Up to 1 million people claiming incapacity benefits could lose hundreds of pounds a month as a result of plans outlined in the budget to push ahead with the “biggest reforms to the welfare system in a decade,” experts have said.
The warning came as ministers unveiled a range of measures to try to drive more people back into the workplace, including scrapping controversial “fit for work” tests for disabled claimants and stepping up the threat of benefit curbs against part-time workers.
The chancellor, Jeremy Hunt, said the proposals would help hundreds of thousands of people with a disability who wanted to work, while cracking down on universal credit claimants who failed to search hard enough for a job or rejected a reasonable offer of employment.
The Institute for Fiscal Studies said up to 1 million people currently on incapacity benefits could lose about £350 a month as a result of dropping the work capability assessment (WCA), which assesses capacity for work, and using the personal independence payment (Pip) test, which measures only the extra living costs of disability.
It said the logic of the plan meant those who had conditions that prevented them working – such as people with short-term or fluctuating illnesses – but who did not claim Pip, or incur major additional living costs, would no longer receive extra support. Pip tests are widely distrusted and currently take 14 weeks to process.
Charities and disability campaigners broadly welcomed the proposals to scrap the much-hated WCA but said the government had a “mountain to climb” to regain the trust of disabled people subjected to degrading and flawed benefit tests in recent years.
the mental health charity Mind attacked the proposals as an “overly simplistic approach to a complex, systemic issue” saying there was “nothing in today’s budget which would allow people who are out of work due to a mental health problem to make a full recovery and return to work in a sustainable manner.”
There was also widespread concern over the government’s plans to apply benefit controls more rigorously to universal credit claimants, in particular to the main carers of children. These claimants will in future be expected to look for work or increase their existing hours under threat of having their benefits docked.
Universal credit claimants will be expected to work at least 18 hours at the national minimum wage or be required to attend work search interviews at a job centre. Current exemptions where a second adult member of a household is not required to look for work if their partner is working will be removed.
The government’s use of benefit controls – in effect fines of at least one month’s benefits allowance imposed for supposed failure to look for work or accept a job offer – have been shown to have little positive impact on employability while impoverishing claimants and increasing mental ill-health, debt and poverty.
Hunt said the announcements reflected the government’s belief that “independence is better than dependence” and that “those who can work should”. He said penalties would be applied “more rigorously” to those who failed to meet work search requirements or take up “a reasonable job offer.”
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However, Alison Garnham, chief executive of the Child Poverty Action Group, called the government’s approach “more stick than carrot” adding that it risked “pressurising parents into low-paid, low-skilled, precarious work – at a time when three-quarters of children in poverty are in working households”..
The government’s disability white paper said its proposals would enable more people with disabilities and chronic health conditions to live “independent and fulfilling lives”.
There would be a voluntary universal support scheme providing £4,000 a year work-help grants to up to 50,000 disabled people.
James Taylor, executive director of strategy and disability charity Scope, said: “For far too long, disabled people have been faced with degrading benefits assessments, cruel sanctions and a dearth of tailored support to find suitable jobs.”
Stephen Evans of the Learning and Work Institute, said: “Care is needed to avoid lower benefit payments for hundreds of thousands of people who leave work due to ill health but are not entitled to a personal independence payment. The answer is more help and support, not just a bigger stick.”
