Disability Rights UK’s submission to the Parliamentary review focussed on the Government’s proposal to reduce payments for disabled claimants in the Employment and Support Allowance Work Related Activity Group
Introduction
Disability Rights UK (DR UK) is a pan disability membership organisation led by disabled people seeking change. Our membership includes individual disabled people and also organisations working on their behalf including disabled people led organisations (DPULOs). Amongst our membership are over three hundred organisations that give advice directly to disabled people, particularly in respect of benefit issues. DR UK run a second tier advice line where we assist their front line advice workers with supportive information and advice.
- 1. What is your evaluation of the support people receive on ESA WRAG? For example the payment they receive and/ or the support that they are offered, such as training or work skills, and whether this helps them move closer towards employment.
The Welfare Reform and Work Bill Impact Assessment to remove the ESA Work-Related Activity Component (EIA) takes as its starting point that the benefit system has trapped people in poverty by disincentivising work but does not question whether other factors are responsible such as the failure of back to work support or the lack of support or incentives for employers.
The Work Programme has placed a mere 29,460 disabled people into work over the four year period June 2011 to June 2015. The specialist Work Choice programme has placed 15,710 into sustained and unsupported work over the first nineteen quarters of its operation. This means an annual average of 10,660 per year or a total of 42 per working day.
These outcomes are out of a total of 191,090 attachments of disabled people to these two programmes over this period. In summary a success rate of only 6.4% of all job outcomes are being achieved by disabled people on the Work Programme and only 17.6% of starts are obtaining a job on the Work Choice programme.
The June 2014 Mind report Fulfilling Potential? ESA and the fate of the Work Related Activity Group found that the back to work support provided through the Work Programme and Jobcentre Plus is causing severe anxiety for people with disabilities and pushing them further from the job market. The report is based on data from over 500 people with a range of physical and mental health problems.
Most people who responded to the survey had been compelled to undertake compulsory back-to-work activities or have their benefits cut. The majority said their disabilities were not acknowledged or accommodated and made engaging in such activities difficult. 80% said they felt anxious about not being able to access activities and 70% were worried about their benefits being cut.
The actual or threatened cutting of benefits is meant to motivate people to get back to work, but the report suggests motivation is not a problem: 60% were strongly committed to work, 30% weren’t sure they could work and just 10% either didn’t want to, or didn’t think they’d be able to, work.
The second assumption of the EIA is that all the previous changes have acted to create incentives. The abolition of the linkage rules for those moving from ESA to work may be just one example of a “perverse incentive” whereby the removal of the ability to go back to a benefit may have deterred many from making the journey in the first place.
The EIA fails to understand the reason people are on ESA i.e. they have been found not currently fit for work. So why does the EIA suggest that the removal of the Work Related activity Group premium could be replaced if the claimants simply did four or five hours work? A further consequence of this approach is that it makes the individual claimants responsible for any mitigation measures – surely it is for the Government to offer mitigations measures to alleviate the hardship faced by the E.I.A.s estimate of 500,000 affected people?
- 2. What would be the impact of the Government’s proposal to reduce the ESA-WRAG payment on claimants/families?
The proposed ESA-WRAG payment will hit households with a disabled person hard – a third of whom are living below the poverty line.
The latest annual Family Resources Survey, which is funded by the DWP shows that after housing costs are taken into account – the percentage of people living in households, where at least one member was disabled, who were in “absolute poverty” rose from 27% in 2012-13 to 30% in 2013-14.
The EHRC’s progress report Is Britain Fairer (2015) highlighted a “significant increase” in levels of material deprivation for working-age disabled people – which measures how poor people think they are – from an average score of 1.4 in 2007-08 to 1.7 in 2012-13, while the gap between the average deprivation scores of disabled and non-disabled people had widened.
And, they show that the number of people in “disabled households” who were living in absolute poverty rose by 300,000 in that one year. The Family Resources survey results also show that the proportion of disabled people living in relative poverty – those who are poor in comparison with the general population – increased in 2013-14 by two percentage points (about 300,000 people), while relative poverty among non-disabled people stayed roughly at the same level.
The proposed £30 per week cut must also be seen in the context of other cuts and freezes to support for disabled people, their families and carers such as the bedroom tax, personal independence payment, council tax support and social care.
Disabled people being supported by ESA receive a higher rate than those on JSA because they face additional barriers as a result of their illness or disability, and typically take longer to move into work.
Almost 60 per cent of people on JSA move off the benefit within 6 months, while almost 60 per cent of people in the WRAG remained on ESA for at least two years.
It is unreasonable and unrealistic to expect disabled people to survive on £73.10 a week for two or more years.
Making higher social security payments to disabled people who are not readily able to gain employment as opposed to those who are has been a major plank of the welfare state for over 40 years.
Richard Berthoud in a 1998 report, Disability benefits: A review of the issues and options for reform set out why benefits had been paid at a higher rate than for those who were unemployed -
“The primary reason historically, was that those who have to live for a long time on social security could not be expected to survive on the very low level of income available as a temporary measure for short-term claimants.
Pensioners will be pensioners for the rest of their lives. Those who become incapable of work before pensionable age can also expect a very long period on benefit (depending on the nature of their condition). Unemployed people can expect (or are at least expected) to return to work after a relatively short period – as indeed the great majority of them do.
This is reflected in another major difference between the treatment of disabled people/pensioners and unemployed people: the former receive non-means-tested insurance payments for life; the latter have only six months’ entitlement to contributory benefit, before having to submit to a family means test.”
Research by Scope has estimated that disabled people spend on average, £550 a month on disability-related expenditure. Welfare payments aimed at alleviating these costs – Disability Living Allowance (DLA), Personal Independence Payment (PIP)– fall far short of meeting them. In 2015/16, the average award of DLA or PIP will be around £360 a month.
Even at present, with the current Work Related Activity Component added to this £360 total, a shortfall of around £60 a month exists.
- 3. Would there be an impact on people’s ability to look for work if the amount of money was reduced? What do you think this impact, if any, would be?
There is no evidential basis for the belief that the ESA-WRAG payment has acted as a barrier to disabled people gaining employment or that its removal will incentivise disabled people to find work.
If the payment is removed, new ESA claimants from April 2017 will be uniformly financially penalised with no justification – in effect sanctioned.
In respect of ESA claimants, the latest DWP statistical release shows that in the period from 3 December 2012 - when the new ESA sanctions regime was introduced - to 30 June 2015, over 70,000 sanctions were imposed – with over 23,000 decisions subsequently overturned.
According to DWP statistics supplied in response to a freedom of information request almost 60% of the ESA claimants sanctioned between October 2013 and September 2014 had mental health problems. Similarly, more than 60% of the ESA claimants sanctioned in Scotland between December 2012 and August 2014 had “mental and behavioural disorders”.
However, the DWP has no evidence that the new ESA sanction regime has given those whose ESA was significantly reduced a greater incentive to remain in touch with the job market or move into work.
In its 24 March 2015 report, Benefit sanctions policy beyond the Oakley Review, The Work and Pensions Committee called for a full independent review of the benefit sanction scheme –
“There is evidence that more “active” unemployment benefit policies are more effective than the alternatives; but evidence on the specific part played by financial sanctions in successful active regimes is very limited and far from clear-cut.
DWP should increase the evidence base through a series of evaluations. In particular, it should test the efficacy and impacts of the longer minimum sanction periods which were introduced under the Welfare Reform Act 2012, and investigate whether the application of a longer sanction makes it more, or less, likely that the claimant moves into employment.”
Again, in its 21 July 2015 report, Universal Credit: priorities for action the Social Security Advisory Committee concluded that -
“Successive administrations have strengthened the regime of penalising compliance failures with withdrawal of, or reductions in, benefit payments. SSAC, amongst others, has raised concerns about the increased use of sanctions, not because we believe that they are necessarily ineffective, but because we do not know for certain that they are effective, at least in terms of getting people into good quality jobs.
We believe that the sanctions regime needs to be tested. The Department is committed to evaluating their effectiveness and we think further changes in the system should be deferred until a firm evidence base to underpin the policy has been established.”
In his 24 August 2015 speech on work, health and disability, the Secretary of State for Work and Pensions Iain Duncan Smith maintained that the gap between the employment rate of disabled and non-disabled people “isn’t because of a lack of aspiration on the part of those receiving benefits….in fact, the majority want to work or stay in work.”
Instead he said the gap exists because of two factors -
“First, some employers are reluctant to employ people with disabilities.
… Second, the poor quality of support they receive leads to many sick and disabled people languishing in a life without work, when work is actually possible for them.”
Again, in going on to explain why ESA needed to be reformed, the Secretary of State stressed the need to change the work capability assessment so that it “focussed on what a claimant can do and the support they’ll need – and not just on what they can’t do.”
Surely if the level of ESA paid to the WRAG group of claimants itself was a currently “perverse incentive” to them becoming employed – such that it requires a 40% reduction – then the Secretary of State would have also highlighted this?
Instead he said the opposite – that those on ESA do not “lack aspiration” and “in fact, the majority want to work or stay in work.”
Finally, the suggestion that the additional £30 acts to disincentivise people from moving toward work is highly questionable. Many within ESA WRAG are managing a fluctuating condition, coping with pain and fatigue or recovering from illness.
While some may want to work, they often find employers are not ready to take them on because of their sickness record or need for a high level of flexibility (for example, unpredictably being unable to work on some days).
There is a need for support and incentives to employers – for example, Government procurement to open up more employment opportunities.
Cutting ESA to those placed in the work related activity group to the bare minimum, thereby causing debt and stress, is unlikely to help disabled people seek work effectively and would contradict the Government's aim to halve the disability employment gap as set out in the Conservative manifesto.
- 4. What further support should be made available to help people in the ESA-WRAG move towards employment that isn’t currently available?
While it is clear that the Work Programme is still failing disabled people, nether Ministers nor Work programme Providers has previously suggested that any cause of this is the “perverse incentive” of the work related activity component.
Instead of reducing the ESA of some disabled people by 40% priority needs to be given to improving their employment support.
In preparation of our October 2013 report Taking Control of Employment Support, Disability Rights UK asked over 500 disabled people for their experiences and views of employment support and also analysed research evidence. We found that:
- There is a huge appetite for a personalised service. We asked whether respondents would like to know more about the resources available for their support, and types of support available, in order to have a say. 78% of respondents said yes. We asked whether they would like to decide how the money on their employment support is spent. 74% said yes. Research shows that a personalised plan helps people experiencing barriers or with support needs to find and keep a job and that with individually tailored support, job outcomes are typically twice as good as with more traditional vocational support. Only 36% of respondents to our survey had had a personal plan. 58% said they would like one.
- There appears to be a gaping gulf between what disabled people want and what they get. Research shows mentoring by someone in a field you are interested in is effective. Only 16% of respondents had been offered this. 38% asked whether they would want this type of mentoring said yes. Mentoring by someone facing similar barriers can also be useful. 12% said they had been offered this. 46% said they would want it. Research consistently shows that work experience and learning on the job improves employment prospects: yet only 13% of respondents had been offered this.
- Most respondents had not had support from the Work Programme. Support to get and keep work came most commonly from family (44%), friends (35%) or a disability organisation (33%).
- 63% said the support they had received did not help them get a job
Existing programmes are failing Britain’s employers, whose success increasingly relies on accessing the widest possible pool of talent, including disabled people. They are providing extremely poor value to the taxpayer, with the government continuing to waste millions of pounds on programmes which do not work. The Work Programme is projected to cost £3-5 billion over 5 years, yet is not working for a core group: people living with disability or long-term health conditions.
It is time to cut out the middleman, releasing the money that is presently being wasted and transferring control of employment support to those who know how it can be used best - disabled people and employers. The incentives are instead currently targeted at providers – and are often perverse. The government should focus on influencing and supporting the people who can really transform employment opportunities: employers and disabled people.
Disabled people require effective support which genuinely improves their position in the labour market. Our survey found that disabled people want to be involved in shaping and directing such support. Successful employers positively embrace people with potential and the desire to learn and develop. Working together, we believe successful employers and disabled people are best placed to work out the support each requires to achieve these goals.
Disability Rights UK believe that that is why the following approach should be piloted and evaluated:
- Disabled people should have far more opportunity to gain experience and skills through work, rather than the endless ‘work preparation’ favoured by the current centralised schemes. This could include work trials, work placements, traineeships, internships and apprenticeships.
- To facilitate this, employers and disabled people should be given the opportunity and power to choose how to spend the budget for disability employment support (including Access to Work funding), with specialist advice as necessary.
- This budget should also be used to facilitate access to learning and qualifications in - or linked to - the workplace. This could take the form of on-the-job vocational qualifications, attending a local college, distance learning or accredited continuous professional development.
The pilots should explore the benefits of this approach across a range of groups and scenarios, including:
- areas with high growth in small and medium sized employers;
- people who have left employment since acquiring an impairment;
- people with low levels of skills and qualifications, including young people not in employment, education or training; and
- people with significant mental health problems and/or a learning disability (who have particularly low employment rates).
Finally, as highlighted in our Closing the disability skills gap (2015) summary report, there is a significant disability skills and qualifications gap: disabled adults are three times as likely as non-disabled peers to have no qualifications at all. Young disabled people are twice as likely to be NEET (not in education, employment or training) and significantly less likely to go to university.
Lack of skills impacts on disabled people’s employment opportunities even more severely than on non-disabled people: the gap between the employment rates of disabled and non-disabled people with no qualifications is 35.7%; with a degree, only 15%.
Having qualifications significantly improves the life chances and employment outcomes of disabled people. In 2012, 71% of disabled graduates had gained employment compared to 42% of disabled non-graduates.
Disabled people need skills and support that works – not greater poverty.
13 November 2015