Introduction – Equality and the Draft Budget
Equality is at the heart of this Draft Budget’s ambitions for a prosperous and fairer Scotland. It is key to how we meet the challenges and seize the opportunities that will allow us to thrive in the 21st Century.
The Draft Budget has been accompanied by an Equality Budget Statement ( EBS) for the last nine years. Many aspects of the EBS process are acknowledged as world-leading, including the involvement of an expert advisory group; coverage of a range of protected characteristics; the integration of equality assessment into the process of setting a Draft Budget; and publication on the same day as the Draft Budget.
It is important to note, however, that the EBS is not the start of the process. Equality assessment takes place throughout the year, helping us make the best decisions about how to target government resources. It ensures that we understand the impacts of policy and spending decisions on equality outcomes and highlights any impacts that appear to be negative. In many cases, a negative assessment at an early stage in the policy or budget process will mean that particular proposals are not taken any further and do not appear in the Draft Budget. This is one of the, perhaps less recognised, benefits of equality processes within the Scottish Government.
This introductory chapter sets out the strategic context for equality from events this year. It then outlines the EBS recommendations of the Scottish Parliament’s Budget Process Review Group, and concludes by summarising new and proposed improvements to the evidence base.
Strategic Budget Context
Continued leadership in approach – At the beginning of this parliamentary term, the First Minister set out a commitment to equality of opportunity and tackling inequalities. This message has been repeated through various engagements and was further reinforced with the ‘Programme for Government’ published in September 2017. This Draft Budget invests in the development of a strong, innovative, inclusive economy combined with the provision of high quality universal services and progressive taxation which together represents a strong social contract between this government and the people of Scotland. This social contract supports the economy of Scotland, reduces inequality and boosts intergenerational fairness. It also gives everyone a stake in our public services and economy.
Responding to slow UK economic growth and austerity – The UK Government’s commitment to austerity and the sluggish growth of the UK economy makes these challenging times, but this Draft Budget supports Scotland to be more positive and to seize future opportunities. It invests in physical and digital infrastructure, it invests in innovation and a competitive business environment and it invests in public services. But, with equal importance, through its social contract, it invests in people. It demonstrates our understanding that sustainable economic growth and prosperity for all can best be achieved by removing barriers to full participation and harnessing the entrepreneurship, diversity, creativity, productivity and skills of all of Scottish society.
Developing a fairer tax system – We recognise the pressure that household incomes are under and aim to continue to make the tax system a fairer, more progressive one: protecting those on the lowest incomes and reducing inequalities. Early this year, we produced a discussion paper ‘The role of income tax in Scotland’s budget’ to inform the debate on the future use of the income tax powers devolved to the Scottish Parliament. The paper covers matters such as the extent of our income tax powers, how the Scottish Government’s final budget is set, the current make-up of income taxpayers in Scotland, the interaction with reserved areas of policy making and some international comparisons. It also set out the impact of various tax policy choices across the income distribution, providing further evidence to support tax decisions.
Responding to Brexit – In response to the negotiations on Brexit and the high Remain vote within Scotland, the Scottish Government published its White Paper ‘Scotland’s Place in Europe’. This explored how to find common ground around a solution that would protect Scotland’s place in the European Single Market from within the UK. Key within Scotland’s approach to Brexit is our continued commitment to the spirit of the core values of respect and dignity, of fostering community cohesion and welcoming and protecting the past and future contribution of EU nationals to Scotland.
Responding to poverty and UK welfare reforms – Further welfare reforms have further entrenched households in poverty in Scotland. The Institute of Fiscal Studies estimated in November 2017 that income inequality would grow over the next four years in the UK and that planned welfare reforms would contribute to rising poverty with absolute child poverty in the UK projected to rise by around four percentage points. Against this backdrop, the Scottish Government has prioritised spend to mitigate some of the worst impacts of welfare reform and has passed the new Child Poverty (Scotland) Act 2017, setting very ambitious targets to reduce child poverty by 2030.
Protecting public services – A healthy, safe and secure population is a vital component of a successful country which requires the provision of first-class public services. This Draft Budget delivers over £430 million of funding to the NHS in Scotland across a range of public services, providing a real terms uplift as part of our commitment to increase health funding by £2 billion over the life of this parliament. It also increases investment in education through the expansion of early learning and childcare, educational attainment funding and investment in colleges, universities and skills agencies. It also provides real-terms protection for the resource budget of the Scottish Police Authority and a fair settlement for local authorities.
Delivering new powers – As the EBS describes in detail, Fair Start Scotland is part of our response to devolved powers on employability. The approach has built in diversity from the start and has developed specific programmes and help informed by the range of protected characteristics. The transfer of social security powers is also on track with experience panels, comprising of people with past experience of the range of transferring benefits, already helping to shape the new system.
Strategic Equality Context
Supporting human rights – The Scottish Government’s overarching vision is of a Scotland where every member of society is able to live with human dignity. The Scottish Government recognises that equality, social justice and inclusive growth are interconnected, and that action to give effect to international human rights treaties requires concerted action to promote genuine equality of opportunity and esteem for all.
Introducing a Fairer Scotland Duty – During 2017, Scotland became the first part of the UK to introduce the socio-economic duty; now called the Fairer Scotland Duty. This duty asks public authorities, including the Scottish Government, to do more to tackle inequality of outcome caused by socio-economic disadvantage. The case for introducing the socio-economic duty was compelling. The public sector already does a lot of important work on poverty and inequality, but the scale of the challenge is huge. Over a million people are living in poverty in Scotland, including one in four children. Public bodies are generally fully supportive of this action. However, we understand and recognise the concerns of some equality stakeholders that efforts to concentrate on socio-economic inequality may actually reduce the emphasis placed on protected characteristics. We will ensure that guidance for public bodies clearly sets out that the Fairer Scotland Duty is additional and in no way replaces the requirements of the Public Sector Equality Duty. We will also consider carefully the relationship between the Fairer Scotland Duty and equality assessments of Scottish budgets.
Supporting children and young people – As we move into the Year of Young People in 2018, this Draft Budget sets out many programmes to improve the outcomes for children and young people. Early learning and childcare remains a significant infrastructure investment programme with funding identified for the expansion of free childcare. Likewise, educational budget priorities aim to reduce the attainment gap and widen access to higher education for young people. This carries forward into improved opportunities for paid employment through apprenticeships and additional help with travel and housing.
Promoting LGBTI rights – Scotland is considered to be one of the most progressive countries in Europe regarding LGBTI equality and has a very clear position on promoting LGBTI rights. This was abundantly clear when the Historical Sexual Offences (Pardons and Disregards) (Scotland) Bill was introduced in the Scottish Parliament on 7 November with a public apology from the First Minister for the wrongs committed by the State against people convicted of same sex sexual activity which is now legal. This was followed on 9 November with the launch of a consultation on the reform of gender recognition legislation to establish whether Scotland ought to adopt a new streamlined administrative process for legal gender recognition and to legally recognise non-binary people.
Improving disability, gender and race equality – Although Scotland takes a mainstreamed approach to the protected characteristics, there is often a justifiable reason to develop specific programmes and plans of action to tackle inequality. The increased budget will support strategic work to advance equality and help communities most impacted by discrimination and disadvantage. Specifically, in 2017 the Scottish Government published ‘A Fairer Scotland for Disabled People’ which set out clear action and targets to progress equality for disabled people. Likewise, we appointed an independent adviser to spearhead further efforts to tackle racism and to take forward the recommendations set out in the ‘Race Equality Framework’. The development of the ‘ BSL National Plan’ following the introduction of the BSL (Scotland) Act 2015 brought the experience of citizens whose first or preferred language is British Sign Language ( BSL) into sharp focus. We also established an Advisory Council on Women and Girls to act as a catalyst for change on gender equality.
Welcoming refugees and promoting community cohesion – Scotland has taken a strong stance on accepting and welcoming refugees with almost 2,000 Syrian refugees resettled since October 2015, reflecting Scotland’s role as a good global citizen and recognising the value and richness that comes from diverse communities.
Responding To The New Budget Processes
During 2017, the Scottish Parliament established an independent review group – the Budget Process Review Group ( BPRG) – to carry out a fundamental review of the budget process following the devolution of further powers. The BPRG produced a final report in June 2017 which recommended that the Scottish Government and public bodies strengthen their scrutiny, performance planning and reporting to provide greater focus on the delivery of outcomes. The Scottish Government has welcomed the report recommendations although notes that some will take time to fully develop. This is particularly true for the recommendations around equality assessment.
The BPRG welcomed and supported the approach to equality analysis taken by the Scottish Government, agreeing that the EBS and associated processes provided a good foundation to build on. However, they did recommend some specific changes including that:
- The equality dimensions of the budget should become an even greater priority and that there should be a plan in place over time to further develop the performance evidence base by protected characteristic.
- There should be further attempts to work towards a cycle of ex-ante (impact and budget baseline analysis), concurrent (performance setting and resource allocation) and ex-post (audit) equality scrutiny of the budget process as recommended by the OECD.
- That the Scottish Government should explore methodologies for developing distributional analysis of the budget by income group and/or protected characteristic.
The Scottish Government already undertakes work in some of these areas. For example, ex-ante equality scrutiny is performed through equality impact assessments and the EBS; concurrent activity is undertaken through the National Performance Framework and other measurement frameworks, and distributional analysis was undertaken by income group in the recent tax discussion paper. However, there is still room for improvement.
The Scottish Government will be working with EBAG over the next 12 months to consider these recommendations and to decide what further analysis is feasible given available data, methodologies and resources.
The Equality Budget Advisory Group
The Equality Budget Advisory Group ( EBAG) has supported the Scottish Government’s efforts to bring equality considerations into budget preparations since the early years of devolution. During 2017, EBAG was represented on the BPRG, discussing the implications of proposed changes on the equality assessment of the Draft Budget. Over the next year, they have been tasked with working with the Scottish Government to improve equality assessment and identify the range of products that could be provided by the government over time.
The work of EBAG remains extremely helpful to the Scottish Government in setting out its equality statement, and we remain grateful to its members for their challenge, time and insight.
Improving Equality Evidence
During 2017 we have continued to develop equality evidence to allow better analysis of impacts. ‘Scottish Surveys Core Questions’, an annual Official Statistics publication for Scotland, can now provide analysis by country of birth, ethnicity, sexual orientation, religion, age, sex, marital status as well as other variables including education level, economic activity, tenure and household type. From 2018, the core questions will also include a new gender identity question which will provide an alternative option for people with a non-binary gender identity. Core questions data is invaluable in providing evidence around some of the protected characteristics where samples are smaller. For example, in January 2017 we published an analysis of sexual orientation in Scotland based on these core questions. 
In June 2017, the Scottish Government published ‘Scotland’s Equality Evidence Strategy’.  This strategy was produced following discussions with policy officials, stakeholders and academics aiming to identify the key research and evidence gaps for each protected characteristic. The strategy set out the types of things we will consider when prioritising research gaps, such as whether data could contribute to the National Performance Framework or would have clear policy relevance. We also set out that we are not responsible for all the evidence gaps. All public bodies have a duty through the Public Sector Equality Duty to monitor the impact of their work as employers, service providers and partners on the different protected characteristics. The more that can be done to share that information, the better the overall data becomes. This strategy should be seen as the start of a discussion on improving equality data with and for ourselves and partners.
In October 2017, the Scottish Government published a draft discussion paper on the gender index; a commitment of the ‘Fairer Scotland Action Plan’. Despite significant analytical work, it proved impossible to replicate the methodology used in the European Gender Index ( EIGE) and, as a result, a technical discussion paper was produced.  Based on this initial paper, stakeholders have agreed that even without international comparisons, the gender index remains a priority and a stakeholder working group will be formed in 2018 to take forward work in this area.
In 2017 we also developed data around older people in employment. Research identified barriers and potential assistance to help older people to continue working into official retirement, helping many to maintain income and good health and wellbeing. This report was launched with employers and has been presented to the Strategic Labour Board comprising of the Minister for Employability and Training, senior academics and key industry representatives.
During 2017, to help provide evidence to support the Child Poverty Bill and to understand the impact of welfare changes, a number of reports were published by Scottish Government analysts. These included a package of statistics and reports on child and other household poverty  as well as detailed papers on the impact of welfare reforms on children  and disabled people. 
The ‘Equality Evidence Finder’  brings together evidence on the protected characteristics in one portal and is updated on a regular basis. Qualitative data will increasingly be used to populate the finder when quantitative data is not available, particularly to provide more detail about intersectionalities.
Intersectionality And The Budget
Intersectionality is the term generally used to refer to combinations of protected characteristics – for example older disabled men, younger Muslim women, or disabled transgender people. It makes clear that as human beings, we all reflect multiple combinations of the protected characteristics. These combinations can shape how we access and experience services, as well as how we experience society. Although there is some reference to intersectionality across the EBS, the evidence base on the range of intersections remains patchy or anecdotal.
It is widely acknowledged that it can be challenging to evidence impacts on particular intersections of protected characteristics because of low population numbers and the sheer number of different variations. In many cases, it is not possible to derive statistically robust data, and other types of information and evidence are needed to understand how people experience services and society. The recent British Sign Language ( BSL) consultation provided BSL people of all ages and genders the opportunity to talk about the issues they face daily. Likewise, a consultation run by third sector stakeholders with refugees in Scotland attempted to identify key barriers that they face including by age, gender and ethnicity. This type of consultation is not statistically representative, but where samples are small and populations less likely to be heard, then consultation and better understanding of lived experience can still provide valuable evidence to inform appropriate policy.
In this way, intersectionality requires government and public services to think more creatively about how to understand issues and about what is provided, how, and to whom. Simply making a service accessible to disabled people might not address the specific needs disabled women have. Equally, opening up a service for lesbian, gay and bisexual ( LGB) people does not automatically mean that minority ethnic LGB people, for example, will use it. Policy makers, funders and service providers need to think harder and smarter about the range of protected characteristics users (and staff) have if they ultimately want to have a successful policy, funding stream or service.
About The EBS 2018-19
The first substantive chapter in the EBS provides an overview of impacts by the equality protected characteristics established in the Equality Act 2010.
A thematic chapter on inclusive growth follows to explain in more detail the Scottish Government’s approach to this critical issue.
The remainder of the EBS document is taken up with a summary chapter for each Ministerial portfolio, e.g. Health and Sport; Education and Skills, allowing a more detailed exploration of these issues.