138. The proposal in the Green Paper that has probably received the most attention is that of the reform of incapacity benefits. Unlike the current incapacity benefits system, the new benefit will not assume that all claimants are incapable of work. This chapter will examine the evidence received during the inquiry on the proposed new benefit.

The structure of ESA

139. From 2008, and for new claimants only, a new Employment and Support Allowance (ESA) will replace Incapacity Benefit (IB) and Income Support paid on the grounds of incapacity. This will be structured as follows:[142]

• When an individual applies for the ESA, they will enter an assessment phase lasting no more than 12 weeks (this includes the reformed PCA - as outlined in the previous chapter). After 8 weeks, claimants will undertake a work-focused interview (WFI). During this assessment phase, they will receive a 'holding benefit' set at Jobseeker's Allowance (JSA) rates.
• If the PCA confirms eligibility for the benefit, the claimant will move on to the main phase of the ESA. Most will receive the 'Employment Support' component which will be conditional on drawing up a personal action plan focused on rehabilitation and work-related activity. The benefit rate will be higher than the holding benefit and set above the current long-term Incapacity Benefit rate. If claimants do not attend their WFI or prepare an action plan, the benefit will be reduced in a series of slices down to the holding benefit level.
• Claimants with the most severe illnesses and disabilities, as identified in the new PCA, will receive the 'Support' component of the ESA which will be paid at a higher level than the current equivalent rate. They will not be required to undertake work-related activity, but will be able to engage in it on a voluntary basis.

140. The new ESA will not contain age additions or adult dependency payments. Those currently receiving Income Support plus the Enhanced Disability Premium or the Severe Disability Premium will continue to get the additional support currently provided through these premiums.

Reactions to the proposed new benefit

141. Evidence received on the new benefit system was mixed and, as with the PCA, it was felt that the limited detail in the Green Paper inhibited useful discussion on all aspects of the reforms. The main areas raised were: the level at which the benefits will be set; the content of the action plan and 'work-related activity'; the extent and necessity of compulsion and sanctions; the ability to move between the two components; the effect of the reforms on existing claimants; and of the implications for benefit simplification. We discuss these issues below.

BENEFIT LEVELS

142. As described above, the Green Paper states that both components of the ESA will result in claimants receiving more money than under the current system. In spite of this commitment, concern was expressed in evidence that some claimants may still lose out in comparison with the current system. Lorna Reith, Chief Executive of Disability Alliance, and the written evidence from the Trades Union Congress (TUC) raised concerns about the rate of the holding benefit being set at JSA levels. They pointed out that many people who have been ill and claiming Statutory Sick Pay (SSP) will, under the current rates, move from benefit of £70.05 to £57.45.[143] When questioned on this issue, the Secretary of State said:

" we felt it was appropriate really not to make a judgment at a point where somebody is applying for Employment and Support Allowance about what their level of disability was or is or might be. That is why we made a decision to have, as it were, a neutral holding rate, and the obvious rate to fix that at was Jobseeker's Allowance. So that is broadly the thinking, the rationale behind that. It is true, clearly, that therefore somebody on Statutory Sick Pay will come down to the new holding rate for Employment and Support Allowance but then has the prospect, assuming they come through the PCA process, of getting the long-term rate for Incapacity Benefit as it currently is paid up to 12 weeks and not wait 52 weeks to get it, which is what they would have to currently do under the existing system."[144]

143. He went on to point out that some people will qualify for support through the Enhanced or Severe Disability Premium prior to the outcome of the PCA as entitlement to these is dependent upon a separate process, such as whether the individual can claim the medium or high rate of the Disability Living Allowance (DLA) care component.[145]

144. A further issue raised was whether those on the holding benefit will receive the age-related rates currently available on JSA.[146] Different rates mean that those aged under 20 receive less benefit than others. It is not clear whether this will transfer over onto the holding benefit rate.

145. The Committee is concerned that those moving onto the new 'holding benefit' may experience a substantial drop in income. We disagree with the Secretary of State's assessment that the Jobseeker's Allowance (JSA) level is an "obvious rate" at which to set the holding benefit. We recommend that the holding benefit be set at a level comparable with Statutory Sick Pay to ensure a more consistent income for ill or disabled claimants. If the holding benefit is set at JSA rates, it would be unfair to award younger claimants less benefit due to the age-related rates that currently apply to JSA.

146. The abolition of the dependency and age allowances was felt by some who gave evidence to be particularly harsh as they provide a valuable source of income for disabled people.[147] The long-term rate of Incapacity Benefit is currently £78.50 and the age allowances are £16.50 or £8.25 - a substantial addition to the total benefit income.

147. Further issues were raised in evidence illustrating the constraints brought about by the lack of detail in the Green Paper. Dave Simmonds of the Centre for Economic and Social Inclusion (CESI) questioned whether some claimants could opt to remain on the holding benefit and receive a lower amount of benefit.[148] It was later clarified by the Secretary of State that it would not be possible to remain at the holding benefit rate without being subject to the JSA conditionality requirements.[149]

148. Lorna Reith of Disability Alliance asked whether any of the new benefit would be taxed; and if it would be treated as income when assessing other benefits and tax credits.[150] The Disability Rights Commission (DRC) asked what the implications were of absorbing the disability premium into the new ESA structure for recipients of Housing Benefit.[151] The Green Paper does not provide detail on these, and other issues.

149. Several areas of clarification are also required on the issue of merging a means-tested benefit (Income Support) with a contributory benefit (Incapacity Benefit). For example, will those aged under 25 and receiving the means-tested version of ESA receive a lower rate, as they would on Income Support?[152] What about those with caring and other family responsibilities?[153] Which aspects of the benefit will be contributory or means-tested?[154] Age Concern questioned whether the contributory side of incapacity benefits would evolve into a means-tested benefit.[155] The Secretary of State confirmed in oral evidence that this would not happen under the current Government.[156]

150. We are disappointed that there are a range of issues requiring further clarification on the level at which the Employment and Support Allowance will be set. We recommend that the Department provide more detailed information in the response to this report. We urge the Department to work closely with disability organisations to ensure a proper assessment is made of the structure of the new benefit, how it will affect the income of ill or disabled people in comparison with the current system and work to alleviate inconsistencies within the system. DWP should ensure that the resulting benefit levels maintain the principle of no loss to existing claimants when a new benefit is introduced.

Benefit adequacy

151. Discussions on the actual levels of the new benefit and comparisons with the current system tend to lead to questions around benefit adequacy. Written evidence from the New Policy Institute (NPI) set out their analysis of various Government statistics showing that 30% of working-age disabled adults have incomes below the poverty line - this is double the rate of working age-adults without a disability and is also substantially higher than it was in the 1990s.[157] NPI attribute these poverty rates to the way in which increases in benefits and tax credits have been channelled towards children and pensioners, while benefits for working-age adults without dependent children have only kept pace with inflation rather than average incomes. In oral evidence, Dr Peter Kenway, Director of NPI, suggested that the Government should set a poverty target for disabled people, alongside the employment target, similar to the current child poverty target.[158]

152. The Child Poverty Action Group (CPAG) took issue with the Green Paper's implied assertion that the current structure of Incapacity Benefit, with a higher long-term rate, was generous and acted as an incentive to remain on benefit rather than working.[159] CPAG said: "We do not believe that the 'generosity' of benefits is a deterrent to employment."[160] Scope stated: "No-one grows rich on incapacity benefits. In fact, anyone relying on IB alone would struggle to make ends meet."[161] Shaw Trust reinforced this view, arguing that there was no evidence to suggest that people remain on incapacity benefits because of financial incentives - rather it was down to issues such as the claimant's lack of confidence or lack of available support.[162]

153. The inadequacy of incapacity benefits was raised by several other witnesses who argued that a 'budget standards' approach should be used to set new benefit levels. Lorna Reith, Chief Executive of Disability Alliance, cited research which her organisation had conducted that looked at the additional costs incurred by disabled people as a result of their disability and compared this with actual benefit rates.[163] The research found that disabled people face substantial extra costs in everyday life for things such as extra heating, services and personal support, which are not met by benefits. The benefit shortfall varied between £220 and £232 per week.

154. Two further issues were raised by Dr Kenway, from the NPI, and Andrew Harrop, Policy Manager for Age Concern. They both pointed to the importance of the level at which the ESA will be up-rated over time, arguing that it should increase in line with earnings rather than prices, in a similar way to the Guaranteed Credit within the Pension Credit.[164] Dr Kenway and Andrew Harrop also highlighted the difference between the rate of incapacity benefits for those approaching state pension age and Pension Credit. They argued that this disparity could not be justified: older people claiming incapacity benefits could receive up to £30 less than someone of pension age.[165]

155. Finally, Scope reminded the Committee that: "The present government's aim has always been 'work for those who can, security for those who can't'. It is questionable whether current benefits actually deliver on the second part of this aspiration." The adequacy of the level at which the Employment and Support Allowance will be set is of great importance. The new benefit must ensure that those claiming either the Employment or Support component receive an adequate amount. We also recommend that the Department publish a full analysis and explanation of its calculations of benefit adequacy in this area, including the basis of future upratings.

Work-related activity

156. The Green Paper states that most people will receive the Employment Support component of ESA and this will be conditional upon drawing up a personal action plan focused on rehabilitation and work-related activity. The Green Paper sets out the range of work-related activity that might be available to claimants, with advice and support provided by Personal Advisers and the private and voluntary sector.[166] This will be informed by current work undertaken in Pathways to Work areas and could include:

• 'Work tasters' through work trials, voluntary work and permitted work
• 'Managing health in work' using the Condition Management Programme and NHS Expert Patients programmes
• 'Improving employability' through basic skills courses and confidence training
• 'Jobsearch assistance' through New Deal for Disabled People Job Brokers, other New Deal programmes and Disability Employment Advisers
• 'Stabilising life' through activities to stabilise health conditions, assessing childcare options, managing home finance and stabilising the housing situation.

157. The Green Paper includes the consultation question:

"Do the types of 'suitable activity' we have set out provide a sensible range of activities that could be undertaken in order to fulfil an acceptable action plan?"[167]

158. Few comments were made in the evidence specifically on the work-related activities outlined in the Green Paper. Evidence received prior to the publication of the Green Paper from a range of organisations referred to the difficulties individuals faced in taking part in activities other than full-time work.[168] This is explored in further detail in the following chapter in connection with the roll-out of Pathways to Work (see paras 271-276).

159. Philippa Simkiss, Head of Employment and Lifelong Learning at the Royal National Institute for the Blind (RNIB), argued that the condition management aspects of the proposed work-related activities were irrelevant and the employment-related activities were often inaccessible to blind people.[169] More broadly, speaking of the employment support currently available through Jobcentre Plus, she also argued that blind people are effectively excluded from taking part in any activities. Dr Mark Baker, Head of Social Research and Policy at the Royal National Institute for the Deaf (RNID), told us that the situation was similar for deaf people. This resulted from a lack of staff awareness of issues affecting deaf or blind people and a lack of communication support.[170] These issues are covered further in the following chapter in the section on 'disability specific services.'

VIEWS ON COMPULSORY WORK-RELATED ACTIVITY

160. ESA will be paid to those who undertake work-focused interviews and agree an action plan. It is also envisaged that engagement in the work-related activities outlined above "would often increase over time as personal advisers work with claimants to build up their individual capacity for work." [171] Those who do not participate in the process will have their benefit gradually reduced - ultimately to the level of the holding benefit.

161. In evidence to the Committee, the Secretary of State confirmed that:

"the conditionality regime, until we are clear about resources in the next Spending Review and beyond, cannot go further at this point than requiring people to do the work-focused interviews and to prepare the action plan."[172]

162. He went on to say:

"We are not proposing at the moment to sanction failing to take work-related activities; that is not part of the reforms. It might become so in the future"[173]

163. This section will chiefly look at involvement in work-related activity rather than work-focused interviews, which are covered in Chapter 5.

164. The issue of conditionality and benefit sanctions was widely raised in the written and oral evidence, with different views being expressed. Those representing ill or disabled people were broadly against the imposition of compulsory work-related activity and benefit sanctions.[174] CPAG, for example, argued that claimants should be given a choice whether or not to engage in work-focused activities and their decision should not jeopardise their incapacity benefit.[175] Disability Alliance stated:

"We are opposed to any further conditionality or sanctions being applied to sick or disabled people. We believe making interviews, work-related activity and action plans compulsory is unnecessary, potentially unworkable and likely to lead to hardship."[176]

165. On the other hand, evidence from employment service providers tended to be more positive.[177] The Wise Group said that it would be:

"wrong to assume that compulsory participation in work-focused support will incite a hostile response from claimants; for some people this may actually provide the impetus they need to instigate a return to the labour market. Mandatory programmes can be helpful in terms of incentivising people who have been economically inactive for a long time and who are demoralised, isolated or lacking in confidence."[178]

166. Looking specifically at the Green Paper proposals, Andrew Harrop from Age Concern warned:

"there needs to be quite a lot of caution in going beyond the Pathways to Work model into compulsory activity as opposed to compulsory interviews. […] people are so different in their needs at different stages of their claim, with different levels of incapacity and the different distance from retirement, that to expect everyone to be mandated on to programmes and in what the Green Paper says it could be mandated to a specific activity, that is clearly not going to be very productive or good value for money, because if people do not feel able and ready to be part of that activity it will not deliver results for them."[179]

167. Richard Exell, Senior Policy Officer at the TUC, made an interesting point:

"We know, from lots of experience now with active labour market programmes, that people do become more likely to get jobs when they become the centre of attention for Jobcentre Plus. Simply spending more time with a group of people does have an effect on getting more and more of them into jobs."[180]

168. This begs the question, is further compulsion necessary? Several of those submitting evidence pointed to the quote often made by Government, that one million disabled people want to work, and queried, if this is the case why was compulsion needed?[181]

169. Dave Simmonds of CESI said:

"there would be grave concerns if the positive features within the Green Paper were overshadowed by both arguments about the level of conditionality as well as what we would consider to be an inappropriate diversion of resources into managing what would be inevitably a very difficult sanctions regime to police […]"

170. He went on to argue that evidence suggested that it would be more worthwhile putting further effort into conveying a positive message of what support is available to help disabled people move into work rather than using more compulsion - in other words, using more carrot and less stick.[182] On a similar issue, Rethink argued that media messages about conditionality put out by the DWP press office compounded anxiety for those with mental health conditions.[183]

171. Much of the evidence we received argued that conditionality was particularly inappropriate for claimants with mental health conditions and fluctuating conditions.[184] Mind warned that it could cause deterioration in health and distress and might lead to claimants taking up unsuitable work.[185] Rethink pointed out that conditionality was particularly unhelpful for those with severe mental illness, many of whom would have experienced compulsory treatment in hospital.[186] They also stressed that sanctions were also unnecessary as people with mental illness already had the highest 'want to work' rate of any disability group[187] - yet they also have the lowest employment rate of any group of disabled people, with just 24% in employment.[188]

172. The Sainsbury Centre for Mental Health took a different view. They supported the levels of conditionality in the Pathways pilots, accepting that some conditionality was needed in order "to get people who had given up hope to start thinking seriously about work" and that the current levels of compulsion were "perceived as supportive."[189]

How conditionality will be enforced

173. More monitoring and policing of claimants' engagement in work-related activities will clearly result in additional costs for Jobcentre Plus but it appears that no assessment has yet been made of this. Lorna Reith commented that it appeared to be Incapacity Benefit Personal Advisers (IBPAs) who would have this role.[190] CPAG questioned whether IBPAs would be sufficiently well-trained to be able to assess whether action plans were suitable and police engagement with work-related activities.[191] This issue was raised many times in connection with those with mental health conditions. The Sainsbury Centre for Mental Health warned that increasing the levels of conditionality, such as requiring people to undergo psychological therapy, "could have damaging effects on people's motivation and may backfire by focusing their attention on their eligibility for the enhanced benefit rather than on actually getting a job." In oral evidence, Richard Exell from the TUC told us:

"[in the Green Paper] there is a list of what can go into people's Action Plans…one of the things there is - 'activities to stabilise mental health problems, for example, use of cognitive behavioural therapy.' I am a survivor of mental health services myself and the idea of being told by a DWP personal adviser who has had half a day's training on mental health issues, that I have got to take my pills, or see my therapist or lose my Incapacity Benefit is utterly horrific."[192]

174. In oral evidence the Secretary of State denied that this would happen, "No. We will not do that. We cannot compel people to undergo medical treatment. That is not part of the sanctions regime."[193] The Committee welcomes this commitment.

175. Mind pointed out that claimants might not be able to communicate deteriorations in such conditions to their advisers and others raised concerns that staff lacked knowledge of mental illness and might therefore misinterpret its symptoms as being uncooperative.[194] Dr Jed Boardman of the Royal College of Psychiatrists outlined for us the difficulties inherent in making decisions about the behaviour of those with mental health conditions,

"That is a rather difficult question in the sense that anybody could be labelled as being awkward because they will not take part in something for good reasons to themselves which are related to their anxieties, their poor motivation because of their depression problems and so on. It is really almost a question of how you label that uncooperativeness. It is something I have to engage with with patients most days. Are they doing this because they do not want to, because they are being awkward, or because they simply cannot?"[195]

176. Mental health conditions may fluctuate, causing the claimants difficulties in undertaking work-related activity - and also for the IBPA in assessing whether the activities have been carried out. The Green Paper does state that in cases where individuals have fluctuating conditions, Personal Advisers will be given discretion to "agree appropriate action" such as a pause in work-related activity, until conditions have improved sufficiently.[196]

177. We questioned the Secretary of State on whether it was appropriate for non-health professionals to make judgements about those with mental health conditions. He replied:

"I think it is entirely reasonable to place the responsibility at that point. It has to be clearly matched by the appropriate level of training, and we do, as I said, try very hard to do that. We do not ask Atos Origin to make benefit sanctions; that is not the contract we have with them. I am not persuaded that it would be sensible to employ, as it were, medically qualified people to make decisions about whether it is right to sanction in relation to non-attendance for a work-focused interview. That is four square within the responsibilities of Jobcentre Plus to resolve."[197]

178. He stressed that there were additional safeguards in place under the current Pathways pilots for those with mental health conditions, such as home visits to establish why they had failed to attend a WFI.[198]

179. The Committee has no objections to the list of work-related activities in the Green Paper: the range is suitably varied and covers activities that may be regarded as a useful stepping stone to work. However, the Department should develop a strategy to ensure that all disabled people, including groups such as people with learning disabilities, deaf and blind people have full access to the range of services offered. We are also concerned that the Department is intending to extend compulsion beyond attendance at work-focused interviews without adequate training or evidence-based guidance for Incapacity Benefit Personal Advisers (IBPAs) in distinguishing claimants who are 'unwilling' to participate from those who are 'unable'. As the evidence shows that many existing incapacity benefits claimants are volunteering to participate in Pathways to Work without compulsion, we are concerned that without adequate IBPA training and clear guidance, increased compulsion could damage both the relationship of trust between IBPAs and their clients and the reputation of the Pathways programme itself. We recommend that the Department further explore involving a wider group of trained professionals to assist personal advisers in the important role that they play.

MOVING BETWEEN THE TWO COMPONENTS

180. Some witnesses raised concerns that those assessed as eligible for the higher level of ESA would be 'written off' and not be given any opportunities or attention in the future.[199] The Green Paper states:

"although it is likely that the majority of individuals in this category will never be able to work again, we recognise that for some their situation may change such that return to some form of appropriate work becomes an option. In these circumstances, individuals will be provided with the support necessary to help them achieve this if they wish."[200]

181. In oral evidence to the Committee, the Secretary of State confirmed that those with fluctuating conditions would be able to move between the two components of ESA depending on the state of their condition.[201] However, as Dr Mark Baker from the RNID pointed out to us, the Government had given no explanation as to how this process would be controlled - whether, for example, it would be done via a new PCA or some other means.[202]

182. The Revolving Doors Agency stressed that this group of claimants who might be able to return to work at some point "would be likely to have problems as varying as those who are able to work in some capacity" and that transfer into this group "should be a key point at which to […] refer them to mental health services and other agencies that are able to work with them."[203]

183. A further issue was raised in oral evidence to the Committee by Philippa Simkiss from the RNIB who asked:

"what would happen to somebody if they have been on the lower rate for, say, three years and the system has not delivered a job despite the best efforts of the individual in seeking a job as to what point does it become clear they are not going to get a job and will they be allowed to progress on to the higher rate of support?"[204]

184. The same point was made by others,[205] including the TUC who suggested that in cases such as these, after a certain period of time, claimants should be put on a self-management regime.[206] When questioned on this issue, the Secretary of State replied that the decision to move onto the Support component, with no conditions attached to it, would be primarily based on a medical assessment.[207]

185. The Committee recommends that claimants who have been engaged in work-related activity for a specified period of time, for example, one year, should review their action plan with their personal adviser and other specialists to ensure that the activities contained within it are appropriate for them. Once the new benefit has been in place for two years, we recommend that it is reviewed by the Department to ensure that the work-related activity system is working properly. As with all new benefits, it should also be subject to a full evaluation.

EXISTING CLAIMANTS

186. The new ESA and the attached conditional requirements will only apply to new claimants. Those currently claiming incapacity benefits will remain on their current benefit. Engagement in work-related activities, including WFIs, will be extended to them "as resources allow."[208] (see Chapter 8). Since February 2005, some existing claimants in Pathways to Work areas are required to take part in three WFIs. This was further extended to cover more of the caseload on a mandatory basis from April 2006.

187. It is worth remembering that there are currently more than 2.7 million incapacity benefit claimants, with around 650,000 new claims made each year and 700,000 moving off the caseload. This means that it will take several years before the number of new claimants on the reformed system outnumber those on the old system. Evidence received suggested that it is unfair to offer different services, apply different conditions and provide different levels of benefits to what are effectively similar claimants.[209] Lorna Reith said:

"I think there is an element of unfairness in that all of the publicity has been around existing claimants and then a system comes in which proposes to leave them exactly where they are; none of this is going to affect existing claimants, though no doubt they will be used in the press at some point in the future; it is all about new people coming on to the benefit."[210]

188. She went on to ask:

"What is the justification for treating those people differently? I am not saying automatically you would bring those people across, but you could offer people a choice of moving into the new system."

189. In evidence, the Secretary of State said that the Department had no intention of moving existing claimants of incapacity benefits onto the ESA. He argued:

"I do not think you should set about these sorts of reforms, as it were, by tearing up people's entitlement to benefits. […] I do not think it should be part of our agenda to retrospectively change benefit entitlement, […] it is likely to be the case in two or three years' time that the claimants who will be the hardest to reach and to place in the labour market will be people on old incapacity benefits, not people coming into new Employment and Support Allowance. But, again, I cannot see any alternative way of managing this process of change other than the way we have set out in the Green Paper."[211]

190. This neatly leads onto the issue of benefit simplification, which we consider below.

BENEFIT SIMPLIFICATION?

191. The Green Paper says that the new ESA - which integrates a contributory and means-tested benefit into a single benefit - will simplify the current system. This view was not taken by all those who gave evidence. The Disability Rights Commission (DRC) asked:

"How will the different combinations relate to the categories of 'reserved circumstances' receiving the additional support payment, and other ESA recipients receiving work-related premiums? Assuming each of these could receive either a) means tested and contributory payments; b) only contributory c) only means-tested payments, this suggests six different combinations, rising to seven or eight when existing claimants (including former invalidity benefit recipients) are included. This presents a challenge to the longer term vision of a simpler system."[212]

192. Lorna Reith also pointed to the different benefit levels that will be paid to new and existing claimants and said that "there is a worry that an opportunity to simplify has not been taken."[213] She went on to propose a method that would simplify part of the structure. She suggested that current claimants of Severe Disablement Allowance (SDA) - which was abolished in 2001 - could be transferred onto the higher rate of ESA as this group of people have already been classified as severely disabled.[214] The Secretary of State, however, said that he rejected the idea of moving existing claimants onto ESA as this could result in people losing out financially.[215]

193. In an evidence session with Leigh Lewis, the Permanent Secretary of DWP, we asked whether, in examining ways to simplify the benefits system, the Department had looked at buying out people's rights to incapacity benefits by paying the claimant a certain sum of money if they moved onto the new benefit. The Permanent Secretary replied that the team of staff working on benefit simplification were ruling nothing in or out.[216]

194. A short chapter of the Green Paper sets out the Government's aim for long-term benefit reform encompassing all working-age benefits. It states:

"We consider that there may be advantages in moving towards a single system of benefits for all people of working age, with appropriate additions for those who have caring responsibilities and those with a long-term illness or disability."[217]

195. In evidence to the Committee, the Secretary of State explained:

"we are not talking about there simply being one working-age benefit. Some people have looked at this part of the Green Paper and have assumed that there will only be one working age benefit; that is not what I think is likely to come out of this. We are talking about a more streamlined, more coherent system, and I think everybody will probably sign up to that."[218]

196. He further explained that he envisaged that the main thrust of the simplification would be in the design of a streamlined benefit system with a single portfolio of help and support services.[219] The Secretary of State was also keen to point out:

"The Employment and Support Allowance is a long-term reform of Incapacity Benefit and provides a much more straightforward, streamlined, simpler form of supporting people on Incapacity Benefit, and is in itself an example of the sort of wider reforms that I would like to see right across the benefit system in the direction of the change that many people have argued for some time […] So Employment and Support Allowance itself I would cite as an example of the longer term direction of change and not something that is likely to be cast out five, six, ten years down the track."[220]

197. The Committee agrees with the broad approach to reforming incapacity benefits that is taken in the Green Paper. We are, however, anxious that the Department is in danger of introducing further complexity to a system of incapacity benefits that is already unwieldy and confusing to claimants and Jobcentre Plus staff alike. We are very concerned that, by introducing a two-tier system, the proposed reforms will establish a further level of complexity. The unconditional higher rate could build incentives into the system which might 'encourage' claimants to claim the Support component rather than the Employment Support component of the Employment and Support Allowance (ESA).

198. It also appears that little consideration has been given to policing the boundaries and creating a mechanism by which people can move between the two components. We recommend that the Department should clarify the mechanism and resources needed for people with fluctuating conditions to move between the Employment Support and Support components of the ESA.

143   Qq 88, 152; Ev 82, vol 2 Back

144   Q 260 Back

145   Q 261 Back

146   Q88, Ev 109, vol 2 Back

147   Q 90, Vol 3: Ev 62; Ev 211 Back

148   Q 90 Back

149   Q 263 Back

150   Q 150 Back

151   Ev 110, vol 2 Back

152   Q 88; Ev 109, vol 2 Back

153   Ev 108, vol 2; Ev 182, vol 3 Back

154   Q 150 [Ms Reith] Back

155   Ev 121, vol 2 Back

156   Qq 264-5 Back

157   Ev 60, vol 2 Back

158   Q 88 Back

159   See, for example, DWP, A new deal for welfare: Empowering people to work, Cm 6730, January 2006, p 4 & 27 Back

160   Ev 212, vol 3 Back

161   Ev 242, vol 3 Back

162   Ev 24, vol 2 Back

163   Q 155 Back

164   Qq 90 & 154 Back

165   Qq 88, 154-55 Back

166   DWP, A new deal for welfare: Empowering people to work, Cm 6730, Jan 2006, p 42-43 Back

167   DWP, A new deal for welfare: Empowering people to work, Cm 6730, Jan 2006, p 44 Back

168   See, for example, Qq 43, 71, 74, 84, 185, 196; Ev 26, vol 2; Ev 168, vol 3 Back

169   Q 181 Back

170   Q 167 Back

171   DWP, A new deal for welfare: Empowering people to work, Cm 6730, January 2006, p 42 Back

172   Q 296 Back

173   Q 298 Back

174   See, for example, Vol 2: Ev 48; Ev 162; Ev 175; and Vol 3: Ev 73; Ev 200  Back

175   Ev 202, vol 3 Back

176   Ev 112, vol 2 Back

177   Vol 2: Ev 13; Ev 23; and Vol 3: Ev 85; Ev 110  Back

178   Ev 13, vol 2 Back

179   Q 175 Back

180   Q109 Back

181   Vol 2: Ev 114; and Vol 3: Ev 135; Ev 211 Back

182   Qq 113-114 Back

183   Ev 180, vol 2  Back

184   Vol 2, Ev 123, Vol 3: Ev 7, Ev 27, Ev 35, Ev 183, Ev 249, Ev 253, Ev 256, Ev 259, and Ev 272 Back

185   Vol 2, Ev 160 and Ev 175 Back

186   Vol 2, Ev 179 Back

187   Vol 2, Ev 179 Back

188   ONS, Labour Force Survey, August 2003 Back

189   Vol 3, Ev 256-257 Back

190   Q 163 Back

191   Ev 205, vol 3 Back

192   Q 113 Back

193   Q 303 Back

194   Vol 2, Ev 181 and Q 163 [Ms Lorna Reith] Back

195   Q 226 Back

196   DWP, A new deal for welfare: Empowering people to work, Cm 6730, January 2006, p 44 Back

197   Q 319 Back

198   Q 318 Back

199   Q 233 [Dr Jed Boardman] and Vol 3, Ev 34 Back

200   DWP, A new deal for welfare: Empowering people to work, Cm 6730, January 2006, p 39 Back

201   Q 267 Back

202   Q 152 Back

203   Vol 3, Ev 271 Back

204   Q 156 Back

205   For example, Vol 3, Ev 213 Back

206   Vol 2, Ev 82-83 Back

207   Q 269 Back

208   DWP, A new deal for welfare: Empowering people to work, Cm 6730, January 2006, p 48 Back

209   Qq 152, 157, 177; Ev 211, vol 3; Ev 252, vol 3 Back

210   Q 157 Back

211   Q1 280-1 Back

212   Ev 110, vol 2 Back

213   Q 150 Back

214   Q 152 Back

215   Q 281 Back

216   Oral evidence taken before the Work and Pensions Committee on 6 February 2006 HC 895, (2005-06), Qq 52-53 Back

217   DWP, A new deal for welfare: Empowering people to work, Cm 6730, January 2006, p 92 Back

218   Q 272 Back

219   Q 272, 277-9 Back

220   Q 279 Back