Select Committee on Work and Pensions Written Evidence


Memorandum submitted by the Mayor of London's Office

SUMMARY

    —  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.

INTRODUCTION

  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 will—unfairly—be deemed unsuccessful in the longer term.

LONDON ISSUES

  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 conditions;

    —  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 standards; and

    —  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.

PATHWAY TO WORK PILOTS

  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 qualifications.

  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.

THE EXPERIENCE OF SICK AND DISABLED PEOPLE

  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 are crucial.

    —  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".

SUPPORT FOR SICK AND DISABLED PEOPLE TO MOVE BACK INTO WORK

  13.  For many people moving from benefits to the labour market—not just those on ICB—there 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 needs);

      —  £389 for a person with low/medium needs;

      —  £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" claimants.

  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.

SUPPORT SERVICES

  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.

Richard Wiltshire

5 October 2005



 
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