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How a £25 payment is turning Scotland into a European pioneer in reducing child deprivation

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For Bonnie Quinn, a cash payment of £25 a week has proved to be a lifeline during the UK’s cost of living crisis.

A single mother from Polbeth, south west of Edinburgh, the Scottish child payment has enabled her to afford packed lunches for her son, who rejects school meals because of his autism, and travel to her job as a catering assistant.

“[It] has really helped just for me to be able to get to work and make sure that my little boy had everything when I was at work,” Quinn said of the government assistance she has received since 2021. “It has definitely been a lifesaver.”

Supporters of the programme say the money is reducing deprivation among Scottish children to levels below the rest of the UK. They also say the initiative could act as a model for cash disbursements in combating poverty globally.

But few people outside of Scotland are aware of the “bold policy intervention”, said Liz Ditchburn, an honorary professor at the Adam Smith Business School at Glasgow university and a former civil servant who held senior positions with the Scottish and UK governments.

“I’ve lost track of the number of times I’ve mentioned the Scottish child payment to colleagues and friends based elsewhere in the UK . . . and been told they’ve never heard of it,” she wrote in a blog posted by the David Hume Institute, a think-tank.

Quinn’s six-year-old son is one of 316,000 children who have benefited from the payment, which Edinburgh said has helped to lift about 90,000 youngsters out of poverty this year.

Paid in addition to other welfare benefits received by families with children under 16 years, the payment means a four-child family is entitled to £5,200 a year that is not available to peers in England.

Each child aged under 16 in Scotland is entitled to £25 a week on top of a “qualifying” welfare benefit, such as universal credit or income support.

The child payment was introduced in 2021 at £10 a week per child, and is one of seven welfare benefits specific to Scotland. It was raised to £20 in April 2022 and to £25 in November.

Supporters of Scottish independence believe its success is an example of how the country could do things differently if it broke with the UK.

Evidence that the payment, which will cost the government £405mn in 2023-24, according to official estimates, is cutting poverty could boost the chances of the crisis-hit Scottish National party at the by-election this week in Rutherglen and Hamilton West.

Morag Treanor: ‘This is a game-changer for Scotland’ © Jeremy Sutton-Hibbert/FT

“Levels of child poverty in Scotland will drop faster [and] further than they will in the rest of the UK, particularly England, because of this payment,” said Morag Treanor, professor at Glasgow university and former deputy chair of a government commission on inequality and poverty. “This is a game-changer for Scotland.”

But some campaigners and charities have said Scotland’s first minister Humza Yousaf is not doing enough to meet his poverty-reduction pledges.

Magic Breakfast, a group that provides breakfast clubs, criticised Yousaf’s government for not implementing a pledge, made in 2020, to provide free morning meals to all primary school children.

Meanwhile, Child Poverty Action Group said the child payment needed to increase to at least £40 for Scotland to meet its interim child poverty target.

Scotland’s child poverty rates were 6 percentage points lower than the rest of the UK in 2019-2022, according to the Scottish government.

Data from the Welsh government showed that England had the highest child poverty rate in 2020-22 at 31 per cent, compared with 24 per cent in Scotland and 28 per cent in Wales. Northern Ireland’s rate was 22 per cent.

This divergence is expected to widen further due to the child payments and other Scotland-specific welfare policies, according to Edinburgh.

In the US, the child tax credit, a similar scheme that was part of the Biden administration’s pandemic response, was welcomed by policy experts.

Introduced in July 2021, the monthly direct payment of up to $300 per month a child, was hailed by analysts as a remarkable success that kept almost 4mn children out of poverty, according to Columbia University research.

But despite support for the programme, opinion over whether it should be made permanent was divided and it was ultimately scrapped.

Meanwhile, the UK government has been criticised over its cap on welfare support payment for children, which restricts tax credit and universal credit to the first two children in a family. There is currently no direct cash payment for children in England equivalent to the Scottish scheme.

The UK government highlighted that: “Since 2010, 400,000 children have been lifted out of absolute poverty after housing costs. Around 7mn families across the UK, including Scotland, receive child benefit payments.”

The devolved government in Edinburgh has a target to reduce the number of children living in families in relative poverty, defined as those whose income is below 60 per cent of the UK median, to fewer than 18 per cent in 2023-24, from 24 per cent. For 2030, the target is less than 10 per cent.

While Edinburgh expects to miss its target next year, with the poverty rate falling to 19 per cent, it estimated the figure would stand at 28 per cent without its policy interventions.

Danny Dorling, a professor of geography at Oxford university, said the child payment would lower the Gini coefficient, a statistical measure of inequality, for children in Scotland to 0.25 this year, from 0.33 before the support was increased to £25 in November.

“This might not sound like a large shift, but it moves Scotland from being one of the most unequal places to live in Europe for a child to being one of the most equal — in just 12 months,” he said.

The SNP hope that the policy will improve perceptions of its competence after 16 years in office, and a recent crisis linked to an ongoing police investigation into its finances.

Ahead of the by-election on October 5, Yousaf said policies such as the child payment should make the SNP the “first choice for families”.

However, the message is not necessarily getting through to the electorate. A recent Ipsos survey showed that 48 per cent of voters believed the SNP was doing a “bad job” of improving the living standards of those with low incomes, with just 25 per cent approving.

The party, faced with a stagnant economy and a budget deficit that was at 9 per cent of gross domestic product in 2022-23, could find it hard to satisfy its critics.

Letter in response to this article:

Remember, UK taxes pay for Scots policy innovation / From Paul McIntyre, London N19, UK

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