Published by Graeme Whippy MBE, Business Disability Consultant on 26 July 2016
- Our Work
- The Reformer Blog
17 August 2016
Dear Debbie Abrahams MP,
I wanted to respond to your blog post Independent think tank: Government must invest more to help disabled people into work, dated 28 July 2016. I am delighted that you have taken the time to read the series on reforming Employment and Support Allowance (ESA). There is an urgent need to ensure disabled people have the opportunities and support to reach their potential, and the failure of successive governments to successfully address the disability employment gap is unacceptable. I am, however, deeply concerned by your mischaracterisation of the final two Reform reports.
You rightly highlight that one of the key recommendations in Working welfare: a radically new approach to sickness and disability benefits is a single rate of out-of-work benefit. The report lays out in detail the reasons for this, including evidence from multiple international studies on the impact on claim durations of having a higher rate for incapacity-related benefits. Within this, however, the report explicitly states that: “For claimants with severely limiting health conditions the level of payment will not affect their chance of moving into work; for others non-financial incentives may be more powerful.” The report at no stage suggests that a single rate alone will move more disabled people into sustainable employment.
The report does, however, show that a single rate is a necessary precursor to abolishing the much criticised, binary Work Capability Assessment and to establishing a more personalised system of support and conditionality. This is something that Paul Gregg highlighted in his 2008 independent review for the last Labour Government.
Most crucially, you state that the report implies that “disabled people don’t need or deserve this extra support, that they are ‘shirkers’ and ‘scroungers’”, which it in no way does. You also ignore the recommendation that all savings from a single rate are reinvested in other support. Working welfare explicitly states:
“The move to a single out-of-work benefit is not about saving money but about creating a simpler, more coherent system. As such, the savings resulting from removing the disability-related additions to the standard allowance should be reinvested into extra costs benefits (PIP) and support services.”
ESA is of course an income replacement rather than an extra costs benefit. Far from “ignoring the extra costs disabled people face by virtue of their disability” the report is in fact calling for further investment in the extra costs benefit (Personal Independence Payment (PIP)), which as it is available regardless of work status has no impact on work incentives.
On the final paper, Stepping up, breaking barriers. Transforming employment outcomes for disabled people, you state that the “’black box’ approach to the Work Programme has been an abject failure”, yet the National Audit Office found the Work Programme to be as effective as previous programmes at a lower cost. The black box has also, as the report notes, been a characteristic of successive welfare-to-work programmes, including New Deal and Pathways to Work.
Work Choice, which you highlight as performing slightly better, also uses a quasi-black box within the modular approach. Though this is not a fair comparison to the Work Programme as Work Choice is estimated to have an average cost of £30,000 per job outcome and 22 per cent of referrals fail to attach to the programme. It is also worth noting that the majority of Work Choice participants are claimants of Jobseeker’s Allowance, not ESA, indicating they are closer to the labour market.
You end by saying that “there was little if anything said about the wider support environment to help disabled people into work. For example, what about addressing the cuts to Access to Work? Or attitudes of employers? Why has there been such poor take up of Disability Confident?” The final chapter in Stepping up, breaking barriers is focused on exactly these issues, with 16 recommendations covering Access to Work, Disability Confident, ‘stepping stone’ jobs (including apprenticeships and supported internships), recruitment and retention.
I would be delighted to discuss the series’ recommendations further.
Deputy Director and Head of Research, Reform