Joseph Rowntree Foundation on the Scottish Government

By stewartb

The Institute for Fiscal Studies (IFS) published (on 25 January) a report entitled ‘Constraints and trade-offs for the next government’. It paints a bleak picture of the present state of the UK, its public finances and services. Over the short to medium term, it offers no cheer for the future.

The IFS notes: ’further tax rises and further cuts for most public services are built into current plans. But on official forecasts, this is only just enough to stabilise government debt as a fraction of national income.’  (my emphasis)

And it adds: ‘Both Labour and the Conservatives have promised to reduce debt as a fraction of national income. Yet a combination of high debt interest payments and low growth is forecast to make this much more difficult to achieve than in the recent past. In fact, on one measure, it will be more difficult to reduce the debt-to-GDP ratio over the next parliament than in any other parliament since the 1950s.’

Reality for the UK, according to the IFS, is that: ’All manner of policy problems will be more difficult to tackle, and all manner of trade-offs will be more acute.’  So as yet another period of austerity looms large, Scotland’s electorate has big decisions to make: with whom – and where – does it wish the power to decide on life changing trade-offs to reside?

The state of poverty in the UK

The assessment by the IFS provides important additional context for the annual review of poverty in the UK published recently by the leading research and campaigning charity, the Joseph Rowntree Foundation (JRF).

Its latest report makes for more grim reading. And yes, it points to levels of poverty within Scotland that most here will consider to be too high. However, from the JRF’s comparative analyses and commentary regarding Scotland’s relative position in the UK, there are noteworthy findings. Unfortunately, these are unlikely to be reported by the BBC and most of the mainstream news media.

Source: JRF (23 January 2024) UK Poverty 2024 (https://www.jrf.org.uk/uk-poverty-2024-the-essential-guide-to-understanding-poverty-in-the-uk )

Context: the JRF report notes ‘It has been 20 years since we last saw a sustained fall in poverty in the UK. Even then, the rapid rise in poverty seen in the 1980s had barely been reversed.

‘Beneath these stubbornly high levels of poverty, an even more troubling picture emerges. Over the past 20 years, very deep poverty has risen. Six million people were in very deep poverty in 2021/22, one and a half million more than two decades ago.’

‘… over the past decade, social security has fallen increasingly short, with the real-terms value of payments reaching a 40-year low at the same time inflation hit a 40-year high, pushing people deeper into financial hardship.’ (with my emphasis)

In short, higher levels of poverty have become endemic in the UK: this problem has been long in the making.

More on scale:  ‘More than one in five people in the UK (22%) were in poverty in 2021/22 – 14.4 million people. Of these, 8.1 million were working-age adults, 4.2 million were children and 2.1 million were pensioners. To put it another way, around two in every ten adults are in poverty in the UK, with about three in every ten children being in poverty.’

‘The number and proportion of children and pensioners in poverty rose between 2020/21 and 2021/22, as did overall poverty. This means that poverty rates across these different groups have returned to around their pre-pandemic levels. It may seem counter-intuitive that poverty increased as we came out of the pandemic, but this is consistent with incomes rising for middle-income households at the same time as a range of temporary coronavirus-related support was withdrawn.’

More history: ‘Taking a longer-run view, we can see that overall poverty has barely moved since Conservative-led Governments took power in 2010. The last period of falling poverty was during the first half of the previous Labour administration (between 1999/2000 and 2004/05), but it then rose in the second half of their time in power.’

On child poverty: ‘Child poverty rates in Scotland (24%) remain much lower than those in England (31%) and Wales (28%) and are similar (if slightly higher) than in Northern Ireland (22%).

‘This is likely to be due, at least in part, to the Scottish Child Payment. This highlights the effect benefits can have in reducing poverty.’

On ‘destitution’: The JRF in late 2023 published a report on rates of ‘destitution’ in the UK, defined as the most severe form of material hardship. ‘People are considered destitute if they have not been able to meet their most basic physical needs to stay warm, dry, clean and fed.’

Source JRF (October 2023) Destitution in the UK 2023  (https://www.jrf.org.uk/deep-poverty-and-destitution/destitution-in-the-uk-2023  )

This report notes: ’Destitution has been increasing at an alarming rate since 2017. Action taken over the past three years has done little to protect people from the most severe form of material hardship. While destitution remains concentrated in particular localities, with some groups particularly exposed, there are warning signs that it is extending its reach to more people and places. We urgently need a bold and ambitious programme of action to address destitution and its corrosive impacts.’

On scale: ‘Around 1.8 million households were destitute in the UK at some point over the course of 2022. These households contained around 3.8 million people, of whom around a million were children. Taking a longer-term view, between 2017 and 2022 the overall number of households experiencing destitution more than doubled.’

Varying rates: ‘Rates have risen in all regions but more so in London, Wales and the West Midlands while they have risen rather less in the three southern regions. Destitution has risen a bit faster in Wales than in these regions, with the exception of London, although it remains below the GB average, while Scotland has improved its position to lie below the GB average, having experienced by far the lowest increase since 2019.

And again on Scotland: ’This may be indicative of the growing divergence in welfare benefits policies in Scotland, notably the introduction of the Scottish Child Payment (from 2021).’

Distinctive ‘protective policies’: The JRF report adds: ‘Scotland’s relative position has improved. This may indicate the protective effect of devolved policies such as the Scottish Child Payment, Scottish Welfare Fund and the mitigation of some cuts to benefits.’

End note

It SHOULD be well known to the electorate in Scotland that successive SNP governments have prioritised reducing poverty by amongst other things mitigating the most damaging effects of Westminster’s welfare policies (e.g. discretionary housing payments to mitigate the bedroom tax) and introducing the Scottish Child Payment.

Third sector critics want the Scottish Government to do much more. This is framed as a wholly negative stance against the Government by the mainstream news media and opposition politicians whose interventions tend to lack the context and perspective available from the JRF’s comparative analysis. It’s relatively rare to find any reflection by oppositional figures on how much more might feasibly be done in Scotland over the short to medium term given the influence of UK-wide economic and welfare policies and practices.

The JRF report refers explicitly to a number of ‘protective’ actions taken by SNP governments to address poverty in Scotland. When compared to the other UK nations, and especially with England and Wales, the its analysis demonstrates relatively better outcomes in Scotland.  However in reality, it’s hard to buck embedded UK-wide trends with limited devolved powers, as the Labour government in Wales may be willing to attest.