A little more on devolving benefits

Reports in the Scotsman (on p 20) and the Herald both refer to my last blog entry.  For the record, I didn’t say that the draft clauses in the White Paper are all gobbledegook – I was referring to a specific, mis-worded paragraph.

I’ve been challenged about the basic argument, so I think I ought to say a little more about it.  What the White Paper is trying to do in this section is to impose new rules to regulate the interactions between benefits and taxation.  The argument may seem fair at first: it’s that we can’t have  arrangements whereby the policies of one government take away money if another government puts it in.  The problem is that benefits and services interact in many ways, and this is going to happen unavoidably.  If older people go into hospital, some benefits are suspended: does that mean that the national benefits system should compensate the Scottish health service? If someone gets placed by employment provision and support, the benefits bill falls: should there be a transfer of resources from the UK to Scotland to pay for it? Would the converse apply if Scotland’s responsibilities for unemployment were to be relieved by a better UK macroeconomic policy?  And if people have JSA or ESA suspended, they are likely to make demands on local support services: should the DWP refund the local authorities and the Scottish Welfare Fund?  If we follow through the rationale in the White Paper, every interaction of the sort should be matched by a compensatory transfer.  The principle is unworkable, and that raises questions as to whether it’s reasonable. It seems to me that it’s an attempt to qualify the force of devolution, and to make it harder to vary the terms of benefits.



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