Poverty and Inequality as measured by the Scottish National Performance Framework

Elke Heins, Lecturer in Social Policy, University of Edinburgh.

There can be little doubt about the Scottish Government taking the problems of poverty and inequality seriously. As recently as 9 October 2014, Finance Secretary John Swinney emphasised in his budget speech the aim to ‘deliver on the aspirations of the people of Scotland for a more prosperous and fairer Scotland’.

The commitment to a ‘flourishing’ Scotland through sustainable economic growth has been at the centre of the public policy agenda in Scotland since 2007 and is reflected in the National Performance Framework, also known as ‘Scotland Performs’. The framework provides a dashboard approach to assess progress towards the delivery of the Scottish Government’s overarching aim of ‘creating a more successful country, with opportunities for all to flourish through increasing sustainable economic growth’.

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This overall government purpose is supported by seven ‘High Level Targets’ of which two targets for solidarity and cohesion directly relate to concerns with poverty and inequality. It is furthermore underpinned by five ‘Strategic Objectives’ of which the objective for Scotland to become ‘Wealthier and Fairer’ is most closely related to anti-poverty policies. Progress towards these targets and objectives is, in turn, assessed by 16 ‘National Outcomes’ and 50 ‘National Indicators’. For example, the achievement of the solidarity target is measured by an increase in the proportion of income earned by the three lowest income deciles by 2017. A reduction in the proportion of individuals living in poverty (defined as individuals living in households with an equivalised income of less than 60% of the UK median before housing costs) is the most direct indicator to track the progress towards poverty reduction.

This multi-dimensional and outcomes-oriented Scottish framework signifies a departure from the traditional way of measuring development and social progress through the increase in ‘national wealth’ as measured by the much criticised GDP. This single-minded focus on GDP as the key figure for government performance has for long been substantively criticised as, among other things, it ignores the negative effects of economic growth on people’s lives and does not say anything about the distribution of any created wealth. Scotland is one of a number of countries where this criticism has led to the pioneering of alternative measures. These new approaches are closely related to the fashionable concept of ‘wellbeing’ that gained traction in recent years all over the world among policy makers, academics and practitioners. The concept recognises that national wellbeing has to be understood in a holistic way, not only including economic, but also social and environmental dimensions and the interrelationships between these.

While the attempt of the Scottish Government, supported by a number of NGOs such as Oxfam Scotland and the Carnegie Trust, to arrive at a more holistic understanding of what makes life worth living and what public policy should strive for is laudable, some concerns with ‘Scotland Performs’ remain. For example, with a particular focus on the strategic objective to achieve a Scotland that is ‘wealthier and fairer’ the following criticisms can be made:

  • Some indicators are too vague; e.g. the national indicator to ‘improve children services’ does not clarify whether this improvement refers to the availability of services, their quality or their affordability and accessibility. As comparative research has shown, all three of these dimensions do matter.
  • A distinction needs to be made between income and wealth as both matter for inequality and poverty, but the focus of the framework is only on the former.
  • There still is an emphasis on traditional economic growth measures throughout the framework. An increase in the number of businesses, for example, does not say anything about the quality of work in these businesses or the environmental impact of their activities. Indicators of decent work (such as the proportion of employers paying a living wage) or of sustainability (such as the proportion of public sector organisations and private enterprises engaging in greener practices) would need to replace indicators that count economic activity without any recognition of its potential harm on the environment, health or poverty.
  • There are no indicators about unemployment, yet we know it is critical to wellbeing and closely related to poverty.

It has to be noted that the Scottish Government is aware of some of the shortcomings with its framework and a revision is currently ongoing which is explicitly seeking suggestions for new indicators to improve the framework. Moreover, measuring national performance is only a first step to improve the quality of life in Scotland and the most perfect measuring tool becomes pointless if it is not followed by a readjustment of policy priorities and, in fact, a reform of the very way in which policy is made in order to deliver on the desired outcomes and ambitions.

Despite the above criticisms, by and large the Scottish Government is taking steps in the right direction because ‘what is measured is what matters’ (for policy makers). Highlighting the relevance of poverty and inequality through the inclusion in the National Performance Framework and its impact on wellbeing for the whole society is thus more than welcome. Ultimately, the turn towards more encompassing measures of wellbeing rather than a narrow focus on economic growth will hopefully contribute to overcoming the perception that ‘doing good’ is difficult to combine with ‘doing well’.

Dr Elke Heins is a Lecturer in Social Policy at the University of Edinburgh. This contribution is based on a Knowledge Exchange Seminar Series called GLADS – Good Lives and Decent Societies, funded by the Scottish Universities Institute in 2014.