A poverty gap is opening between England and Scotland, in particular in child poverty rates, according to a new report by the Joseph Rowntree Foundation. In its annual report: “UK Poverty 2023: The essential guide to understanding poverty in the UK”, the charity reports that rates of child poverty are diverging between the two countries.
The report found that Scotland has a lower rate of overall poverty (18 percent) than England (22 percent) and Wales (24 percent), partly because of lower housing costs. Scotland has seen the largest fall in poverty of any area in the UK – six percentage points below where it was 20 years ago. The report praised the Scottish Government’s move to limit rent increases, and the Scottish Child Payment scheme, whereby poorer households receive £25 a week for each child under 16.
Child poverty rate in Scotland comparable to the south of England
Child poverty in Scotland is amongst the lowest in the UK, at a similar level to the south of England, the report says. Across other areas of the UK, hard-won reductions in child poverty are “unravelling”, with child poverty in North East England up 12%.
The report said: “Divergence in policy across nations will probably drive greater disparity in poverty rates. Scotland has taken decisive action in defining child poverty targets in legislation and enhancing the benefits system with a Scottish child payment for those receiving qualifying benefits; this was introduced in February 2021 at £10 a week per child under the age of six; the value doubled in April 2022 to £20 a child and increased again in November 2022 to £25 when it was also rolled out to all eligible children under 16. In response to both the pandemic and cost of living crisis, both Scotland and Northern Ireland have taken steps to limit rent increases for social renters, while the Scottish Government is introducing more protections for private renters including greater rent controls and eviction bans.”
The Council Tax Reduction scheme is also unique to Scotland and helps people on low incomes save an average of £750 a year on their council tax bill. Those eligible can also save up to 35 percent on their water and waste charges.
The “rape clause” is driving more and more children into poverty in England
The Scottish Government mitigates the UK Government’s ‘rape clause’ which says that a low-income family can only get benefits for two children – unless they can prove that a subsequent child was the result of rape. The Scottish Government spends over £1.4 billion each year to mitigate this and other UK welfare benefit cuts.
The JRT report does not provide separate numbers for large-family poverty in Scotland and England. But it said that almost half of children in large families in the UK are now in poverty, up from 33% a decade ago. The JRT says that this two-child limit is increasingly important in driving up rates of child poverty in larger families.
The report said: “The latest data still does not show the full effect of the two-child limit policy, which explicitly targets larger families. This has withdrawn means-tested support from third and subsequent children born since April 2017. In the latest data, more than half of families containing three or more children have their youngest child born before this date so are unaffected by the benefits cap. As time goes on, more and more families will be affected by this and poverty rates in larger families are therefore likely to increase further.”
Poverty still a huge and growing issue – as Brexit shrinks the UK economy
Although it is worse in England, poverty is a serious and growing issue for too many families across Scotland. Brexit is turning the UK into the sick man of Europe and the economy is shrinking. An independent Scotland back in the EU could emulate Ireland’s growth rate – it grew more than 12% in 2022, compared to 4% for the UK – and fund better pensions and measures to support families.
The cost of energy bills in Scotland is also in part due to the UK Government’s ideological decisions over how to tax oil and gas and their choices over privatisation of important infrastructure such as the national power grid. The JRT research doesn’t yet reveal the effect of the energy crisis on low-income Scots – currently paying the highest bills in the UK despite living in an energy-rich country.
Conclusion – an independent Scotland could do better
This report shows the result of the political and ideological choices of a UK Government that Scotland didn’t vote for. A cruel policy to limit benefits to two children in a family forces many into deep poverty. The Scottish Government has to spend too much of its fixed budget on mitigating these choices.
An independent Scotland back in Europe and with full control of its huge energy resources would have much more power to change the current political landscape and emulate other small European countries where relative poverty is much lower.