Tens of thousands of disabled people have lost all of their out-of-work disability benefits this week, thanks to new rules brought in by the government through its controversial Welfare Reform Act.
The act introduced a new one-year time limit on claiming the contributory form of employment and support allowance (ESA) for those disabled people expected to move gradually towards work.
The new time limit was introduced retrospectively, which meant that claimants began to have their ESA removed on 30 April, even though the act only became law two months ago.
The Department for Work and Pensions (DWP) confirmed that it expects 40,000 people from this work-related activity group (WRAG) to lose all of their ESA this week, with a further 60,000 losing their contributory ESA but becoming eligible for at least some ESA on the grounds of low income.
Those disabled people with higher support needs, who have been placed in the ESA support group, are not affected by the time limit.
The one-year limit was one of the most controversial aspects of the act, with the disabled peer Lord [Colin] Low telling the government earlier this year that the measure would be “not only unfair but downright cruel”.
Disability Rights UK (DR UK) said this week that the time limit would increase the number of disabled people living in poverty, with some losing more than £90 a week.
Neil Coyle, DR UK’s director of policy and campaigns, said the new measure would only penalise disabled people who have worked in the past, as only those who have made national insurance contributions qualify for contributory ESA.
He called on the government to monitor the impact of the new time limit closely.
In its own equality impact assessment (EIA) of the measure last October, DWP conceded that the policy would affect about 700,000 people by 2015-16, with about 280,000 of them losing all of their ESA.
DWP estimates suggest that disabled people hitting the one-year time limit will lose an average £32 per week for men, and £43 for women.
A DWP spokeswoman said: “The welfare system must support those with the most need.
“ESA for people who could be expected to get back into work was never intended to be a long-term benefit and the time limit of one year strikes the best balance between recognising that some people need extra help to enter the workplace and that the taxpayer cannot afford to support people indefinitely who could return to employment.”
She added: “Although a person’s ESA has ended they may be entitled to other help such as housing benefit, council tax benefit or working tax credits.”
She said DWP would monitor the impact of the time limit through its “frontline operation” and by “making sure people know what other benefits may be available to them”.
She added: “In terms of helping people, even if you are not eligible for benefit you can continue to claim national insurance credits and be eligible for all the support to help you get closer to the labour market, such as the Work Programme.”
She said this was another way for DWP to “stay in touch” with former claimants.
For more information on ESA, visit the government’s benefits adviser online service.
3 May 2012