Select Committee on Work and Pensions Written Evidence


Memorandum submitted by Durham County Council

REFORMS TO INCAPACITY BENEFIT

  We are a local authority Welfare Rights Service employing 20 WROs who provide a specialist welfare benefits service for the people of County Durham. In addition to targeted campaigns, advice provision and representation, we also provide dedicated support services to various arms of our Authority within Social Care and Health and assist with corporate strategy as required. A measure of the scale of our service is that we provided representation at one third of all appeals heard by the Appeals Service, Newcastle Regional Office in 2004. We would like to offer the following comments to assist the Committee's enquiry.

  1.  It is difficult to see how the proposed system of two benefits with an additional test (the employability and support assessment) would be either simpler to administer or easier for claimants to understand. Whilst knowledge of the detail would enable a better assessment, intrinsically the proposals appear to be a retrograde step.

  2.  Arguably any measures that restrict the support provided by Social Security payments within any context will improve work incentives. However this only makes sense if it's assumed that either that either improving work incentives is an omnipresent goal or that current incentives are too low. The former is clearly an absurdity as incentives could be best improved by the removal of Social Security provision altogether. With regard to the latter it is our view that the current Incapacity Benefit levels provide sufficient incentive for claimants who are able to work to do so. We consider it highly unlikely that individuals would choose to live on £76.45 (long term annual rate) when they could earn £220 for a weeks work (40 hours @ current minimum wage). Although we accept that there is small number of people in receipt of Incapacity Benefit who may be capable of some form of work the current stringent regime of PCA recalls is more than able to deal with this issue. In any event most people who fall within this category are not there by choice but by necessity as a result of factors such as a lack of available jobs, poor education etc.

  3.  The statistics show that the highest concentrations of Incapacity Benefit claimants are in areas characterised by high unemployment and social deprivation. These are the areas that have lost "traditional" industries such as coal mining, steel making, shipbuilding and other heavy industries. We believe that it is folly to ignore the fact that those industries have been responsible for a prevalence of industrial accidents and diseases which goes a long way to explaining why so many are incapable of work. It is also counterintuitive to argue that claimants in such areas are for some reason less willing to work when they have demonstrated their ability to work long hours in the most harsh and demanding conditions for generations.

  4.  Our previous comments on incentives refer to the negative incentives that may form part of the reforms. However, we welcome positive incentives to help sick and disabled people find work. This would include education, retraining and the help of personal advisors. The caveat is that these measures must be optional for claimants and non-participation must not be penalized. Indeed it is only by giving sick and disabled people real choice in this area that the success or otherwise of such initiatives can be accurately measured.

  5.  Deciding whether a person a person is incapable of work or not inevitably involves exercising a degree of discretion. Clearly this can be within the context of an informed judgement but we think that it is probably impossible to replicate the type of scientific accuracy available within the material, as opposed to the human, world. We believe that the current means of making the distinction are more than adequate to ensure that Incapacity Benefit decisions do not result in significant amounts of public money being paid to people who are capable of work.

  6.  We do not consider that the reforms will impact positively on either levels of fraud or error. We believe that current levels of fraud are minimal and reforms which make the benefit more difficult to access may even be counterproductive in achieving openness and honesty in claimants' compliance with the new regime. Furthermore it is again difficult to see how introducing further complexity to disability adjudication will reduce error in decision making, particularly given the substantial staffing cuts faced by the Department for Work and Pensions.

  7.  In many areas local labour markets will not be able to provide the jobs needed. Indeed this is evidenced by the high degree of correlation between local levels of unemployment and the number claiming Incapacity Benefit. In those areas removing entitlement to Incapacity Benefit is more likely to increase the number of Jobseekers Allowance claimants rather than increase the number of people in employment. Paradoxically this would have the effect of reducing local demand and so act as a driver to increase unemployment.

  8.  The evidence does not suggest that Incapacity Benefit is, by any standards, a "runaway" benefit. The bulk of the expansion of numbers occurred prior to the election of this government in 1997 with only a 100,000 increase since then. The Department for Work and Pensions Five Year Strategy itself states that new claims are reduced by "around a third" (pg 41 DWP—Five Year Strategy) and that the latest data indicates a small fall. Neither does the statistic that "once a person has been on the benefit for 12 months, the average duration of their claim will be eight years" (pg 41 DWP—Five Years Strategy) necessarily mean that claimants are becoming disabled by "worklessness".

  Although there can be little doubt that the longer without work the harder it is to re-enter employment this statistic is more likely to reflect the fact that those ill for 12 months are likely to have a longstanding condition which will take a considerable time to resolve.

  9.  We do not have sufficient information at present to comment on the success or otherwise on the pathways to work pilot schemes but would hope to provide a meaningful analysis once the green paper is published.

Mick Guy

3 October 2005



 
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