Committee
Social Justice and Social Security Committee 05 February 2026 [Draft]
05 Feb 2026 · S6 · Social Justice and Social Security Committee
Item of business
Budget Scrutiny 2026-27
Good morning. The 2026-27 budget invests funding of almost £68 billion to secure a fair, healthy, safe, prosperous and green society, to tackle the cost of living crisis and to deliver on the priorities of the people of Scotland. Thanks directly to the decisions that we have taken, 55 per cent of Scottish taxpayers are now expected to pay less income tax than they would if they lived in England and, unlike taxpayers in England, they will continue to benefit from free university tuition, free prescriptions, no peak-time rail fares and expanded childcare provision.We are, of course, having to operate in a highly challenging financial environment, exacerbated by a United Kingdom budget that failed to deliver for Scotland—a budget that will not move the dial on the cost of living for squeezed households and which has left us with resource funding that is expected to grow by an average of only 1.1 per cent in real terms during each year of the forecast period, which is not enough to change the difficult fiscal position that we face.Despite those constraints, we have again put child poverty at the heart of the budget, with a package of co-ordinated investment that includes £61.5 million for our tackling child poverty fund to supercharge action on child poverty across the life of the next Parliament, with the detail to be set out in our forthcoming tackling child poverty delivery plan, and more than £100 million over three years to support the delivery of a universal breakfast club offer for primary school-aged children by August 2027.Meanwhile, the budget provides for an increase to £28.20 per week in 2026-27 in our transformational Scottish child payment, which has been increased by more than 180 per cent since its launch. Additionally, we will increase the value of the Scottish child payment to £40 per week for children under the age of one from 2027-28 onwards to provide increased support in the critical first year of a child’s life. The budget also sets out how the £141 million that would have been spent on our payment to tackle the two-child benefits limit will be reinvested next year to tackle child poverty, in keeping with the commitment to do so given by both the First Minister and me.Overall, we are investing around £7.2 billion in social security assistance in 2026-27. That fully funded investment will support around 2 million people. Not only will children be kept out of poverty, but there will be support for disabled people and their carers and essential help for pensioners and others via winter heating payments.As I set out in my letter to the committee last month, there have been a number of significant developments since the committee’s pre-budget scrutiny was carried out. Most importantly, updated Scottish Fiscal Commission forecasts reflect a number of key changes, the most notable of which is the UK Government’s welcome, but belated, reversal of the wholly unacceptable cut to personal independence payment that was announced in July last year. As a result, our overall additional investment in Scotland’s social security system is expected to fall from £1.8 billion to £1 billion by 2029-30, which is a 45 per cent reduction when compared with the June 2025 forecast.Meanwhile, the proportion of the overall resource budget that the Scottish Government has chosen to invest in Scotland’s social security system, over and above the funding that we receive from the UK Government through the block grant adjustment, will be around 1.7 per cent each year from 2026-27 to 2029-30. Compared with the position that was set out in the medium-term financial strategy in June last year, that is a reduction of 0.8 percentage points in 2026-27 and of 1.4 percentage points by 2029-30. The updated position as set out in the SFC forecast demonstrates very clearly, in my view, that our social security investment is sustainable and that we in the Government produce costed financial programmes that deliver real benefits for the people of Scotland.On adult disability payment, I must say that the proposals that were put forward last week by the Scottish Conservatives to overturn the eligibility criteria, which were unanimously approved by the Parliament, and to remove assistance from people with mental health conditions are wholly unacceptable, abhorrent and barbaric. I am also deeply concerned by the stigmatising rhetoric that we have heard about mental health, which completely ignores the fact that adult disability payment supports disabled people with the everyday tasks that many of us take for granted.Importantly, the latest Scottish Fiscal Commission forecast now shows a 70 per cent reduction in the additional investment that will be required for adult disability payment in 2029-30, over and above what is received in block grant adjustments. That means that the £770 million that was originally forecast by the Scottish Fiscal Commission in June 2025 is now reduced to £287 million.The causes of increased demand for disability benefits are analysed in a detailed report that was published last Thursday by the chief social policy adviser. The report sets out that the evidence that is currently available does not indicate that the conscious policy decisions that we have taken in Scotland to deliver a better system of disability benefits are the primary driver of increased spending. Instead, the report sets out that the two main contributors are rising ill health and the UK Government’s raising of the state pension age, which means that more people can get adult disability payment for longer in an ageing population.Equally significant, in my view, is the “Delivering dignity?” report that was published by the Resolution Foundation in December, which explicitly stated:“the introduction of ADP shows that improving the claimant experience is not at odds with keeping caseloads and costs under control”,and, contrary to much of the ill-informed commentary of the previous week, that“there is no evidence that ADP is a more leniently-awarded benefit than PIP”.A value-for-money Scottish social security safety net, which all of us might need at some point in our lives, is something that, in my view, the Parliament should be enormously proud of—I certainly am.I thank the convener again for the opportunity to take questions from the committee this morning.
In the same item of business
09:00
The Convener
SNP
Our next item of business is an evidence session with the Cabinet Secretary for Social Justice on the Scottish Government’s budget for 2026-27. I welcome Shi...
The Cabinet Secretary for Social Justice (Shirley-Anne Somerville)
SNP
Good morning. The 2026-27 budget invests funding of almost £68 billion to secure a fair, healthy, safe, prosperous and green society, to tackle the cost of l...
The Convener
SNP
Thank you very much, cabinet secretary. We will move straight to questions.
Marie McNair (Clydebank and Milngavie) (SNP)
SNP
Good morning. Audit Scotland recommends that the Scottish Government should have a clear strategy to manage risks to the Scottish budget that arise from UK G...
Shirley-Anne Somerville
SNP
There is no denying that the Scottish Government’s budget choices are impacted by our exposure to UK Government decisions. In my area, that is particularly r...
Marie McNair
SNP
It is challenging, but we are still managing to set a balanced budget every year. The U-turn on PIP gave us the Timms review. What influence are we having on...
Shirley-Anne Somerville
SNP
I welcome my on-going discussions with Stephen Timms; indeed, I spoke to him just yesterday about the work that the review is undertaking. It would be fair t...
Carol Mochan (South Scotland) (Lab)
Lab
Good morning. The Scottish budget increases Social Security Scotland’s fiscal resource budget by around £40 million. In addition, a response to a recent parl...
Shirley-Anne Somerville
SNP
I will bring in Stephen Kerr in a minute, because that issue has a direct impact on what has been happening in his directorate, with staff moving to the agen...
Stephen Kerr (Scottish Government)
Carol Mochan is right to say that the £40 million concerns more than just people. If you think about it as assets—
Carol Mochan
Lab
That is what I was trying to get at.
Stephen Kerr
We have a number of contracts in place. For example, our testing contract is worth around £10 million. When we are making changes and introducing new benefit...
Carol Mochan
Lab
That is helpful. You touched on the live running and digital development functions. The policy and delivery function within the Scottish Government has a bud...
Stephen Kerr
Yes. That is essentially the budget that I am left with at the end of the programme. Around half of that goes on core elements of the social security system ...
Carol Mochan
Lab
That is helpful—thank you.I have one final question at this point. The spending review sets out cumulative savings and efficiencies for Social Security Scotl...
Shirley-Anne Somerville
SNP
Public service reform and the savings that are set out in the spending review are important. The savings that are set across the spending review period apply...
Jeremy Balfour (Lothian) (Ind)
Ind
At our meeting on 22 January, David Wallace told the committee that Social Security Scotland can drive public service reform and efficiencies. He referred to...
Shirley-Anne Somerville
SNP
I will give some examples of how it has happened in the past. Some of it will be obvious and demonstrable, such as a change to automation of payments, for ex...
Jeremy Balfour
Ind
I have a couple of quick follow-up questions. First, you talked about free school meals, but could information be shared with local authorities in relation t...
Shirley-Anne Somerville
SNP
On the first point, we are in the foothills of how we can and should use data sharing in the future. A lot of work is going on in that area, not just in rela...
Julie Humphreys (Scottish Government)
It is important that we evaluate the impact of different policies across the tackling child poverty programme. As I have said to the committee previously, we...
Jeremy Balfour
Ind
That is helpful.I want to cover another area quickly. When do you intend to introduce regulations that will enable Social Security Scotland to estimate the l...
Shirley-Anne Somerville
SNP
That is an area that the committee discussed in great detail when it considered the Social Security (Amendment) (Scotland) Bill. From memory, the committee w...
Jeremy Balfour
Ind
Thank you.
Marie McNair
SNP
As we know, the Westminster Parliament debated the bill to remove the two-child limit from universal credit. It took a while to get to that stage, but we got...
Shirley-Anne Somerville
SNP
There will be an impact on the Scottish Government’s budget, because we will continue to mitigate, as far as we possibly can, the benefit cap in full. It is ...
Marie McNair
SNP
It is really important for DHPs to get to families who are impacted. Access to DHPs used to be through housing benefit, which meant that councils were clear ...
Shirley-Anne Somerville
SNP
It is a challenge. That is one of the reasons why, rather than the Scottish Government mitigating the effects of the benefit cap, it would be more effective ...
Marie McNair
SNP
We have received suggestions about how the money that is no longer needed for mitigation of the two-child limit should be spent. What are your thoughts on th...