COMMONS

Implementation of Personal Independence Payments nothing short of fiasco

20 June 2014

Public Accounts Committee publishes its report into Personal Independence Payments.

The Rt Hon Margaret Hodge MP, Chair of the Committee of Public Accounts, today said:

"The implementation of Personal Independence Payment has been nothing short of a fiasco. The Department of Work and Pensions has let down some of the most vulnerable people in our society, many of whom have had to wait more than 6 months for their claims to be decided.

The Department’s failure to pilot the scheme meant that the most basic assumptions, such as how long assessments would take and how many would require face-to-face consultations, had not been fully tested and proved to be wrong. This resulted in significant delays, a backlog of claims and unnecessary distress for claimants who have been unable to access the support they need to live, and in some cases work, independently.

The personal stories we heard were shocking. We heard evidence of a claimant requiring hospital intervention as a result of the stress caused by the delays suffered, and another claimant who was unable to afford the specific diet required for diabetes and gastric problems while waiting for a decision.

By October 2013, the Department had only made 16% of the decisions it had expected to have made by that time. What was particularly alarming was that terminally ill people were having to wait on average 28 days for a decision, 180% longer than expected.

Some claimants have been forced to turn to food banks, loans and charitable donations to support the extra costs of living associated with their disability.

The standard of service provided by the Department and its contractors has been unacceptable. Claimants have experienced difficulties in arranging appointments – and assessors have cancelled home visits at the last minute and have failed to turn up when claimants have travelled to assessment centres. Four in ten claimants in Atos areas have had to travel over an hour to be assessed, a far cry from its promise that between 75% and 90% of claimants would travel less than 30 minutes to an assessment centre. 

We are concerned that Atos appears to have included incorrect and potentially misleading information in its bid for the contract. Atos stated in its tender document that it had “contractual agreements” in place with a national network of 56 NHS hospitals, 25 private hospitals and over 650 physiotherapy practices to provide assessments. This turned out not to be true.

The Department should challenge claims made in bids, so that it can demonstrate it has not relied on inaccurate or exaggerated information when awarding contracts.

We would have expected the Department to have exercised particular caution in letting this contact, given the poor performance of Atos on Work Capability Assessments. The Department must take into account previous performance on similar work when running a procurement.

The process has also proved to be inaccessible and cumbersome for claimants, increasing the risk of delays and incorrect decisions.

The Department urgently needs to get this Scheme up to scratch and make sure some of our most vulnerable citizens are protected when going through this process. What we’ve witnessed is a rushed, wholly unacceptable job, and the Department should take a long hard look at what went wrong."

Margaret Hodge was speaking as the Committee published its 1st Report of this Session which, on the basis of evidence from James Bolton, Policy Officer, Mencap, Lesley Hawes, Chief Executive, DABD (UK), Vicky Pearlman, Social Policy Officer, Citizens Advice, Robert Devereux, Permanent Secretary, Department for Work and Pensions, Lisa Coleman, Senior Policy Officer, Atos, Dr Stephen Duckworth, Chief Executive Officer, Capita PIP, Jason Feeney, Benefits Director, Department for Work and Pensions, examined Personal Independence Payment.

The Department for Work and Pensions (the Department) rushed the introduction of Personal Independence Payment and did not pilot the benefit process. We are concerned that many disabled people have experienced long and unacceptable delays in their Personal Independence Payment being assessed and granted. The process has proved inaccessible and cumbersome for claimants, who are some of the most vulnerable people in society. The Department significantly misjudged the number of face-to-face assessments that providers would need to carry out, and the time these assessments would take. This has resulted in significant delays to benefit decisions and a growing backlog of claims. The unacceptable level of service provided has created uncertainty, stress and financial costs for claimants, and put additional financial and other pressures on disability organisations, and on other public services, that support claimants. The Department has yet to achieve the savings it intended to make and will have to seek compensatory savings elsewhere.

Conclusions and recommendations

In April 2013, the Department introduced Personal Independence Payment, a new benefit to replace Disability Living Allowance, to support disabled people with the extra costs of living so that they can live independently and in some cases work. The Department administers and awards claims for Personal Independence Payment but it pays private sector contactors to assess claimants’ needs. Atos Healthcare (Atos) and Capita Health and Wellbeing (Capita) conduct face-to-face consultations, or paper-based assessments, against criteria set by the Department. The Department introduced the new benefit through a ‘controlled start’ so that the Department could test early parts of the process, including the new IT system, staff guidance and the telephone application process, as it rolled out the benefit. The Department started taking new claims for Personal Independence Payment in parts of the north of England from April 2013, and nationally from June 2013. However, only 360 decisions had been made by the time the scheme was implemented nationally. The Department began to reassess the 1.7 million Disability Living Allowance claimants from October 2013, but then postponed this for most claimants when it realised that claimants already faced long delays, and that significant backlogs had developed.

Critical assumptions about the process were not fully tested and proved to be incorrect, resulting in significant delays to benefit decisions and a backlog of claims. The Department expected 75% of assessments would be face-to-face consultations rather than on paper, and that they would take 75 minutes on average to conduct. In practice, over 97% of assessments have been face-to-face consultations and they take around 120 minutes. This should have been established through a pilot programme, with necessary adjustments being made so that so many claimants could have avoided the distress and lack of support brought about by the delays. Without this piloting, contractors’ planned staff numbers have been inadequate, benefit decisions have been delayed and backlogs have developed. When the Department rolled out the scheme nationally for new claims in June 2013, it had made only 360 benefit decisions and therefore had not fully tested the end-to-end process, or the accuracy of its assumptions. In deciding to continue with the roll-out, the Department had relied on its own judgement of the capacity required, and on assurances from assessment providers.

Recommendation: The Department should ensure that new systems and policies are fully tested before they are implemented nationally, to provide evidence that assumptions made and any assurances received from third parties, are correct.

Claiming Personal Independence Payment can be cumbersome and difficult for claimants, increasing the risk of delays and incorrect decisions. Claimants are encouraged to apply by telephone, but this deters and delays some people from making a claim, particularly those with mental health problems and sensory impairments. Obtaining an alternative paper-based form is difficult and time-consuming, with forms not readily available. Providers conduct face-to-face rather than paper-based assessments of claims when they lack sufficient information. In most cases assessment providers do not receive extra evidence requested from third parties such as General Practitioners, physiotherapists and social workers. The processes to ensure the appropriate information is delivered on time were not tested before the scheme was implemented nationally.
Recommendation: The Department should make the process easier for claimants by, for example, making paper claim forms available through recognised voluntary organisations, such as Citizens Advice. The Department should also ensure that third parties supply information on claimants where relevant and do this in good time.

There have been unacceptable delays in making benefit decisions, placing unwarranted pressure on claimants, disability organisations, and other services. Many claimants have had to wait over six months for their claim to be decided. By October 2013, the Department had only made 16% of the decisions it had expected to have made by that time. We heard evidence of a claimant requiring hospital intervention as a result of the stress caused by the delays suffered, and another claimant who was unable to afford the specific diet required for diabetes and gastric problems, while waiting for a decision. Claimants waiting for a decision may no longer be able to claim linked benefits such as carer’s allowance, and additionally, delays have increased demand on third sector organisations which are helping claimants through the process. Some claimants have resorted to discretionary housing payments and others to food banks, loans and charitable donations to support the extra costs of living associated with their disability.

Recommendation: The Department must speed up all stages of the process to ensure benefit decisions are made on a timely basis and tackle the backlog of cases that has arisen.

The Department and its contractors have failed to provide an acceptable standard of service to claimants. Claimants have experienced difficulties in arranging appointments, assessment providers have cancelled home visits at the last minute, and assessors have failed to turn up when claimants have travelled to assessment centres.

Recommendation: The Department should ensure that it, and its contractors, provide an acceptable level of service to claimants by minimising delays and travel times, making home visits when arranged, improving administrative processes, and providing better information to claimants.
The Department maintained that it had not regarded the Personal Independence Payment bids as a contractual commitment, and that it expected negotiations between Atos and its subcontractors to continue once Atos had submitted its bid. It also stated that it had ignored the bidders’ previous record in providing assessments for Employment Support Allowance, when deciding to whom to award contracts. We would have expected the Department to exercise particular caution in letting this contact, given the poor performance of Atos on work capability assessments. The Committee were concerned that Atos appeared to include incorrect and potentially misleading information in its bid for the Personal Independence Payment contract.

Recommendation: The Department should challenge inaccurate or exaggerated claims made in bids, so that it can demonstrate it has not relied on them when awarding contracts. The Department should have regard to previous performance on similar work when assessing contractors.

Further information

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