Forbes urged to put child poverty 'front and centre' in upcoming Scottish budget

John Dickie, the director of the Child Poverty Action Group is reiterating his calls today for a doubling of the Scottish Child Payment, as well as meeting statutory child poverty targets.

He has also criticised the Chancellor’s budget for the impact it will have on people who are unable to work, and who have suffered a reduction in the rate of universal credit.

According to widespread analysis of Mr Sunak’s spending plans, the quality of life for millions of people is set to get worse and those who are unable to work have been disproportionately penalised.

The Institute for Fiscal Studies director Paul Johnson said earlier this week that due to inflation, any rises in minimum wage levels or benefits payments could be wiped out.

He explained: “Next April benefits will rise by just over 3%, but inflation could easily be at 5%.

“That will be a real, if temporary, hit of hundreds of pounds a year for many benefit recipients.”

READ MORE: Living standards for millions will be worse as a result of spending plans

Speaking exclusively to the Herald on Sunday, Mr Dickie said the Chancellor’s budget impacts mean it is essential that Kate Forbes uses her spending plans to mitigate some of the worst effects.

He said: “it is now more important than ever that the Scottish Government puts the national mission to end child poverty front and centre in its forthcoming budget.

“We need to remember the horrendous context to Wednesday’s UK budget - that the Chancellor had already pushed through a £20 a week cut to universal credit that slashed family incomes by over £1000 a year and will push over 20,000 children into poverty in Scotland alone.”

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He said that Ms Forbes should use the block grant from the UK Government to tackle child poverty. Mr Sunak claimed the devolved governments in Scotland, Wales and Northern Ireland would receive their biggest ever increase in block grant funding since 1998 as part of his Budget, however Ms Forbes has said the claims are untrue. Scotland is set to receive an extra £4.6bn in its block grant every year for the next three years, with the Scottish Government claiming this will still be less money than it received in 2021/22.

Analysis by economists revealed that both politicians are correct – with Mr Sunak’s claims standing up to scrutiny if the additional pandemic funding from the last 18 months is not included, while Ms Forbes’ claims are also accurate if the pandemic money is taken into consideration.

Mr Dickie continued: “The improved outlook for the Scottish block grant compared to what had previously been anticipated should now be used to help contribute to meeting the statutory child poverty targets.

“With one in four children in Scotland still living in poverty an immediate doubling of the Scottish child payment must be the top priority. Families really can’t wait for this additional support, nor can the Scottish government afford to delay if it is to meet its own child poverty targets.”

He has also called for the UK Government to remove the benefit cap and two-child limit on tax credits, and “restore the value of children’s benefits”

Mr Dickie added: “We have record child poverty levels across the UK and this budget left far too much still to do. To enable every child to thrive the Chancellor needs to restore the value of children’s benefits and remove the benefit cap and punitive two-child limit. “

He said that the Budget did not do anything for people who are unable to work and will make them worse off.

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On Wednesday the Chancellor announced he would be amending the Universal Credit taper rate, meaning people who are working will get to keep more of their benefit for every £1 they earn.

He changed the rate from 63 per cent to 55%, meaning for every £1 someone on UC earns, they will lose 55p of the benefit rather than previously losing 63p.

This was done in an attempt to address criticism of the UK government’s decision to remove the temporary increase of £20 aa week to UC during the pandemic. Charities, opposition politicians and even members of the Conservative party said the decision was wrong and urged the administration to think again.

Despite the backlash, the £20 a week was stopped at the end of September, saving the government around £6bn.

The changes to taper rates will cost around £2bn, creating an overall saving of around £4bn made predominantly from people who are receiving benefits but are not working.

READ MORE: Forbes: Rishi Sunak’s claim of record funding for Scotland is wrong

Mr Dickie said this is wrong, and added: “Whilst the long-overdue decisions to lower the universal credit taper rate and increase the work allowance will help lots of low earners in Scotland and across the UK, there was nothing for those who cannot work.

“Carers, those with young children and people who are sick or disabled face the same cost pressures as other families, if not more, and will still have a £1000 a year black hole in their finances after the universal credit cut.

“In short the Chancellor’s announcement comes nowhere near to making up for the UC cut for the vast majority of low-income families.”

While Rishi Sunak has finished announcing his major spending plans this year, Kate Forbes will set out how the Scottish Government plan to spend its money on December 9 in Holyrood.