House of Commons - Work and Pensions

Select Committee on Work and Pensions Fourth Report

6 Benefit take-up

98. The Committee wished to consider how DWP service delivery affected the take-up of benefit by minority ethnic groups compared with take-up by the population as a whole. As benefit take-up was most commonly raised during the inquiry in connection with pensioners, this section primarily considers the take-up rates among ethnic minority pensioners as a case-study, focussing in particular on the efforts of the Pension Service to encourage take-up of Pension Credit. Pension Credit came into force in October 2003, replacing the Minimum Income Guarantee as the main means-tested benefit for pensioners.[111]

99. Reliable take-up statistics on Pension Credit in the first six months will be available in autumn 2005.[112] The most recent figures that are available indicate that in 2002/03, between 63% and 74% of those entitled to the Minimum Income Guarantee actually claimed it.[113] The Pension Service does not currently record a person's ethnic origin,[114] so estimates of take-up by ethnic group are not yet available. However, the fact that ethnic minority groups are over-represented amongst the poorest pensioners in Britain[115] suggests they may be more likely than other poor pensioners to be entitled to means-tested benefits.

Take-up of Pension Credit and other benefits

100. The Government has set targets to have 3 million households receiving Pension Credit by 2006 and 3.2 million by 2008.[116] At the end of December 2004, there were 2.65 million recipients of Pension Credit including 2.08 million receiving Guarantee Credit.[117] DWP says it is on course to meet its 2006 targets.[118]

101. Since the publication of the Committee's report on Pension Credit, DWP has provided further information on the amounts which it estimates that those not claiming means-tested benefits (Housing Benefit, Council Tax Benefit and Minimum Income Guarantee) were missing out on in 2001/2 and 2002/03. These figures suggest that:

Although take-up of Housing Benefit is comparatively high (with only around one in ten not taking up their entitlement),[119] those not claiming were often missing out on significant amounts. For example, 13% were missing out on £50 or more per week and when entitlement to MIG and Council Tax Benefit were also taken into account, this increased to 35%.[120]
Although take-up of Council Tax Benefit is lowest with around 40% not claiming their entitlement, those not claiming miss out on relatively small amounts:[121] 62% of that 40% were missing out on less than £10 a week in Council Tax Benefit and only 2% on £20 or more. When entitlement to MIG and Housing Benefit were also taken into account those missing out on £20 or more rose to 32%.[122]
Between 26% and 37% of those entitled to MIG did not claim their entitlement.[123] Some of those not claiming were missing out on significant amounts, with 17% missing out on £50 per week or more of MIG. When entitlement to Housing Benefit and Council Tax Benefit were also taken into account the proportion missing out on £50 or more rose to 26%.[124]

102. These figures provide some useful indications of where the Department should focus its efforts if it is to concentrate on pensioner poverty. For example, although take-up of Housing Benefit is comparatively high, some of those not claiming are missing out on large weekly amounts, particularly where entitlement to other benefits is included.

103. In its Pension Credit report, the Committee recommended that the Family Resources Survey should be used to gain a better understanding of overall take-up of means-tested benefits by pensioner households (including Pension Credit, Housing Benefit and Council Tax Benefit) in order that resources to increase take-up could be focussed on those who are missing out on the largest amounts. The Department is currently exploring options for improving the capacity of the Family Resources Survey to be used for analysis of ethnic minority groups.[125] The Committee recommends that a breakdown of take-up of means-tested benefits by pensioner households should also be provided by ethnic group.

Figure 1: Percentage distribution of MIG, HB and CTB Entitled Non-Recipients, by band of weekly unclaimed amounts of MIG, HB and CTB respectively, 2001/2 - 2002/3

Source: Ev 205

Notes:

1. 2% of those not claiming Council Tax Benefit are missing out on £20 a week or more

2.This chart shows: i) the percentage distribution of unclaimed MIG among entitled non-recipients by size of weekly entitlement; ii) the percentage distribution of unclaimed HB among entitled non-recipients by size of weekly entitlement; iii) the percentage distribution of unclaimed CTB among entitled non-recipients by size of weekly entitlement.

3. To allow a reliable breakdown by pensioner groups, estimates are based on a combination of two years' worth of data. Therefore, estimates may differ from published statistics.

4. Estimates have not been corrected for the biases that may be inherent in modelling entitlement to income-related benefits and so should be treated with some caution. In particular, a significant proportion of those appearing to be entitled non-recipients (ENRs) will not be true ENRs, and a significant proportion of true entitled non-recipients will not be captured in our modelling.

5. Because of these uncertainties, breakdowns are presented as percentages rather than numbers of ENRs.
Figure 2: Percentage distribution of Council Tax Benefit, Housing Benefit and MIG entitled non-recipients, by band of total unclaimed amounts of income-related benefits (MIG, Housing Benefit and Council Tax Benefit) 2001/2-2002/3

Source: Ev 205

Notes:

1. When entitlement to missed Housing Benefit and MIG is also taken into account 32% of not claiming Council Tax Benefit are missing out on £20 or more.

2. This chart shows: i) for MIG eligible non-claimants, the percentage distribution of total unclaimed income-related benefits (MIG, HB and CTB); ii) for HB pensioner eligible non-claimants, the percentage distribution of total unclaimed income-related benefits (MIG, HB and CTB); for CTB pensioner eligible non-claimants, the percentage distribution of total unclaimed income-related benefits (MIG, HB and CTB).

3. To allow a reliable breakdown by pensioner groups, estimates are based on a combination of two years' worth of data. Therefore, estimates may differ from published statistics.

5. Because of these uncertainties, breakdowns are presented as percentages rather than numbers of ENRs.

6. The table shows bands of total unclaimed entitlement. For example, the £30-39 band for MIG would include a pensioner entitled non-recipient of MIG claiming £20 HB but not claiming £25 MIG and £10 CTB.

104. Research published by DWP in 1998 estimated take-up of Attendance Allowance to be between 40% and 60%, and take up of Disability Living Allowance (DLA) to be between 30% and 50% for the care component and between 50% and 70% for the mobility component.[126]

105. A report published by Disability Alliance in late 2003 argued that research was needed to determine whether apparent underclaiming of DLA by ethnic minority groups was an accurate reflection of need or "an indicator of systemic deficiency." Without such research, it argued, our knowledge of ethnic minority disability and carer benefits experience would continue "to be descriptive, and the gaps in our knowledge vast."[127] In evidence, Vanessa Davis of Disability Alliance argued that information needed to be collected statistically so that it is possible to work out how to address the issue.[128]

106. DWP research on service delivery to ethnic minority groups found there was uncertainty about what Attendance Allowance was for and who is eligible to claim it. Complaints were made about the length of time it took to complete claim forms for these benefits. The questions were felt to be "extremely personal, detailed and intrusive."[129] DWP says that "simpler and better focussed" Attendance Allowance claim forms were introduced nationwide in October 2003.[130] The Department says that the development of Joint Teams in the Pension Service (see paragraph 125) appears to have contributed to an increase in the number of pensioners taking up their entitlement.[131]

107. In its recent Pension Credit report, the Committee recommended that "the Government undertakes and then publishes research providing estimates of eligibility for Attendance Allowance and Disability Living Allowance, and of the potential impact of this on Pension Credit eligibility, and soon thereafter announces a take-up target for disability benefits."[132] The Committee further recommends that research on the estimates of eligibility for Attendance Allowance and Disability Living Allowance should look specifically at eligibility among ethnic minorities.

Take-up of Pension Credit by ethnic minority pensioners

108. The Pension Service has conducted research aimed at callers to the Pension Credit Application Line which found that callers from ethnic minority groups "closely matched and in most cases exceeded the census ethnic mix levels." Further work is being considered to examine take-up by those using other routes, such as the Local Service.[133]

109. There are also plans to collect data on ethnicity through new information technology being introduced as part of the Pension Service's Pensions Transformation Programme.[134] DWP told us that the first opportunity for including the required IT changes will be in late 2006. In the mean-time, the Pension Service is examining census data to 'monitor how Pension Credit is working in this respect.'[135]

110. The Committee recommends that the Pension Service collects data on the ethnicity of its customers from late 2006.

Barriers to take-up by ethnic minority pensioners

111. Research by the National Audit Office identified a number of specific barriers to take-up of benefits by ethnic minority pensioners. For example:

Being less likely to speak English.

Being less likely to read or write English.

In some cases, being less likely to read or write their own first language.

Experiencing greater administrative difficulties, for example, in providing acceptable evidence to support claims, such as marriage certificates. Subsequent DWP research also identified concerns about the impact of claiming on residency status and difficulties arising from not having a National Insurance Number (which particularly affected Asian women).[136]
Reluctance to visit Benefits Agency offices, because of the possibility that they might not be understood by staff.
Being less likely to have come into contact with the benefits system and more likely to rely on informal advisers than to have direct contact with statutory agencies.
For some minority ethnic groups, being more likely to live in extended family households. This has been shown to have an impact on take-up, with some communities having strong negative perceptions of claiming benefit.[137]

112. Research subsequently published by DWP also highlighted literacy problems, ignorance about the benefits system (and sometimes of the concept of benefits) apprehension about contact with statutory service providers, reluctance to use the telephone and difficulties in communicating in writing.[138] It looked at the needs of pensioners of different ethnic groups. It identified, for example, specific difficulties facing Asian women, some of whom were not used to handling their own finances or interacting with people outside their social circle.

113. These research findings were reinforced by evidence received during this inquiry which pointed to some of the reasons for low take-up of benefits among ethnic minorities. This can partly be attributed to the stigma attached to claiming benefits among some ethnic minority groups - and particularly older people. It was pointed out that, for some, the culture within their home countries was for independence and self-sufficiency with older people supported by their extended families and this leads to a reluctance to claim their benefit entitlement even when encouraged to claim.[139] In their report on DWP and race equality, Disability Alliance referred to a real reluctance to claim benefits because of the "culture of stigma and shame" experienced by ethnic minority benefit claimants.[140] Evidence also pointed out that some ethnic minorities find the benefits claiming process hostile and are fearful of rejection.

The Pension Service's take-up strategy

114. The Pension Service was launched on 1 April 2002, taking over the work previously done by the Benefits Agency in delivering state pensions and benefits to pensioners. It is a largely telephone-based service. Applications are made via the Pension Credit Application Line and processed by Pension Centres, who have telephony staff to take calls about the process of applications. For pensioners unwilling or unable to contact the Pension Service by phone, the Local Service provides Information Points (formerly known as 'surgeries'), conducts home visits and works in partnership with local organisations to encourage take-up.[141]

115. In its first report on Pension Credit, the Committee registered some concerns about how the Pension Service model would work for people for whom English was not a first language. It recommended, for example, that adequate provision be made at all call centres to cope with pensioners from ethnic minorities, for whom English is not a first language.[142] Steps taken by DWP to encourage take-up of Pension Credit by ethnic minority pensioners include targetted press and media activity and Local Service take-up initiatives.[143] The Pension Service has also conducted a number of 'hard-to-reach' pilots, aimed at those older people less likely to respond to Pension Credit media advertisements and direct mailings, for example, because of physical, psychological, cultural or geographical reasons. These demonstrated that a variety of approaches was needed to target the hard-to-reach customers.[144]

Contacting the Pension Service

116. Age Concern argued that the emphasis on contacting the Pension Service by phone created difficulties and barriers for some ethnic minority older people, especially where their first language is not English. Many were not confident in using the telephone, perceiving that they would not be understood by Pension Service staff.[145] Representatives of community organisations in Wolverhampton agreed that ethnic minority older people were particularly likely to want a face-to-face service.[146]

117. Age Concern emphasised the importance of such pensioners being able to contact the Pension Service locally, both at the time of making an application and for follow-up inquiries once an application had been made. It argued that regular surgeries, both at appointment-based and drop-in locations, were particularly important in enabling older people from minority ethnic groups to "feel comfortable about asking for advice and information about benefit entitlements."[147] Age Concern also said that while local surgeries are welcome, these should be in addition to a permanent Pension Service high street presence.[148] The Pension Service has recently reduced the number of Local Service 'information points' - from 2,566 in April 2004 to 1,598 in December 2004. The number of customers seen at Information Points each month fell by 10,000 to 15,802.[149] DWP says that:

150

118. While there has been an increase in the number of home visits conducted by Local Service staff,[151] some of these have been in connection with moving people from order books to Direct Payment.[152]

119. The recent emphasis in the Local Service on home visiting and the reduction in Information Points suggests that it may be more difficult to contact the Pension Service at a local level in future.[153] Recent DWP research highlighted uncertainty among potential claimants about the fact that a home visit can be requested.[154] As part of its duties under race relations legislation, the Pension Service should evaluate awareness among ethnic minority pensioners about how to access the Pension Service at local level, determine whether the arrangements in place are sufficient to meet their needs and by 1 October 2006 report on the results.

Partnership working

120. Ethnic minority older people are often included in the category of pensioners described as 'hard-to-reach'. Dr Sadhu Singh, Chairman of the Sikh Gurdwaras in Wolverhampton told the Committee that some ethnic minority elders were quite isolated:

"…because of the language and culture barrier they are [too] shy to go out so they just sit at home and do not know what … facilities are available."[

155

121. A number of witnesses mention distrust of statutory service providers such as DWP.[156]

122. However, as Sally West of Age Concern told the Committee, so called 'hard to reach' people are not isolated from everybody - they visit GPs, for example, and attend hospital appointments.[157] Vanessa Davis of Disability Alliance commented:

"It is not necessarily that [ethnic minorities] are harder to reach; it is perhaps that we are not looking in the right places."[158]

123. She went on to argue that as many ethnic minorities may already be in contact with, for example, doctor's surgeries, hospitals or social services, professionals working within these areas are in a position to provide information and advice and could be appropriately trained.[159] This strategy was also endorsed by the Local Government Association (LGA) who also said that local authorities have an important role to play in working closely with ethnic minorities as they provide a gateway to a range of services which ethnic minorities may already be using.[160]

124. Voluntary and community organisations are an important point of contact for many older people from ethnic minorities. The Policy Research Institute on Ageing and Ethnicity said voluntary and community organisations were often acting as "primary providers" in providing advice and referrals to other services.[161] Richard Wilson of Help the Aged said that local community groups were often the "first point of call", because they are trusted and "that is where they go for all their other translation and support needs."[162] Vanessa Davis of Disability Alliance also stated that local community or religious groups usually have one or more people whom the ethnic minority community use as a contact point for information and advice. Such people can be a useful way of getting information into a local ethnic minority community. Other witnesses pointed to the important, and common, practice among ethnic minority groups of passing information by word of mouth.[163]

125. DWP research found that strategies to encourage take-up were found to be most effective when developed in partnership between the Department, the local authority and with the community and voluntary sector.[164] Pension Service works in partnership with outside organisations in a number of ways. For example, it has developed:

Joint Teams, made up of Pension Service, local authority and, in some areas, voluntary sector staff who operate as a single team, undertaking home visits and taking claims across the range of benefits and, at the same time, undertaking financial assessments for services.[165]
A Partnership Fund which offers short-term (maximum of two years) funding to local and national partner organisations to: improve take up of benefits by, and promote the independence of, older people; improve access to services and gain a better understanding of the needs of older people, including ethnic minority elders.[166]
Local Service staff also work in partnership with other organisations on take-up initiatives.

126. DWP has also conducted research into barriers to take-up and awareness of and attitudes to Pension Credit. Recent research found that more needs to be done to: clarify the levels of income and savings at which people may be entitled to Pension Credit: raise awareness of the fact that people aged 60-64 are entitled to Guarantee Credit; and highlight that certain circumstances do not mean people cannot claim (such as home ownership and receiving financial support from family members).[167]

127. Research on delivering benefits and services to black and minority ethnic older people found that it was important to have a specific strategy aimed at understanding each individual community and providing services tailored for that community. Community and statutory organisations in the three Asian communities studied felt these strategies needed to take account of the particular difficulties facing women.[168] Evidence to the inquiry underlined the importance of doing this. Terry Patterson, a representative of the LGA, spoke of the need to think things through "community by community...in terms of the approaches made."[169] Jeremy Vanes of Wolverhampton Citizens Advice Bureau thought DWP needed to break down the target communities on the basis that every community was made up of different groups and had different ways of working. In order to know this,

170

128. Dee Springer, Director of Frontline Housing and Advice, recommended a pilot with DWP working in collaboration with small ethnic minority organisations to collect such information about the numbers of ethnic minority pensioners, who they go to and how to access them and provide suitable information.[171]

129. There are a wide range of organisations and local groups already working closely with ethnic minorities and witnesses to the inquiry felt that more needed to be done to build links with these organisations. Junior Hemans of the West Midland Caribbean Parents' and Friends' Association told the Committee that "the plugs into the channels of networks do not exist, or have never been fully developed".[172] In addition, Mahmood Kahn, a representative of Wolverhampton Mosques, said:

173

130. It was emphasised during evidence that it was possible to build up these links with community organisations but it took time and persistence. Sending leaflets to community organisations was not enough.[174] Work done recently by the Pension Service was welcomed. Jeremy Vanes of Wolverhampton Citizens Advice Bureau praised the improvement in claim forms for pensioners and on the outreach work that had been done, although he emphasised the importance of consistency in the staff undertaking this work.[175] Age Concern welcomed the proactive efforts being made to reach all older people.[176]

131. Evidence to the Committee's recent Pension Credit inquiry suggested that partnership working is more successful in some areas of the country than in others.[177] The Committee recommended that the Pension Service should monitor the partnership working of the Local Service and, by 1 July 2006, develop a plan for improving partnership in areas where it may be found to be weak.[178]

132. Evidence to that inquiry also showed emerging concern about the impact of the requirement to achieve efficiency savings across DWP. There were concerns that this was reducing the capacity of the Local Service to play an active role in local partnerships. Paul Vizard of the Pension Service trade union side, told the Committee that:

179

133. The Committee was told that the number of Partnership Liaison Managers in the Local Service had been cut by approximately a third, to 203. We were told that the aim was to increase the number of Customer Liaison Managers in order to focus on one-to-one contact.[180]

134. There were concerns that staff who had previously been involved in high-quality outreach work are now being required to 'cold call' pensioners on the basis of computer generated scans in a drive to meet take-up targets.[181] There were also concerns that this activity was not generating 'good returns.'[182] The Chief Executive of the Pension Service said that she recognised that:

183

135. There is an important question as to whether this type of approach is likely to be successful in encouraging 'hard to reach' pensioners, including ethnic minority pensioners, to claim. The NAO report suggested that local outreach work, though more resource-intensive, was more successful in this respect. Jeremy Vanes of Wolverhampton Citizens Advice Bureau provided an example of the sort of resource intensive approach needed to reach certain pensioners:

184

136. Local Area Agreements, currently being piloted by the Office of the Deputy Prime Minister with local authorities, offer an excellent opportunity to bring together all local agencies to enable them to focus on meeting community needs, including benefit take-up, income maximisation and anti-poverty strategies. It is essential that local councils take the opportunity to match such strategies to the ethnic profile of their populations, but the resource demands upon those with the most diverse and mobile communities will need to be taken into account.

137. When asked about the extent of outreach and partnership work that the Department undertakes, the Minister for Work replied:

185

138. The Business Strategy Director of Jobcentre Plus thought that it is important that the Department uses the voluntary and community sectors to help them reach out to ethnic minorities. The Ethnic Minority Outreach (EMO) Project has helped in this endeavour, although it is chiefly concerned with ethnic minority employment. The EMO project is examined in more detail in chapter 8.

139. The Committee considers local partnership schemes to be essential to the success of the Pension Service and therefore we recommend that areas with higher-than-average ethnic minority populations get additional resources and support for partnership development.

111 Pension Credit is made up of a Guarantee Credit (almost identical to MIG) and a Savings Credit (which aims to ensure that those who have some private provision for retirement will be better off than those who have not). Back

112 Work and Pensions Committee, Pension Credit, Third Report of Session 2004-05, HC 43-11, Ev 126 Back

113 DWP/National Statistics, Income Related Benefits Estimates of Take-Up in 2002/2003, www.dwp.gov.uk Back

114 HC Deb, 15 November 2004, col 1179w Back

115 Ev 138 Back

116 HM Treasury, 2002 Spending Review, Cm 5570, July 2002, para 18.2; and HM Treasury, 2004 Spending Review, Cm 6237, para 19.6. Within the overall target, there are targets to be paying Guarantee Credit to 2.1 million pensioner households by 2006 and 2.2 million by 2008. Back

117 HC Deb 3 Feb 2005 col 68WS Back

118 DWP, DWP Autumn Performance Report: Progress against Public Service Agreement Targets, Cm 6397, December 2004, p 46 Back

119 DWP and National Statistics, Income Related Estimates of Take-up in 2002/03, Table 2.1. Take-up of Housing Benefit by caseload was between 84% and 90% Back

120 Ev 205, tables 3 and 4 Back

121 DWP and National Statistics, Income Related Estimates of Take-up in 2002/03, Table 3.1. Take-up of Council Tax Benefit by caseload was between 56% and 62%. Back

122 Ev 205, tables 5 and 10 Back