A cap on talent

Well talk about pissing on your own fireworks….

Today, Minister for Disabled People Mark Harper MP made a statement to Parliament setting out reforms to the Access to Work scheme.  The proposals include a series of very welcome developments, including personal budgets for people with ongoing awards for travel or support (the money following the person), regarding support for self-employed people and the abandonment altogether of the ridiculous 30 hours of support rule.  Also promised are improvements to the way the scheme is administered.

And then this:

‘In 2013/14 the average Access to Work award was around £3,000, and half of users have awards below £1,000. However, 1% of users with awards over £35,000 per annum account for 15% of the budget. I want to ensure that Access to Work can help the most people it can in future. So as of October 2015, Access to Work will provide awards up to a limit set at one and half times average salary (a limit of £40,800 per person per year at October 2015). This will be uprated annually in line with the level of average salaries. I believe it is right that there is this explicit link to the labour market.’

For this policy to make any sense the effect of the policy must be to reduce the % taken up by the 1% of people whose awards are over £35,000.  That suggests that a reasonable proportion of the 1% receive awards over the proposed cap of £40,800 per year, which in turn means those facing the most profound – and costly to address – barriers in the workplace – and the enlightened employers who have taken them on – will receive less support in future to address those barriers.  That of course very likely means fewer of those people will be able to work.  I assume DWP will be publishing its impact assessment to this effect and explaining how it intends to mitigate this risk.

Spending on Access to Work represents around 0.08% of total annual DWP expenditure and research has shown a clear return on investment in the scheme for the Treasury.  The next government should increase investment in the scheme.  Todays proposals are an unnecessary and regressive cap on talent that Britain can ill afford.

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