Memorandum submitted by the Mayor of London's
Incapacity Benefit reform is a major
issue for London. Contrary to what is widely believed, London
includes some of the areas in the country with the highest rates
of Incapacity Benefit (ICB) receipt for people aged 50 and over.
The next round of Pathways to Work
pilots should include at least two areas in London.
There needs to be a fundamental review
of how service providers (eg Jobcentres and employment advisers/GP's
and careers advisers) understand disability equality.
There should be a clear contract
between employment services and people taking up the offer of
supported return to work activities, guaranteeing continuing support.
1. Incapacity Benefit reform is a major
issue for London. Contrary to what is widely believed, London
includes some of the areas in the country with the highest rates
of ICB receipt for people aged 50 and over. In Inner London, the
rate of ICB receipt for people aged 50-59 is higher than in any
region of England apart from the North East. Four London boroughs
are among the 20 in England with the highest rates of receipt
for this age band (Hackney, Islington, Newham and Tower Hamlets).
2. The Mayor welcomes the approach to supporting
disabled people and people with limiting medical conditions set
out in the Five Year Strategy, which focuses on people's capabilities
rather than their presumed "incapacity". Successfully
implementing this approach will demand major changes in public
attitudes towards disability and in the employment chances of
disabled people and people with limiting conditions.
3. The Mayor is concerned that the public
discussion of ICB reform has been focused on the ways of reducing
the overall number of ICB recipients rather than on improving
employment outcomes for disabled people and people with limiting
conditions. An unfortunate aspect of this has been the failure
of this discussion to take into account some broadly positive
trends in ICB receipt over the last 10 years.
4. It is true that the number of ICB claimants
has remained virtually unchanged since 1995, but this reflects
the combined effects of falling rates of ICB receipt among
older male workers and increases in the numbers of older workers,
both male and female. While there has been an increase in the
rate of ICB receipt among women, this in all likelihood mainly
reflects higher rates of entitlement to ICB due to increased employment
of women. It is therefore not the case that there has been no
change in ICB receipt, as seems to be assumed in much of the public
discussion on reform.
5. It would be imprudent to allow policy
on ICB reform to be seen primarily in terms of potential reductions
in the overall number of claimants, because it is impossible
to predict at this stage whether the effects of population ageing
will outweigh the effects of future improvements in employment
for disabled people and people experiencing limiting medical conditions.
There is therefore the risk that successful policies to
improve employment outcomes for disabled people and people with
limiting conditions willunfairlybe deemed unsuccessful
in the longer term.
6. Because London has a younger population
than other parts of the country, the very high rate of ICB receipt
among older workers in the capital has tended to pass unnoticed.
Efforts on improving employment for those on ICB have been largely
concentrated in former mining and industrial areas.
7. The Mayor is concerned that no London
local authority areas are included in the Pathways to Work pilots.
This means that lessons concerning the specific issues facing
disabled people and people with limiting conditions in the London
labour market, and the appropriate interventions to address those
issues, will not be learnt.
Among these issues are:
longer travel to work distances
and journey times: those who are limited to seeking employment
in areas closer to their area of residence are heavily disadvantaged
in the London labour market due to the concentration of employment
in central areas (a point which applies to lone parents as well
as disabled people);
flexibility in employment: London
has fewer part-time jobs than elsewhere in the UK, severely limiting
the options available to those with disabilities and limiting
cost of living: while wages
are generally higher in London than elsewhere, the "London
Earnings Premium" is far smaller in both absolute and percentage
terms for workers in lower-paid occupations. As nearly half of
those who are long term sick or disabled in London have no qualifications,
their job prospects are largely confined to lower paid jobs which
may not afford them a significant improvement in their living
demand for workers with lower
qualifications: the relatively low wages for jobs requiring
low qualifications are a symptom of the bias of demand for labour
in London towards occupations with higher qualifications levels.
Although there is strong demand for labour in London (arguably
unlike in some of the current Pathways to Work pilot areas) demand
for those labour with low qualifications is low, increasing the
disadvantage experienced by a high proportion of ICB recipients.
8. It is vitally important that the multiple
disadvantage in employment experienced by many disabled people
and ICB claimants is taken into account in the offer of return
to work activities. Nearly half of those who are out of the labour
market due to permanent sickness or disability have no recognised
9. It is also crucial that differences between
regional labour markets are taken into account. It is therefore
important that new methods of offering support to people moving
from incapacity related benefits to employment be piloted in London
as well as in those (predominantly) former industrial and mining
areas where efforts have so far been concentrated. The Mayor therefore
agrees with the conclusion of the National Employment Panel report
Enterprising people, enterprising places that the next round of
Pathways to Work pilots include at least two areas in London.
10. In order to deliver a change in culture
in relation to disabled people and employment there needs to be
a fundamental review of how service providers (eg Jobcentres and
employment advisers/ GP's and careers advisers) understand disability
equality. It is understood that the new Disability Act and particularly
the public sector duty will go along way to challenging this culture
of service provision. However, the Green Paper should explicitly
acknowledge the need for a change in culture and approach.
11. This point is very much supported by
the initial findings of the disability viewpoints research commissioned
by the GLA. The draft report findings are that:
Access to Work was strongly praised
as a useful scheme that enabled people to work, but Jobcentre
Plus and Disability Employment Advisors were very strongly criticised
by the majority of participants.
The benefits system was a major obstacle
preventing people seeking and remaining in work.
Attitudes and lack of awareness on
the part of both employers and colleagues were also a major barrier.
Flexible working hours and methods
Employers were perceived as being
unwilling to commit resources to make work places accessible or
to invest in equipment.
Voluntary work was very important
for many disabled people in this research but could also have
drawbacks in terms of lack of access support and financial implications.
12. People with mental health problems form
an increasing proportion of the ICB caseload. It is vitally important
that obligations to attend work focussed interviews or engage
in return to work activities are handled sensitively. The Mayor
therefore agrees with the Disability Alliance that "there
needs to be flexibility around targets and an understanding of
reasons for non-compliance by people in these groups".
13. For many people moving from benefits
to the labour marketnot just those on ICBthere is
insufficient support available after they have entered work. At
present Jobcentres' interest in a case effectively ends once the
individual has ceased to claim benefits. Two risks are that people
take up unsustainable employment opportunities and wind up experiencing
repeated spells of worklessness and that people are left in low
paying employment with limited prospects for advancement. The
Mayor would therefore recommend a clear contract between employment
services and people taking up the offer of supported return to
work activities, guaranteeing continuing support in the areas
of income maximisation, access to services and benefits, careers
advice, childcare and further training over a period of at least
eighteen months from the commencement of employment.
14. It also needs to be recognised that
there are significant additional costs associated with taking
up employment that are often not recognised. Research, conducted
by the Centre for Research in Social Policy with the support of
Disability Alliance, presents budget standards for groups of disabled
people who have different needs arising from physical or sensory
impairments. The budget standards represent the amounts disabled
people (of working age) require in order to cover the costs of
an acceptable and equitable quality of life. The findings of this
research were that:
Disabled people experience additional
costs in most areas of everyday life, from major expenditure on
equipment essential for independence, to ongoing higher expenses
for, for example, food, clothing, utilities and recreation.
The weekly budget standards required
for disabled people are as follows:
£1,513 for a person with
high/medium mobility and personal support needs;
£448 for a person with intermittent
or fluctuating needs (ie from relatively negligible needs to higher
£389 for a person with low/medium
£1,336 for a person with
needs arising from hearing impairment; and
£632 for a person with needs
arising from visual impairment.
Deaf people face particularly high
costs due to their need for interpreter/communicator services.
The weekly income of disabled people
who are solely dependent on benefits is approximately £200
below the amount required for them to ensure an acceptable, equitable
quality of life.
Unmet weekly costs for disabled people
who work 20 hours per week at the minimum wage are up to £189
(for those with high/medium needs).
15. There are potential problems with the
proposed dual benefit structure. The Mayor recommends that in
order for this distinction to work it should be firmly rooted
within a social rather than a medical model of disability. Its
description in the strategy is very much based on a medicalised
approach. Developing a more flexible and individually tailored
approach could be more beneficial than what seems to be outlined
in the Strategy. The distinction between the Rehabilitation Support
Allowance (RSA) and Disability and Sickness Allowance (DSA) risks
reinforcing stereotypes of "deserving and non-deserving"
16. The Mayor welcomes the fact that people
on the proposed Disability and Sickness Allowance have access
to all return to work programmes. The Mayor recommends that these
programmes be designed and funded to accommodate the needs of
those with more severe impairments.
17. Much of the discussion of ICB reform
has been concerned with how to improve employment for those with
less limiting conditions (those who would be in receipt of the
proposed "Rehabilitation Support Allowance"). For those
people who are genuinely unable to work at a level that will take
them out of the benefits system, the system needs to provide adequate
income and a flexible structure that allows people to take opportunity
of one off or part-time employment or to test possibilities without
the fear of losing such support. It also needs to ensure that
people in this situation are not written off or considered as
valueless. The Mayor recommends that disabled people themselves
should directly inform any process or structure that is developed
to help people obtain experience and qualifications.
18. Serious consideration needs to be given
to the process whereby disabled people engage with the system.
Current experience is of a system that continues to treat disabled
people in a negative way and as passive recipients of support.
Although there are experiences of good practise there is considerable
evidence to say that support services are under-resourced, are
seen as less important and are overly bureaucratic and paternalistic.
Consideration should be given to developing employment support
through the structure of Centres for Independent Living. The process
needs to be holistic, rights based and directly informed by the
experience of disabled people. Support and advice need to be joined
up looking at the range of barriers faced by disabled people.
The move towards personal budgets needs to be linked into employment
as well as personal assistance and transport.
5 October 2005