 | This article needs to be updated.(October 2019) |
Incapacity Benefit was a British social security benefit that was paid to people facing extra barriers to work because of their long-term illness or their disability. It replaced Invalidity Benefit in 1995. The government began to phase out Incapacity Benefit in 2008 by making it unavailable to new claimants, and later moved almost all the remaining long-term recipients onto Employment and Support Allowance.
In 1995, the Conservative Secretary of State for Social Security, Peter Lilley, abolished Invalidity Benefit for fresh claims and replaced it with Incapacity Benefit after the Prime Minister of the day, John Major, had complained about the burgeoning caseload, saying: "Frankly, it beggars belief that so many more people have suddenly become invalids, especially at a time when the health of the population has improved". [1]
A new feature of Incapacity Benefit was that officials could ask for claimants' disabilities to be confirmed using a bespoke testing procedure – the All Work Test – carried out by doctors working for the government. Another feature was that claimants would be assessed on their ability to do any job, not just their old trade. And unlike its predecessor, Incapacity Benefit was taxable. [2] Nevertheless, the caseload continued to rise.
After 2000, some recipients underwent a Personal Capability Assessment to establish whether their condition had improved: if it had, benefit payments could be withdrawn; otherwise, a Capability Report was drawn up by the examining doctor and used by Job Centre staff to plan ways to boost recipients' employability, in the hope of returning them to work. [3] This new test was also used to assess some fresh claims for Incapacity Benefit.
In late 2008, the Labour government replaced Incapacity Benefit with Employment and Support Allowance (ESA) for new claims and brought in another gateway health test largely carried out by nurses: the Work Capability Assessment.
Following the introduction of ESA, the number of remaining Incapacity Benefit recipients dwindled, largely as they came off the benefit upon reaching the State Pension age. By early 2011, the Incapacity Benefit caseload had shrunk by more than 500000, and the ESA caseload had grown by the same amount. [4]
The Coalition government decided to implement the plan to reassess most remaining Incapacity Benefit recipients. [5] This reassessment programme, which began in early 2011 and was effectively completed in 2016, used an updated version of the Work Capability Assessment. Recipients confirmed as having limited capability for work were transferred onto ESA; any found fully capable of work had their Incapacity Benefit payments stopped and were invited to apply for Jobseekers Allowance (JSA).
To be eligible for Incapacity Benefit claimants had to meet one of two criteria:
For the first 28 weeks of the claim, eligibility was based on whether the claimant could do their normal occupation. From the 29th week onwards, eligibility was based on whether the claimant was able to do any type of work. [7] People over state pension age who were claiming Incapacity Benefit before they reached this age were eligible to receive Incapacity Benefit for up to one year after they became eligible for the state pension. [6]
| Short Term(under state pension age) | Short Term(over state pension age) | Long Term | |
|---|---|---|---|
| Lower Rate | £82.65 | £105.15 | £109.60 |
| Higher Rate | £97.85 | £109.60 |
The short term rate was paid to people who had claimed Incapacity Benefit for less than 52 weeks. After 52 weeks, claimants would be paid the long term rate, [7] however, claimants who had a terminal illness or got the highest rate care component of Disability Living Allowance were able to be paid the long term rate after 28 weeks of claiming Incapacity Benefit. [6] The short term rate was split into two other categories: lower rate and higher rate. The lower rate was paid to people who had been sick or disabled for more than four days but less than 28 weeks and who were not able to claim Statutory Sick Pay. The higher rate was paid to people who had been sick or disabled for more than 28 weeks but less than 52 weeks. [6] Claimants who became unable to work as a result of sickness or disability before the age of 45 also were paid the Incapacity Age Addition. [6]
The number of Incapacity Benefits rose dramatically in the 1990s. A study on this phenomenon argued that it was extremely unlikely that the number of people with serious disabilities had risen as rapidly as the number of Incapacity Benefit claimants. [9] The study found that areas where a high number of jobs had been lost (for example, from the closure of coal mines in the 1980s) experienced the biggest rises in people claiming Incapacity Benefit, but that there was no comparable rise in Jobseeker's Allowance claimants. [9]
In 2004, the caseload peaked at just under 2,500,000 then began to fall slowly, but caseloads never fell lower than they were in 1995. [10] [11]
A report written by academics from Sheffield Hallam University argued that Incapacity Benefit had been used to give the appearance that unemployment levels were lower than they genuinely were. The report's author's claimed that because Incapacity Benefit claimants were not counted as unemployed in official data on employment levels, unemployed people with disabilities that did not necessarily prevent them from working were allowed to claim Incapacity Benefit so that unemployment figures would appear lower. The report cites data from the DWP that show that the number of Incapacity Benefit in relation to the number of JSA claimants rose considerably between the 1990s and the 2000s. [10] [12] As well as this, an article in the Telegraph argued that the number of former Incapacity Benefit claimants found fit for work when assessed for ESA showed that Incapacity Benefit had been used to hide unemployment levels [13]
In 2008, the then health secretary, Alan Johnson complained about a "sick-note culture" that allowed people to drift onto Incapacity Benefit. [14] In some cases, the claimant's recorded main disabling conditions were conditions that were not necessarily disabling, such as acne or a chronic cough. [15] A medical certificate from a GP is the first step onto sickness benefits; although a government-run eligibility test was brought in alongside Incapacity Benefit in 1995, said that officials still accepted too many claims using information supplied by the claimants themselves and their GPs without asking for an All Work Test to be performed, partly because the pool of medical assessors was relatively small and partly because doctors' time was costly - which was why large numbers of nurses were brought in to perform the new test introduced in 2008. [16]
In 2014, Iain Duncan Smith said that once claimants had been granted Incapacity Benefit they were caught in a welfare trap, where it was not worth coming off the benefit and going to work. [17]
In 2011, out-of-work sickness benefits had an annual cost of £13 billion: the Chancellor, George Osborne, called this "a very large budget". [18] The total annual budget of the Department for Work and Pensions in the 2011/2012 financial year was £166.98 billion, [19] [20] with the largest slice by far - almost half - being spent on the State Pension, followed by Housing Benefit at slightly under £30 billion. Tax Credits, administered by the Treasury, cost roughly the same as Housing Benefit. [20]
After many Incapacity Benefit claimants were reassessed, some news reports that only a very small number of Incapacity Benefit claimants were genuinely unable to work. The Guardian claimed that 75% of Incapacity Benefit claimants who were reassessed for ESA were fit to work. This figure that had been arrived at by combining the number of claimants who withdrew their claim during the assessment phase, those who were found fit for work after the WCA and those who were placed in the work-related activity group. [21] 25% of Incapacity Benefit claimants who attended a WCA were found fit for work. [13]
The welfare state of the United Kingdom began to evolve in the 1900s and early 1910s, and comprises expenditures by the government of the United Kingdom of Great Britain and Northern Ireland intended to improve health, education, employment and social security. The British system has been classified as a liberal welfare state system.
A disability pension is a form of pension given to those people who are permanently or temporarily unable to work due to a disability.
The Department for Work and Pensions (DWP) is a United Kingdom government department of His Majesty's Government responsible for welfare, pensions and child maintenance policy. As the UK's biggest public service department it administers the State Pension and a range of working age, disability and ill health benefits to around 20 million claimants and customers. It is the second largest governmental department in terms of employees, and the largest in terms of expenditure (£187bn).
Jobseeker's Allowance (JSA) is an unemployment benefit paid by the Government of the United Kingdom to people who are unemployed and actively seeking work. It is part of the social security benefits system and is intended to cover living expenses while the claimant is out of work.
Jobcentre Plus is a brand used by the Department for Work and Pensions in the United Kingdom.
Income Support is an income-related benefit in the United Kingdom for some people who are on a low income, but have a reason for not actively seeking work. Claimants of Income Support may be entitled to certain other benefits, for example, Housing Benefit, Council Tax Reduction, Child Benefit, Carer's Allowance, Child Tax Credit and help with health costs. A person with capital over £16,000 cannot get Income Support, and savings over £6,000 affect how much Income Support can be received. Claimants must be between 16 and Pension Credit age, work fewer than 16 hours a week, and have a reason why they are not actively seeking work.
Social security, in Australia, refers to a system of social welfare payments provided by Australian Government to eligible Australian citizens, permanent residents, and limited international visitors. These payments are almost always administered by Centrelink, a program of Services Australia. In Australia, most payments are means tested.
Employment and Support Allowance (ESA) is a United Kingdom welfare payment for adults younger than the State Pension age who are having difficulty finding work because of their long-term medical condition or a disability. It is a basic income-replacement benefit paid in lieu of wages. It is currently being phased out and replaced with Universal Credit for claimants on low incomes, although the contribution-based element remains available.
Disability Living Allowance (DLA) is a social security benefit in the United Kingdom paid to eligible claimants who have personal care and/or mobility needs as a result of a mental or physical disability. It is tax-free, non-means-tested and non-contributory. The benefit was established by the Social Security Contributions and Benefits Act 1992, integrating the former benefits Mobility Allowance and Attendance Allowance and introducing two additional lower rates of benefit. Prior to 2013 it could be claimed by UK residents aged under sixty five years. However, the benefit was phased-out for the majority of claimants between 2013 and 2015 and replaced by a new Personal Independence Payment. DLA can still be claimed by children under sixteen and can still be received by existing claimants who were aged sixty five or over on 8 April 2013.
Disability benefits are funds provided from public or private sources to a person who is ill or who has a disability.
Severe Disablement Allowance (SDA) was a United Kingdom state benefit intended for those below the state pension age who cannot work because of illness or disability. It was replaced by Incapacity Benefit in April 2001, which itself was replaced by Employment and Support Allowance. However, although it is no longer possible to make a claim for SDA, individuals who are already receiving the benefit have continued to do so. The benefit is administered by Jobcentre Plus.
Attendance Allowance is a non-contributory Social Security benefit paid to elderly disabled people in the United Kingdom. It was introduced in the National Insurance Act 1970. The benefit is intended to provide support for those who live independently but might otherwise need to go into residential care. It is paid by the Department for Work and Pensions. The Social Security Contributions and Benefits Act 1992, integrated Mobility Allowance and Attendance Allowance into a new benefit Disability Living Allowance for people under 65.
Universal Credit is a United Kingdom social security payment. It is means-tested and is replacing and combining six benefits for working-age households with a low income: income-related Employment and Support Allowance, income-based Jobseeker's Allowance, and Income Support; Child Tax Credit and Working Tax Credit; and Housing Benefit. An award of UC is made up of different elements, which become payable to the claimant if relevant criteria apply: a standard allowance for singles or couples, child elements and disabled child elements for children in the household, housing cost element, childcare costs element, as well as elements for being a carer or having an illness or disability and therefore having limited capability to work.
Personal Independence Payment is a welfare benefit in the United Kingdom that is intended to help working age adults with the extra costs of living with a health condition or a disability.
The Welfare Reform Act 2012 is an Act of Parliament in the United Kingdom which makes changes to the rules concerning a number of benefits offered within the British social security system. It was enacted by the Parliament of the United Kingdom on 8 March 2012.
The Work Capability Assessment (WCA) is used by the British Government's Department for Work and Pensions (DWP) to decide whether and to what extent welfare benefit claimants are capable of doing work or work-related activities. The outcome of the assessment also determines whether claimants are entitled to Employment and Support Allowance (ESA), or more recently, additional elements of Universal Credit (UC).
Paul Litchfield CBE FRCP FFOM is a British physician who was Chief Medical Officer for BT Group plc from 2001 to 2018. He reviewed the Work Capability Assessment run by Atos for the Department for Work and Pensions in 2013 and 2014 and he is an advisor to the UK government on the relationship between mental ill-health, absence from work and the take up of out-of-work sickness benefits.
Invalidity Benefit was a benefit from the United Kingdom's National Insurance scheme that was introduced in 1971 by Edward Heath's government. It was paid to people who had been invalided out of their trade or occupation after sustaining an injury or developing a long-term illness. It was replaced by Incapacity Benefit in 1995.
Criticism of the Work Capability Assessment, used by the Department for Work and Pensions in the United Kingdom, to assess and reassess claimants of Employment and Support Allowance or enhanced rate Universal Credit, has been wide-ranging, from the procedure itself, to the financial cost of using both Atos and Maximus to assess claimants. Other criticisms discuss the level of deaths, suicides and high overturn rates at tribunals that the WCA has caused.
Iain Duncan Smith served as Secretary of State for Work and Pensions from 2010 to 2016. A member and previous leader of the Conservative Party, Duncan Smith was appointed to the cabinet by Prime Minister David Cameron following the 2010 general election and the formation of the coalition government between the Conservatives and the Liberal Democrats. He was reappointed after the Conservatives won a majority in the 2015 general election but resigned in March 2016 in opposition to disability benefit cuts.
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