Reform of incapacity benefits is set to “impoverish vast numbers of households” and “cause untold distress in countless more”, a new research report has warned.
The report, by the Centre for Regional Economic and Social Research at Sheffield Hallam University, estimates that the reforms will cut the number of disabled people on out-of-work disability benefits by nearly one million, in just three years.
It stresses that the reduction will be because of strict rules on claiming the new employment and support allowance (ESA), and “does not mean that there is currently widespread fraud, or that the health problems and disabilities are anything less than real”.
It also concludes that nearly 600,000 claimants will be pushed out of the benefits system completely, while another 300,000 will be forced to claim the mainstream jobseeker’s allowance – which is paid at a lower rate than ESA.
The report also warns that the effects of the reforms will be concentrated in the older industrial areas of the north, Scotland and Wales, while they will impact “barely at all on the most prosperous parts of southern England”.
It points out that the proportion of working-age adults claiming incapacity benefits in Merthyr Tydfil was 14.5 per cent in February 2011, but in the area of Hart District Council, in Hampshire, it was just 2.1 per cent.
Some of the reforms – a tough new work capability test, new requirements for many disabled claimants to engage in work-related activity, and the re-testing of all existing claimants of old-style incapacity benefit – were introduced or proposed by the Labour government.
But the coalition has accelerated the pace of reform and controversially plans to time-limit the contributory form of ESA to just one year for those found able to carry out some work-related activity.
The report says Labour’s reforms were “always set to trigger much distress for very little reward” but the coalition’s time-limiting of entitlement to ESA will “merely crank up the levels of distress”.
Professor Steve Fothergill, co-author of the report, said: “In terms of the numbers affected and the scale and severity of the impact, the reforms to incapacity benefits that are underway are probably the most far-reaching changes to the benefits system for at least a generation.
“They will impoverish vast numbers of households, and cause untold distress in countless more.”
Although the report says that some former claimants will find work, it says there is “little reason to suppose that the big fall in claimant numbers will lead to significant increases in employment”.
It adds: “Incapacity claimants often face multiple obstacles to working again and their concentration in the weakest local economies and most disadvantaged communities means they usually have little chance of finding work.”
In response to the report, employment minister Chris Grayling said: “It’s clear that millions of people have been written off for years [and]left on incapacity benefit with no real support to get into work. That’s why we are retesting people to see if they have the capacity to work.
“Our changes will make sure those in genuine need get more support and those who could and should be working are given the opportunity to do so.
“For those that need additional help, our new Work Programme is up and running and will tailor support to people’s needs so that they can overcome whatever barriers they face.”
9 November 2011