UK

Scottish independence issues at-a-glance: Pensions and welfare

A pensioner holds his walking stick in September 2014 in Walsall Image copyright Getty Images

What powers does the Scottish Parliament currently have and how might they change with independence or further devolution?

This page summarises the implications of the referendum for pensions and welfare - one of seven different themes. The others are: The economy and currency,energy oil and gas, EU membership, citizenship and immigration, defence and broadcasting.

More in-depth analysis on pensions and welfare.


At present

MPs in Westminster set the levels of benefits in Scotland - including child benefit, pensions, tax credits and welfare payments.

They also regulate occupational pension schemes and personal pension schemes.


After a Yes vote

The Scottish government says a new approach is needed because too many Scottish people are "trapped in poverty and prevented from realising their full potential".

It has pledged to:

  • Increase state pensions by inflation, earnings or 2.5%, whichever is higher.
  • Increase the state pension age to 66 in 2020 (in line with the rest of the UK) but an independent commission would advise on any changes after that.
  • End housing benefit changes - what it calls the "bedroom tax" - within the first year of an independent Scottish Parliament and halt the rollout of the single, Universal Credit for the unemployed.
  • Continue free personal and nursing care and free bus passes for the elderly.
  • Increase the minimum wage in line with inflation and promote a "Scottish living wage".

After a No vote

Better Together says "with Scotland's population ageing faster than the rest of the United Kingdom", the costs should be spread across the UK.

A similar point is made about welfare, saying it should be allocated according to "need not nationality".

The Labour Party says:

Housing benefit and attendance allowance should be devolved. The basic state pension, the additional state pension, the contributory element of jobseeker's allowance, the contributory elements of employment and support allowance should remain reserved.

Tax receipts on oil should remain reserved, but a lower rate of fuel duty should be charged in remote rural areas of the Highlands and Islands. Westminster should work with islands councils to support the development of renewable energy resources and ensure grid connections improvements.

The Conservative Party says:

Responsibility for the state pension should remain with the UK. There is a case for devolving housing benefit and attendance allowance; additionally there is a case for conferring on the Scottish Parliament the power to supplement welfare benefits legislated for at UK level.

The Liberal Democrats say:

A single UK welfare and pensions system should be retained. The strategic planning of welfare services should be considered for joint working combined with a constitutional duty to tackle poverty.


The policies under independence are taken from the Scottish government's White Paper on independence. Yes Scotland and other Yes campaigners do not necessarily share these positions.

Where Better Together has a stance, this has been cited. The separate Labour, Conservative and Lib Dem proposals are taken from their respective reports on devolution.

Both sides' preferred policies would be subject to negotiations following the referendum.

The Scottish government has said that following a Yes vote, arrangements would be in place for full independence from 24 March 2016.

The Better Together campaign has said that following a No vote draft legislation on devolution would be introduced by the end of January 2015.