Claims that fail to stand up

The proposed shake-up to incapacity benefit is based on dubious theories, outdated facts and unhelpful targets, argues Neil Bateman

After ministerial efforts to achieve consensus before Christmas, the green paper on welfare reform(1) is out with plans to change incapacity benefit (IB).

Some would have us believe that the numbers on IB have exploded in recent years with a new generation of work-shy people being signed off by naive GPs, (a perception not helped by some of the government’s statements). The other argument is that the rise in IB claimants started in the 1980s when unemployed people were encouraged to claim benefits through the sickness route rather than inflate the unemployment tally.

But what are the facts and what effect will the changes have on people with a long-term illness or impairment?

According to the government there are 2.7 million people on IB but in reality one-third receive only national insurance credits. A person cannot receive IB for a long period without medical evidence and after an extensive medical examination by the Department for Work and Pensions’ own medical service. As the green paper states, the route onto IB is “one of the toughest in the world”. And those moving onto “the sick” from “the dole” may have had their health damaged by the experience of job loss and subsequent unemployment.

DWP figures show that in recent years the numbers of people on IB in the older industrial areas have fallen while some areas of the south have had an increase – by 9 per cent in Hampshire’s
case – with the biggest single rise being among people with mental health problems.(2)

The government’s intention is to move a million people off IB but currently there are only 501,800 recorded job vacancies in the UK, many of which are unsuitable because more than half those on IB have no qualifications. The policy arises out of Labour’s manifesto aspiration to raise the employment rate to 80 per cent of those of working age (18 to 60), which would place the UK above every country in the world apart from Iceland. This can only be met if the numbers on IB are slashed. But even policy makers do not sound confident; a government source commenting that: “The one million figure is not the most precise or scientific of numbers.”

The green paper also asserts that work is good for one’s health. But the DWP’s own research notes “the rising prevalence of absence due to workplace stress arising from poor relationships at work and rising workloads and pressure. The view among GPs was that sickness absence is almost always genuine”.(3)

The researchers also conclude that work is not the panacea that government ministers would have us believe. They say that “…where patients worked in low paid jobs of low status, and where the job itself caused or exacerbated a physical or psychological problem” it was harmful.

This echoes many international studies that show that jobs involving a high level of psychological demand with little opportunity to control work or to use skills, damages a person’s physical and mental health, particularly when combined with job insecurity in a flexible labour market.(4)

Work itself is not always the answer: “In the financial year 2003-4, 57 per cent of all poor adults of working age were living in households where at least one person was working. In absolute terms, 2.8 million people of working age were living in such households”.(5) And poverty and inequality are recognised as causes of ill-health. For example, take a graph showing the three-and-a-half fold increase in IB claimants between 1979 and 2005 and compare it to a graph showing the three-and-a-half fold increase in the population with below half average incomes over the same period and you have a close fit.

So, what might be the impact of these reforms on individual benefit claimants with a health problem or disability?

An employment and support allowance will replace IB from 2008 for new claims, which will also have a new test of incapacity for work, and claimants who do not co-operate with “job preparation” activities will have their benefit levels reduced. DWP teams will be set up before 2008 to do spot checks on IB claimants.

Gary Vaux, head of money advice at Hertfordshire Council and Community Care contributor, says: “You cannot increase employment among this group by changing benefits alone. Key to success is availability of suitable jobs and employer attitudes. A tougher benefits regime might reduce the numbers on IB but if they just have their incomes cut by £24 a week by moving onto jobseekers allowance, what sort of success is that?”

Head of the Disability Alliance Lorna Reith says: “We need to see details of the spot-checking process but as fraud among IB claimants is very low it is costly to check people who are entitled. There is already a thorough checking process.”

Reith is also concerned about the prospect of more benefit reductions. “Sanctions can be counter-productive as they affect people who have already had negative experiences. They undermine trust and this has been borne out by the DWP’s own research among its staff.”

Doctors will be rewarded for helping move people into work and employment advisers will be put in surgeries. Hamish Meldrum, the British Medical Association’s GP chair, said that advisers would “only be effective if they are supportive in helping patients to return to work rather than acting as an enforcement arm of the DWP”.

Local consortiums of statutory bodies and employers are proposed to raise employment rates in cities. Details are sketchy, but the green paper states: “The consortiums will be required to operate within the new national benefits structure, including the proposed conditionality arrangements.” Councils might collaborate with benefits agencies, which could have implications for those whose benefits are cut.

The green paper has been trailed as a genuine attempt to help people into work, but careful examination suggests a different diagnosis.

Green paper changes