Policies developed on a false premise will inevitably run into problems. When these policies apply to people this can also cause great harm.
The Government's policy on 'sickness benefits' is framed on the assertion that previous governments 'dumped' people on these benefits who never worked again. For their own good they needed to be re-tested on a new basis. M any people would then be returned to the labour market and spending on the benefit would be cut. The trouble is that numbers haven't reduced much, and projected savings haven't been made. But rather than review the basis on which their policy was built, it appears that the Government is simply going to cut by £30 per week the benefits of many of those its own test has found unfit for work for the time being .
Like all good myths this has some elements of truth. Incapacity Benefit was used to deal with the problem of those displaced from industries like coal, textiles and steel during the 1980s. Job opportunities where they lived were limited, and many genuinely suffered from work related poor health . This was particularly true of older workers whose chances of a new job were always the slimmest. Under the Conservatives between 1978/79 and 1996/97, the total number of claimants more than doubled from 1.204 million to 2.569 million. This rate of increase slowed under Labour, with total numbers eventually peaking at 2.678 million in 2008/09 when ESA was introduced.
As this Budget rolls out I suspect we are going to hear a vigorous refreshing of the 'people being callously dumped' argument from Tory Ministers and backbenchers. However the truth is more complex. Even where total numbers have remained similar over a fairly long period, these are not by any means the same people. There is substantial flow both on and off benefit. Of those who are long term claimants , many have long term conditions making employment difficult, sometimes impossible.
The Government insisted on rolling out the transfer of all existing Incapacity Benefit claimants to Employment & Support Allowance from 2011 , believing that the more stringent test applied for ESA would result in many existing claimants being found fit for work. In its first three years ESA was for new claimants only, with around 35% being found fit for work. The correctness of the testing process has rightly been the subject of much controversy , but applying the same test to those moving from IB produced a different result with only 23% being found fit for work initially. One conclusion which may be reached is that in fact many people in receipt of IB actually were more unwell or disabled than the Government's propaganda keeps suggesting . Not a conclusion it appears the Government wants to accept.
Even more crucially despite all the numbers being found 'fit for work', trumpeted by the Government as proof of their assertions, when you look at the total numbers in receipt of ESA, together those still on the older benefits, this number remains very high. The total number in receipt of ESA and IB is only 100,000 lower than in 2008/9. Yet taking just the period between April 2011 and March 2013 some 234,600 former IB claimants had been found fit for work. With the toughness of the test also applying to new claimants, and the time-limiting of contributory ESA to a year for many , one would expect the total number of claimants to drop by more than the number of Incapacity Benefit claimants declared Fit for Work - but bizarrely it has dropped by considerably less. With unemployment falling since 2008/9, one might hope that more people with health issues would have been able to find work.
Something unexplained is going on. Despite all the stress to individuals , the increasing cost and difficulty of administering the system (the migration process created a huge backlog in the assessment process), nothing much seems to have changed and savings not achieved. Are more people are becoming ill or disabled? This seems unlikely.
But what if the initial assumptions were wrong, and that there are not lots of 'fit' people sidelined onto incapacity benefits. Three quarters of those being 'migrated ' from IB are not fit for work. The proportion of new claimants being found fit for work has fallen to 23%, and has been steadily falling . in addition I suspect that a good number of those declared Fit for Work, are simply not getting better, not getting jobs, getting less well and end up reapplying for ESA and being awarded benefit the second time round.
If we accept that most claimants actually face significant barriers to returning to work, we need to be putting more effort into both giving them the help they need, and encouraging employers to take people on. This was what the Work Related Activity Group was intended to do, but for many the support offered is minimal . People are invited to 'work focused interviews (in letters that contain severe warnings about the consequences of not attending) and are then sent away for a year in some cases. Box ticked but no help given. Some are referred to the Work Programme which has very poor outcomes for this group, not surprising given that those attending say that all the emphasis was on the mechanics of job search with little reference to their heath.
Taking away £30 pw of income won't tackle these weaknesses of the system. Will there still be a Work Related Activity Group at all? The only difference from being on JSA will be less conditionality (although there is still some and examples of ESA-WRAG claimants being sanctioned).
Nor are we dealing here with people with minor illness. Charities report that 45% of people who put in a claim for ESA, and had Parkinson's, Cystic Fibrosis, multiple sclerosis, or Rheumatoid Arthritis, were placed in the Work Related Activity Group (WRAG).
While this change isn't due to start until 2017 it won't take long for it to apply to a substantial number of people . Around 700,000 apply each year for ESA, of which number around 60% proceed to full assessment (the others generally return to work before the process is complete). Currently around 14% of these go into the WRAG. That's around 60,000 people affected every year.