Mitigation of the two-child cap
Options for delivery
Different options for the delivery of the mitigation payments have been considered by the Scottish Government. The Scottish Government’s priority is to make payments as soon as possible, given the immediate impacts that the two-child cap is having on peoples’ lives.
Within the framework of the eight core Scottish social security principles the Scottish Government have considered the following options for delivery:
- ‘at source’ by the Department for Work and Pensions (DWP) as part of the Universal Credit system
- by local authorities in a similar way to Discretionary Housing Payments (DHPs)
- by Social Security Scotland
The consultation paper sets out the benefits and disadvantages of each option.
The Scottish Government considers that the best way to achieve its urgent aim of reducing child poverty through mitigating the two-child cap in Scotland is to deliver a payment through Social Security Scotland.
You may wish to refer back to the consultation paper while answering the questions.
Benefits and disadvantages of each option
‘At source’ by the Department for Work and Pensions as part of the Universal Credit system
Benefits
- earnings limits would rise in line with the real size of a household, which would likely make some people who are currently not in receipt of Universal Credit eligible for payments
- the traumatic experiences suffered by many women as a result of the ‘rape clause’, which forces mothers to disclose painful past experiences to qualify for benefit, would no longer be necessary
Disadvantages
- would require the UK Government to introduce legislation and make system changes in order to remove the two-child cap from Universal Credit calculations for families in Scotland
- would depend on the UK Parliamentary process, as well as DWP’s timescales for making the necessary technical changes, which could mean slower progress toward delivering payments
By local authorities in a similar way to Discretionary Housing Payments (DHPs)
Benefits
- Local authorities already have experience of delivering the Scottish Government's mitigation of the UK Government 'benefit cap' using Discretionary Housing Payments, supporting around 3,400 families, with nearly 11,000 children
Disadvantages
- the existing Discretionary Housing Payment scheme was not designed for mitigation of the two-child cap
- it is currently legally limited to housing costs, which means that some families would be excluded from receiving the payment
- would put further pressure on local authorities’ resources
By Social Security Scotland
Benefits
- making payments through Social Security Scotland will allow for a consistent approach across Scotland
- the agency has a strong track record of delivery of payments at pace, such as the Scottish Child Payment
- the Scottish Government will retain more control of the implementation timetable
- the knowledge and experience built up by the Social Security Programme and Social Security Scotland can be utilised in order to build the necessary systems and administer the payments