One of the main issues I focused on during my time as MP for Edinburgh East was Employment and Support Allowance. This is the benefit people are meant to claim if they can’t work due to a disability or health condition. This page introduces ESA and the main issues of concern. The sub-pages listed at the bottom and under the ESA menu above explore these detail and set out my work on them.

Why ESA was introduced
The last Labour Government replaced Incapacity Benefit, Severe Disablement Allowance and Income Support on the grounds of disability with Employment and Support Allowance in 2008. Since then the benefit has attracted a lot of criticism, but I still support this decision.

In the 80s the Tories sidelined many people onto Incapacity Benefit without any pretence that they might ever be able to return to work. In part this was an attempt to manipulate the unemployment figures of the day. These were often men who had lost their jobs following the decline of the heavy industries and mass manufacturing. While it would be unreasonable to expect many of these people to go back to the mines or the steel plants, the key insights of ESA were that:

  • although people who are ill or disabled won’t be able to do any sort of work, with the right support there are jobs they can do;
  • it is often better for people’s mental and physical health if they are working rather than staying at home;
  • and while some people with a particular condition won’t be able to work, others with the same condition will.

Obviously there is also a financial benefit for both the state and the individual when people are in work and not on benefits.

The Work Capability Assessment (WCA) determines eligibility for the benefit, and generally involves a face to face assessment carried out for the Department of Work and Pensions by private contractor Atos Healthcare. It was designed to look at people’s functional capability rather than simply their condition. It was meant to identify what people could do rather than what they couldn’t.

What are the problems?
However it soon became clear that ESA wasn’t working as it should. My experience in the 2010 General Election told me that far too many claimants were being incorrectly assessed as fit for work, and these concerns were shared by advice agencies, charities and other MPs. They were also far more profound than any raised about Incapacity Benefit.

Between the introduction of the assessment in October 2008 and March 2013, 1.855 million new claimants were assessed and 1.002 million were declared fit for work. Of those 410,200 appealed their decision and 151,500 were successful and were awarded ESA. In percentage terms:

  • 41% of Fit For Work decisions were appealed
  • 15% of Fit For Work decisions were successfully appealed
  • 37% of Fit For Work appeals were successful
  • 8% of all decisions were successfully appealed

Although the proportion of decisions overturned has started to fall, the overall number still remains extremely high (for up to date figures see here). I am also clear that these statistics underestimate the number of people given incorrect decisions – for more on this see here.

These figures were raised at DWP Select Committee on 21 November 2012 by the Minister then responsible for this area, Mark Hoban. My colleague Anne Begg gave a telling response:

Mr Hoban: Thank you for that helpful clarification, but if you look at the 687,000 fit for work decisions that have been made, only 15% have been overturned. So if you look at the whole pool of decisions made by the Department where people have been judged to be fit for work, only 15% were overturned. So I think we need to get some perspective.

Chair: I have to say that, when I was a teacher, if I had 15% of my marking overturned I would have thought I was a failure as a teacher.

Incapacity Benefit reassessments
The Government started reassessing the 2.2 million people currently in receipt of Incapacity Benefit for ESA with pilots in Aberdeen and Burnley in November 2010. This was rolled out nationally in April 2011, and was due to be completed by March 2014. While it always the intention to reassess this group when ESA was introduced, I think it was wrong to press ahead without addressing the issues that the assessment of new claims were throwing up.

Initially the Government published separate figures for Incapacity Benefit reassessments but these were later combined with those for new claims. Between the start of the migration and March 2013 -with at least 12 months of the process still to go – 234,600 out of the 1.015 million Incapacity Benefit claimants reassessed were declared Fit for Work – 23 per cent. Unfortunately, as this written answer from January 2013 shows, detailed appeals data isn’t published for this strand of the assessment process. However this parliamentary question from 12 December 2012 tells us that on average 34% of Fit for Work decisions were overturned every month between February 2011 and June 2012.

Periodic reassessments
The third and final type of ESA assessment involved existing claimants undergoing periodic reassessment to check if their condition had changed for better or for worse. Again I supported this in principle, but would contend that in reality, people were being called back too regularly, and not enough people with progressive conditions – people who, in other words, won’t get better – were being reassessed on paper (i.e. without a face-to-face assessment).

It also seemed bizarre to persist with reassessing existing claimants when the assessment process for new claimants remained so troublesome. On Monday 24 February 2014 the website Benefits and Work published a leaked internal DWP memo that suggested DWP Ministers now finally acknowledge this – it instructed staff to stop calling existing claimants for periodic reassessments. For more on this see here.

Number and cost of appeals
The combination of new assessments, Incapacity Benefit reassessments and periodic reassessments has led to a huge volume of appeals and lengthening backlogs. DWP statistics reveal that 109,650 claimants are waiting over a year for their claim to be resolved (see here and here for written parliamentary questions on this).

I’ve reproduced a table with full figures on ESA appeals since the benefit’s introduction. These Ministry of Justice figures show that there are currently 114,900 outstanding ESA cases.

2009/10 2010/11 2011/12 2012/13 2009/13
Annual Total Annual Total Annual Total Annual Total Total
Table 1.4
Total Number of Social Security and Child Support Receipts by Benefit Type, 2009/10 to 2013/14
Employment Support Allowance
126,838 197,363 181,137 327,961 833,299
Table 2.6
Social Security and Child Support Disposals by Category and by Benefit Type, 2009/10 to 2013/14
Employment Support Allowance 70,535 176,567 204,321 268,137 719,560

As you can see there were 268,137 appeals disposed of in 2012/13 and, given that the average cost of each case is £248 (see Q123 in this DWP Committee evidence session from 7 May 2014), the total cost of appeals in 2012/13 would have been £66 million – enough to give nearly 12,000 people ESA at the Support Group rate for a year (Q92 in the evidence session confirms the Ministry of Justice simply bill DWP for the costs of ESA appeals).

This approach to calculating cost was not contested by the then Justice Minister Jonathan Djanogly on 3 July 2012. However during the aforementioned DWP Committee evidence session it was suggested that this figure was actually only £30 million. In addition a written PQ from 9 July 2012 suggests that this figure was £12 million in 2010-11 and £15 million in 2011-12. I therefore wrote to DWP to clarify the situation on 19 May 2014, and received a response dated 9 June 2014 from the Minister responsible for this issue, Mike Penning. He explains that the Treasury provide ‘baseline funding to HMCTS to administer a number of ESA appeals'; that ‘the figure of  £30 million was the amount of additional funding provided by DWP to cover the number of ESA appeals above this baseline’ in 2012/13; and that this was included in the overall cost of £66 million.

Regardless of this confusion, evidence to the DWP Committee from 7 May 2014 (see Q90 in particular) revealed that DWP were spending 10 times as much on ESA appeals than they initially planned for.

Is Jobseekers Allowance an alternative?
When people are incorrectly declared Fit for Work, they will often have no choice but to claim Jobseekers Allowance. However this requires people to be ‘available for work’, and often Jobcentre Plus advisors realise that this would be impossible for the individuals concerned and refuse them benefit as a result. This leaves people stuck between being too sick or disabled for JSA, and being not sick or disabled enough for ESA (all claimants that want to challenge Fit for Work decisions may now face this problem, as I discuss here). Those incorrectly declared Fit for Work that do manage to claim JSA will then often be referred to the Work Programme. But contractors are reluctant to commit time and money to getting these people into work due to the limited chances of success. These judgements by Jobcentre Staff and Work Programme contractors are, in effect, ‘real life’ WCAs. The fact that they come to completely different conclusions to the WCA used by Government highlights the flaws with the current system.

Impact on people
Some campaigners argue that incorrect Fit for Work decisions have prompted people to commit suicide. In response to a Freedom of Information request, DWP acknowledged that 10,600 people died between January and November 2011 while in receipt of ESA or awaiting a decision. Obviously some of these deaths will be related to the health conditions that prompted people to apply for ESA in the first place – as is emphasised in this Daily Telegraph piece from 9 July 2014 – but I do understand the concern that others may have been prompted by the stress of the ESA process.

Campaigners also point to the stress caused to people who are awarded ESA but who have had to appeal, or have been regularly reassessed, or who are subject to conditionality as a result of being in the WRAG. And following correspondence from constituents I’m also conscious as to how inappropriate the current assessment process can be for those approaching retirement or who are merely applying for ESA with a view to obtaining National Insurance contributions towards their state pension. In future it will be important to consider whether we need to take a different approach for these groups, particularly while the assessment process is producing so many incorrect decisions.

Impact on Health Services and Advice Agencies
It’s worth acknowledging the bureaucratic burden on GPs to support applicants – particularly during appeals – and the cost to the NHS of stress related illnesses caused by the process. Advice Agencies are similarly affected, with Citizen’s Advice Scotland’s annual report noting that in 2010/11, bureaux staff and volunteers helped clients with 19,536 new ESA issues – an increase of around a third on the previous year. Advisers also provided representation at 1,550 ESA tribunals, which took over 1,100 working days of adviser time. Ministers need to be aware that any drop in funding for the CAB could have serious consequences for ESA claimants.

Impact on claimant numbers
Statistics on the number of working age claimants of ESA and its various predecessor and equivalent benefits can be found on the Incapacity Benefits caseload table in the Incapacity Benefits tab in the Benefit Expenditure and Caseload tables. These are published at an annual basis and also include the total expenditure on these benefit. Although DWP’s tabulation tool provides statistics on the number of claimants on a quarterly basis, these only run back to August 1999, and do not include expenditure figures.

Under the Conservatives between 1978/79 and 1996/97, the total number of people claiming ESA’s predecessors more than doubled from 1.204 million to 2.569 million. This rate of increase slowed under Labour, with total numbers eventually peaking at 2.778 million in 2003/04, and dropping to 2.678 million in 2008/09 – the point at which ESA was introduced for new claims.

The number of claimants dropped to 2.621 million in 2009/10, and then 2.597 million in 2010/11, at which point the reassessment of Incapacity Benefit claimants started. Since then this figure has dropped again to an estimated 2.447 million in 2013/14 – a drop of 150,000.

However specific figures for the Incapacity Benefit migration indicated that between its launch and March 2013 – with at least 12 months of the process still to go – 234,600 out of the 1.015 million Incapacity Benefit claimants reassessed had been declared Fit for Work.

What with the toughness – or unfairness, as I would suggest – of the test also applying to new claimants, and the time-limiting of contributory ESA to a year, one would expect the total number of claimants to drop by more than the number of Incapacity Benefit claimants declared Fit for Work – but bizarrely it has dropped by 84,600 less.

In addition new evidence from page 3 of the October 2014 edition of DWP’s Statistical Summaries indicates that since the total number of claimants hit a low of 2.440 milion in August 2013, this figure rose to 2.459 million by February 2014, and is estimated to have risen to 2.515 million in August 2014. I raised this issue to no avail with the Minister for Disabled People Mark Harper on 3 November 2014.

It should be acknowledged that the statistical summary highlights the increasing proportion of claimants who receive National Insurance credits only thanks to contributory time-limiting for those in the WRAG; it also notes that the State Pension Age is increasing, which will also lead to an increase in claims over time.

But regardless of these qualifications, it’s clear that for all the distress caused to claimants and the cost of assessments and appeals borne by taxpayers, the Government’s attempts to reduce the numbers on Incapacity Benefits have fallen well short.

One possible explanation is that more people are becoming ill or disabled and so the number of successful new claims is rising. However this seems unlikely.

Instead I suspect that some of those declared Fit for Work, either as new claimants or having previously been on Incapacity Benefit, are simply reapplying for ESA and being awarded benefit the second time round.

I would contend that the poor quality of support in terms of finding and holding down a job leaves people who might be able to work with no option but to reapply for ESA. I highlighted this in a debate in parliament on 3 April 2014 and have written about this here and here on my website and for the New Statesman on 20 June 2014.

Impact on spending
Total expenditure on working age ESA and its predecessor and equivalent benefits are available on the Benefit Expenditure and Caseload tables on the Government website. The tab entitled Incapacity Benefits shows that expenditure was, in 2014/15 prices, £7.066 billion in 1978/79 and £16.315 billion in 1996/97. It peaked at £17.022 billion in 2001/02 and fell to £14.130 billion in 2008/09. At the start of Incapacity Benefit reassessments in 2010/11 it stood at £14.142 billion, and this dropped to an estimated £13.533 billion in 2013/14. This is forecast to continue to fall to £13.235 billion by 2016/17, and will then rise slowly after that. This letter from Esther McVey from March 2014 presents an older set of forecasts in nominal terms.

I’m concerned about the Government’s approach to statistics on ESA and other benefits on three levels:

  1. Firstly the statistics that are published are deliberately misused to the disadvantage of people with genuine disabilities – see here for more information.
  2. Secondly some of the data is incomplete – particularly that on the number of successful requests for reconsideration – with the effect that it underplays the extent of policy failings – again see here for details.
  3. And thirdly Ministers treat the publication of statistics as unimportant and an optional extra, and there are a range of statistics that would shed further light on the performance of the WCA that the Government simply refuse to collect – see here.

The Government’s response
The Government’s response to criticism has generally been to defend the process and highlight the independent review process and the recommendations that they claim to have implemented. They also point to an increase in the proportion of ESA claimants being placed in the Support Group.

However since summer 2013 the narrative has changed so that Ministers now increasingly acknowledge the ESA assessment process as an issue and blame Atos. This is something I have always tried to avoid as, ultimately, Atos are simply implementing policy determined by Government – a point reinforced by the Work and Pensions Select Committee’s July 2014 report on ESA.

Ministers are also increasingly inclined to blame the previous Government, who awarded the contract to Atos in the first place. This point is particularly dubious given that the current Government renewed Atos’ contract in 2011 and awarded them the contract for Personal Independence Payment assessments in 2012.

In evidence to the Work and Pensions Select Committee on 10 June 2014 Mike Penning, the Minister currently responsible for ESA, admitted that 700,000 people were currently waiting for a WCA. However he since argued that this was just as much of an issue while Labour were in power – most notably at DWP Questions on 23 June 2014. I’ve examined this claim and in reality, the backlog was a mere 28,300 people in May 2010. I’ve highlighted this in a letter to Mike Penning on 3 July 2014, with which I enclosed two spreadsheets of data. For more see here.

Work and Pensions Select Committee
Many of these concerns – and the inadequacy of the Government’s response thus far – are covered in a report from the Work and Pensions Select Committee – of which I’m a member – published in July 2014.

What would Labour do?
On 16 April 2014 Labour’s Shadow Work and Pensions Secretary Rachel Reeves and Shadow Disabilities Minister Kate Green set out how Labour would reform ESA and the WCA in an article for The Independent. We would:

  1. Re-design the WCA to make it more effective at helping disabled people into work. This would involve claimants receiving a copy of an assessor’s report that includes detail on how their condition affects their ability to work, and information about the support available in their local area.
  2. Continue to publish independent reviews of the WCA and give disabled people a greater role in putting these together.
  3. Ensure assessments are ‘right first time’ by imposing financial penalties on the WCA contractor whenever a Decision Maker or Judge overturns a contractor’s advice. This should prompt assessors to listen to claimants and collect all the necessary medical evidence.

In this set of pages I will bring together all my work and research on these issues: