Work and Pensions Committee Press Notice

EMARGOED: NOT FOR PUBLICATION OR BROADCAST BEFORE 00.01 HRS SATURDAY 6TH MAY 2006

Committee gives verdict on proposed reforms to incapacity benefits

Attn: Political Corrs, Social Affairs Corrs, News Desks

The Government's objective to get one million people off incapacity benefits within ten years is a bold and laudable aim, say the Work and Pensions Select Committee. But, concludes a report by the MPs, more detail on how it will be achieved is needed.

The Committee notes the apparent success of the Pathways to Work pilots - a specialist programme to assist ill or disabled people to find and retain employment. They conclude that elements of Pathways, such as the Condition Management Programme - an employment rehabilitation service - and the Return to Work Credit - which boosts the income of disabled people moving into work - are particularly helpful.

The proposed reforms to the gateway onto incapacity benefits - the Personal Capability Assessment - will measure people's capacity for work rather than the severity of their disability. This change is also welcomed by the MPs so long as the complexity of ill or disabled peoples' lives, especially those with fluctuating and mental health conditions, is also taken into account.

The MPs point out that the Welfare Reform Green Paper lacks detail about many aspects of the proposed reforms. They urge the Department to clarify the baseline by which the one million reduction in incapacity benefits claimants will be measured. The Committee also warns that the £360 million allocated for the national roll out of Pathway to Work 'may not be sufficient without services being watered down'.

MPs conclude that plans to reform incapacity benefits may introduce 'further complexity to an already confusing incapacity benefits system' with little consideration being given to the IT systems, risks and resources required to administer the proposed new two-tier Employment and Support Allowance (ESA).

MPs conclude that there is a danger of leaving behind those already claiming incapacity benefits. They recommend that the Department publish a date by which these people - who may have been on benefit for some years - will be fully included in Pathways to Work.

Progress towards reforming employers' attitudes towards disabled people is criticised as 'wholly inadequate'. MPs conclude that if the Government reforms are to be successful there 'remains much work to do in engaging employers and addressing the poor understanding that many have on disability issues'.

Commenting, Committee Chairman Terry Rooney said:

"Disabled people experience a range of barriers to finding work including employer attitudes, lack of awareness of support, concerns about their continuing entitlement to benefits and local labour market conditions.

Our Committee welcomes the Government's aim to increase the employment rate of disabled people. The Pathways to Work pilots have shown that taking actions to address these problems as a package can work. However, this has to be done carefully. Currently, the Green Paper is short on detail and remains in danger of turning a complex system of benefits into a maze of bureaucracy.

Greater thought needs to be given to how those with mental health problems can be assisted back in to work, and in improving the poor understanding employers have of disability issues.

It is unclear whether enough money has been earmarked for the reform programme and Pathways to Work national rollout and we urge the Department to clarify the budget."

The Committee concludes that:

€Awareness of the Access to Work Scheme amongst disabled people and employers remains far too low. The budget for the scheme is inadequate.

€In-work support is crucial for incapacity benefits claimants who move into work and should be available for more than six months.

€Contracts should pay service providers for a range of outcomes leading up to job entry so that they do not skew their focus towards helping those who are already closer to the labour market.

€New incapacity benefits claimants may initially experience a substantial drop in income while their claim is assessed. If the Government's proposals are implemented, the 'holding benefit' should be set at a level comparable with Statutory Sick Pay to ensure a more consistent income for ill or disabled claimants.

€The Department should develop a strategy to ensure that all disabled people, including groups such as people with learning disabilities, deaf and blind people have full access to the range of services offered.

Notes to Editors

1) Embargoed hard copies of the report will be available from the House of Commons Press Gallery and the Reception 7 Millbank SW1P 3JA from 11.00am on 5th May 2006; Pdfs available via email from 11.00am on 4th May.

2) Media Bids/Request for interviews with members of the Committee should be directed to Luke Robinson on 07917488549

3) The report is also being published in Braille, audio (CD and tape), large print and easy read. These alternative formats will be available from the Committee office (020 7219 5833) on request.

4) For detailed information on the report the Committee can be contacted on 020 7219 5833.

5) Almost 10 million people in Britain are estimated to be disabled - around one in six of the population. In 2004, only 50 per cent of the disabled people of working age were in employment, compared to 75 per cent of the working age population as a whole. The Government has committed itself to reducing this gap and increasing the employment rate of disabled people by 2006, and further by 2008. More than 7% of the working age population is currently claiming incapacity benefits. Between 1979 and 1997, the numbers in receipt of incapacity benefits rose from 700,000 to 2.5 million, and currently has stabilised at around 2.6 million. These benefits cost the Exchequer £12 billion per year. Departmental research indicates that once a person has been on incapacity benefit for 12 months, the average claim will go for a further 7 years. The Government has recently announced its intention to reform incapacity benefit.