House of Commons - Improving Access to Work for disabled people

Improving Access to Work for disabled people - Work and Pensions Committee Contents

2 Marketing and funding

13. Concerns about a lack of awareness of AtW, and insufficient funding, are not new. In 2003 a predecessor Committee recommended that:

Liz Sayce believed that implementing her recommendations could lead to a doubling of the number of people helped by AtW, broadly within the current overall funding package for specialist disability employment support.[12]

14. In this chapter we examine the available information on AtW caseloads and spending in recent years. We also consider the likely level of unmet need and whether additional funding for AtW could be found from elsewhere within the overall funding package for specialist disability employment support. Finally we consider the steps which DWP needs to take to establish the overall cost-effectiveness of AtW, so that a strong case could be made to HM Treasury for substantial additional funding. This would enable much more high profile marketing of the programme to be undertaken with the aim of satisfying the current extent and range of unmet need.

Caseload and expenditure

15. Caseload figures are published in the AtW Official Statistics. Programme expenditure is not routinely published, but expenditure in recent years can be gleaned from DWP's answers to Parliamentary Questions. AtW supported 35,450 people in 2013/14 at a total cost of £108 million. The caseload increased in each of the last two full financial years; however, this followed two years of decline, and the 2013/14 total is below the peak of 37,280 reached in 2009/10. AtW caseloads and programme spend from 2009/10 to 2013/14 are set out in the table below:[13]

Access to Work total caseloads and programme expenditure 2009/10-2013/14

Financial year Total caseload Total programme spend
(£ million)

2009/10 37,280 98.0

2010/11 35,820 105.5

2011/12 30,780 98.3

2012/13 31,500 99.0

2013/14 35,450 108.0

Awards by impairment type

16. Liz Sayce pointed out in her review that there has long been a perception that AtW is about providing "bits of kit"—special equipment and technology—to enable people with physical and sensory disabilities to overcome their barriers in work. This was echoed by witnesses to our inquiry. AtW has tended to be considered less relevant to people with mental health problems, learning disabilities or autism spectrum disorders.[14]

17. The emphasis of the programme has broadened somewhat in recent years. In 2011 DWP established an AtW Workplace Mental Health Support Service (WMHSS), to help people who develop a mental health issue to stay in their jobs (see chapter 3). However, it remains the case that the programme is mostly utilised by people with physical or sensory impairments. The 2013/14 Official Statistics show that around 30% of AtW users have a hearing or sight impairment (10,740 people) and about 24% have physical problems with their arms, hands, legs, feet, back or neck (8,620 people). The number of users who have a mental health problem has grown significantly in recent years but remains relatively low. The number increased from just 200 people in 2007/08 to 1,410 people in 2013/14; a more than seven-fold increase. However, this still represents only 4% of the total caseload. The number and proportion of AtW users who have a learning disability is also low: 1,760 people (5% of the caseload). The Official Statistics do not separately identify the number of AtW users with autism spectrum disorders.[15]

The costs of different types of support

18. There are official data on the types of support AtW provides, but very little information on the financial costs of different elements of support is routinely published. The Official Statistics contain a breakdown of the total number of awards by element type. This shows that the most used type of support is "Support Workers" (14,850 awards in 2013/14); followed by travel to work (13,120); and aids and equipment (5,470). AtW funds very few adaptations to premises (40) and vehicles (200). The Official Statistics do not give any breakdown of the costs of the different elements.[16] The UK Statistics Authority recently found that the coverage of DWP's statistics on AtW is "too limited, which constrains their usefulness."[17]

19. DWP emphasised that support for people with hearing impairments accounts for a disproportionately large amount of AtW spending: 5,250 hearing impaired service users (17% of the total caseload) accounted for some £35 million of spending in 2012/13 (around 35% of total expenditure).[18] This is largely due to the costs of BSL interpretation: a recent DWP Freedom of Information response revealed that BSL interpretation alone accounted for around £25 million of AtW expenditure in 2013/14.[19] The Minister confirmed that DWP had recently taken steps to address the costs of AtW-funded BSL interpretation, but that it was DWP's intention that AtW should continue to provide effective BSL support (we return to this issue in chapter 4).[20]

20. Liz Sayce noted that, while the costs of meeting some disabled people's needs, such as those who require full-time Support Workers, including BSL interpreters, can be very high, the average cost of AtW per service user is not, at around £3,000 per year.[21] Her view was that, while it is always important to consider the most cost-effective ways of supporting people with high cost support needs, DWP should not cap the total amount of funding on an individual basis. She emphasised that the number of people with very high cost support needs was small.[22] DWP reported that 120 AtW awards in 2012/13 were over £40,000; of these 60 were over £50,000.[23]

Establishing the level of unmet need

21. While it is clear that there is a large "employment gap" between disabled people and the non-disabled population, and that a substantial number of people fall out of work each year due to ill health and disabilities, establishing with any precision the number of people who might benefit from AtW is not straightforward.

22. Disability Rights UK (DRUK) cited recent research which suggests that around 4% of the disabled working age population would have additional disability-related needs at work. If this percentage is applied to the gap between the proportion of disabled people in employment and the proportion of the general population who are employed (a difference which equates to proportionately 2 million fewer disabled people in work) or to the entire economically inactive disabled population (some 3.6 million people), it implies a range of between 80,000 and 144,000 potential beneficiaries of AtW.[24] However, Liz Sayce, now Chief Executive of DRUK, acknowledged that these figures were uncertain, and that it is currently difficult to estimate from official data how many of these people would require support above the level of "reasonable adjustments" which employers are required to provide.[25]

Budget

23. The AtW budget is part of an overall funding package for specialist disability employment support—£350 million in the spending period to 2015/16.[26] This funding is part of DWP's overall Departmental Expenditure Limit (DEL), the budget allocated for administrative costs and programme expenditure, including employment programmes. DWP's DEL has been reduced year on year since 2009/10 as part of the Government's economic measures to address the budget deficit: it was £5.4 billion in 2013/14, down from £7.4 billion in 2009/10.[27]

RELEASE OF RESOURCES FROM REMPLOY

24. Liz Sayce envisaged that implementing her proposals for the closure or sale of Remploy's factories would release resources for other forms of specialist disability employment support, including AtW. In 2012 DWP confirmed that "savings from the policy changes will be used for more effective and proven employment programmes such as Access to Work, to benefit many more disabled people".[28]

25. Remploy is currently a non-departmental public body, sponsored by DWP, and receives government grant-in-aid funding, i.e. a public subsidy. The closure or sale of Remploy's factories following the Sayce Review was largely completed by the end of 2013.[29] Remploy also has an employment services arm, which places disabled people into mainstream employment. Remploy Employment Services has become established and successful in the market over the last 15 years. It is currently the subject of a commercialisation process, in which a private or third sector investor is being sought, to take a substantial stake in the business.[30]

26. Remploy's Annual Reports show that it received £130 million in grant-in-aid subsidy in 2010. This had fallen to £61.3 million by 2013 in a planned reduction following the reorganisation recommended in the Sayce Review.[31] Gareth Parry of Remploy explained that its total public subsidy is likely to have been reduced by around £80-£85 million, compared to the 2010 figure, when the reorganisation process is complete. He confirmed that this was set to be achieved in the next few months, once a number of "transitional issues" had been dealt with.[32]

27. Despite the reduction in public funding for Remploy, the Minister insisted that "There was not a spare £80 million lying around that could all have gone into Access to Work." He told us that the resources released from the reorganisation of Remploy had already been "recycled", including an additional £15 million for AtW, announced in 2012.[33] He stated that funding for the other main elements of disability employment support, Work Choice and the Work Programme, had been "protected" during a time when savings had been made elsewhere in DWP programme expenditure.[34] However, it was not immediately clear from the Minister's answers to our questions how the remaining reduction in Remploy's subsidy had been reallocated. The Minister later told us that "the £80 million figure is not specifically recognised by the Department". He reiterated that spending on specialist disability employment support had been protected from the substantial cuts to DWP's budgets since 2010 and that, "Had the Department not reformed Remploy, this would not have been possible." Information provided by DWP shows that, other than the additional £15 million for AtW announced in 2012, the only element of spending on disability employment support which has increased substantially since 2011 is that for Employment and Support Allowance claimants taking part in the Work Programme, DWP's mainstream contracted employment programme.[35]

28. DWP has not provided a satisfactory explanation of how the money saved from the closure or sale of Remploy factories has been used to increase funding for effective, specialist disability employment support. We do not consider it appropriate to classify spending on the Work Programme as additional funding for specialist disability employment support. We recommend that, in response to this Report, the Department provide further information on how the savings from the reorganisation of Remploy have been used to date, and that it clarifies whether it intends to increase funding for specific areas of specialist disability employment support, other than the Work Programme, as a result of the reorganisation of Remploy.

29. The Minister stated that any additional funding for AtW before the next Spending Review period would have to come from other employment programmes or from further administrative savings from elsewhere within DWP's DEL.[36] It should be noted that DWP's DEL is not a ring-fenced element of government spending and may be subject to further reductions.

POTENTIAL "AME/DEL SWITCH"

30. The Minister acknowledged that implementation of Liz Sayce's recommendation to double the AtW caseload would require a broadly commensurate increase in funding. He indicated that the Department was considering how this might be achieved in the next Spending Review period (i.e. from 2016/17 onwards). He explained that one option might be to make the case to HM Treasury to increase funding for AtW by using DWP's much larger Annually Managed Expenditure (AME) budget, which is for items that are demand-led and difficult to forecast, in particular social security expenditure. The rationale for this is that AtW is widely considered to be cost-effective; supporting disabled people in work often brings a long-term return to the Exchequer through reduced out-of-work benefits and increased income tax returns. In theory DWP's larger AME budget (£163 billion in 2013/14) could be used to substantially increase funding for cost-effective employment programmes such as AtW, on the understanding that this was likely to produce long-term savings in benefits expenditure.[37]

31. However, it should be noted that the idea of applying an "AME/DEL switch", or "Invest to Save", in relation to DWP's spending on employment programmes, has existed since at least 2007.[38] There is no indication that HM Treasury supports the concept; it would require a very significant change to HM Treasury's approach to the setting of DWP's budgets.

Establishing the cost-effectiveness of Access to Work

32. The Sayce Review cited research by disability organisations which concluded that expenditure on AtW achieved a return to the Exchequer of £1.48 for every £1 spent, based on reduced social security benefits and increased income tax take. She therefore recommended that in the longer term the Government implement the so-called "AME/DEL switch", as described above.[39]

33. The Minister told us that the £1.48 figure was not supported by official research; DWP had "not been able to establish the workings for that figure." He indicated that he had asked DWP officials to "undertake some analytical work" on the cost-effectiveness of AtW because, "if we are going to have a discussion with Treasury colleagues about funding, we want some good evidence."[40]

Employers' contributions

34. Larger employers contribute to the costs of AtW funded aids and adaptations to premises, or equipment for their employees. Employers are required to contribute 100% of the costs up to a threshold, and 20% of costs between the relevant threshold and £10,000. The thresholds are based on the total number of employees a business has, as set out below:

0-49 employees: Nil

50-249 employees: £500

250 or more employees: £1,000

Additional voluntary contributions are sought "where the support provides a general business benefit" to the employer.[41] DWP abolished employer contributions for employers of fewer than 50 people in 2012/13, as part of a drive to encourage participation in AtW by smaller employers, following the Sayce Review's conclusions.[42]

35. Mike Adams told us that his expert panel's recommendation had been to abolish employer contributions altogether to encourage employer engagement across the board. He believed that the current arrangements resulted in employers contributing such a small proportion of the total cost of AtW support that the administrative costs to DWP of collecting it were likely to be disproportionate.[43] The Business Disability Forum (BDF) agreed. BDF also believed that the current arrangements caused confusion amongst employers about the extent to which contributions were mandatory or voluntary. However, TLT Solicitors, a nationwide employer which engages extensively with AtW, found the current arrangements "easy to interpret" and believed them to be "reasonable".[44]

36. The Minister told us that DWP was considering the employer cost-sharing arrangements as part of its internal review. However, he was clear that the administrative costs of collecting employers' AtW contributions were "certainly not" greater than the total amount collected. Employers currently fund around £7 million per year in total mandatory and voluntary contributions. This was equivalent to the administrative costs of running the entire AtW programme. The Minister therefore believed that it was "not a trivial amount". However, he noted a lack of information about the range of larger and smaller employers taking part in the programme and their respective financial contributions. He confirmed that he had asked DWP officials to collate data on this. He was keen to ensure that the Department "takes full advantage of the amount of taxpayer money we have got and the amount of employer resource as well."[45]

Tension between marketing and available funding

37. Given the likely scale of unmet need and the limited available funding, there is an inevitable tension between marketing AtW more widely and maintaining costs within the budget. Susan Scott-Parker of the BDF told us that her understanding, drawn from speaking to DWP officials over the last 15 to 18 years, was that the budget for AtW had "never been fully utilised" and that "officials have been under pressure not to tell too many people about it in case the demand grew."[46]

38. DWP again rebutted the assertion that there was "unused money lying around".[47] However, the Minister did acknowledge the difficult balance between marketing the programme more widely and ensuring that there was sufficient funding available to meet increased demand. He also believed that it was important to ensure that more robust administrative structures were put in place, before any substantial expansion of the programme (we address some of the key administrative issues in chapter 6).[48]

39. DWP spent around £50,000 on a 12-month "targeted marketing campaign" from June 2012. This included:

[…] press releases, presentations at disability and employer events, and articles in disability publications and engagement in direct marketing to large employers. It also included use of digital media, paid advertising links in popular search engines, magazine adverts and awareness training for Jobcentre Plus Disability Employment Advisors.

DWP believed that this activity reversed the decline in caseload which had occurred in 2010/11 and 2011/12 and resulted in a significant increase in visits to the AtW webpages on the GOV.UK website.[49]

40. DWP also drew attention to its Disability Confident campaign, which was launched in July 2013. Disability Confident is a series of conferences and promotional material aimed at employers. It seeks to "work with employers to remove barriers, increase understanding and ensure that disabled people have the opportunities to fulfil their potential and realise their aspirations."[50] A central message of Disability Confident is that employers can reap economic benefits from employing disabled people, as well as achieving corporate social responsibility aims.[51]

41. Notwithstanding the above, most witnesses felt that AtW still suffered from inadequate marketing and that awareness remained low, particularly amongst smaller employers and disabled people with particular types of impairments. Individual service users suggested that awareness tended to be spread by word of mouth rather than as a result of any official marketing strategy.[52] The BDF, which has taken part in Disability Confident events, believed that AtW was not featured sufficiently prominently in the campaign. This view was supported by Remploy.[53]

42. Improved marketing should lead to increased uptake of AtW which in turn should begin to address the level of unmet need. It is clear that this unmet need lies in some specific groups of potential AtW users, including people with mental health problems, learning disabilities and autism spectrum disorders, and young people with disabilities trying to enter the labour market for the first time. In addition, as we pointed out in our report on Employment and Support Allowance (ESA) earlier this year, a significant number of claimants are being found fit for work as result of the ESA process. Many of these people are likely to require in-work support of the type AtW can help to fund, if they are to enter and sustain employment. An expert panel involved in the trial of an alternative assessment for ESA eligibility identified that 83% of claimants deemed fit for work would need "on average, two or three" adjustments; and 24% would need a support worker. We argued that the ESA process needed to be properly joined up with effective employment support for people found fit for work who had disabilities or ongoing health conditions.[54] Proactive promotion of AtW, by Jobcentre Plus Work Coaches and contracted providers, to people leaving incapacity benefits and trying to find work would be one step in this direction.

43. It was clear from the Minister's evidence that DWP intends to increase the number of people helped by Access to Work. This is welcome; the evidence strongly suggests that Access to Work currently supports only a minority of disabled people who might benefit from the programme. However, it was equally clear that the Department is currently trying to increase the Access to Work caseload within an only marginally increased budget. We believe that there is a risk of unintended consequences from this approach, because focusing on the number of people being helped while trying to remain within a tightly constrained budget might result in DWP bearing down on the awards of current service users who happen to require relatively high cost support, to the detriment of meeting their needs effectively. We welcome the Minister's assurance that this is not DWP's intention. The focus of the programme should remain addressing the range of barriers faced by disabled people, including the relatively few people whose support needs are currently high cost. We agree with the Minister that a substantial increase in the number of people Access to Work helps is likely to require a broadly commensurate increase in the available funding.

44. It is not currently possible to ascertain with certainty the number of people whom Access to Work might benefit; the range of needs they would have in work; or the cost of providing support which meets the range of currently unmet need. However, it is clear that substantial unmet need includes that which exists amongst people with mental health problems, learning disabilities and autism spectrum disorders, young disabled people trying to enter work for the first time, and people found fit for work as a result of the Employment and Support Allowance eligibility process. While it is widely accepted that supporting disabled people in work brings a long-term return to the Exchequer through reduced spending on out-of-work benefits and increased income tax returns, there is a lack of published official data to support this.

45. We recommend that, as a priority, DWP undertake research to establish a) the likely level and range of currently unmet need; and b) a cost-benefit analysis of Access to Work expenditure, including its likely long-term impacts on social security expenditure and income tax returns. We believe that such a study is likely to produce an overwhelming case for substantial additional funding for Access to Work, which we recommend be presented to HM Treasury at the earliest possible opportunity. Our hope is that HM Treasury will be able to announce substantial additional funding before the next Comprehensive Spending Review.

46. There is remarkably little published information on Access to Work. We have had to piece together much of the information we needed for this inquiry from DWP's answers to Parliamentary Questions and Freedom of Information requests. This lack of transparency is unacceptable. We recommend that DWP change its approach to Access to Work statistics and that, as a minimum, it regularly publish the following information: an indicative annual budget; annual expenditure outturns, broken down by support element and impairment type (including autism spectrum disorders); the number of service users by size of employer; and employers' mandatory and voluntary financial contributions, broken down by size of employer. We also recommend that DWP set out the steps it is taking in response to the December 2014 UK Statistics Authority Report on the compliance of Access to Work statistics with the Code of Practice for Official Statistics, in its response to this Report.

47. We welcome the Minister's assurance that the current employer cost-sharing arrangements are being considered by the Department as part of its internal review. We believe that DWP could do more to clarify and simplify the arrangements, which might encourage more employers to engage with the programme. We recommend that DWP publish case studies on the Access to Work webpages, to illustrate the types of support which are typically considered to be "reasonable adjustments" under the Equality Act, and those which would normally qualify for publicly funded support. Case studies should also illustrate the circumstances in which employers' contributions are typically regarded as mandatory, and those in which contributions are voluntary.

48. Given the severe constraints on DWP's budgets, we recommend that the Department encourage increased voluntary employer contributions, particularly from larger employers. DWP should publish and promote case studies which illustrate examples of employers which have gone beyond their legal requirements to support the recruitment of disabled people, to encourage others to follow their example. The Access to Work webpages should include an employers' page, and links to Disability Confident promotional material, to promote the benefits of employing disabled people. We also recommend that Access to Work be more prominently featured in the Disability Confident marketing campaign.

49. In the remainder of this Report we examine AtW in more detail, including aspects of DWP's administration of the programme, which are likely to require change in the short to medium-term, particularly if, as both we and the Department hope, AtW is to be scaled up substantially in the longer-term.

11 Work and Pensions Committee, Fourth Report of Session 2002-03, Employment for all: Interim report, HC 401-I Back

12 Sayce Review, p 124 Back

13 HC Deb, 6 December 2012, col 824W; HC Deb, 11 June 2014, col 168W; Access to Work official statistics; Written Answer, 30 October 2014 [211995] Back

14 Sayce Review, p 82; Q36 [Liz Sayce]; Q126 [Nicola Oliver] Back

15 DWP, Access to Work: Official Statistics, July 2014 Back

16 Ibid. Back

17 UK Statistics Authority, Statistics on Access to Work, December 2014 Back

18 DWP (ATW0235) Back

19 DWP, Freedom of Information request 4093/2014 Back

20 Q271 Back

21 Q28; DWP (ATW0235) [£3,000 figure is total annual programme expenditure in 2013/14 (£108 million) divided by the total number of people helped by the programme in the same period (35,450)] Back

22 Q28 Back