Drawing on ongoing analysis of benefit receipt due to be published this autumn, we can confront David Cameron’s ignorant narrative with some real-world evidence.
Today’s press stories on Employment Support Allowance (ESA) show that politicians and the media are stuck in a mid-1990s timewarp when it comes to sickness and disability benefits.
Far from representing the immobile bloc of long-term worklessness so often assumed in public discussion, the sickness and disability benefit caseload has changed dramatically over the last 15 years, driven by tumbling rates of receipt coupled with increases in severity of impairment.
Failure to recognise the scale of these changes has led both the previous and the current government to indulge in undisciplined and unrealistic expectations about the potential for caseload reductions.
This quotation from David Cameron neatly summarises the received wisdom on IB/ESA:
“For too long in this country we have left people on welfare for year after year when those people, with help and with assistance, could work, and so we’re producing a much better system where we really put people through their paces and say that if you can work, you should work.”
Drawing on ongoing analysis of benefit receipt due to be published this autumn, we can confront this narrative with some real-world evidence.
There are three areas where the shortfall in realism is particularly striking.
(1). “For too long in this country we have left people on welfare”
It is well known that sickness and disability benefits were extensively used in the 1980s and 90s by UK and other governments to encourage some unemployed workers – especially older male industrial workers – to leave the labour market.
Rates of IB receipt rose dramatically, with huge disparities between regions, and between men and women, which could not be realistically explained by differences in health and disability status alone. This ‘hidden unemployment’ is the origin of the lack of public confidence which has continued to dog IB to this day.
But rates of receipt for Incapacity Benefit/Employment Support Allowance have been falling for years, and have fallen most for those groups and areas which were most affected by the policies pursued in earlier decades – older men in industrial areas. The pattern has been one of strong convergence, with regions moving much closer together and falling receipt among older men.
The process is illustrated in Graph 1 below with regional data for one of the groups with the highest rates of receipt, men aged 55-59. There are still gaps between regions, but they are far smaller than in 1999 and a far more consistent with regional differences in health and disability status.
This suggests that if there was a significant ‘hidden unemployment’ component in the IB caseload in 1999, it is now largely a thing of the past – and prompts the question of just how low rates can be expected to go.
Graph 1:
(2). “We have left people on welfare for year after year”
When politicians talk about sickness and disability benefits, they invariably focus on long-term claims. As these benefits need to support people with long-term disabilities, it is inevitable that a significant share of the caseload is long-term in nature.
But IB/ESA are not just for the severely disabled, and long-term claims are the exception, not the rule, except for severely disabled recipients. It is true that at any point in time, long-term claims make up a majority of the caseload, but this is simply due to the arithmetic of stocks and flows.
Taking the caseload over time the pattern is reversed, as illustrated in Graph 2 below, where the picture at one point in time – with a clear majority of claims running for five years or more – is the mirror image of the picture over a five year period.
Characterising the IB/ESA caseload in terms of long-term receipt while neglecting the huge numbers of people moving into and out of the system every year is an arithmetical error which fosters unrealistic expectations and blinds policy-makers to the fact these benefits are also there to support people with temporary and less severe conditions.
Graph 2:
(3). “Those people, with help and with assistance, could work”
Over half of all IB/ESA recipients are now also in receipt of Disability Living Allowance, rising to two thirds among the long-term IB recipients with whom the prime minister is concerned. The rise in DLA receipt is one of the major trends in welfare of the last two decades, reflecting demographic change and trends in disability prevalence.
While many of the DLA recipients who dominate the long-term IB caseload would like to work, their support needs are of a different order to those with less severe impairments. It would obviously be absurd to suggest that putting ‘people through their paces’ and telling them that ‘if you can work, you should work’ are going to make a difference to the employment chances of DLA recipients.
Graph 3:
These developments raise serious questions about how much further the sickness and disability caseload can be reduced without impacting on people in highly vulnerable situations.
This is not shroud-waving: if government intends to maintain a functioning system of support for sickness and disability, it needs to recognise that with IB receipt at low levels compared to a decade ago, any further reductions come with increased marginal costs.
As things stand, those costs are increasingly falling on sick and disabled people, and not on the exaggerated social stereotypes variously described as the ‘hidden unemployed’, ‘discouraged workers’ or ‘benefit scroungers’.
In their zeal to cut caseloads, policy makers have for years been ignoring obvious trends and pursuing self-defeating strategies in the teeth of evidence. It’s high time they recalibrated their expectations to the realities of what has been happening to benefit caseloads since the 1990s.
That would mean asking how the system can meet the twin objectives of supporting people for the duration of their inability to work and maximising the employment chances of people with long term conditions.
198 Responses to “The three things Cameron should know about sickness and disability benefits”
Jill Hayward
http://t.co/IAVRUWK THIS IS RESEARCH WE'VE BEEN WAITING 4 PLS RT #spoonie #disability @BrokenofBritain Evidence! We're not all "scroungers"
Jackie Rafferty
RT @monstertalk: Three things Cameron should know about sickness and disability benefits http://zite.to/o8NvtY via @zite #newsnight #Purnell
Mary Lockhart
Succinct, hard hitting and to the point – these are facts which every politician of ever party, every civil servant, every local government officer, and every Trades Unionist should know. Thankyou for the ammunition we have needed for a long time
Grahame Morris
RT @leftfootfwd: Three things Cameron <& James Purnell> should know about sickness & disability benefits http://t.co/jqNY0x9 #universality
Lee
I’m not wishing to disagree with your key point – indeed, I welcome people looking at the data instead of the rhetoric. The only person I know on DLA is my dad, and I know for sure that he can’t work. If millions of people are faking it, I’ve not met them.
However, you choice of data for, and analysis of, Graph 1 isn’t working for me.
1. Although the overall number/percentage of claimants in the sample has fallen, the regional variations appear to be broadly similar at both ends of the chart relative to the total. So yes, there are less claimants.. but the regional variations are as stark as they always were.
2. Whilst the sample is based on a group with a high level of claimants, for understandable reasons, it’s a relatively narrow group of people – and the age and gender means it picks up exactly the people who were shunted onto the benefit for the reasons you cite. It obviously makes sense that the sample would change over time. Although there has been an ongoing decline in the heavy industry that many of these people would have been employed in, there was obviously a peak of that happening in the 80’s and 90’s, meaning that if that did lead to increased benefit claims then the peak for the sampled age group would likely have been the mid-late 90’s, and it could only fall from then on as there would not be the new claimants to replace those who fall out of the age range in the other direction. Look at the North East, Yorkshire and the East Midlands… three areas to have lost significant mining industries.. it went first in the North East, then Yorkshire, and then (a fair while later) in the East Midlands. Is it a coincidence that the line for the North East falls the fastest, then Yorkshire, then the East Midlands? Or is it just reflecting where the pain came first.
The point, there, is that looking at the ‘unwinding’ of a particular feature of DLA, using a sample peculiarly well suited to that, doesn’t enable us to draw conclusions about the system as a whole. If you want to bust a myth then you can’t cherry-pick data and whilst I’m not saying that you did, I am saying that it’s pretty easy to accuse you of doing so. Why haven’t you used data for the whole population? Or at least provided one or two alternative sample groups to illustrate that the pattern you note is not just specific to men aged 55-59? How do I know that if I look at the whole population I won’t see flat lines because the rates of claim have gone through the roof amongst women aged between 40 and 45?
Apologies for length. And please don’t regard this as tory trolling.. as I’m not a tory, and I don’t live under a bridge and menace goats for fun.