An influential committee of MPs has delivered a scathing account of the failure of the Department for Work and Pensions (DWP) to challenge the poor performance of its “fitness for work” contractor Atos Healthcare.
The public accounts committee says in its report, published today (Friday), that DWP is “getting far too many decisions wrong” through its much-criticised work capability assessment (WCA) system.
Margaret Hodge, the Labour chair of the committee, said DWP’s failures were creating “misery and hardship” for many claimants.
Her committee’s report says: “We are concerned that the department is unduly complacent regarding the quality of the decision-making process, particularly given the hardship which can be caused to individuals when the decision is wrong.”
It also accuses DWP of complacency over the number of successful appeals against being found fit for work, with nearly 40 per cent of appeals succeeding, and a third of these not as a result of any new evidence.
Hodge said the “standardised ‘tick-box’ approach” of the WCA “hits the most vulnerable claimants hardest”, while its “one-size-fits-all approach fails to account adequately for mental health conditions or those which are rare or fluctuating”.
She added: “While the department has started to improve, the process is still too inflexible and too often is so stressful for applicants that their health simply gets worse.”
DWP was unable to tell the committee the full cost of the WCA system across government, including knock-on costs to the NHS and Ministry of Justice.
The government has outsourced all of its medical assessments since 1998, with the contracts all carried out by one company, Atos – except when it has changed hands due to a company takeover – leaving DWP with “limited leverage to remedy poor performance”.
In 2011-12, DWP paid Atos £112.4 million to carry out 738,000 assessments, most of which were WCAs.
Atos will also assess about 440,000 claims a year for the new personal independence payment – the replacement for working-age disability living allowance – from April 2013.
The committee was scathing about DWP’s failure to manage its contract with Atos.
Hodge said DWP rarely checked that it was being charged correctly by Atos, failed to withhold payment for poor performance, and could not say whether Atos was making a “disproportionate” level of profit from the contract.
In a typical month, DWP only checked 0.1 per cent of the assessments it was invoiced for, the report says, and relied too much on information provided by Atos.
The report says the “lack of challenging targets for medical quality” allows Atos to conduct “thousands of poorly administered tests each year” without any financial sanction.
Hodge concluded: “There needs to be a substantial shake-up in how the department manages this contract and in its processes for improving the quality of decision-making.”
Liz Sayce, chief executive of Disability Rights UK, welcomed the report and “the fact that a cross-party committee of MPs agrees with what disabled people have been saying so strongly”.
She said: “Fear does not help job-seeking. People out of work for many years need encouragement and support to build confidence. We need personalised employment support, not tests causing anxiety and distress.
“We need a ‘real world’ test that takes account of barriers to work – whether employers make adjustments, whether people have the support they need to work.”
Meanwhile, the DWP has published its response to last November’s report by the work and pensions select committee on how universal credit will meet the needs of “vulnerable claimants”.
The universal credit reforms will be gradually introduced from April and will see key means-tested benefits and tax credits combined into a single payment.
The committee’s report called on the government to “reconsider” the loss of additional disability payments which are available under the current benefits system, particularly those affecting disabled children and disabled people with high support needs.
In its response, the government defended its changes, which it said would create a “simpler and fairer system” and would see disabled people “on average” gain by £8 a month, while it had “committed to a thorough process of evaluation for the effect of universal credit on disabled people”.
The disabled Labour MP Dame Anne Begg, who chairs the committee, said “significant concerns” remained about whether vulnerable people would receive the support they needed, although the government had shown “some movement in this direction” and had pledged to “monitor closely various aspects of the policy”.
8 February 2013