Memorandum submitted by WorkDirections (DM 08)
1. WorkDirections, as part of the international
Ingeus group of companies, delivers welfare-to-work services in the
2. In terms of this Inquiry, WorkDirections' primary concern is how the benefit decision making and appeals process interacts with welfare-to-work provision and the support we provide in helping people into sustainable employment.
3. In this context, we believe that an effective decision making and appeals process is timely, consistent and transparent. It should promote an understanding of the rights and responsibilities of claimants and ensure that they are able to access support to help them move back to work.
4. For those who are receiving conditional benefits, the decision making regime should act to link the cause of the sanction (non-attendance or non-compliance) with the effect (benefit reduction). The process must be timely, consistent and fair in order to support changes in the behaviour and attitude of clients. It is imperative that sanctions are not applied as a result of lack of understanding or poor communication.
5. Since the last reform of decision making and appeals the role of the private and voluntary sector in DWP delivery has grown. However, changes to programme delivery, benefits and conditionality have not been matched by investment in the systems and processes that support timely, consistent and transparent decision making.
6. Currently across all the programmes we deliver there is a time-lag between the act of non-compliance and the implementation of a sanction which can undermine efforts to engage clients and change attitudes and behaviours.
7. The interaction with the decision making and appeals system is part of the administrative cost of delivering DWP programmes for providers. When the system is operating inefficiently it takes away resources from engaging clients and helping them into work. With a high rate of clients appealing decisions and being successful in their appeals, there is a need to review the system to increase efficiency.
8. With contracted provision for Jobseeker's Allowance (JSA) claimants currently in transition to Flexible New Deal, our submission will predominantly focus on decision making and appeals in relation to clients claiming health-related benefits and engaging on the Pathways to Work programme.
9. There are significant ongoing challenges with decision making in relation to eligibility for Employment and Support Allowance (ESA) and the Work Capability Assessment (WCA). Delays in the assessment phase and a lack of coordinated communication with clients and providers is leading to inefficient resource use on Pathways to Work and confusion and distress for claimants.
10. The introduction of the Flexible New Deal offers an opportunity to improve upon the decision making and appeals procedure for JSA claimants and learn lessons from previous provision. Processes need to support transparent, clear and consistent decision making and all stakeholders (decision makers, providers, clients) need to have a shared understanding of what the rules mean and how they will be applied. The role of the decision making and appeals system must be part of the planning for transition in employment programmes. Decision makers and provider staff must have received sufficient training to ensure that the new programme will interact with the system in an efficient way.
Decision Making and Appeals on Pathways to Work
11. WorkDirections highlighted challenges with decision making and conditionality in a paper which fed into the Gregg Review in November 2008.
12. There are two main areas of concern in relation to the decision making and appeals process for people claiming health-related benefits. These are decisions about eligibility for ESA and decisions about compliance with the requirements of an ESA claim. There are considerable concerns about the effectiveness and efficiency of the decision making system in both of these situations.
Decision making based on the Work Capability Assessment
13. The Work Capability Assessment (WCA) is critical to decision making in relation to ESA. The WCA identifies how a client's health condition or disability affects their ability to work and plays an important role in determining their entitlement to benefit.
14. When individuals initiate a claim for ESA the first 14 weeks are an assessment period when they are placed on the basic rate of the benefit which is equivalent to JSA rates. The intention was that claimants' WCA would be completed within those 14 weeks and then once a decision had been made that they were eligible for ESA and had been placed in the Work-Related Activity Group (WRAG) they would be referred to the Pathways to Work programme.
15. ESA claimants are being referred to Pathways to Work after 14 weeks of initiating a claim but for the majority of clients this means they are being referred before they have had their WCA. Providers begin the cycle of mandatory monthly Work Focused Interviews at the point of referral despite the fact that the WCA (which is the basis of the decision making about eligibility for ESA) has not taken place.
16. The consequences of this delay in decision making about eligibility for ESA as a result of delayed WCAs are significant - both for individuals claiming the benefit and for Pathways to Work providers.
17. At the time of writing, over 50% of the WorkDirections caseload at week 14 of the Pathways to Work programme (28 weeks after their original claim) have not received notification of the WCA results (and thereby benefit eligibility). By this point they are potentially over half way through the mandatory cycle of Work Focused Interviews.
18. For some clients, who are later placed in the ESA Support Group as a result of the WCA, it can mean that they are expected to attend mandatory interviews despite the fact they may be undergoing treatment or be terminally ill. This causes great distress to the individuals concerned and their families. These clients' participation can be deferred until after their WCA but by this point they will normally have had to attend at least two interviews (one with Jobcentre Plus and one with the Pathways to Work provider).
19. Currently the majority of clients are having their claim for ESA refused following their WCA. The information available to clients about why their claim for ESA has failed is patchy and a high number of clients appeal. Whilst clients are awaiting the results of their appeal, it can be difficult to motivate them to engage with work-related activity.
20. For the clients who 'fail' the WCA, this can lead to a sense that they have been 'penalised for trying'. As a result of engaging with the programme, improving their ability to manage their health condition, and by considering moving into work their claim for ESA is refused and their access to support through Pathways to Work is denied.
21. For providers, the impact is significant. In one of our offices, 50% of all clients who started the programme over a six-month period failed their WCA and left the programme. These clients will have been attending the monthly Work Focused Interviews as a minimum and may have also been engaging in voluntary elements of the programme including accessing condition management services. In some instances clients have actually completed the five monthly interviews (the mandatory element of the programme) before it is decided they are ineligible.
22. It is costly for providers to invest in support for clients who have joined the programme and engaged with it before their eligibility for the benefit and the programme has been determined. These costs were not included in financial modelling undertaken by providers for Pathways to Work. This is because the decision about eligibility for the programme and ESA was due to take place during the assessment phase (before clients were referred to providers).
23. The administrative burden of the decision making and appeals process has reduced resources available for engaging clients and helping them into work (the Pathways to Work programme's objective). Providers cannot recoup the investment in clients who move off the programme. They have only six weeks to work with a client after their claim for ESA is closed (the tracking period). Some clients do move into work during this period but it is a small percentage of those clients who 'fail' the WCA. Seventy per cent of funding for Pathways to Work is linked to a client moving into work.
24. In addition, in terms of performance measurement, the people that exit the programme are still included in start figures. This means that the conversion ratios measuring mandatory starts to job starts are distorted. If, for example, 50% of clients leave the programme due to a decision being made against their eligibility for a benefit, performance figures will be significantly affected. To achieve the performance offer with this measurement, with 50% of clients leaving the programme, a provider will have to achieve double the number of job outcomes that were originally offered.
25. OFSTED and DWP's Star Ratings use the conversion of programme starts to job outcomes to measure performance and assess quality of provision. For Pathways to Work programmes, given the high levels of clients who leave when a benefit decision is made, this will not fairly reflect provider performance or the quality of their service. In addition, if delays in decision making and rates of failure of WCA vary between different areas, comparative provider performance data and wider comparisons with Jobcentre Plus-led Pathways to Work will also be unfair.
Decision making on benefit sanctions
26. Mandatory Pathways to Work clients must attend a minimum of five monthly Work Focused Interviews with a Pathways to Work provider, as well as the initial Work Focused Interview with Jobcentre Plus.
27. The decision making on benefit sanctions has multiple hand-offs included in the process. This includes several different departments within Jobcentre Plus (frontline delivery offices, Benefit Delivery Centres, payment teams). At any point information can be lost or not delivered to providers and clients. Data is stored on several different and incompatible systems and often it relies on paperwork being passed back and forth.
28. On Pathways to Work once a referral for a sanction has occurred providers are not allowed to contact a client or engage with them on the programme until they have been notified of the decision. It can take several months for a notification to be received and with some regularity they are not received at all. This is disruptive to the process of engagement and activation which is critical in the process of supporting people into work.
29. It has not been possible to track each individual referral and decision to analyse the outcomes (sanction applied, sanction not applied) and whether providers and clients are notified in a timely fashion. However, the data that WorkDirections has collected for May, June and July 2009 highlights considerable areas of inefficiency and concern. In this period 1919 clients were referred for a sanctions decision and we received notification of 603 decisions. Of those 45% resulted in a benefit sanction being applied. From this information it seems reasonable to conclude that providers are not always receiving notification of decisions and that Jobcentre Plus decides that sanctions will not be applied in the majority of cases.
Decision Making and Appeals and Flexible New Deal
30. The introduction of the Flexible New Deal offers an opportunity to monitor the effectiveness of decision making for JSA claims and make improvements where necessary.
31. As on all programmes, the efficiency of the decision making and appeals process will partially be determined by whether those referring clients for a decision and those making the decision have a shared understanding of the process and reasons for referral. The technical language involved in decision making and appeals can often be difficult for those making referrals to understand. If the right language or forms have not been used referrals may be returned to the provider or the referral can be rejected and sanctions are not applied to the client's benefit.
32. The proposed system for Flexible New Deal has eight different forms for referral for sanction or raising a doubt on someone's claim. It will be difficult for advisors to differentiate between the reasons for referral as the definitions are overlapping and confusing for five of the forms (see below). Using the wrong form will constitute a deficient referral and therefore it will be sent back to the provider. The use of both prime and sub-contractors to deliver services may add layers of complexity and confusion.
33. Proposed Flexible New Deal referral forms:
34. The speed of decision making will be critical. Whilst decisions are being made or clients are appealing it is difficult to engage clients. The quicker the decision is made the easier it is to maintain clients' momentum on a programme. In many instances, time lags in decision making can mean that the sanction on the client's benefit happens after the client has re-engaged with programme. This undermines the client's faith in the decision making and appeals system and can lead to significant challenges for providers in terms of keeping clients engaged and active.
35. WorkDirections welcomes the Committee's inquiry into 'decision making and appeals'. The quality of the interaction between the benefit decision making and appeals process and welfare-to-work provision must be improved. Confidence in the system is being undermined by the way it operates. Client experience and employment programme performance are being affected.
36. The current decision making and appeals process does not recognise the increased role of the private and voluntary sector in delivering DWP programmes. Processes must be reviewed to maximise efficiency and effectiveness when there are changes in provision or in benefits or conditionality. The introduction of Pathways to Work and ESA has highlighted the need to ensure that the system can respond to the roll-out of Flexible New Deal and lone parent conditionality and benefit changes.
37. There is significant potential to improve client experience and the performance of employment programmes through addressing issues raised in this submission.
 Jordan, Hannah (2009) Conditionality and Pathways to Work, WorkDirections November 2009 http://www.workdirections.co.uk/files/uploads/DocFile_id_231.pdf
 Barker, Alex (2009) Sickness benefit threatens political side effects Financial Times 12th July 2009
 30% of contact value is paid as service fee, 50% is paid when a client enters work and 20% is paid when a client remains in work after 26 weeks.