The welfare reform bill will penalise the disabled, those working class communities who live in inner cities and second-earners who work over 16 hours a week.
While coalition partners battle over whose European stance damages the City more, the welfare reform bill reaches its report stage in the House of Lords today – the final chance before the final yes/no vote by peers to affect it.
The Bill may be being spearheaded by the seer of compassionate conservatism, work and pensions secretary Iain Duncan Smith, yet it penalises many of the most vulnerable in our society, especially the disabled.
It is a direct example of how the counter-productive attempt at rapid deficit reduction is being balanced on the backs of the poorest. There are many problems with the bill, but here are five:
1) Time-limiting Employment and Support Allowance
Employment and Support Allowance (ESA) is mainly intended for those who are disabled or ill but can work. It provides extra financial and personal support, such as training, to enable the disabled to get back into work.
Under the bill, if an ESA claimant has
• Worked in the past and previously paid national insurance
• Can perform some kind of work and
• They either have a partner earning at least £7,500 per year or limited savings
they will lose the benefit completely after one year of claiming
Let us put aside the rather conservative point that this reform will be a disincentive to saving or to the partner of the claimant working. At a time when many are predicting a recession, and therefore today’s high unemployment to hold or increase, ministers estimate that at the end of the year 94 per cent of claimants will become ineligable.
In the absence of jobs or benefits, we are throwing hundreds of thousands of the most vulnerable people, including those with MS, cancer, Parkinson’s, bowel disease, kidney failure, heart disease, lung disease, schizophrenia, bipolar disorder, and their families to the wolves.
Liberal Democrat Conference passed a motion asserting that ESA should not be time limited. Maybe after a week in which the Tories have called the coalition tune on Europe, it is time for the Lib Dems to push for one of their policies. To lobby a Lib Dem peer, see Sue Marsh’s Diary of a Benefit scrounger blog here.
2) As Disability Living allowance (DLA) , intended for those with more long-term conditions, is replaced by Personal Independence Payments (PIP), it is stated aim of ministers to reduce expenditure by the arbitrary figure of 20 percent.
Worryingly, because the level of PIP will be determined by what the claimant can do, not what they cannot, and the current work capacity assessments tend to be very ‘generous’ in ascribing abilities to claimants, many may lose much-needed support.
For example, watch this video of Kaliya Franklin who blogs at Benefit Scrounging Scum and lives with Ehlers-Danlos syndrome, who, because she can physically walk, may be categorised as ‘fully mobile’:
People like Kaliya will face cuts, and statistics showing how they can work will no doubt be pushed out to the Daily Mail and the other tabloids to demonstrate to the wider public how they are merely being feckless.
3) The bill will cut provision to those who were disabled from before working age.
As Declan Gaffney explained on Left Foot Forward in September:
“Clause 52 of the bill, will prevent hundreds of thousands of young people with lifetime or early-onset disabilities from accessing contributory ESA when they reach working age, whether or not they are deemed capable of any ‘work-related activity’.
“People who have been disabled since childhood will no longer be entitled to benefit in their own right as adults but will be subject to means testing based on the income of their family.
“The provision that clause 52 abolishes allowed people under 20 with work-limiting conditions to be treated as if they met the national insurance contributions for ESA.
“The rationale was that people with conditions that begin in childhood may never be able to accumulate sufficient contributions to entitle them to the non-means tested benefit
“This arrangement prevented a situation where people with lifetime or early-onset conditions would generally have less favourable entitlements than people who became disabled in adulthood.
We can get a rough idea of the numbers who will affected by clause 52 and the conditions they are living with from figures on children receiving Disability Living Allowance, the non-means tested benefit which compensates for the additional costs faced by disabled people.
“There are an estimated 327,000 children under 16 currently receiving DLA. By far the most important disabling condition for this group is learning disability (41 per cent), followed by mental health problems (10 per cent).
“While not all of these children will be eligible for ESA in adulthood, and there will be many who are eligible for ESA who are not receiving Disability Living Allowance, these figures do point to one important implication of clause 52: given that around 75 per cent of 25-34 year-old DLA recipients are also on ESA, a large proportion of those affected will have learning difficulties or mental health problems at the more severe end of the spectrum.”
4) The housing benefits cap is anti-community and anti-families
As we now know about this government, when it comes to the choice between good governance and good headlines, its usually the latter that wins out. So it was arguably their spinners’ greatest day when they announced capping housing benefit to average earnings, forcing the opposition to side with unpopular ‘scroungers’.
The tragedy here is that the reform will break up communities. The scandal is that it shows up how compassionate conservative thinking is, in many ways, bunk.
Traditional conservatives argue that compassion comes not from the state but from communities. Here families, often brought together by places of worship, are the bedrock of society. Rather than the forced taxation of the state, here the volunteer and charity gladly help thier fellow man or woman.
But how can we expect a renewal in volunteering, of a sense of community and belonging a place, if the sole dictate of where people live is markets? What future for the West Indian community in Notting Hill in Kensington, or the Chinese community in Soho in Westminster, if sky high rents push out the working poor?
Instead of having a system of housing benefit, much larger council housing provision would be preferable, and cheaper for the Treasury in the medium to long term. However, with the government offering a further discount on buying council houses but no concerted effort for a large expansion in council housing, we seem set to see the working poor being driven out of inner London.
I’m sure Cameron will still be able to enjoy the Notting Hill Carnival around the corner from where he lives. It’s just a shame he will have contributed to a hollowing out of the community that created it.
It also discourages families from staying together. As Sam Royston of the Children’s Society explained on Left Foot Forward:
“This welfare cap would introduce one of the most substantial couple penalties ever seen in the benefits system. Couples have a higher benefit entitlement than single people. Job Seekers Allowance for a couple is £38.45 per week higher than for single people.
“Therefore, compared to current entitlements, a couple with children and benefit entitlement in excess of the cap would lose up to £2,000 per year more than an equivalent single-parent household.”
5) The universal credit system discourages work
The new universal credit system, intended to consolidate an array of benefits into one payment, essentially redistributes resources from single parents or lower earners in a household that work more than 16 hours a week to those that work less. We are in the strange position were a Conservative led government is encouraging people to work less.
As Donald Hirsch at the Resolution Foundation explained:
“For second earners working part time in families with low overall income, a new basis for withdrawing support as family income rises will greatly reduce the amount of pay that is retained below the income tax threshold.
“At present, the first £139 a week of earnings of the partner of someone receiving tax credits is free of tax and national insurance, but causes tax credits to fall by 41p for every £1 earned.
“This has risen from 39p in 2010, and will jump to 65p under Universal Credit. For a second earner working under 16 hours a week, this loss will offset the gain from becoming eligible for childcare support. Someone on the minimum wage will only be about £1 better off for each hour worked.
“But the real change will be to the incentive to take a part time job of 16 hours or more, where now someone on the minimum wage can gain about £50 a week or more from doing so. Under Universal Credit, the same second earner takes home less than £20 in some cases.”
So we have a bill that pins deficit reduction on some of the most vulnerable, will split communities and discourage work. The Liberal Democrat Conference highlighted several problems with it. But now peers from all parties of good conscience must oppose it.
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• Life in the Lords logjam may be death for the health bill – Alex Hern, December 2nd 2011
• Appeal backlog reveals false economy of the welfare cuts – Alex Hern, November 28th 2011
• On welfare reform, IDS is ignoring the ERAD project; Miliband must not join him – Stephen Evans, October 7th 2011
• Yet another nasty in the welfare bill: Means testing support for the disabled-since-youth – Declan Gaffney, September 22nd 2011
• Society and the media are failing the sick and disabled – Sue Marsh, May 13th 2011