4 Enforcing the responsibilities of
Benefit conditionality and sanctioning
76. Conditions have always been applied
to the payment of unemployment benefits. The concept of a conditionality
regime enforced by financial sanctionsi.e. stopping benefit
payments for a limited periodfor claimants who fail to
comply with the rules dates from the 1980s. The system has been
strengthened a number of times in recent decades and broadened
to apply to a greater proportion of the workless populationthere
are now requirements on some claimants with ill-health and disabilities
and lone parents with young children to at least prepare for a
return to work, for example.
77. For a typical claimant the conditions
for continued entitlement to JSA include: signing a JSAG; actively
seeking employment; being available for at least 40 hours work
per week; attending the Jobcentre as required (as noted in chapter
3, most JSA claimants are currently required to attend fortnightly);
applying for any job notified to them by a Jobcentre Adviser;
and completing any relevant job-search activity as directed. Exceptions
and flexibilities apply to claimants with ill-health or disabilities
which limit their capacity to work and to people with caring responsibilities.
78. Under Universal Credit the conditions
are broadly similar but with reduced powers for Jobcentre staff
to apply discretion.
As noted in the previous chapter, the Claimant Commitment potentially
adds a layer of conditionality in that it enables Jobcentre staff
to require claimants to spend 35 hours per week looking for work.
79. In our Report on Universal Credit
implementation we concluded that conditionality has an important
role to play but that the strict conditionality inherent in the
Claimant Commitment should be balanced by meaningful employment
support for claimants. We noted that there is little evidence
that sanctions strengthen work incentives on their own; our view
was that sanctions should therefore be used primarily as a deterrent
and a last resort.
80. We reiterate our view that conditionality
is a necessary part of the benefits system and that sanctioning,
if used appropriately, can be a useful tool for encouraging engagement
with employment support. Sanctions should be used primarily for
this purpose and as a last resort. Strict conditionality regimes
should be balanced by meaningful and in-depth advice and support
from JCP for those who need it.
Welfare Reform Act 2012: tougher
81. Prior to the Welfare Reform Act
2012 coming into force, the maximum period for which a claimant's
benefit could be stopped for a breach of the rules was six months.
New rules which came into force following the Act increased the
maximum period of a JSA benefit sanction to three years. Sanctions
are applied according to the seriousness of the infraction as
- Low level failures, including
failure to complete a specific action as directed by a Jobcentre
Adviser, can result in a one month sanction or three month sanction
for a repeat offence;
- Intermediate failures include
a more general failure to actively seek work or failure to be
available for work and can result in disentitlement to benefit.
If claimants re-apply, no benefit is payable for one month after
a first failure and three months for a second or subsequent failure;
- High level failures, including
failure to accept a reasonable job offer or leaving a job voluntarily,
can result in the longest "sanction", which is effectively
disentitlement to benefit for three years.
82. The Act also strengthened ESA sanctions.
Under the previous system ESA WRAG claimants who failed to attend
a Jobcentre appointment, or who failed to carry out agreed work-related
activity, could be subject to an open-ended sanction. The sanction
amount was 50% of the work-related activity component of their
benefit (i.e. around £14 per week), increasing to 100% (£28.15
per week) of the component after four weeks. Under this regime
full benefit was reinstated as soon as the claimant recommenced
compliance with the conditions.
83. Under the new rules, ESA WRAG claimants
who fail to comply can receive the same open-ended sanction of
their work-related activity component while they fail to comply,
followed by a fixed period sanction once they start to comply
again. The fixed period sanction is one week for a first failure,
two weeks for a second failure and four weeks for third and subsequent
failures in a 52 week period. The fixed period sanction is loss
of the claimant's entire ESA basic component (£71 per week).
The claimant's work-related activity component is unaffected under
the new rules.
84. For both JSA and ESA, Jobcentre
Advisers are responsible for referring claimants for a sanction
where they believe the claimant has failed to meet the conditions
of benefitknown as "raising a doubt". The decision
about whether a sanction should be applied rests with a DWP Labour
Market Decision Maker, who is independent of the employment support
process, following the rules as set out in legislation and several
internal staff guidance documents.
Increasing prevalence of sanctioning
85. Research by Dr David Webster of
the University of Glasgow shows that the prevalence of sanctions
increased in the period 2008-2012. Dr Webster highlighted the
"common misconception" that sanctions only affect a
very small minority of claimantshis research found that
around one fifth (19%) of all JSA claimants in the period April
2008 to March 2012 were sanctioned (1.4 million people). He also
noted that, as there are around twice as many sanction referrals
as there are "adverse decisions" resulting in a claimant's
benefit actually being stopped, around 3 million people were "threatened"
with a sanction in the same period. Sanctioning rates in the year
to October 2012 were 4.2% of all JSA claimants per month.
For JSA claimants aged 18-24 the rate was 8% per month.
86. The latest release of official data,
covering the period from the introduction of the tougher regimes
in late 2012 to June 2013, shows that sanctioning rates have increased
further. The proportion of all JSA claimants being sanctioned
each month increased to around 5%. In total there were 553,000
JSA sanctions applied, an increase of nearly 11% on the same period
in 2011-12. There were 11,400 ESA sanctions applied in the period
from the introduction of the tougher ESA regime in December 2012
to June 2013. This is nearly double the number in the same period
in 2011-12. Dr Webster
pointed out that the number of sanctions in the year to 30 June
2013 was around 860,000, the highest number in any 12-month period
since statistics began to be published in their present form in
Reported inappropriate sanction
87. Most witnesses accepted that conditionality
regimes were necessary and that sanctioning of benefits was the
most practicable method of enforcing a conditionality regimea
notable exception was the PCS union, representing Jobcentre staff,
which was of the view that sanctioning "does not work in
terms of getting people into work".
88. However, witnesses also believed
that Jobcentre staff were too quick to raise doubts and make sanction
referrals without applying due discretion. We were provided with
a number of real life examples of referrals which appeared to
be inappropriate. These included referrals made for missing Jobcentre
appointments despite claimants having good cause and informing
the Jobcentre of the reason.
Citizens Advice reported an example of a claimant referred for
a sanction for not actively seeking work in the period between
finding a job and starting that job.
89. The PCS union reported that Jobcentre
staff were being put under pressure by management to increase
sanctioning rates. DWP has strongly denied the existence of any
national or local targets for sanctioningfollowing an investigation
and report to the Secretary of State on the issue carried out
by Neil Couling. However, PCS believed that the Department had
"expectations" about the appropriate level of sanctioning
and that these were "targets by another name". The PCS
also highlighted that Jobcentre staff whose sanctioning rates
were not meeting expectations were subject to an "improvement
plan"formal performance management proceedings.
The Minister for Employment recently confirmed that the number
of sanction referrals made by Jobcentre Advisers is part of a
"variety of performance data" used to monitor Advisers'
90. Neil Couling told us that he and
the Department had an expectation that people would be sanctioned,
"because that is the law" and "public servants
are meant to follow the law." DWP monitored sanctioning rates
to highlight and investigate anomalies with a view to ensuring
that sanctions were being properly and consistently applied across
the Jobcentre network. In the course of his investigation into
the alleged existence of sanctioning targets, he had found variations
in sanctioning rates between different Jobcentres which he was
seeking to address.
91. Under the new rules introduced
in late 2012, the number of sanctions has increased to the extent
that some 5% of all Jobseekers Allowance claimants are sanctioned
every month. Some 860,000 Jobseekers Allowance claimants
were sanctioned in the year to June 2013, the highest number in
any 12-month period since at least April 2000. Our evidence suggests
that many claimants have been referred for a sanction inappropriately
or in circumstances in which common sense would suggest that discretion
should have been applied by Jobcentre staff.
The link between sanctioning and benefit off-flow
92. Several witnesses noted the risk
that Jobcentre staff might see sanctions as positive outcomes
in themselves, particularly as JCP performance is measured primarily
against the proportion of claimants coming off benefit by specific
points in claims (known as benefit off-flow, see chapter 5). The
concern was that Jobcentre staff might see sanctioning, and other
actions which discourage people from claiming benefits, as a route
to achieving off-flow performance targets. Inclusion believed
that such behaviour was unlikely to be widespread but noted that
it had occurred when similar targets were in place in the 1980s.
93. The Minister implied that the risk
was minimal because, when you are under a sanction, "So long
as you continue signing on, you are not taken off the claimant
We asked DWP to clarify whether in fact a claimant could be required
to continue to sign on if they were not receiving benefit because
of a sanction. We also asked DWP to provide data on the number
and proportion of sanctioned claimants who do not continue to
sign on during the period of the sanction or for longer periods.
The response we received merely confirmed that sanctioned claimants
come off the claimant count only if they become disentitled to
benefit because they choose not to sign on during a sanction period.
DWP was unable to provide any information on the number or proportion
of sanctioned claimants who choose this course of action.
 The impact
of sanctioning on benefit off-flow therefore remains unclear.
The impacts of sanctioning on
94. Some witnesses were concerned that
sanctions were leading to severe financial hardship for some claimants.
Most notably, Church Action on Poverty (CAOP) and Oxfam reported
that financial hardship due to sanctioning was a significant factor
in a recent rise in referrals to food banks. A joint CAOP/Oxfam
report published in May 2013 estimated that 500,000 people in
the UK were "reliant on food aid". The report estimates
that "up to half" of people who turn to food banks do
so "as a direct result of having benefit payments delayed,
reduced, or withdrawn altogether."
95. The Trussell Trust, a charitable
organisation which runs the largest chain of food banks in the
UK, reported in October 2013 that it had received 350,000 referrals
to its food aid in April to September 2013, a threefold increase
on the same period in 2012. It has previously published statistics
which show that changes to benefit payments, including sanctions,
are the third most commonly reported reason for referral to food
aid, accounting for 15% of referrals in 2011-12.
96. DWP has stated that Jobcentres "signpost"
claimants to food aid where appropriate. However, there are no
official data on referrals to food aid or on how many referrals
are related to financial hardship caused by benefit sanctions.
Ministers have also stated that the Department does not currently
collect or collate data on the number of claimants signposted
to food aid by Jobcentres.
However, in oral evidence, the Minister reported that she believed
that DWP was "doing a lot of information gathering into why
people present themselves at food banks".
97. We recommend that DWP take
urgent steps to monitor the extent of financial hardship caused
by benefit sanctions, including by collecting, collating and publishing
data on the number of claimants "signposted" to food
aid by Jobcentres and the reasons for claimants' need for assistance
in these cases.
Monitoring the conditionality
98. On 15 May 2013, DWP set out terms
of reference for an independent review of the JSA conditionality
and sanctions process. An independent review of the operation
of the sanctions regime is required by the Jobseekers (Back to
Work Schemes) Act 2013. The independent review's report will be
presented to the Secretary of State as soon as reasonably practicable
after 26 March 2014. The terms of reference for the review include:
- The clarity of information
on conditionality provided to JSA claimants;
- The options available to claimants
who are sanctioned, including the availability of hardship payments;
- The clarity of the review and
99. In oral evidence the Minster told
us that she was committed to establishing a further independent
review to investigate whether sanctions were being applied proportionately.
100. It is important that JCP makes
fair and proportionate sanction referrals and that the process
is transparent. We welcome the current independent review which
will focus on the clarity of communications between JCP and claimants
in relation to the conditionality and sanctioning process; the
availability of hardship payments for sanctioned claimants; and
the clarity of the review and appeals process. We strongly believe
that a further review is necessary and welcome the Minister's
commitment to launch a second and separate review into the broader
operation of the sanctioning process.
101. We recommend that the second
review of sanctions investigate: whether sanction referrals are
being made appropriately, fairly and proportionately, in accordance
with the relevant Regulations and guidance, across the Jobcentre
network; and the link between sanctioning and benefit off-flow,
including whether benefit off-flow targets have an influence on
sanctioning rates. We also recommend that this review consider
whether, and to what extent, the use of sanctions is having the
desired effect of encouraging claimants to engage more actively
in job-seeking. We further recommend that this review is launched
as a matter of urgency and reports before the end of 2014.
70 Dr David Webster, Ev w91 Back
DWP, Ev 141 Back
Centre for Economic and Social Inclusion, Ev 117 Back
Committee's Universal Credit Report, paras 182-183 Back
"Choosing a life on benefits is no longer an option",
DWP press release, 22 October 2012 Back
5 December 2013] Back
DWP, Ev 141; See also, HC Deb 18 November 2014, col 674W Back
Ev w90 Back
DWP, Jobseeker's Allowance and Employment and Support Allowance
Sanctions-decisions made to June 2013, GB, 6 November 2013 Back
Ev w111 Back
Q 205 [Charles Law] Back
Church Action on Poverty, Ev 123; Citizens Advice Scotland, Ev
See Citizens Advice, Punishing Poverty? A review of benefit
sanctions and their impacts on claimants and clients, October
Ev 175 Back
HC Deb, 15 October 2013, col 674W Back
Q 577; See also, DWP, Conditionality and sanctions: Report
to the Secretary of State by Neil Couling, May 2013 Back
Ev 115 Back
Q 566 Back
Ev 146 Back
Church Action on Poverty/Oxfam, Walking the breadline: the
scandal of food poverty in 21st Century Britain,
May 2013 Back
"Tripling in foodbank usage sparks Trussell Trust to call
for an inquiry", Trussell Trust press release, 16 October
2013; See also, www.trusselltrust.org/stats Back
HC Deb, 5 June 2013, col 1204W; HC Deb, 14 October 2013, col 490W Back
Q 572 Back
"Independent reviewer of benefit sanctions announced",
DWP press release, 19 September 2013 Back
Q 574 Back