When the proposals to reform Employment and Support Allowance were first touted by Ian Duncan Smith following the spending review he argued that:
‘ESA may have been designed with the right intentions, but at its heart lay a fundamental flaw. It is a system that decides you are either capable of work or you are not. This needs to change – things are rarely that simplistic.’
In fact, the very category Duncan Smith’s Welfare and Work Bill has been trying to abolish – the Work Related Activity Group – was designed precisely to overcome such simplicity, removing the binary ‘can work/can’t work’ test by including a ‘may be able to work sometime in the future’ option. The result of getting rid of the WRAG will be to reenforce a binary fitness to work test that Duncan Smith claims to want to solve – placing people in either a ‘can never work’ or ‘ready and able to work right now’ box. Which is, one might argue, somewhat simplistic.
A particular obsession of DWP and assorted think tanks is the effect of benefit levels on ‘incentives’ to work. By their own admission the evidence to support this assertion is weak at best and largely non existent, but it serves the case for cutting benefits where all else fails. So let’s take the issue of incentives and disincentives seriously for a moment. Writing in 1974, Vik Finkelstein, one of the most significant architects of modern disability rights argued that proposals for a ‘disability income’ would:
‘immediately create for us a vested financial interest in claiming what becomes our main asset “disability”. In addition, since the amount of (State) charity will be determined by the degrees of disability, physically impaired people will also have a vested interest in playing down our abilities. The best financial contribution we could make to our families would be to become, or pretend to become, more dependent……The State, of course, will automatically be in conflict with us for it will seek to limit its handouts, otherwise there would be no one at work. State Charity, therefore, creates a conflict of interests between the State and its social administrators on the one hand and physically’ impaired people on the other.’
Now, the planned reforms to ESA may be a milestone on a journey towards there being no disability related out of work benefit at all (David Freud has hinted that this is the government’s goal). Whatever one thinks of that aim (see my view below) abolishing the WRAG appears a very odd way to get there because it provides a powerful incentive for people to emphasise the barriers and impairment/health related limitations they face – that is, it create a powerful incentive for people to seek to be placed in the ‘can never work’ group. This incentive is not simply borne of an extra £30 a week, but of avoiding the punitive, inflexible and insensitive sanctions regimes that, combined with entirely ineffective ’employment support,’ do nothing to help people find sustainable employment. Moreover, we are being asked to support these reforms without having seen the government’s proposals to halve the disability employment gap. One might argue this is somewhat putting the cart before the horse.
As for the idea being ventured by think tanks such as Reform that disability related costs should be met via Personal Independence Payment, not out of work benefits, this is something that I have floated in the past. But once one looks deeply at the idea it quickly falls apart.
Disabled people and people with long term health conditions are more likely to live in poverty (and hence require assistance) because they face both an ‘income penalty’ and a ‘cost of living penalty’. The income penalty is a result of reduced opportunities to raise a living income through paid employment, either as a result of the effects of ill health or impairment or because of discrimination and disadvantage, or more commonly a combination. The cost of living penalty results from the additional costs of having an impairment or health condition. ESA and its forerunners recognise the income penalty and additional payments are made in lieu of this. PIP and its forerunners recognise the cost of living penalty.
As a result, PIP as presently designed would not cover the income that people who presently fall into the WRAG receive in recognition of their income penalty, and trying to amend PIP so that it addressed both the income penalty and cost of living penalty would I would argue not only be too complex a task even for Ian Duncan Smith and David Freud, it would needlessly muddy waters.
As welcome a goal as halving the disability employment gap is, committing to do so cannot justify benefit reforms that should only ever be implemented on the back of real success. The amendment secured by the House of Lords is a helpful delay and I hope MPs will see sense and support it. Now for the Disability, Health and Work White Paper.