Chamber and committees

I have nothing to add.

Amendment 104 agreed to.

Section 25, as amended, agreed to.

Section 26 agreed to.

Long title agreed to.

The Government has proposed amendments in my name that fall under three themes for the compensation recovery provisions: stylistic drafting changes, changes to improve clarity and some small changes to the proposed powers in the relevant parts of the bill.

Amendments 61 to 63, 68, 75, 79, 82 and 86 to 91 all make stylistic changes to the drafting of the provisions. The majority of those amendments are designed to address the overuse of the word “any” in the provisions by replacing it with the words “a” or, where appropriate, “an”. Others are designed to remove duplication or to make grammatical changes. We consider those amendments to be minor and to have no effect on the operation of the provisions.

The committee will note that the compensation recovery provisions are complex. The next set of amendments is designed to provide clarity and to simplify where possible, without impacting the functionality of the provisions.

A key issue is that the provisions must make reference to multiple parties, often in the same section, which can be confusing. Proposed new section 94A of the 2018 act, in particular, refers to many different parties, so amendments 59 and 60 help to clarify to whom the specific provisions apply.

Proposed new section 94M provides for a

“review of certificates of recoverable assistance.”

On reconsideration, we identified that we could reduce complexity through amendments 69 to 72 by making a small change to the wording, updating the references and eliminating the need for subsection (6).

Following engagement with bodies representing the insurance industry, we believe that via amendments 66 and 67 we can reduce complexity in proposed new section 94H when referring to policies of insurance. Those changes ensure that the meaning is clearer without having any impact on how the provision will function in alignment with the rest of the United Kingdom.

Also in that section, we intend that a “policy of insurance” should cover liability only in so far as that policy has been stated to cover, and not any further. The Association of British Insurers in particular expressed concern that the point was not clear enough in the bill. Amendment 64 removes the risk that the provision could be misinterpreted to read that the insurer covers all liability, beyond the terms of the policy.

There might be situations in which, following a reconsideration or appeal, it is revealed that a person who received a compensation payment knowingly provided inaccurate or insufficient information. We believe that also proving that person’s

“intent of increasing the compensation payment”

is not necessary as there could be no other reason to do it, so amendment 77 removes that requirement in proposed new section 94P.

Amendments 78, 80 and 81 apply to the provisions on periodical payments. On review, we were concerned that those provisions could be confusing. The amendments remove words that add no value to the provisions, simplifying proposed new section 94R while having no impact on its effect.

The next series of amendments is designed to make some changes to the powers that were proposed when the bill was first introduced. Many of those changes are in response to scrutiny from both the Delegated Powers and Law Reform Committee and the Social Justice and Social Security Committee.

At proposed new section 94H, we agreed with the Delegated Powers and Law Reform Committee that the equivalent UK provision contains a more restricted power to limit the amount of the insurer’s liability. We agreed that a wider power was not required, and amendment 65 makes that change.

Amendment 84 relates to the diffuse mesothelioma payment scheme administrator. As drafted, the provision could apply to anyone providing any services to the DMPS administrator, but we do not intend for that provision to apply so broadly. The amendment narrows that power to apply only to those specifically “acting on behalf of” the administrator.

Amendments 73, 74 and 76 relate to the provisions on appeals against a certificate of recoverable assistance at the First-tier Tribunal. They remove unnecessary subsections that relate to raising an appeal; it is more appropriate that the matter be covered in tribunal rules.

The Delegated Powers and Law Reform Committee also queried the regulation-making power relating to the

“non-disclosure of medical advice or ... evidence given ... in connection with an appeal”.

On review, it was identified that a power that is contained in the tribunal rules and which is already in practice makes sufficient provision in relation to the disclosure of documents and information. As such, amendment 76 removes that unnecessary power.

Amendments 100 and 101 remove the references to those powers from the section outlining procedures.

Proposed new section 94T provides regulation-making powers for the provision of information in relation to “recovery from compensation payments”. It was identified that the provision might apply more broadly than necessary, deviating from the equivalent provision in the UK legislation. Amendment 85 narrows that power. There is also no need to specify mandatory content for regulations, so amendment 83 makes changes to allow for content that could be included in regulations.

I hope that everyone has followed those technical amendments, convener.

I move amendment 59.

The Government does not support amendment 14, in the name of Jeremy Balfour, although I acknowledge his point that some people might wish to have an in-person hearing. I also very much agree that it is important for clients to have that choice.

When the SCTS gave evidence to the committee in April, it advised that, during Covid, the chamber started operations with telephone hearings as the default and that some users enjoyed and appreciated that format. It also advised that, where appellants want a certain type of hearing, the tribunal will accommodate their choice, unless there is a compelling reason not to do so.

I also understand from the session earlier this year at which the SCTS gave evidence that it is making improvements to the service to allow people to choose the type of hearing that best suits them, including in-person hearings, and to express their preference through various channels. Moreover, I understand that the number of in-person hearings, although still small in comparison to pre-pandemic levels, is increasing. Therefore, I do not think it necessary to introduce a presumption in legislation, if there is already a process in place to allow clients to choose.

I very much encourage the committee to consider the fact that some people find a phone or video hearing much less daunting than an in-person hearing, or they might well find it more convenient and that it fits in with their day-to-day responsibilities and commitments. I fear that a presumption of an in-person hearing will have the unintended consequence of pushing people towards a type of hearing that they do not want and which does not best suit their needs.

The only other point that I would make—and I would have to refer back to the record for this—is that the figures that Mr Balfour referred to were, I think, for the appeals that were due under the DWP system, not the Social Security Scotland system.

Before I speak to the individual amendments in the group, it might be helpful to offer some context on the development of the provisions and the rationale that underpins them. I recognise that some stakeholders and members have raised concerns about what is being proposed and hope to address those today.

First, let me be clear that the ethos of treating individuals with fairness, dignity and respect is the bedrock on which our social security system is built. I am content that nothing in this section of the bill runs contrary to that ethos. As a Government minister, I have a duty to ensure that I am stewarding public finances responsibly and take that duty very seriously. Value for money is also one of the fundamental social security principles in section 1 of the 2018 act.

In its 2021-22 annual audit report, Audit Scotland considered it a matter of priority for the agency to develop the capability to assess the levels of fraud and error present within its case load. Ministers and accountable officers also have a duty under the Public Finance and Accountability (Scotland) Act 2000 to understand the levels of fraud and error that are present within the devolved social security system. It is therefore crucial that the agency can produce robust estimates. In developing the provisions, we have sought to balance those duties with our ethos of fairness, dignity, and respect and with the principle of value for money. I am content that we have struck the right balance to protect individuals and the public purse.

I will speak first to the non-Government amendments, before moving to the Government amendment in my name. Amendment 10, in the name of Jeremy Balfour, would remove from the bill the provisions that allow the Scottish ministers to make a decision to suspend entitlement in cases where the agency has repeatedly and unsuccessfully tried to gather the necessary audit information.

Although I recognise that the laudable aim of the amendment is to protect individuals from having their entitlement suspended unnecessarily as part of the audit process, I cannot support it. When repeated attempts to obtain the required information have not been successful, the agency must be able quickly to establish that the individual remains entitled to the assistance and that significant overpayments are not being accrued. We might, for example, have to establish whether the individual still resides in Scotland and thereby meets the necessary residency criteria.

Following detailed consideration of options, suspension has been identified as the most effective tool to ensure that people participate in the audit process. I hope that the committee will recognise that it is a proportionate intervention where, as we clearly intend, it is applied in line with our ethos of treating people with dignity, fairness and respect.

Although the suspension powers are new, the committee should bear in mind that they are entirely consistent with the Scottish ministers’ existing powers to suspend assistance where they require information to make a determination of entitlement. If somebody stops responding to Social Security Scotland, that will rightly raise a concern. The existing suspension powers are in place so that people and the public purse can both be protected. Removing the suspension powers from this part of the bill would not, therefore, prevent the possibility of suspension altogether. It would simply undermine the whole point of taking the powers in the first place.

However, the existing powers may be used only in situations where ministers require information to decide whether someone is still entitled to assistance—for example, where somebody has stopped responding to Social Security Scotland’s correspondence. They could not be used to request information to inform a statistical sample. That is one reason why the additional suspension powers in part 6 are required. The other reason is that we consider it to be more transparent to place the relevant powers in the relevant part of the primary legislation.

I reiterate that a decision to suspend payments is not one to be taken lightly and that it will only ever be done when the agency has made extensive and repeated efforts to gather the necessary information for the audit process. I hope that that further reassures the committee that safeguards are built into the process. Individuals will have the right to ask the Scottish ministers to review the decision to suspend their assistance, and any suspended assistance will be backdated if they subsequently respond to the request for information. Therefore, the Scottish Government cannot support amendment 10.

Maggie Chapman’s amendment 58 would remove the provisions in relation to information fraud in their entirety. I will also deal at this point with amendments 99 and 103, which I understand are simply consequential. My officials undertook a detailed options appraisal on how to provide an audit framework and considered best practice for gathering such information in other parts of the UK and other countries, and that work informed the development of the provisions.

If amendment 58 was agreed to, the agency would be left with no powers to require information from individuals. It would be able to gather information only from individuals who opted to participate in the audit process. That self-selection of participants would likely mean that those who knew that they should have reported a change of circumstances but did not do so and those who knew that they were claiming under false pretences would simply not participate. The approach would also be inconsistent with similar mandatory client survey approaches that are conducted in other countries, including the rest of the UK, Ireland, Canada and Australia.

Amendment 58 would damage the validity of any data that was gathered and it would prevent the agency from responding effectively to Audit Scotland’s recommendation. It would arguably cut across ministers’ duties under the Public Finance and Accountability (Scotland) Act 2000 to accurately assess levels of fraud and error in the case load.

However, I recognise that stakeholders may still have concerns in that area, and I reassure the committee that my officials will work to address them, including through public consultation. We have included safeguards in the process to ensure that individuals will be supported to participate, with the right to an advocate or supporter. As ever, we will continue to engage and work with stakeholders as the bill progresses and any subsequent legislation is developed.

I committed to lodge my amendment 57 at stage 1 and I urge the committee to support it. It will place a duty on the Scottish ministers to undertake a public consultation on the categories of individuals who should be exempt from participation in the information for audit process. Although it would not be appropriate to prejudge the results of that or indeed any future consultation, or to definitively list types of individuals who would be exempt from providing information, it may help the committee if I offer an example of a category that could be included in the regulations. Initial policy discussion suggested that those whose entitlement has recently been reviewed would automatically be exempt from participation. We will, of course, welcome stakeholder views on other categories of people who should be exempt from the exercise.

I hope that amendment 57 further illustrates our commitment to work with stakeholders and address any concerns that they have. As I have outlined, the provisions seek to balance two different sets of priorities. As the committee noted in its stage 1 report, that is not easy to achieve. However, as a Government minister, I have a duty to ensure that the public purse is protected and that funds are spent wisely and appropriately. At the same time, that cannot come at a cost of departing from our principles and the ethos of treating people with dignity, fairness and respect. I am content that we have struck the correct balance in the bill’s provisions.

It is not feasible, for the reasons that I have outlined, for the agency not to undertake audit activity to assess the levels of fraud and error in its case load. However, I am aware that some stakeholders have concerns about what is proposed. I hope that the measures and safeguards that we have outlined will help to ease some of those concerns.

I move amendment 57.

Yes, I certainly will. Mr Stewart is right to point out the pros and cons of putting something in primary legislation.

I absolutely want to put on the record that, under this Government, there will never be sanctions on social security—never. The reason for that is that they are absolutely ineffective as well as immoral. Therefore, there will never be a sanction, but we need a robust system. I can provide an example of why that might be to the benefit of the client. If we begin a process and we then receive information that there has been a massive overpayment building up—for example, to a vulnerable client—the last thing that we would want to do is to allow the overpayment to continue to build up for even more time, because, at some point, it would have to be paid back. Therefore, there are reasons, which are to the client’s benefit and advantage, for ensuring that the information is provided.

Mr Balfour places a lot of weight on the fact that we do not need this power because we have other powers in the previous act, but I simply have to disagree with him on that. Section 52 of the 2018 act allows for determinations without application, as set out in regulations, but that can be done only in order to make a determination because of, for example, a change of circumstances and overpayment. This is different, and therefore the powers that Mr Balfour suggests are in section 52 of the 2018 act would not assist us in this process. However, that points to the fact that we already have suspension powers that are very carefully used in the social security system.

A number of members have rightly talked about safeguarding, which is critical for what we are doing. Again, I think that we are all coming at this from the same point. The safeguards in the bill as drafted set out that individuals have a right to request withdrawal of information and a right to support for a response to Social Security Scotland. There are also safeguards in the 2018 act. Mr O’Kane raises a really important point. Again, I will need to reflect on what could be done between stages 2 and 3 and what should be in the bill itself. However, Mr O’Kane is right to point out that it is very important that, as the agency moves forward, it does so in conjunction with stakeholders. That is the way in which the guidance on fraud and error was developed when it was first introduced. It is the way in which the agency always develops guidance. It does not sit there and do it unilaterally. There is very much an openness to learn and adapt.

It is important that, while we are still working through what that operational process will look like, the stakeholders will have an opportunity to get involved in its development. However, I will reassure the committee on certain aspects. The process will be designed to be as sympathetic as possible to circumstances while maintaining statistical rigour. The individuals who are selected will have access to support. There will be scope for people to provide the required information in a range of formats. Reasonable timescales will always be in place to gather that information. People can ask to have a request withdrawn if they think that they have good reason.

Suspension and determination without application will only ever take place when people have received numerous reminders and timeframes. I absolutely appreciate the fact that members want to ensure that that is done not just in letters or in a way that might not be useful to a vulnerable client but in a way that is sympathetic to vulnerabilities. Stakeholders and the agency need to work together on that.

For the sake of near brevity, I end my remarks there.

I absolutely take that point and, if Mr Balfour will bear with me, I assure him that I will get to that. However, the committee has the power to request information.

In addition, allowing Scottish ministers to set key performance indicators for the First-tier Tribunal would undermine ministers’ statutory duty to uphold the independence of the tribunals, which bolsters guarantees of judicial independence that are enshrined elsewhere in legislation. That is a fundamental principle of democratic society. Like Social Security Scotland, the performance and operation of the First-tier Tribunal is already subjected to scrutiny.

On the point that Mr Balfour has raised, he and I have had discussions on that. There has been a degree of frustration about some of the information that he and stakeholders have wished to see; for example, management information is not there for Social Security Scotland to pull, and to do so quickly.

I, too, remember the trips down to Victoria Quay. I was probably responsible for social security at that time, given that I have been for more than half of Mr Balfour’s time in the Scottish Parliament. He will also remember that it was an agile programme and that the aspects that were brought in were always going to require continuous updating and improvements. That was part of the process and was clear from the start. Some of that is about the ability to obtain information and to request information in an easy way that does not, for example, require a lot of manual workarounds.

I hear and appreciate Mr Balfour’s frustration on the issue. As he has already alluded to, I do not think that the way to address that is through primary legislation. I have offered to meet Mr Balfour, along with the senior management of the agency, to discuss the areas on which he feels that more information is required. We will also continue to work on that with stakeholders.

Amendments 92 to 94 bring within the scope of SCOSS’s formal scrutiny remit regulation-making powers on care experience assistance, appointees, assistance given in error and information for audit.

The bill as introduced sought to implement the findings of the Glen Shuraig Consulting review and bring specific additional regulations into SCOSS’s formal scope. At that point, the regulations that were being brought into scope did not include those for care experience assistance, compensation recovery, information for audit, appointees or assistance given in error, as those were not under consideration at the time of the review.

As the committee heard during stage 1, there were calls from stakeholders for all the new regulation-making powers in the bill to be subject to formal scrutiny by SCOSS. Following that evidence, the board of SCOSS wrote to me in April 2024, noting that it welcomed additional scrutiny of some—rather than all—of the regulations that were made possible by the bill. Amendments 92 to 94, in my name, therefore add to the existing list of regulation-making powers that are captured under section 97 of the 2018 act, in accordance with those exchanges with the board of SCOSS—[Interruption.] Excuse me, convener. Clearly, I am allergic to stage 2 proceedings after a certain amount of time.

I urge the committee to support those amendments. We have seen how SCOSS scrutiny adds value to the development of regulations, and I have no doubt that its scrutiny of regulations on the added topics will similarly make an important contribution.

Amendments 95 and 96 simply ensure that section 97 of the 2018 act, on formal scrutiny by SCOSS, applies to regulations whether they are subject to the affirmative or the negative procedure.

Amendment 97 ensures that SCOSS is aligned with similar public bodies in its duties to publish an annual report. The Glen Shuraig review noted that the 2018 act’s relatively onerous statutory duty on the commission to prepare accounts and submit those for external audit should be removed. Amendment 97 replaces it with a more proportionate requirement to prepare an annual report that must be submitted to ministers and laid before the Parliament. The SCOSS board has welcomed that amendment.

Amendment 11, in Jeremy Balfour’s name, would expand SCOSS scrutiny to primary social security legislation as well as a broader range of secondary legislation. The Government cannot support that. The Scottish Government is already bringing the majority of the regulation-making powers in the 2018 act within the scope of scrutiny by SCOSS. That aligns with the recommendations of the independent review, which recommended a focus on areas that can have an impact on clients. The widening of the scope that is proposed in amendment 11 would both undercut that policy objective and create unclear resource implications for SCOSS.

The Government also has concerns about how the provisions on the scrutiny of primary legislation would work in some contexts—for example, if emergency legislation is required, there might not be sufficient time.

It is also important to highlight that the functions of SCOSS under the 2018 act are already wide ranging, and relate not only to the scrutiny of legislative proposals; SCOSS can, when requested, prepare and submit to the Scottish ministers and the Parliament advice on any matter relevant to social security and report on whether expectations as set out in the Scottish social security charter are being fulfilled, as well as make any recommendations for improvement. According to its most recent annual report, the commission has progressed work in that area, and I believe that it would be useful for the committee to consider those existing functions rather than create entirely new statutory functions, given that those that are available to the Parliament have been used so little.

I move amendment 92.

The committee will be pleased to learn that amendment 104 is a minor amendment and that my speaking notes on it are short.

Amendment 14 will allow the provision that sets out the parliamentary procedure for the regulation-making powers to commence the day after the bill is given royal assent. It will remove the need for a set of commencement regulations to be laid for section 24, which would be disproportionate, given that the provision relates solely to parliamentary procedure.

I move amendment 104.

Good morning, convener. The Scottish Government’s amendments 52 and 53 are technical changes to clarify that an individual’s eligibility to receive assistance has no bearing on whether an appointee may act on their behalf. An appointee may act in connection with a determination, even if the result of that determination is that the individual is not eligible.

Amendments 54, 55 and 56 are minor drafting amendments relating to terminology: they change the words “their” and “they are” to “the person’s” and “the person is”, respectively, to avoid any potential ambiguity as to whom is being referred to. It has no substantive effect on the operation of the provision or policy.

Amendment 102 corrects an error in the Social Security (Scotland) Act 2018. My officials, while considering other amendments to the bill, identified that section 85B(5) of the 2018 act on appointees is not included in the list of negative procedure powers in section 96(3). Amendment 102 amends section 24 of the bill to correct that. I ask the committee to support amendments 52 to 56 and amendment 102.

Amendment 126, in the name of Jeremy Balfour, seeks to allow Scottish ministers to appoint a person who already has authority to act on behalf of a child—for example, someone with existing parental responsibilities and rights. I again thank Mr Balfour for his on-going interest and support in relation to ensuring that we make payments to the right person and based on the best interests of disabled children. That is, I think, our shared aim, and I will explain why I do not think that the amendment will meet that aim.

I believe that amendment 126 could create uncertainty or an unnecessary additional step for parents who, in most cases, already have the right to be their child’s legal representative.

Social Security Scotland already has procedures in place to ensure that the child disability payment goes to someone who is suitable to manage that payment on behalf of the child. If Social Security Scotland receives information that suggests that persons may no longer be suitable to manage payments, it will take action urgently. It will also ensure that payments are suspended when there is a risk of financial abuse or when someone is no longer able to continue managing the assistance.

I am concerned that amendment 126 could result in Social Security Scotland or the First-tier Tribunal for Scotland being used as an arena for some separated parents to play out their disputes, with neither being suited to fully arbitrate such disputes. I believe that that would be a negative outcome for Social Security Scotland, the tribunal and the child, particularly when there are processes in place to manage such disputes. I have written to Mr Balfour to provide more information, and I hope that he has had the opportunity to reflect on that additional information.

For those reasons, the Government does not support amendment 126, and I ask Mr Balfour not to press it.

I turn to Jeremy Balfour’s amendment 9, which seeks to put third-party representatives on a statutory footing by setting out existing policy and processes in primary legislation. Nomination of a third-party representative can already be achieved under common law using a mandate form, and the process has been in place at Social Security Scotland for more than four years. Clients are not restricted to using Social Security Scotland’s mandate. They can nominate a third-party representative using other methods, such as over the phone or by submitting an organisation’s own mandate.

I understand the motivation behind amendment 9. I assure the committee that the Government continues to listen to clients and stakeholders and will seek to streamline the administrative process for nominating a third-party representative as much as possible. For example, for the launch of the pension-age disability payment, we have integrated a mandate into the application form, reducing the need for any additional forms or phone calls from the client.

I am not persuaded that we should remove the flexibility to respond quickly to feedback and to continuously improve our processes by setting out such operational detail in primary legislation. We have heard similar things from organisations that regularly act as third-party representatives in connection with social security. Citizens Advice Scotland told us that it does not support amendment 9. CAS said:

“The insertion of this process into legislation and the addition of the word ‘must’, may create operational difficulties”,

noting that representatives can change in the course of a client journey.

Therefore, although I very much respect the intent behind amendment 9, I encourage Mr Balfour not to press it.

I move amendment 52.

I will respond to some of the points that Mr Balfour and Mr O’Kane made on the authority of Social Security Scotland to make the decisions in relation to children around some aspects, based on the common-law approach.

With regard to amendment 9, I can see where Mr Balfour is coming from on third-party representatives. However, that is one of the areas where we must be careful of unintended consequences. For example, there is a default position that representation is for three months. That was asked for by the Scottish Women’s Convention. We can imagine circumstances where a woman who is experiencing coercive control by her partner or husband might wish not to have something like Mr Balfour’s suggestion in place. Therefore, primary legislation is really not the place for such a provision, because the system needs to be flexible.

Of course, a client can ask for longer. The default position is that representation is for three months but it does not have to be three months. Clients have the opportunity, as I said in my opening remarks, not just to use the mandate form from Social Security Scotland and not just to have representation for three months but to choose to do something different should they so wish.