Published on 8 November 2024
Following a bulge in claims, recent figures suggest new disability benefits may not pose as big a cost to the Scottish Budget 2024 as first feared
Disability benefits and Scotland’s reforms
In the UK, disability benefits are available to those whose poor health or disability is deemed to result in them facing additional costs of living. These benefits are not means-tested, meaning that people with any level of household income can receive them, nor are they linked to whether or not the claimant is in or is able to do paid work. Personal independence payment (PIP) is the main working-age disability benefit in England and Wales.1
In 2022, following devolution of disability benefits to Scotland, the Scottish Government introduced a new benefit to replace PIP.2 Adult disability payment (ADP) has the same eligibility criteria and pays the same rates as PIP but is designed to be easier to apply for and, if a claim is successful, to get renewed at the end of the award. There are telephone and online services offering advice and guidance for potential applicants and a take-up strategy has been outlined to raise awareness. ADP applications can be made online or face-to-face, whereas most PIP applicants must make a telephone or paper-based application. When assessing applications, ADP staff collect supporting information where necessary, rather than requiring applicants to supply documents such as a confirmation of diagnosis or a letter from a support worker. While PIP applicants usually have to undergo a medical assessment, ADP only uses consultations where necessary, and these may take place either on the phone, online or face-to-face upon request. Finally, recipients of ADP have their eligibility reviewed less frequently, and these reviews are ‘lighter touch’, than those PIP recipients are subjected to.3
As a result of these changes, the introduction of ADP has been expected to increase the number of recipients compared with if Scotland had retained the PIP system. The funding Scotland receives from the UK government each year for disability benefits (known as the block grant adjustment, or BGA) is adjusted based on the change in spending per capita in England and Wales. Any additional spending in Scotland that outstrips the BGA funding must be covered by the Scottish Government from its general budget. Therefore, increases in disability benefit spending beyond those in England and Wales would either require reduced spending elsewhere or higher taxes (conversely, if disability benefit spending in Scotland is lower than the BGA, the difference can be used to finance higher spending elsewhere or lower taxes).
Working-age disability benefits have been the subject of considerable attention recently due to the rapid rise in caseloads and spending since the pandemic.4 Here we update the analysis in chapter 3 of the IFS Scottish Budget Report 2024–25 (Boileau et al., 2024), exploring how trends in these benefits have differed in Scotland compared with in England and Wales, the potential impact of the ADP reform, and the implications for the upcoming Scottish Budget.
Full report – ifs.org.uk/articles/what-has-happened-disability-benefits-scotland-update
