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6.55 pm

Angela Eagle (Wallasey) (Lab): As a great supporter of the concept of pathways to work, I rise to share with the House the early experiences of the programme in Wirral and to note the results so far. I also hope to draw some useful conclusions about future effectiveness.

When I was a Minister at what is now the Department for Work and Pensions, I was closely involved in the transformation of the then Benefits Agency into what is now known as Jobcentre Plus. The aim was to retool the Government’s administrative apparatus and ensure that we could deliver a more active labour market, and hence try to offer more positive choices for those of working age who had found themselves having to claim benefits. Since that time, the new deal has blossomed and laid the groundwork for the national presence of the personal adviser-led pathways to work programme, which has recently arrived in Wirral.

Although the capacity of the Government to deliver an effective, active labour market service to claimants has risen substantially since 1997, so have the needs of those who are still left without work after well over a decade of economic growth and the creation of 2.5 million extra jobs. In the Wirral area, the proportion of people of working age claiming incapacity benefit or income support and therefore eligible to enter the pathways to work programme is 11 per cent. That is by no means one of the highest figures in the country, but it is not one of the lowest either.

That means that substantial numbers of our fellow citizens are finding access to work difficult because of illness or injury. In some of the electoral wards that I represent, levels of incapacity benefit and income support claims are even higher than that. It is difficult to see how such areas can share fully in the rising prosperity of the country and benefit from our growing economy when they have so many people workless and stuck on benefits. It is our duty to reach out to try to help them.

Life on incapacity benefit is not easy, as the levels of payment are hardly generous. That is especially true if the individual is out of work for any length of time. Yet Government figures show that the average length of time that incapacity benefit recipients spend out of work is increasing. When the benefit was first created in 1985, an individual could expect to spend an average of three years out of work; that has now gone up to nine years. That means that those who fall out of the labour market and on to incapacity benefit are finding it increasingly hard to get back into work. That is the case despite a buoyant labour market. We must work out why that is, and seek to address it effectively, if we are to spread opportunity throughout the country and ensure that no one is left behind.

The pathways to work national programme was begun in 2002 in order to achieve progress in that important area. Initial research demonstrated that of the 2.7 million people receiving incapacity benefit, 1 million wished to
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find work. A good proportion volunteered to go on to pathways programmes because they rightly saw them as helpful and beneficial. Perhaps surprisingly, experience in the initial pilots demonstrated that the main barriers to incapacity benefit recipients finding work were to do not with the health condition that had probably led them to claim benefit in the first place, but with their loss of confidence after spending time out of work or having had some trauma in their lives, their lack of skills, and worries about being able to leave benefits safely. Therefore, suggesting effective ways to tackle these problems was an obvious design priority for the programme.

It being Seven o’clock, the motion for the Adjournment of the House lapsed, without Question put.

Motion made, and Question proposed, That this House do now adjourn .—[Steve McCabe.]

Angela Eagle: Initial results nationally also showed that three chronic conditions accounted for three quarters of all the health complaints of those who ended up claiming incapacity benefit. Some 35 per cent. had mental health issues such as stress and depression, 22 per cent. had musculoskeletal conditions such as neck or back problems, and 11 per cent. had cardiovascular conditions such as high blood pressure, respiratory illness or angina.

Pathways to work came to Wirral as part of phase two of the national implementation strategy on 24 April. New incapacity benefit claimants now get immediate access to help by being given a mandatory work-focused interview within two months of their initial claim. Some cases involving serious medical conditions are waived at this stage; other claimants, however, are interviewed every month and assisted in a plan to get back to work quickly, before a lack of confidence has time to become established. Initial results in my locality show that this is working well.

The very good news is that in the first six months, 352 people in the district, 120 of whom are from the Wirral, have been enabled to move off incapacity benefit and into work. That shows that the programme is effective even for those who have been seen as the hardest to help. I am enthusiastic about this and I want it to continue, but I want more people to be helped more quickly. I ask my hon. Friend the Minister to consider the steps that could be taken to spread this opportunity further and faster in the Wirral and elsewhere.

I know that effort is also being made to contact and motivate those who have been on benefit for some time. As a first phase, Jobcentre Plus contacted 800 existing claimants in the Wirral, asking about their condition and whether they would like access to the assistance that pathways can offer. The response rate was unusually high, and it became clear from the responses how great a problem stress and depression has developed into. Instead of such lower-level mental illness accounting for a 35 per cent. share of the big three chronic conditions causing incapacity benefit claims, as it does nationally, the figure locally is an astonishing 86 per cent. Only 9 per cent. of claims are caused by physical conditions. Stress and depression thus appears to be by far the main barrier to work among benefit claimants of working age. That might not be such a surprising conclusion, on reflection,
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because we know, for example, that being jobless can ultimately cause depression. This can be made worse by the lack of confidence that often results from struggling on benefits and losing the sense of self-worth that comes from employment.

In my advice surgeries, I all too often come across people whose mental well-being has been destroyed by bullying at work, which not only causes them to leave their existing employment but often destroys their future employment prospects. Can my hon. Friend the Minister say whether the Government have any plans to address this hidden but costly problem and to minimise the undoubted costs to our economy?

I have spent some time talking to the dedicated staff who are delivering the in-work support and the condition management programme that pathways can offer to incapacity benefit recipients. They, too, are struck by the huge effect that stress and depression appears to be having on the life chances of many people. In the first six months of the programme, 138 people across the district were referred to the condition management programme, which is provided in the Wirral by the local primary care trust. I met some of the very committed nurses and psychologists who support this invaluable and hitherto unavailable service. They use cognitive behaviour therapy to assist people in managing poor health and stress, and they also assist them in developing more positive feelings of well-being. Some of that involves advice on diet and exercise and pain management, and on such disparate things as goal-setting in life, and even relaxation techniques.

The programme begins with an understanding that years out of work can destroy confidence and impairs the ability to face challenges without destructive anxiety. It goes on to teach claimants how to overcome such barriers. It does not provide medical treatment and is therefore complementary to existing NHS services. Participation is entirely voluntary. Many benefit recipients choose to go on the programme, and the early evidence is that it is very valuable. I suspect that it is filling a gap left by the lack of work-based occupational health services and preventive counselling for depression and stress-related conditions. It can prevent people from deteriorating into more serious mental suffering.

If our experience in the Wirral is anything to go by, the cost of those gaps in health provision, both socially and economically, seem to be far higher than we might previously have imagined. I have read some of the local case studies and they show convincingly just how much stress and anxiety has gone unnoticed and untreated in our society. Over and over again, nurses delivering the condition-management programme reported to me that their questioning of benefit recipients to establish how they had fallen out of the labour market in the first place led them to comment that it was the first time that anyone in the system had bothered to ask them how they were, or offered them any useful advice or support. The early experience of the programme was that such people could get back on their own two feet again with just a little help at the right time.

In some cases, the response has been positive and instantaneous, with a transformation of the condition and a quick and successful return to work. In achieving that very encouraging result, the return to work credit has been an invaluable tool. It is payable to those who
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have taken a job earning less than £15,000 a year, and is worth £40 a week for 52 weeks. In other cases, the path back to employment is harder and more difficult to embark on, but there have been some notable success stories, which inspire confidence that the programme will go from strength to strength.

I wish especially to commend the work of the local administrators programme, in both Jobcentre Plus and the NHS. They are working well together in achieving the initial success that I have highlighted. Some 36 personal advisers in the district have received intensive training, 11 of whom operate from the Wirral. The local primary care trust has supplied five case managers to deliver the condition management programme, which is doing so much to offer a helping hand back to meaningful work.

A further strength of our local programme is the employer engagement activities that have been undertaken. In order to create the potential to place claimants in jobs, it is vital that local employers have their often bad perceptions of incapacity benefit claimants challenged. That has been achieved locally by meeting some of those who have successfully made the transition back into work, and arranging testimony from employers who have hired them. It is a tribute to the positive relationships that have been established with the Merseyside Employer Coalition, and 176 individual employers, that so far 51 people have begun work with those employers.

Pathways to work in the Wirral has made an encouraging start, but I urge my hon. Friend the Minister to learn the lessons that it is teaching us, especially about the prevalence of stress and depression and the effectiveness of some simple methods to help people deal with them. Above all, will my hon. Friend think about increasing the targets for re-engagement so that more can receive the assistance being offered by the programme? Can he also think about what further co-operation there could be between his Department and the Department of Health to tackle the gaps in provision to help with the effects of stress and depression that have been highlighted by our experience in the Wirral?

7.8 pm

The Minister for Employment and Welfare Reform (Mr. Jim Murphy): I am delighted to have the opportunity to respond to the points raised by my hon. Friend the Member for Wallasey (Angela Eagle). I am also delighted that others have taken the opportunity to join us in the Chamber this evening, including my hon. Friends the Members for Falkirk (Mr. Joyce), for Birmingham, Hall Green (Steve McCabe), for Motherwell and Wishaw (Mr. Roy) and the Under-Secretary of State for Northern Ireland, my hon. Friend the Member for Liverpool, Garston (Maria Eagle). It is a testimony to their interest in the issue that they are in their places.

My hon. Friend the Member for Wallasey has, as she has said, had much experience in this area, as the content of her comments has proved. She was instrumental in laying the foundations of the Jobcentre Plus interview approach, which has allowed pathways to work to be introduced in the 40 per cent. of the country in which it operates at present.

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It is also an opportune time to have this debate, as tomorrow we will finish the Committee stage of the Welfare Reform Bill, which puts in place a new legislative framework to support people on incapacity benefit. In the past, many of those people have been written off by state or have simply given up on themselves, although which came first is often a moot point. However, a combination of factors has meant that far too many people remain on the benefit for dramatically prolonged periods, as my hon. Friend the Member for Wallasey noted. Although 80 or 90 per cent. of claimants initially want and expect to work, she is right to say that the support has not been in place for them to do so. The Welfare Reform Bill will change the entire dynamic of welfare support for people on incapacity benefit.

My hon. Friend the Member for Wallasey spoke knowledgably about the Merseyside Employer Coalition. While it is essential that we put in place the legislative framework necessary both for the roll-out of pathways and to underpin people’s rights and responsibilities, we must also ensure that employers are engaged. To put it in a crudely economic sense, the Welfare Reform Bill and the initiative, effort and investment involved in pathways amount to a supply-side intervention in the labour market. To make that work, we must make sure that there is employer demand for people whose rebuilt confidence and regained skills bring them closer to the labour market. If they are ready to work, employers will be able and willing to take them on.

Earlier today, I had the opportunity to visit Sainsbury’s London headquarters to celebrate the first anniversary of a fantastic initiative called Workright, which promotes the right to work of people with learning disabilities. I listened to inspirational personal testimonies from the relatively small number of people involved. They said that the initiative had given them greater confidence and self-esteem, and described how the opportunity to work had transformed their lives and their perception of themselves. That is a great testimony to the companies involved and to Mencap, which has played a key role in supporting folk with a learning disability to enter, and remain in, the labour market.

Supporting people to enter the labour market is only part of the challenge, as we know, but we must keep them there and make sure that they do not continue to bounce backward and forward between work and the benefits system. That is why the engagement of employers is crucial, and why we have to do more in that regard.

There are some really enlightened and progressive employers in this country. I shall not name any, as to do so would be unfair to any that I do not mention, but they include some of our major companies, and we also have some very enlightened small and medium-sized firms. We must make sure that their good practice is spread more widely.

Companies seem willing to talk in very positive terms about employing people who have claimed incapacity benefit as a result of a learning disability or a mental or other illness. My hon. Friend the Member for Wallasey is right to say that we must learn the lessons from the pathways roll-out, both in the
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north-west of England and across the UK as a whole. For example, the pilot scheme in Somerset makes support available for all incapacity benefit claimants, not just new ones. We will analyse the findings that emerge from that scheme and from some of the other innovations that we are trying within the pathways framework to determine the best environment for national roll-out in the private and voluntary sectors. For that reason, we will look very closely at the experience in the Wirral and elsewhere.

My hon. Friend the Member for Wallasey also spoke about engaging with the NHS and health providers generally. Of course, a key part of the Welfare Reform Bill—the central thrust of part 1—is the establishment of the employment support allowance, underpinned by the national roll-out of pathways. That will progressively and sensitively encourage people to try to come off incapacity benefit.

An additional part of our agenda for having a million fewer people on incapacity benefit over a decade is to prevent them from having to be on it in the first place. That will not be by rigidly and punitively tightening the gateway to prevent people from claiming incapacity benefit or employment support allowance, but by making much earlier interventions—through employers, the Department of Health, health professionals and others—on the journey out of work and economic activity to incapacity benefit. In many instances, there are markers or flags, such as fluctuating mental health conditions, during people’s experience of that journey and we must make much more coherent interventions when signs of the early evolution of a condition become apparent.

Angela Eagle: I thank my hon. Friend for those comments, because he refers to a crucial part of what we need to learn. So many people in Wirral seem to have fallen into incapacity benefit because they were not helped when they were just about to fall out of work. An occupational helping hand is lacking at the appropriate time, as is cognitive behavioural therapy, which is easily given and not too expensive. Will my hon. Friend raise those points with his ministerial colleagues in the Department of Health? Can we provide more of a safety net than appears to have been the case in the past?

Mr. Murphy: I shall be happy to raise the issue. We have been discussing it in some detail with colleagues at the Department of Health, but as my hon. Friend has referred to it in the House, I shall raise it again and respond to her, either formally at a meeting, if she wishes, or in writing, with an update on progress with our ministerial colleagues.

I hope that my hon. Friend will allow me to make a slightly more political point. In the 1980s and, to some extent, in the early 1990s, many observers would have been forgiven for coming to the conclusion that Government policy was actively to encourage people to claim incapacity benefit rather than unemployment benefit. At a time of mass unemployment, when the Government’s economic policies were failing, there was real pressure at local level for people to go from major redundancy straight on to incapacity benefit. There were two years in the 1980s when the incapacity benefit on-flows were above, or at, 1 million. There was nothing in the water, the air or the food chain during
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those two years—nothing different in the environment; the operation of the welfare system encouraged people on to incapacity benefit, explicitly or implicitly as a matter of Government policy. I am glad to say that the Labour Government’s approach is the polar opposite.

As my hon. Friend kindly acknowledged, we have made significant progress. Nationally, over the past decade, the number of people in work went up by more than 2.5 million to a record 29 million. The employment rate is up. Employment has risen in every region and country in the UK and unemployment has fallen, according to both jobseeker’s allowance and International Labour Organisation measurements. The claimant unemployment rate has fallen most in areas where unemployment was previously highest, from which, as Labour Members, we take great spirit. Long-term—six months plus—youth claimant unemployment has fallen by almost two thirds.

My hon. Friend will be aware of the statistics relating to her area, but the House and the public record will be enlightened by my sharing them with a wider audience. Since 1997, employment in Wallasey is up by 4.4 percentage points, which is better than the national improvement, and claimant unemployment is down by 40 per cent. Long-term unemployment—one year plus—is down by 80 per cent., which again is better than the national figure, and long-term youth unemployment is down by 60 per cent. Of 7,050 new deal starts, 4,840 individuals have been helped into work.

My hon. Friend noted that pathways to work was introduced in April and alluded to its successful roll-out in her constituency thus far. I acknowledge that we do have further to go; we all know that. As she said, it is not good enough that if a person is on incapacity benefit for a year or more, the average becomes nine years. The crucial role of pathways is to provide that earlier dimension, so that people do not become conditioned into a life of benefit and economic inactivity. The scale of our challenge is illuminated by the fact that three quarters of our current IB customers have been on the benefit two years or more. We lay that alongside the pretty hellish statistic that, on average—there are of course exceptions—if someone is on incapacity benefit for two years or more they are more likely to retire or die than ever work a day again in their lives. Three quarters of our current 2.6 million customers are already beyond that threshold, so that highlights the scale of the challenge that we have identified for ourselves as a Labour Government to support a net reduction of a million people on the current numbers of people on incapacity benefit.

I shall now mention the additional efforts that we are making in respect of the pathways in the Welfare Reform Bill. Pathways will be delivered by Jobcentre Plus in 40 per cent. of the country by the end of this year, and we shall ensure that there is coverage throughout Great Britain in time to underpin the employment and support allowance envisaged in the Bill. That will be achieved in phases, the first to be complete by October 2007. Procurement for the first phase has already begun, and I know that my hon. Friend will be pleased to know that some of the experience from elsewhere has been taken into that roll-out. We are using the private and voluntary sectors, and we have taken a deliberate decision to use them, with their expertise, in the future roll-out.

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