The cost of establishing Scotland’s new benefits system has more than doubled to £651 million, a Scottish Government document has revealed.
The soaring price tag for delivering the country’s newly devolved benefits has been caused by the new social security system taking longer than previously thought to set up.
The complexity of the system, which is run by Dundee-based Social Security Scotland, has contributed to the delay. Some of the complexity arises from having to align the new Scottish system with the benefits which will remain under the control of Westminster’s Department for Work and Pensions.
In all, 11 benefits are being transferred to Holyrood, the biggest handover of responsibilities since the birth of devolution in 1999.
Scottish ministers publish revised business case
The cost came to light in a revised business case published by the government, which gave figures for developing the system over the next four years.
The document said: “Current plans indicate spending on implementation will total £651 million from 2018-19 to 2024-25.
“This one-off investment in implementation will benefit the people of Scotland and will be used by future governments for decades. It represents less than 0.5% of the estimated £150 billion in benefits expenditure over the next thirty years.”
The forecast contrasts with 2017 figures when the Scottish Government estimated the full cost of creating the new Scottish welfare state would be around £308m.
The SNP is now finding out just how hard it is to deliver a fair and affordable benefits system.”
Tory MSP Adam Tomkins
The vast majority of the cash will be spent on staff costs and creating the infrastructure for delivering benefits.
These include application and payment systems as well as decision-making mechanisms to assess eligibility for payments.
Around £8m of the £651m will go towards fitting out offices in Dundee, Glasgow and elsewhere in the country.
Scottish Conservative MSP Adam Tomkins said: “Having spent years criticising the UK Government over welfare policy, the SNP is now finding out just how hard it is to deliver a fair and affordable benefits system.
“But if the nationalists can’t even get the set-up costs remotely right, what chance do they have of administering payments properly?”
The SNP claimed they could set up an independent country in 18 months. Instead their new social security agency has been beset with delays and doubled in cost.”
Lib Dem leader Willie Rennie said: “There is a huge opportunity to build a system that tackles inequality and poverty but that needs to be underpinned by a well-managed and well-run agency in charge.
“The SNP claimed they could set up an independent country in 18 months. Instead their new social security agency has been beset with delays and doubled in cost.
“This money would be better spent in lifting up the more than one million people in Scotland living in poverty.”
Social Security Secretary ShirleyaAnne Somerville said: “We are investing in creating the infrastructure for a new public service for Scotland.
“Our new Scottish social security system is being built from scratch with dignity, respect and fairness at its heart. I am proud we are co-designing a service to meet the needs of in the people of Scotland now and for generations to come. And we are creating 1900 jobs to support our work.
We have met and surpassed our commitments to date.
Social Security Secretary Shirley-Anne Somerville
“We have met and surpassed our commitments to date. By the end of this parliamentary term we will have introduced eleven benefits that will help over 800,000 people in the next year. And by 2024 we will deliver 16 benefits and reach 1.8 million children and adults, and pay out an estimated £4 billion. And we are ensuring we do not replicate the current DWP system which people find stressful, complicated and often inhumane.”