Perverse disincentive

BillMckenzie.jpgBill McKenzie on the flawed logic underpinning Tory attempts to financially punish those too ill to work

Later today, the House of Lords will vote on whether to knock out two clauses from the Welfare Reform and Work Bill. It is a significant decision to remove whole sections of proposed legislation, and not one Peers take lightly. It is no more significant however, than the effect these clauses would have on the lives of the disabled people who will be affected.               

Clauses 13 and 14 would cut £30 a week from future claimants of Employment Support Allowance (ESA) who would be assessed as not fit for work. Half a million disabled people: some recovering from cancer, and many with mental and behavioural disorders, including learning disabilities and autism.

These are individuals who, if able to return to work, need time and proper support. Instead, the Tory medicine is to reduce their weekly support from £103 a week to just £73; adding to their debt, stress and anxiety – and so making their lives more difficult, if not impossible.

Far from seeing this as a punitive measure, Ministers believe they are in fact doing this group of individuals a favour. The flawed logic runs that by removing their higher level of support, they will be incentivised to go out and seek work, with resulting improvements in their health – as well as the life chances for their children.

The positive benefits of work on individuals and families are not in question here. What Labour and others are challenging however, is the notion that for people within this ‘Work-related activity group’ (aka WRAG), taking away their money will have any effect on their ability to work.

Such is the concern around the government’s plans that expert Crossbenchers in the Lords conducted a formal review of the planned cuts. The conclusions of Colin Low, Molly Meacher and Tanni Grey-Thompson’s report could not have been clearer:

“There is no relevant evidence setting out a convincing case that the Employment Support Allowance WRAG payment acts as a financial disincentive to claimants moving towards work, or that reducing the payment would incentivise people to seek work.”

Worse still, they have found that the proposals are instead: “likely to move them further away from the labour market rather than closer.”

Ministers should not be surprised by these findings. People within the WRAG group have found to be too ill to work, and so the idea that a little financial incentive might mean they suddenly have the strength or health to do so is frankly, ludicrous. The reason why these individuals are given extra support in the first place, is because we recognise that they are likely to be unemployed for a longer period than those receiving Jobseeker’s Allowance.

Of course, this isn’t the only loss of income people with disabilities face. There is also the impact of cuts in council tax support, the bedroom tax, and the benefit cap for those not in receipt of Disability Living Allowance. Many disabled and ill people will have already had to deal with a loss in support, and these clauses will merely push them further into poverty.

The report from our Crossbench colleagues lays plain the strains of daily living for so many in our society. One respondent to the review wrote: “I wouldn’t be able to afford the basics like food and electricity and heating.” Another, with a mental health condition said: “Losing this money would make me more worried and stressed.”

Today, Peers will urge Ministers to see sense and listen to those whose lives will be made a misery by this cut to their support. Many would welcome the chance to move towards work if we would only invest in tailored, personalised programmes. This is where the government should be directing its energy.

Bill McKenzie is a member of the Shadow DWP team in the House of Lords

Published 27th January 2016

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