what has been lacking is a clear, costed vision of what that 'Scottish welfare system' might comprise."The SNP Government has established a panel to examine the cost and delivery of welfare in an independent Scotland. The group is due to report in May.A Scottish Government spokeswoman said: "Figures show that 40% of Scottish tax revenues were spent on social protection, compared with 42% for the UK as a whole."With a lesser share of Scotland's tax revenues needed to support welfare and pensions than the rest of the UK, Scotland is in a stronger position to support our pensions and welfare system than the UK as a whole. "Add to this our serious concerns about the pace, scale and impact of Westminster's benefit changes and it is clear that Scotland needs independence and control over welfare to guarantee social justice and protection for some of the most vulnerable in our society."

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Warning on welfare costs

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