Citizens Advice Scotland response to Work and Pensions Committee's Cost of Living Inquiry

The cost of living crisis is squeezing household finances across the country. Across the Citizens Advice network in Scotland, we’ve seen an uptick in advice need for energy bills, debt, and food bank referrals. Since September 2021:

• Advice need for food banks has grown by almost a third (31%)
• For other charitable support, including fuel bank referrals, advice need has increased by 23%
• Advice on Budgeting Advances has increased by 25% over 2021–22
• Advice on sanctions has grown by 53% since the start of 2021-22

While one-off payments will have provided some relief to people in the short-term, the further planned energy price cap increase in October and higher energy needs in winter mean that the cost of living crisis is unlikely to end in the next few months. Long-term thinking is needed to ensure our social security system is accessible to everyone and offers the right level of support for today’s skyrocketing prices.

CAS recommends:

• An immediate uprating of Universal Credit’s basic allowance to present inflation rates and the implementation of a more responsive system to keep track with inflation.
• Further emergency targeted support for those on the lowest incomes.
• A continuous review of the adequacy of social security payments to ensure they meet everyone’s needs.
• Scrapping the benefit cap and the two-child limit.
• Ensuring any uprating of Universal Credit is extended to all legacy benefits.
• Reduce all deductions for DWP and HMRC debt to the 5% minimum until the DWP’s debt recovery process can be replaced with a revised system based on a robust holistic affordability check that better reflects people’s ability to pay, such as the Common Financial Statement.
• Writing-off historic Tax Credit debt and other historic benefit overpayment debt.
• Abolishing the five week wait by introducing a non-repayable assessment period grant at the beginning of all UC claims.
• Suspending the use of sanctions until the cost of living crisis is over.
• Automating where possible the process for claiming the State Retirement Pension and Pension Credit.
• Developing and publishing an uptake strategy for the DWP to increase claims for pension-age support.