Welfare Reform Bill: dangers of reform to incapacity benefit rules. By Neil Bateman

The Welfare Reform Bill heralds major changes to incapacity benefits in 2008. Eligibility will be tightened and sanctions extended. Welfare rights organisations and others are concerned about the impact on people with a disability or long-term health problem.

Service users and practitioners face a tough time if all the regulations of the Welfare Reform Bill are passed, argues Neil Bateman, as there is too much emphasis on compulsion rather than persuasion

The Welfare Reform Bill is working its way through parliament and should be enacted by March. The bill proposes major changes to benefits for people who are unable to work because of illness or disability (see Employment and Support Allowance (ESA)).

Many people who use social care services receive incapacity benefit or income support on the grounds they are unable to work. So those who work for social care agencies will need to know about entitlement to employment and support allowance (ESA) as they may well be the first point of contact for service users whose benefits are affected by the new, harsher rules.

The bill itself is light on detail and it’s only as we now see the draft regulations to be made under the act that it is clearer exactly what is involved in this new legislation (see list of further reading).

The thinking behind the bill is to move up to one million people off incapacity-related benefits and into work. Of course there is scepticism about how realistic this is with just 600,000 vacancies in the economy and these mostly being for high skill jobs, it’s hard to see how the numbers add up.

One change will be the removal of the groups who are currently exempt from medical assessments. This is causing alarm in mental health where many practitioners already spend time managing the anxiety caused by people with mental health needs being called up for Department for Work and Pensions medicals. At least an exemption provides an escape route for them.

Sue Christoforou, policy officer with Mind, says that although it is fairer to assess people as individuals rather than on the basis of their diagnosis, Mind is concerned about the level of mental health training DWP doctors have. “Mind’s front-line staff tell us that their clients find face-to-face assessments so difficult and stressful that the process can actually cause deterioration in their mental health.”

She believes that the new system will mean more vulnerable people being subject to assessments. “If they undergo the same low standard of assessments we are currently seeing, then we will inevitably see more people having their mental health damaged by the assessment system.”

Another area that is worrying experts is the plan to give private contractors legal powers to impose benefit sanctions for non-compliance with ESA rules. Because of the reduction in Jobcentre Plus staff, the government has to externalise services to implement the changes, but there are already signs that contractors’ behaviour can be influenced by the system of incentive payments for job placements. Aside from the constitutional concerns about who has authority to cut individuals’ benefits, there is concern that contract terms may inadvertently encourage contractors to sanction “less co-operative” yet very vulnerable benefit claimants.

The government envisages mainstream voluntary bodies being taken on as contractors, but it is clear that many do not want to be involved if they have to impose sanctions. The result may simply be that big private firms such as Capita are the only ones to sign up.

One concern is that resources are not being increased, and unless this happens ESA will be perceived as a more punitive regime. Another concern is whether standards of evidence gathering and decision-making on benefit claims will be improved. More than half of appeals against refusal of incapacity benefit are successful, so major improvements are essential to avoid people being left without the money they are entitled to.

Analysis of the material presented to parliament throws up some interesting issues. For example, papers for the House of Commons’ committee stage of the bill include fictitious case studies of how claimants will be helped into work by ESA. One case study is a young man with a psychotic illness whose employer willingly allows him to take days off from his job as a librarian when his symptoms are troublesome. Whether this would really happen remains to be seen.

Concern also centres on the details of the new compulsory aspects of ESA alongside the tightened eligibility criteria. Child Poverty Action Group has been among those involved in lobbying for lessening of compulsion fearing its negative impact on claimants. Chief executive Kate Green emphasises: “The carrot rather than the stick approach works best. Disabled people need greater job opportunities as well as more support with training, child care and transport costs, not threats of benefit sanctions.”

And of course, most employers (including the DWP itself) are reluctant to recruit staff with a history of sickness absence. As more detail emerges, one has to wonder whether the end result of ESA for many seriously sick and disabled claimants will be more exclusion and pressure, less money and only a few more jobs. It’s one to watch.

● From November 2008, ESA replaces new claims for incapacity benefit (IB) and income support (IS) for people who are incapable of work.
● ESA will be for those with limited capacity for work, but they will still have to pass a medical assessment and score 15 points as now.
● Government plans to transfer existing IB/IS claimants onto ESA when the system has settled down.
● After 13 weeks, ESA will consist of a work-related activity component and a support component. The latter is payable when it is unreasonable to require someone to undertake work-related activity.
● Benefit rates are unknown but while some people may gain from the support component, many others may be worse off.
● Compulsory work-related activity will include training, condition management and voluntary work.
● Removal of lower scores in medical assessment will make it harder to gain ESA than IB/IS.
● Exemptions that currently put many people onto IB do not exist for ESA.
● But much of the new activity such as work-focused interviews will be contracted out to private contractors who will also have powers to apply benefit sanctions.
● Non-compliance with the new benefit rules can result in cuts to ESA and even remove it after three breaches.
● Draft legislation does not allow people who receive disability living allowance (or other passporting benefits) to go onto the equivalent of a disability premium.

Training and learning
The author has provided questions about this article to guide discussion in teams. These can be viewed at www.communitycare.co.uk/prtl and individuals’ learning from the discussion can be registered on a free, password-protected training log held on the site. This is a service from Community Care for all GSCC-registered professionals.

Further information (back to top)

● Welfare Reform Bill, HMSO, 2006
● Welfare Reform Bill. Draft Regulations and Supporting Material, DWP, 2006
● Transformation of the Personal Capability Assessment, DWP, 2006
● Disability Alliance and Child Poverty Action Group, Welfare Reform Bill: Draft Regulations and Supporting Materials. Comments 2006
● Disability Benefits Consortium, Parliamentary Briefing. Welfare Reform Bill: House of Commons Second Reading, 2006.
● For more, go to website of Child Poverty Action Group atwww.cpag.org.uk/welfarereform

This article appeared in the 15 February issue of the magazine under the headline “Compulsive disorder”