Government has announced £1bn of employment support measures aimed at helping disabled and long-term sick people back into work.
The Department for Work and Pensions said the new measures are designed to ensure a welfare system that is “fit for purpose and available for future generations and make inroads in reducing the 2.8 million people economically inactive due to long term sickness – one of the highest rates in the G7.”
In response the Income Protection Task Force (IPTF) told government in an open letter that the protection sector has a “pivotal” role in helping it meet its objectives.
Measures announced by government include:
- Reintroducing reassessments for people on incapacity benefits who have the capability to work to ensure they have the right support and aren’t indefinitely written off
- Targeting personal independence payments (PIPs) for those with higher needs by changing the eligibility requirement to a minimum score of four on at least one of the daily living activities to receive the daily living element of the benefit, in addition to the existing eligibility criteria
- Rebalancing payment levels in universal credit to improve the standard allowance – raising it above inflation by 2029/30 and adding £775 annually in cash terms
- Consulting on delaying access to the health element of Universal Credit until someone is aged 22 and reinvesting savings into work support and training opportunities through the Youth Guarantee
Government added that its reformed system will be built on a straightforward guarantee: any disabled person or person with a long-term health condition who is claiming out of work benefits will be able to access high quality, tailored help into a job.
It will also mean that those who cannot work will always get the support they need.
It said that in Scotland and Wales, it will work closely with the devolved governments as it develops this package of support.
Five key principles
The reforms are based on five key principles:
- Protecting disabled people who cannot and will not ever be able to work and supporting them to live with dignity by:
- Income protection: Those currently in receipt of UC health will benefit from the increased standard allowance and will not be affected by plans to reduce UC health in future
- Extra financial support: For people who receive the new rate of UC health in the future system, we are proposing a new premium for individuals with severe, life-long health conditions who will never be able to work. The details, eligibility criteria and rate of this premium will be set out in due course
- Ending reassessments: Reassessments for disabled people and people with life-long conditions who will never be able to work will be scrapped
- Improving safeguarding practices: The government will look at how safeguarding practices for the most vulnerable can be improved and improve experiences with the system, working with stakeholders to identify areas for improvement.
More employment support
Measures aimed at delivering better and more tailored employment support to get more people off welfare and into work include:
- A £1bn employment package to deliver tailored support for disabled people and those with long-term conditions
- New support conversations to provide earlier opportunities for people with health conditions to discuss work goals and available help
- Investing in the Youth Guarantee by delaying access to UC health element until age 22 and reinvesting savings into work support and training for young people
- Stopping people from falling into long-term economic inactivity through early intervention and support by:
- Access to work scheme: Government will consult on improvements to help people start and stay in work with reasonable adjustments including aids, appliances and assistive technology. These would be the first substantive changes to Access to Work since its introduction in 1994
- Unemployment insurance: Government will reform contributory benefits (ESA and JSA) into a single, non-means tested, time-limited benefit for those who have paid into the system to ensure people get the support they need to find a new job that makes the most of their skills, contributing to a dynamic and productive economy.
Trust and fairness
And in order to restore trust and fairness in the system by fixing the assessment process, government has committed to:
- Scrapping the WCA to end the labelling of people as either ‘can or can’t work’ and consulting on a new single assessment. Under the new system, any extra financial support for health conditions (including PIP, ESA or UC health) will be assessed via a new single assessment which will be based on the PIP assessment – considering on the impact of disability on daily living, not on capacity to work.
- Increasing face-to-face assessments for PIP and the WCA to improve the quality of assessment decision while ensuring it continues to meet the needs of those with who may require a different method of assessment.
- Longer term reform of the PIP assessment – In the long term government will set out broader reforms to the PIP assessment, and intend first to carry out a review involving experts and stakeholders to adapt and improve it.
- Right to try guarantee: which will ensure someone trying work or on a pathway towards employment will never lead to an immediate reassessment or award review.
- Restarting mandatory reassessments: Government will reintroduce reassessments for incapacity benefits, with exceptions for those who will never work and those under special rules for end-of-life care. Reassessments have largely been switched off since 2021, leaving people stuck on benefits when they could be helped into work and to improve their quality of life.
Ensuring the system is financially sustainable to keep providing for those who need it most by:
- Changing PIP eligibility: PIP will be targeted more on those with higher needs by requiring a minimum of four points on one daily living activity, in addition to the existing eligibility criteria. DWP will work with DHSC to ensure that existing people who claim PIP who may no longer be entitled to the benefit following an award review under new eligibility rules have their health and eligible care needs met. The government is consulting on how best to achieve this.
- Rebalancing universal credit: by improving the standard allowance to provide more adequate support. The government plans to raise the standard allowance above inflation by 2029/30, adding £775 in cash terms annually. This aims to avoid people having to choose between employment or adequate financial support. This change addresses the current issue where the health element rate is double that of the standard allowance, creating an incentive for people to prove they are unfit to work to claim the health element and access greater financial support.
Letter to the PM
The proposals prompted Jo Miller, managing director of the IPTF, to write an open letter to the Prime Minister saying she would welcome the opportunity to discuss:
- The best way to ensure that individuals who take responsibility for their own financial security through income protection policies are incentivised or, at the very least, not penalised within the welfare system, recognising that taking personal responsibility lessens the burden on the state
- How vocational rehabilitation and added-value services within income protection propositions effectively support claimants in returning to work reducing long-term welfare dependency and supporting sustainable employment
- Supporting renters as well as homeowners in mitigating the financial impact of illness or injury, helping to maintain housing stability
