Older People’s Energy Costs

– in the Scottish Parliament at 12:47 pm on 28 November 2024.

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Photo of Alison Johnstone Alison Johnstone Green 12:47, 28 November 2024

The next item of business is a statement by Shirley-Anne Somerville on supporting older people with increasing energy costs.

Further to an earlier point of order, I note that some aspects of the Scottish Government’s statement have appeared in the media and, therefore, in the public domain before the Parliament’s elected members have had an opportunity to put questions to the Government. It is the Government’s responsibility to manage information to avoid such a situation occurring, which is disrespectful to the Parliament.

The cabinet secretary has written to me to apologise. In the interests of our constituents and public transparency, I will allow the statement to be made, but I have asked the cabinet secretary to shorten the statement to allow more time for questions.

Photo of Jeremy Balfour Jeremy Balfour Conservative

On a point of order, Presiding Officer. I am grateful for your clarification. Normally, spokesmen and spokeswomen get early sight of a ministerial statement, but, having spoken to my colleagues, I understand that that has only just happened, which means that it will be difficult to properly scrutinise the statement. Have you thought of asking the Government to move the statement to later today—perhaps before decision time—so that the Parliament can properly scrutinise the very important decision that is going to be made?

Photo of Alison Johnstone Alison Johnstone Green

Thank you, Mr Balfour. It is, of course, convention that the Scottish Government strives to ensure that members have as much advance sight of statements as possible. We will continue with this item of business, but your comments are on the record. I will now pass to the Cabinet Secretary for Social Justice.

Photo of Shirley-Anne Somerville Shirley-Anne Somerville Scottish National Party 2:42, 28 November 2024

Thank you, Presiding Officer. Before I make my statement, let me apologise to you once again—and, indeed, to members—for the unfortunate early coverage of some of the content of my statement in the media this morning. Regretfully, the coverage gave high-level information regarding the announcement that I am about to make.

Presiding Officer, we take very seriously your guidance that details of any major announcement should not be publicly released before it is made to the Parliament. Accordingly, as you said, I have written to you to formally apologise, and I am grateful for the opportunity to make a shortened version of the statement and to answer members’ questions. I add an apology to Opposition spokespeople for the fact that I have not provided them with early sight of my statement, as I usually do.

I turn to my statement. As members will know, the United Kingdom Government announced its decision on 29 July to restrict entitlement to the winter fuel payment from this winter to people in receipt of pension credit and other means-tested benefits. That meant that an important provision of financial support that had up until now been available to all pensioners across the UK was abolished. The decision was taken with less than an hour’s notice to and no discussion with the Scottish Government.

As a result of the decision, Scotland’s share of the block grant adjustment funding, which we had planned to use to introduce pension age winter heating payment, our like-for-like replacement for the winter fuel payment, was cut by £147 million—a cut of more than 80 per cent to that budget. That had an immediate and profound impact on our ability to continue as planned and to offer our payment as the universal benefit that we had intended implement this year.

As members will be aware, we could not identify the additional funding that was required in-year to mitigate the UK Government’s decision. In addition, the timing of the UK Government announcement meant that alternative approaches to either a universal payment or the means-tested approach that was introduced by the UK Government could not be implemented in the time that was available to us.

We have repeatedly urged the UK Government to reverse the decision; indeed, the Parliament has supported that call. However, our representations have been ignored and payments of the benefit will be delivered by the Department for Work and Pensions under an agency agreement with Scottish ministers this winter. That approach will at least ensure that vital support is available to those eligible pensioners who are most in need of help with their fuel bills this winter.

Unfortunately, that means that, once again, we are in a position in which the Scottish Government is having to mitigate the impact of the UK Government’s damaging decisions on social security policy. There has been a change, but the change is that we are now mitigating the actions of a Labour Government rather than those of a Tory one.

The Scottish Government provides a wide range of heating cost support to our pensioners. For example, our winter heating payment guarantees a reliable annual payment, and—unlike the UK Government’s cold weather payment—it does that regardless of the weather, the temperature or proximity to a weather station.

We are also continuing our child winter heating payment, which, last year, provided support to more than 30,000 children, young people and their families who had higher energy needs due to disability or a health condition. That benefit is not available elsewhere in the UK.

Meanwhile, our warmer homes Scotland scheme and our area-based schemes support people who are experiencing fuel poverty to make their homes warmer and more fuel efficient. In the past decade, those two programmes have supported more than 150,000 households living in, or at risk of, fuel poverty.

All those programmes are valuable, but we all recognise that households across the country are acutely feeling the twin pressures of the cuts to social security budgets that have been made over many years by successive UK Governments—Conservative and now Labour—and of rising energy costs, despite Labour’s promise that people’s energy bills would fall if Labour was in government. Bills are set to rise again in January.

This year alone, the Scottish Government has already spent £134 million on mitigating the effects of UK Government welfare decisions. Although we cannot possibly mitigate the effects of every decision that is made by the UK Government, we are determined to do more where it is possible for us to do so.

I am therefore announcing today that the Government will invest a further £20 million in the Scottish welfare fund’s budget, which will be distributed to councils this financial year. That increase will help councils to meet the increased demands on the fund that exist as a result of decisions by Westminster.

I am also confirming today that we will invest an additional £20 million in the warmer homes Scotland scheme, which focuses on long-term sustainable measures. That additional funding will help a wider group of households to install energy efficiency measures and more efficient heating systems, which will save them an average of around £300 per year in energy bills.

Finally, for this year, in response to the calls that have been made by a coalition of housing and anti-poverty organisations for a shift in spending from crisis intervention to prevention, I will direct an additional £1 million of grant funding to registered social landlords and third sector partners for tenancy sustainment and homelessness prevention work.

Although those measures will go some way to allaying the fears of older people in Scotland ahead of winter, the Government recognises that more must be done. That is precisely why I have consistently committed to keeping the eligibility for pension age winter heating payments under review.

After careful consideration, I am announcing today to Parliament that, ahead of next winter, I will bring forward regulations to introduce a universal pension age winter heating payment for every Scottish pensioner in the winter of 2025-26. That universal benefit, which will provide much-needed support that is not available anywhere else in the UK, will deliver support across Scotland’s older people, as we had always intended to do before the UK Government decided to cut the payment. It will help to mitigate the increases in energy costs, provide vital cost of living support for all pensioner households and help to reduce pensioner poverty.

The full details of our proposed approach will be set out in the Scottish Government’s budget. However, I can announce that pensioners in Scotland who are in receipt of a relevant qualifying benefit, such as pension credit, and who, this winter, will receive payments of £200 or £300, depending on their age, will continue to receive those payments automatically next winter. In addition, we will introduce universal payments of £100 to every other pensioner household. That will ensure that those pensioners who are in receipt of pension credit or other means-tested benefits will receive a higher amount of support that will protect their incomes. At the same time, it will ensure that support is provided to all pensioner households. Such support will not be available elsewhere in the UK.

We have not taken that decision lightly, given the significant pressures on the Scottish Government’s budget, but we are determined to stay true to our values. On our watch, we will treat people in this country with fairness, dignity and respect. We will not abandon older people in this or any winter, and we will continue to protect our pensioners from the harsh reality of a UK Labour Government.

Photo of Alison Johnstone Alison Johnstone Green

The cabinet secretary will now take questions on the issues raised in her statement. I intend to allow around 20 minutes for those questions, after which we will move to the next item of business. Members who wish to put a question should press their request-to-speak buttons.

Photo of Elizabeth Smith Elizabeth Smith Conservative

I note what you said, Presiding Officer, in your opening remarks. The Scottish Government was rightly angered by the UK Government not giving any notice of changes to the winter fuel payment and, therefore, undermining the necessary scrutiny, but the same thing has happened this afternoon: we have not had prior sight of the statement to allow us to scrutinise it properly.

There is more than a hint of irony in today’s announcement, because the Scottish National Party moans constantly about its hands being tied, fiscally, by the bad deeds of Westminster when, as the Scottish Fiscal Commission rightly said a few months ago, some of the real pressure on budgets comes from the Scottish Government’s decisions, so it is simply not true when ministers argue that they had absolutely no choice but to leave pensioners out in the cold.

I have two questions for the cabinet secretary. First, does she admit that the SNP is hoodwinking pensioners by pretending that it is bringing back the full winter fuel payment when that is simply not the case? Secondly, the cabinet secretary said in her statement that she will bring forward regulations, so will she confirm whether she will do that via primary legislation and, if so, when that will happen?

Photo of Shirley-Anne Somerville Shirley-Anne Somerville Scottish National Party

I apologised to Opposition spokespeople at the beginning of my remarks, and I now do so directly to Liz Smith. I hope that she has known me well enough for long enough to know that what has happened was absolutely not my intention.

We have returned to providing a universal payment for pensioners, and we are determined to hold to that important principle. If anyone is concerned about the principles behind social security, that should be because of the discussion that Russell Findlay has instigated since taking over leadership of the Scottish Conservatives. He has questioned the amount that we spend on social security in Scotland and, when I asked him directly whether that meant that he wants to cut money for low-income families, disabled people, carers or pensioners, he could not give me an answer. That is most concerning. We see the payment as an investment in our people and an important protection for our pensioners.

Liz Smith asked about the regulations, which we will make using secondary legislation, as we have done with all benefits since passing the Social Security (Scotland) Bill in 2018.

Photo of Paul O'Kane Paul O'Kane Labour

It would be customary to thank the cabinet secretary for advance sight of her statement. We note the short period of time that she had, but we, of course, read her plans in some detail in today’s press.

I welcome the support that is finally being offered this winter. The cabinet secretary knows that I have always said that more could be done this winter. I have consistently asked in the chamber about the £42 million that will come as a result of UK Government decisions about the household support fund. Will the cabinet secretary finally provide some clarity on what will be done with the Barnett consequentials that will come as a result of spending this winter?

In addition, we have always said that the pension-age winter heating payment, which is devolved to Scotland, provides an opportunity to widen the criteria beyond those receiving pension credit. I again point to the in-year announcement of £1.5 billion of Barnett consequentials for the Scottish Government, with the figure rising to £3.4 billion in the budget next year. I ask the cabinet secretary whether it is as a result of that spending that she is able to announce that she will bring forward regulations on the pension-age winter heating payment, given that she previously said that that would be impossible because she did not have the money and that she

“cannot base a budget on a wing, a prayer and a promise”.—[Official Report, 3 October 2024; c 44.]

Finally, will she speak to the Poverty and Inequality Commission about its opinion of her payment?

Photo of Shirley-Anne Somerville Shirley-Anne Somerville Scottish National Party

I gently point out to Paul O’Kane that we would not have to take mitigating action this winter if the Labour Government had not whipped money away from pensioners. That is why I have had to make my announcement today. As well as asking some questions, which he is obviously right to do, Mr O’Kane and his party should come here with a bit of humility and apologise to Scotland’s pensioners for putting us in this position in the first place.

Presiding Officer, please forgive me if I am slightly misquoting Mr O’Kane, but he said, “We have always said”. With the greatest respect, I note that Labour has said a lot of things at a UK level and a Scottish Government level since the chancellor made the announcement. Most particularly, there have been two votes on the matter—one in the UK Parliament and one in the Scottish Parliament—and every Labour member was whipped to vote against Scotland’s pensioners. I am proud that the Scottish Government is, once again, stepping up to defend Scotland’s pensioners, and we will continue to do that. It is a shame that Scottish Labour has not done the same.

Photo of Clare Adamson Clare Adamson Scottish National Party

Labour promised to lower energy bills but, instead, the energy price cap has risen twice, with total inaction from the UK Government. Labour cut the provision to 900,000 Scottish pensioners. Does the cabinet secretary agree that mitigating bad decisions cannot go on indefinitely and that it would be much better if powers over decisions on the regulation of energy were held here in our own independent Parliament? [ Interruption .]

Photo of Shirley-Anne Somerville Shirley-Anne Somerville Scottish National Party

I hear groans from Scottish Conservative and Scottish Labour members as we talk about the fact that we continue to mitigate. That says a lot about where the debate is at the moment.

I share the member’s frustration that we are, once again, talking about mitigation. As I said in my statement, we are already spending £134 million in this financial year to mitigate some of the worst excesses of UK Government policies. Not only is the fact that we are having to do that again deeply disappointing, but it is a deeply expensive way to try to protect people. If only this Parliament had the ability to make more such decisions without being shackled to Westminster spending decisions, we could do so much more. Until that day comes, however, we will continue to do what we can to protect pensioners, those on low incomes and, indeed, everyone else who relies on social security, which is an investment in our people.

Photo of Jeremy Balfour Jeremy Balfour Conservative

Will the cabinet secretary confirm that the block grant adjustment for the household support fund is £41 million, so the Scottish Government will not be spending any more money out of its own pocket this year? Will she also confirm that no more money will go directly into people’s pockets in this financial year? [ Interruption .]

Photo of Shirley-Anne Somerville Shirley-Anne Somerville Scottish National Party

The Government has to look carefully at how quickly we can provide support to people. As I said in my statement, that is particularly important when the UK Government gives no forewarning of such decisions. The quickest way that we can do that is to use something such as the Scottish welfare fund, which is an established practice that we have used to assist people in the past—for example, during Covid. That is an important way in which we can assist people with an immediate crisis. As I mentioned, we are doing more to help in a systemic way, too.

I note again that, with the budget on the way just next week, Jeremy Balfour seems to say in his questioning that he wants to spend more at the same time as those on his front bench want the Government to make tax cuts. I am afraid that that does not make economic sense.

Photo of Stuart McMillan Stuart McMillan Scottish National Party

The cabinet secretary’s statement will come as a relief to pensioners and low-income households in my Greenock and Inverclyde constituency and across Scotland, who face financial uncertainty this winter as a result of brutal Labour UK Government cuts. That said, does the cabinet secretary share my frustration that such significant Scottish Government resources must, once again, be directed towards mitigating Westminster austerity measures such as the winter fuel payment cut, the benefit cap and the bedroom tax, despite Keir Starmer’s promise of change?

Photo of Shirley-Anne Somerville Shirley-Anne Somerville Scottish National Party

Stuart McMillan is quite right to point out not just the need for mitigation but its financial cost. He pointed to the work to mitigate the bedroom tax and the benefit cap. That is the decision that we have taken, and I believe that it is the right one, as is our decision to mitigate, again, today.

However, that money could be spent in a variety of different ways, such as on anti-poverty measures, education or the national health service. As we look to the budget next week, the fact that the Scottish Government has had to continue to mitigate—first under the Conservatives and now under Labour—requires us to make difficult decisions in other portfolios. We take that responsibility seriously and, as a member of a minority Government, I hope that the other parties in the Parliament will rise to their responsibility and ensure that a budget is passed next week, so that we can continue to support people in difficult times over the winter.

Photo of Colin Smyth Colin Smyth Labour

More than half of older people in Scotland live in homes that have poor levels of energy efficiency, with an energy performance certificate rating of D or below, at a time when, under this Government, fuel poverty among those in later life is at a record level. Why is there such low awareness of the Government’s energy efficiency schemes? According to the Chartered Institute of Building, awareness levels among older people are as low as 39 per cent, which means that far too few of them benefit from the schemes that the cabinet secretary has talked about.

Photo of Shirley-Anne Somerville Shirley-Anne Somerville Scottish National Party

In the past decade, our energy efficiency schemes have supported 150,000 households that were either in or at risk of fuel poverty. Given that Colin Smyth has talked about fuel poverty, I hope that he bears it in mind that one reason for fuel poverty is energy costs. Labour said that it would cut those, yet there are further increases just as Labour is taking money away from pensioners.

We need to ensure that people are aware of the schemes that are available, but I hope that Colin Smyth will join me in support of the announcements that have been made today about further extending investment in the warmer homes Scotland scheme.

Photo of Jackie Dunbar Jackie Dunbar Scottish National Party

Despite Labour’s pre-election promise to slash bills by £300, household energy prices rose by £149 in October and are set to rise again in January. It is vital that we work to make pricing fairer, and I welcome the Scottish Government’s work so far on a social tariff. Will the cabinet secretary say more about how a social tariff might operate and how it would help to lower costs?

Photo of Shirley-Anne Somerville Shirley-Anne Somerville Scottish National Party

Jackie Dunbar is right to point out the important role that a social tariff could play in assisting those who are either in fuel poverty or at risk of fuel poverty. She will be aware of the work that Scottish Government ministers are taking forward on a social tariff, including the working group that has been set up and is meeting. I think that it is due to meet again in December.

Of course, the ability to deliver on that social tariff comes down to the UK Government. If it continues to be determined to take money away from pensioners, I hope that it will at least act on the work that is being progressed in that working group, and deliver on that social tariff.

Photo of Maggie Chapman Maggie Chapman Green

I welcome the additional investment in the Scottish welfare fund and the warmer homes Scotland scheme. However, temperatures have already plummeted, and people are already being forced beyond the choice between heating their homes and eating. How will the Government ensure that the money will get to those who need it—this year, right now?

Photo of Shirley-Anne Somerville Shirley-Anne Somerville Scottish National Party

Maggie Chapman is right. We not only need to deliver on the funding that we have announced today; we need to ensure that we support Scotland’s councils as they administer the Scottish welfare fund. That is exactly why, as part of the £20 million package, we have recognised that we will need to support councils with the administration costs of doing so. I give Maggie Chapman an assurance that that has been taken account of, so that we can support our councils to get that money out the door as quickly as possible.

Photo of Willie Rennie Willie Rennie Liberal Democrat

Liberal Democrats have opposed the cuts to the winter fuel payment, so we welcome the statement and the change in direction as a step in the right direction, especially given Scotland’s colder climate.

Opposition members are often challenged by Government ministers about where the money should come from for particular policies. That is a fair question to ask. For the sake of clarity, will the cabinet secretary say where the money came from to properly fund this policy?

Photo of Shirley-Anne Somerville Shirley-Anne Somerville Scottish National Party

Mr Rennie is quite right to put that challenge back to me. I have often put that challenge to him in the chamber and elsewhere.

As I mentioned, the budget will be announced next week. The support package that has been announced today was discussed in Cabinet as part of the Scottish Government budget. I ask Mr Rennie to wait just a bit longer, because the announcements on the rest of the Scottish Government budget will be made by the Cabinet Secretary for Finance and Local Government next week.

Photo of Christine Grahame Christine Grahame Scottish National Party

Like many in the chamber, I welcome—[Interruption.]

Photo of Christine Grahame Christine Grahame Scottish National Party

That was terribly rude.

I welcome the announcement. Unfortunately, this Government is having to put in place more mitigations. As I understand it, there are two categories of pensioners: those who are on pension credit, who will get £200 to £300, depending on whether they are single, their age and so on; and the rest of us—that includes me—who will get £100. However, 40 per cent of those who are entitled to pension credit do not receive it. That is no fault of the Government, because that has been the situation for a very long time. The Department for Work and Pensions has those figures, so I assume that that 40 per cent of pensioners will just receive the £100 payment, which is fine. However, how on earth can we increase pension credit uptake? If we do not do that, some pensioners will be left out in the cold.

Photo of Shirley-Anne Somerville Shirley-Anne Somerville Scottish National Party

Christine Grahame is right to point to the need to encourage the uptake of pension credit. She will be aware that this Government has a benefit uptake strategy—it is the only one in the UK—and we are determined to encourage those who are entitled to benefits to apply for them.

Pension credit is a reserved benefit, so it is not part of the benefit uptake strategy. However, regardless of the fact that it is not our responsibility, we have tried to encourage further uptake of pension credit through Social Security Scotland and other public agencies, and I thank our local authority partners for their work on that, too.

Belatedly, the UK Government is delivering a pension credit uptake strategy, which is welcome, but much more can be done. In the main, the responsibility for the matter lies with the UK Government. However, we continue to play our part, and I am sure that Christine Grahame would remind me often that we should do that.

Photo of Craig Hoy Craig Hoy Conservative

I note that the minister has, yet again, sought to turn the issue into a constitutional grievance. Cynically, the SNP would like us to believe—[Interruption.]

Photo of Craig Hoy Craig Hoy Conservative

—that benefit mitigation such as that announced today is necessary only because we remain part of the UK. However, is it not the case that the Scottish Government can offer those benefits only because of the Barnett funding formula? That formula gives her Government £2,200 of additional money to spend on benefits and services for every man, woman and child in Scotland today.

Photo of Shirley-Anne Somerville Shirley-Anne Somerville Scottish National Party

Mr Hoy might wish to reflect on the constitutional aspects of this matter—I certainly do. We disagree on the issue and we will continue to do so. However, we have to agree on the fact that this Government’

Photo of Shirley-Anne Somerville Shirley-Anne Somerville Scottish National Party

—that Opposition party members seem to think that that is okay. I would have hoped that we could all agree on protecting our pensioners or, indeed, the budget that comes to this Parliament. It is sad that Mr Hoy refuses to do so.

Photo of Emma Roddick Emma Roddick Scottish National Party

Freezing temperatures and significant snowfall in the past week left many households in the Highlands and Islands struggling to meet the cost of heating their homes after yet another energy price rise. Labour promised to slash energy bills, but prices have skyrocketed under Labour. While the Scottish Government works to protect pensioners from the worst of Westminster austerity, the UK Government has failed to act and has instead chosen to cut support. Therefore, does the cabinet secretary agree that the UK Government must follow the example of the SNP Government and take meaningful action to tackle rising bills?

Photo of Shirley-Anne Somerville Shirley-Anne Somerville Scottish National Party

Emma Roddick is quite right to point out that meaningful action is required, and that is exactly what this Government has delivered today. She is also right to point out that the UK Government should do likewise. It is not too late for UK ministers to change their mind, reflect on their poor decision and come back with a universal payment. That would be the right thing to do.

In the questions and answers following today’s statement, we have already had discussion and debate about other aspects of meaningful action that the UK Government can undertake. Whether it involves the social tariff or protecting people from increases in energy costs, that is action that the UK Government must take responsibility for. While it continues to ignore the need for that action, we will get on with the action that we can take, as announced today.

Photo of Rachael Hamilton Rachael Hamilton Conservative

Has the cabinet secretary any advice for constituents who have worked hard all their lives for pension entitlements but do not qualify for pension credits? I very much welcome the announcement of the £100, but it will not go far enough to support elderly and vulnerable people and keep them warm this winter.

Photo of Shirley-Anne Somerville Shirley-Anne Somerville Scottish National Party

I agree with Rachael Hamilton that there is a great deal that could be improved with regard to pension credits. It is a shame that the Conservative Government did not do so when it was in power.

We are keen to ensure that older people and other people can receive advice to assist them on their rights. That is exactly why we make provision for welfare rights advice and fund citizens advice bureaux to provide that.

However, I say again to Rachael Hamilton that she cannot come to the chamber and ask us to spend more money when—unless I am mistaken—next week, we will hear that her party wants us to make tax cuts. She cannot have it both ways.