Spending watchdog calls for ‘wide-ranging’ review of benefit sanctions regime

The government has been heavily-criticised by the public spending watchdog for failing to investigate how its own sanctions regime affects disabled people and other claimants of out-of-work benefits.

The National Audit Office (NAO) report says the Department for Work and Pensions (DWP) has failed to track the costs and benefits of sanctions, including financial hardship, the impact on claimants’ mental health, and higher public spending in other areas, such as council-funded support.

And it calls on DWP to conduct a “wide-ranging review” of its regime, which has led to 400,000 sanctions being applied in 2015 across four benefits: jobseeker’s allowance (JSA), employment and support allowance (ESA), universal credit and income support.

DWP has previously rejected calls for a wider review, and NAO says it has also “resisted working with academic researchers and third-party organisations to explore the effect of sanctions”.

DWP has even told Work Programme providers not to cooperate with government-funded research looking at the role and impact of sanctions.

Only last month, the UN’s committee on the rights of persons with disabilities – in a report concluding that there had been “grave or systematic violations” of the UN’s disability convention by the UK government – pointed to a significant and “disproportionate” increase in benefit sanctions handed to ESA claimants between 2012 and 2014.

The committee concluded that sanctioned claimants had faced “financial hardship, including through becoming indebted, relying on the support of relatives or on food banks or having reduced essential services”.

Disabled activists have repeatedly highlighted the deaths of disabled benefit claimants they believe were linked to the government’s sanctions regime, including those of David Clapson (pictured) and Alan McArdle.

DWP admitted last year that 10 of 49 benefit claimants whose deaths were subject to secret reviews by the department had had their payments sanctioned at some stage.

The latest DWP figures showed a sharp rise in the number of sanctions imposed on ESA claimants, with 1,199 decisions taken to impose a sanction on an ESA claimant in May 2016, rising to 1,749 in June, compared to 900 in January.

NAO says that DWP has not used sanctions consistently, that referral rates have varied “substantially” across jobcentres and providers of employment support, and that sanction numbers have “risen and fallen over time in ways that cannot be explained by changes in claimant compliance”.

It also says that the use of sanctions was “not rare”, with nearly one in four JSA claimants between 2010 and 2015 being sanctioned at least once.

And preliminary research carried out by NAO suggests that the use of sanctions on sick and disabled people who claim ESA actually led to a fall in the time they spent in work.

NAO says that international studies show claimants who receive sanctions are more likely to secure work, but this effect can be short-lived, because people “move into work more quickly, by accepting less well-paid and sustainable work than they otherwise would have done”.

Studies also suggest that sanctions encourage some claimants to become “inactive”, by stopping their claim without finding work.

The watchdog has estimated that the government failed to pay £132 million in benefits in 2015 as a result of sanctions, and paid out £35 million in hardship payments to these claimants, while the cost of administering the sanctions system in 2015 was between £30 million and £50 million.

Linda Burnip, co-founder of Disabled People Against Cuts (DPAC), said: “As DPAC has always said, sanctions do not help disabled people find and keep work and it is good to have this confirmed by the NAO.

“How can anyone, even the dimmest of people, seriously think that someone with no money for essentials such as food, heating and sanitary products is likely to be able to pay to travel to interviews, buy clothes for interviews or have any energy to even apply for any jobs? It’s simply a ludicrous idea.”

John McArdle, co-founder of Black Triangle, welcomed the NAO report and said it showed the “arbitrary” nature of the government’s sanctions regime and “confirms what we have been saying all along”.

He said the sanctions regime breaches both article two (the right to life) and article six (the right to a fair trial) of the European Convention on Human Rights.

McArdle said: “There is no safety protocol in place. Disabled people on ESA are being sanctioned and they are basically leaving people destitute.

“It can put people in life-threatening situations. It can cause disabled people catastrophic harm in a way that it wouldn’t do to people who are not so disabled.”

But McArdle said there was “not a hope in hell” that the government would agree to the NAO recommendation to carry out a wide-ranging review.

He said: “The only thing that will bring this government to heel is proceedings in the criminal court.”

The Liberal Democrats called on the government to look again at its “discredited” sanctions regime.

The party’s leader, Tim Farron, said the report was the “Civil Service equivalent of a character assassination”.

He said: “It shows that a failing department is trying to prop up a discredited system.  

“The DWP have turned this system [into] a postcode lottery and means that someone could be sanctioned in one place and not in another for the same thing.

“What is worse is that the government are not assessing the impact of sanctions, using their own data to see what is going on and they are not even tracking the benefits.”

The Liberal Democrats voted to scrap all benefit sanctions at their party conference in September.

Meg Hillier, the Labour MP who chairs the Commons public accounts committee, said: “Benefit sanctions punish some of the poorest people in the country.

“But despite the anxiety and misery they cause, it seems to be pot luck who gets sanctioned.

“While studies suggest sanctions do encourage some people back into work, other people stop claiming but do not start working and the Department for Work and Pensions has no record of them.

“If vulnerable people fall through the safety net, what happens to them?”

A DWP spokeswoman said: “Sanctions are an important part of our benefits system and it is right that there is a system in place for tackling those few who do not fulfil their commitment to find work.

“This report fails to recognise the improvements we have made to sanctions, particularly to help those who are vulnerable.

“The number of sanctions has fallen, and they are only ever used as a last resort after people fail to do what is asked of them in return for benefits.

“We will consider the recommendations, and respond fully in due course.”