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Background Information of Change in Scotland Contents 1.Purpose of the analysis 2.Definitions and terms 3.Inequality and the economy 4.Income and wealth inequality 5.Poverty 6.Health 7.Education 8.Social inclusion 9.Crime and justice 10.Human Rights 2

The aim of this document is to provide a range of information to support discussions about how Scotland is changing, and what sort of country we would like to live in. The material seeks to: Define key concepts Provide a brief overview of the progress that is already being made in Scotland; and Outline some of the key challenges we face in tackling inequalities to help you and your group think about how we might change to make things better The information is intended to support conversations about priorities and responses. Through these facilitated conversations we are seeking to build a shared view about how we might collectively act to create a Fairer Scotland. Further information is available on the Social Justice website at Purpose of the analysis 3

Social justice: an umbrella term referring to a commitment to tackling poverty, disadvantage and inequality - and to promoting and furthering equality. It is concerned with the distribution of wealth and opportunities in society, and involves working to create the conditions for everyone to succeed in life. Equality: ensuring that every individual has an equal opportunity to make the most of their lives and believing that no one should have poorer life chances because of who they are, where they were born, what they believe, or whether they have a disability. Human Rights: the wider set of fundamental rights to which everyone in society is entitled. Human rights are not just about things like privacy or freedom of expression. They also include economic and social rights – like decent housing, an adequate standard of living or the best attainable standard of physical and mental health. Achieving social justice requires public authorities to meet established human rights obligations. 2. Definitions and terms 4

Inclusive growth: growth that combines increased prosperity with greater equity; that creates opportunities for all and distributes the dividends of increased prosperity fairly. Inequalities: While the population of Scotland as a whole is benefiting from better circumstances, greater opportunities and improved outcomes, these benefits are not shared equally. Inequalities are the systematic differences that we observe between groups in society. Inequalities affect people according to their social and economic status and demographic factors (e.g. age; gender; ethnicity etc.). Inequalities are also evident between geographical areas and communities. Some groups are particularly at risk due to a combination of these factors. Inequalities exist in a range of domains (health, education, wealth etc.). They may be seen in the form of life-chances, conditions, opportunities, rewards or outcomes. 5 Definitions and terms

3. Inequality and the economy 6 Recent international research suggests that inequality has a negative impact on economic growth, performance and resilience. For instance, analyses by researchers at the OECD estimate that rising inequality in the UK reduced GDP per capita growth by 9 percentage points between 1990 and 2010¹. Together with other emerging international evidence, this suggests that tackling inequality and improving social justice are important for improving economic performance as well as for a wide range of other reasons including: improved educational and health experiences and outcomes, more cohesive, connected and resilient communities, and greater equality of opportunity and life chances. The Scottish Economic Strategy is based on the recognition that improving economic performance and tackling inequality are mutually supportive processes.

Scotland’s economic framework 7

Scottish Government economic strategy 8

9 Scotland has strong economic foundations Scotland is a wealthy and productive nation, with GDP per head that ranks among the top 20 OECD countries. Scotland has a highly skilled workforce, with the highest rate of graduates as a share of the population in the EU. Scotland has the highest employment rate of the UK nations, and outperforms the UK on female and youth employment. Scotland has a reputation for innovation, and world-renowned products and companies competing successfully in global markets. These are strong starting points for building a more competitive economy and a fairer society.

4. Income and wealth inequality 10 Although Scotland is less unequal than the UK, we would rank 20 th in the OECD for income inequality, as measured by the Gini Coefficient The Gini coefficient is a measure of income inequality with lower values meaning greater equality.

Income distribution Over the long-term, income levels in Scotland have risen. However, the distribution of income is skewed by a small proportion with very high incomes. Focussing on low incomes alone is unlikely to reduce income inequality. The bottom 40% of households have just over 20% of household income in Scotland. The middle 50% have approx. half of all income. This is the case across time and internationally. Inequality is driven by how the remaining 50% is divided between the top 10% and the bottom 40%. The top 10% of households have approx. 25% of household income in Scotland. 11

Wealth distribution Wealth is far more unequally distributed than income. The bottom 40% had 5% of wealth. The middle 50% had 51% of wealth. The top 10% had over 44% of wealth. The top 2% alone had 17% of all wealth 12

5. Poverty 13 Standard definitions of poverty distinguish between different levels of poverty: o Relative poverty equates to a household income which is less than 60% of the UK average o Severe poverty equates to a household income which is less than 50% of the UK average o Extreme poverty equates to a household income which is less than 40% of the UK average In Scotland, living in relative poverty if you are a single person means a household income of £9,200 per year; for a couple with two children, you have a household income of £21,000. Minimum living costs for those living in remote rural Scotland are estimated to be 10-40% higher than the equivalent in urban UK.

14 Relative poverty has fallen over the last decade (despite a rise in the most recent year compared to the previous 12 months). Individuals in relative poverty, Scotland 2001/ /13 Poverty

15 1 in 6 Scots are living in poverty. People living in poverty now are more likely to be in severe or extreme poverty than a decade ago. This is especially the case after housing costs. In 2012/13, 50 per cent of all people in poverty lived in extreme poverty(after housing costs), compared with 36 per cent in 2002/03. Poverty Depth of poverty after housing costs (AHC), 2012/13

In-work poverty The nature of poverty in Scotland has changed. While employment remains the best route out of poverty, employment is no longer a protection against poverty. There are three key factors influencing in-work poverty: 1.the hourly rate of pay 2.the number of hours worked by members of the household (work intensity) 3.income gained and lost through the welfare and tax systems. 16

The Scottish Government supports the Scottish Living Wage - £14,975 per year. Estimates suggest that around 1 in 5 Scots earn below this. The pay gap has been closing over time and latest figures show an increase in earnings, yet women in Scotland continue to earn less than men. On average, for every £ a man earns, a woman earns 83p, with the gap being greater in the private sector. Scotland currently has the highest employment rate of the four countries in the United Kingdom and latest figures show that the employment rate has increased. Youth unemployment remains above the overall unemployment rate in Scotland making it difficult for some young people to find the jobs that will lift them out of poverty. Some minority ethnic groups are less likely to be in employment and more likely to be in poverty compared to the rest of the population in Scotland. Households with a disabled adult are more likely to be in poverty than those that do not. Working age adults with a disability are less likely to be in employment than adults without a disability. 17 Poverty and employment

6. Health 18 Improving Scotland’s health has been a key challenge over a number of decades, and the national health profile is changing for the better on various fronts. For example: Life expectancy continues to increase for both men and women, and has risen from 73 to 77 years for men and from 78 to 81 years for women since Smoking prevalence has declined from 31% to 23% of adults since Fewer people are drinking alcohol outwith government guidelines - down from 53% to 45% of men and from 42% to 35% of women since The prevalence of overweight and obesity has stabilised over the last five years following a period of increase.

Healthy Life Expectancy 19 Healthy life expectancy has been gradually increasing in Scotland, yet there remains a significant gap between the most and least deprived areas. Men and women in the 10% most deprived areas live in good health for over 20 years less than those in the 10% least deprived areas. 10% of men in Scotland can expect to live for only 46 years in good health, and 10% of women in Scotland can expect to live for only 50 years in good health.

Mortality 20 Premature mortality rates (deaths before age 75) have improved every year in recent decades. However, from age 20, those in the 10% most deprived areas are more likely to have two or more health conditions.

Mental health 21 National mental wellbeing scores have not changed in recent years though there remains a gap between people in the most and least deprived parts of the country.

Alcohol and drug misuse 22 Alcohol related hospital admissions for both men and women have been falling since 2007 but they are consistently higher for men than for women by a ratio of around 2.5:1 Estimated 2012/13 data show that men are also around 2.5 more likely than women to have a problem drug issue

7. Education - Early years 23 At the point of entry to primary school, the vast majority of children do not show any signs of social, emotional or behavioural difficulties Children from the poorest income group are twice as likely to have developmental problems than those from the wealthiest income group. On average, children from more advantaged households have better vocabulary and problem solving ability at ages 3 and 5 than children from the less advantaged By age 5, the gap in vocabulary between children from low-income and high-income households is already 13 months. Children who experience multiple disadvantage in the early years are more likely to have poorer social-behavioural development and lower attainment at age 14.

School attainment % of school leavers had one of more passes at Higher or Advanced Higher equivalent in 2013/14, an increase on the previous year (55.8%). There remains a significant deprivation gap. Over 80% of school leavers from the least deprived decile gained 1 or more Higher or Advanced Higher equivalent in 2013/14, compared with just over a third of those from the most deprived decile.

School leavers 25 The proportion of all school leavers entering positive destinations is at its highest level since 2008/09 However, there remains a gap between those most deprived and least deprived

Looked After Children 26 Though improving, looked after children continue to have a lower level of school attainment compared to the rest of the population. Looked after children are also less likely to go into employment, work or training.

Higher education 27 Historically, young people in Scotland are more likely to participate in HE by the age of 30 than those in England. In , the likelihood in Scotland was 55% compared to 43% in England. The likelihood of those from the most deprived areas entering higher education between the ages of 16 and 30 the likelihood has increased by 4 percentage points between 2006/07 and 2012/13. Yet, the likelihood of entering higher education is 20 percentage points higher for those from the least deprived areas compared to those from the most deprived areas.

8. Social inclusion - Democracy 28 Recent events have demonstrated a high level of political engagement among the Scottish population. Voter turnout from the Independence Referendum was 85%; and Scottish voter turnout in Scotland for the recent General Election was 71%. In elections in Scotland and the UK, turnout is lowest among younger age groups, those who do not own their homes, and those from a black or minority ethnic group. Income also makes a difference in voter turnout. In the United Kingdom, voter turnout for the 20% of the population with the highest incomes is an estimated 73%, whereas the participation rate of the poorest 20% is an estimated 50%. Levels of voter registration are also generally lower among these groups.

29 Democracy Despite the increased political engagement during the referendum, the population in Scotland continued to have a low level of satisfaction with democracy (22% in Scotland compared with 23% for the whole UK). Only 22% of people in Scotland feel that they can influence decisions in their local area. People in lower socio-economic groupings and those with lower incomes feel that they have lower levels of influence on politicians and the government, than those from higher socio economic backgrounds/income groups.

Community connectedness 30 In 2013, a majority of people living in Scotland (52%) said that ‘most people can be trusted’ while 46% said ‘you can’t be too careful dealing with people’. People living in the least deprived areas were nearly twice as likely (61%) to say that most people can be trusted compared with those living the most deprived areas (34%). Levels of trust were also higher in remote rural areas and small towns than in large urban areas. In 2013 about one quarter (24%) of the public said they had volunteered at least once in the last 12 months. People who are the least socially connected and those least trusting of others, have lower life satisfaction than other people. In 2012, 79% of adults in the 10% most deprived areas of Scotland rated their neighbourhood as either good or fairly good compared to almost all (99%) of those in the 10% least deprived areas.

9. Crime and justice 31 Recorded crime in Scotland has reduced by 36% since and is at its lowest level for 40 years. The risk of being a victim of crime has also fallen over recent years. However, the risk of being a victim of crime remains higher in the most deprived areas than the rest of Scotland. Fear of crime has also reduced but is higher in the 15% most deprived than elsewhere – only 57% feel safe walking in their neighbourhood after dark compared to 75% in the rest of Scotland

32 The risk of crime is slightly higher for males than for females. The risk of being a victim of crime decreases with age. However, the fear of crime (feeling safe walking home after dark) is significantly higher for women than men, and for older people than younger people Risk and fear of Crime

Youth crime 33 Between 2008/09 and 2012/13 the number of recorded crimes committed by children and young people fell by 52%. The proportion of crimes committed by children and young people decreased from 22% to 14%. The number of young people in prison has fallen. The population of young offenders under 21 has been falling steadily since the late 2000s. This has been particularly marked over the past 2 years. There has been a fall of 83% in children referred to Scottish Reporter since 2006 – 07.

10. Human Rights 34 Human rights are the fundamental rights to which everyone is entitled. They are defined in international treaties and domestic law, and provide a benchmark for social justice. Despite progress in many areas, barriers to realising human rights continue to create and deepen poverty and social exclusion. The UN Committee on Economic, Social and Cultural Rights has called for human rights based anti-poverty strategies to address the persistence of poverty and social exclusion, as a matter of ‘high priority’. It has also has expressed particular concern at the continued wage gap between men and women. The European Committee on Social Rights found the UK minimum wage “manifestly unfair” and in breach of Article 4 of the European Social Charter.

Additional information 35 If you would like to access further information, please visit the Fairer Scotland Website at: