Income and employment: policy context

Current Scottish Government policy emphasises working to narrow inequalities and investing in life circumstances to improve health, building on the work of previous administrations. This is likely to be informed by the recent report by the Independent Advisor on Poverty and Inequality to the First Minister. 

The 2015 Economic Strategy argues that "creating a fairer society is not just a desirable goal in itself, but is essential to the sustained, long-term prosperity of the Scottish economy". Of particular relevance to public health is the priority given to promoting inclusive growth and creating opportunity through a fair and inclusive jobs market and regional cohesion.  The Fair Work Convention will report in 2015/16 on specific proposals to help ensure that work improves people’s lives.

Working for Growth: A Refresh of the Employability Framework for Scotland re-iterated the Scottish Government’s belief that “overcoming barriers to work remains at the heart of employability…from age and gender to skills, physical ability, and addiction”. To achieve this, they emphasise the need for greater integration between different parts of the employability sector, as well as between the economic development and employability sectors in Scotland.

The UK Government believes that tackling poverty among working-age families and their children requires radical reform of the welfare system. These policies, which aim to merge out-of-work and in-work benefits, impose stricter conditions on those receiving benefits and ensure "all amounts of work will be more financially rewarding than inactivity", are outlined in Universal Credit: welfare that works (1.7Mb).  In January 2016, the Institute for Fiscal Studies published an updated assessment on The (changing) effects of universal credit.

Under the Child Poverty Act 2010, both the UK and Scottish Government were legally required to substantially reduce Child Poverty.  However, in July the UK Government introduced legislation to make significant changes to the Child Poverty Act 2010, via the Welfare Reform & Work Bill.  The Child Poverty Act will be renamed the Life Chances Act and the UK Government will no longer be required to report on child poverty targets relating to relative low income, combined low income and material deprivation, absolute low income, and persistent poverty income targets.  They will instead be required to report on measures of worklessness for the whole UK and educational attainment (based on GCSEs) for England.  The UK Government has argued that this approach will more effectively improve inequalities in children’s life chances.

The Scottish Government does not support these changes, and has therefore secured amendments to the Welfare Reform & Work Bill to repeal all parts of the 2010 Act imposing any duty on Scottish Ministers.  The Scottish Government has committed to continuing to refine and develop a Scottish approach to tackling poverty, in collaboration with the existing Ministerial Advisory Group on Child Poverty, the Independent Advisor on Poverty and Inequality, and other key stakeholders.