A £290 million package of support for people affected by the soaring cost of living crisis has been announced by the Scottish Government, including £150 council tax rebates for eligible households.
How it works
All households in bands A to D will receive a £150 payment or discount from their council tax bill, as will those in other bands who already qualify for reduced rates.
Finance Secretary Kate Forbes said it means 73% of Scottish households – about 1.85 million people – would receive the money.
The money will either be given as a direct payment by local authorities or used as credit towards council tax bills, Forbes explained.
Scots can find their council tax band using the online tool on the Scottish Assessors' website here.
"Imperfect scheme"
The Finance Secretary admitted it is an “imperfect scheme” and does not go far enough to support those hit by rising energy bills.
“In terms of the challenges that we face right now, I think the measures that we have outlined will only go so far,” she said.
Opening the stage three debate of the Scottish Budget, Forbes estimated that the energy price cap rise of almost £700 “could move a further 211,000 households into fuel poverty, and around 235,000 households who were already fuel poor into extreme fuel poverty”.
Announcing the financial support measures, she said: “Firstly, we will provide £150 to every household in receipt of council tax reduction in all council tax bands.
“The council tax reduction scheme already identifies households in greatest need and will allow us to target this intervention.
“Secondly, I will provide local authorities with funding to pass on £150 to other occupied households in bands A to D in Scotland.”
What else did she announce?
The Finance Secretary also announced an additional £10m for the Fuel Insecurity Fund “to help households at risk of self-disconnection, or self-rationing their energy use, due to unaffordable fuel costs”.
Explaining her decision, Forbes said: “This is clearly an imperfect scheme.
“It will reach some households who may not need this, but it is the only route we have to make sure we reach those for whom it will make a difference, quickly and simply.
“I know that the cost of living crisis is affecting households who are not in receipt of benefits, who are not claiming a council tax reduction. And they are facing hardship too.
“We must seek to do what we can to prevent those households and families on the edge of the poverty line from falling over it.”
Councils will be allowed to carry forward any underspends in the Discretionary Housing Payment and the Scottish Welfare Fund into the next financial year, Forbes said.
What have charities said?
The Joseph Rowntree Foundation (JRF) and the Poverty Alliance said more support should have been targeted towards low-income households.
Peter Kelly, director of the Poverty Alliance, said: “People across Scotland are feeling the grip of poverty tighten on their lives, as the cost of living crisis continues to bite.
“So it was deeply disappointing that Kate Forbes’s announcement today mirrored the UK Government’s misguided approach to the cost of living crisis.
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“While any additional cash into people’s pockets is welcome, the measures fail to properly target support at people on the lowest incomes.
“This was a missed opportunity to protect people living in poverty from the waves of hardship that threaten to overwhelm them, and a missed opportunity to right the wrong approach taken by the UK Government.”
Meanwhile, Citizens Advice Scotland said it has seen “soaring demand for energy advice”.
Chief executive Derek Mitchell said: “Further support for people struggling is certainly welcome, however the stark reality is that lots of people are still going to be significantly worse off.
“The spring is going to see a cost of living crisis which will squeeze household budgets to breaking point.
“People are already struggling badly, with one in three of us finding bills unaffordable right now, and half a million people in Scotland cutting back on food to deal with bills.”
Forbes addressed criticism from the charities at a later point in the Holyrood debate on Thursday.
She told the Chamber: “If we had the full levers of a social security system or tax system I think we could do a far more targeted approach.
“But the approach that we’ve taken ensures that families get help quicker rather than later.”
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