Chapter 2: Function to Prepare Forecasts of Devolved Social Security Expenditure
20. The Fiscal Framework agreement provides that the Commission will prepare independent forecasts of Scottish demand-driven social security spending.
21. Work to enable the Scottish Parliament to start legislating on social security and employability as provided for in the Scotland Act 2016 is currently underway. The powers will include control over certain aspects of housing related benefits, Disability Living Allowance, Personal Independence Payment, Attendance Allowance and Carer's Allowance.
22. The Scottish Government may choose to phase the process of implementing these new powers over a number of years, including bringing forward the necessary legislation. More detail on the timings of devolution can be found at: http://news.scotland.gov.uk/News/Transfer-of-new-powers-26e4.aspx.
23. The proposed regulations on which we are seeking views would add to section 2(2) of the SFC Act a function and a duty requiring the Commission to produce forecasts of demand led social security expenditure. The forecast would need to cover a five-year period, and would have to be produced at the same time as the devolved tax forecasts. This means that forecasts would be provided twice a year - once in sufficient time for the Scottish Ministers to formulate the draft budget and the other in time for the Scottish Parliament to use forecasts to support scrutiny of the Budget Bill for that year.
24. The proposed Regulations (see Annex A) provides an update to section 3 of the Act, defining "demand led social security expenditure". In the interests of efficiency, this drafting captures in full the requirement for the Commission to produce demand led social security expenditure forecasts. This means that further legislation does not need to be laid as each of the new social security powers take effect in Scotland. The function should therefore be "future proofed" should there be further devolution of social security powers in due course.
Question 2: Do you agree with the approach of adding a social security forecasting function to section 2(2) of the Scottish Fiscal Commission Act 2016 as outlined in this consultation and in Annex A?
Question 3: Do you agree that the wording of the regulations will avoid Scottish Ministers having to make further changes to the Scottish Fiscal Commission Act 2016 as and when the new social security powers take effect? If not, what alternative approach would you suggest?