Is Labour abolishing illness?

The new rules on incapacity benefit stake everything on a major gamble: that a large proportion of c

Incapacity benefit has become one of this year's favourite scare stories. Hardly a day passes without a new headline deploring its soaring costs and the rising numbers of claimants who get "something for nothing", at the expense of decent, hardworking taxpayers. We are told that we are footing an outrageously escalating bill for 2.4 million people, a million of whom shouldn't be on the benefit at all, and each successive work and pensions minister vows to be more ruthless than the last.

The true picture is somewhat different. The unreported version, which can be culled from Department for Work and Pensions (DWP) data, is that only 1.4 of the 2.4 million actually receive any payment, the rest get national insurance credits only, and numbers have been falling since 2003. The basic benefit is worth barely £3,000 a year. After two small rises in the first year there is no further increase, other than index-linking. All those who get the benefit have to pass a rigorous "personal capability assessment" (PCA) with doctors appointed by the DWP; and they can be re-examined at any time. The audited estimate of fraud is under 1 per cent - the lowest of any part of the social security system.

Nonetheless, the 2007 Welfare Reform Act is now being implemented across the country. It replaces support, as of right, for illness/disability (one of the planks of our rapidly disappearing welfare state) with a new, conditional employment and support allowance. Claimants are held on a basic allowance until it is confirmed that their capability for work is limited. This is determined by a "work capability assessment" tougher than the old PCA. Those deemed capable of one day returning to work (and the arbiters are health professionals rather than doctors) must engage in a series of "work-focused" interviews and activities. These include, among other things, "condition management", which in practice is likely to consist of group sessions loosely based on cognitive behavioural therapy. All this brings an additional slice of benefit that can, however, be cut for those who do not engage in it without "good cause" - a potential loss of 40 per cent of income. Ultimately, any whose capability for work remains limited through failing to follow medical advice, or "any prescribed rules of behaviour", face a period of disqualification. (A further provision of the act, to be piloted in nine areas, is that people served with Asbos - antisocial behaviour orders - can face cuts in their housing benefit for refusing local authority offers "to help address any problem behaviour".)

A main selling point of the reform was the great savings it would bring. It would staunch the outflow of benefits and get many people into jobs where they would pay tax and provide for their old age. This government's cherished goal is an employment rate of 80 per cent of the working-age population - though it is difficult to find any reasoned argument in support of this since our present rate of 75 per cent is, with Canada's, the highest in the world. The government accepts that employers must be paid to take on people with an illness record and, for the time being, it has pledged not to cut the benefits of existing claimants. Any immediate savings, therefore, can only come from bumping as many as possible off the benefit, shaving future benefit levels (already well in hand), and making it harder for newcomers to get it in the first place. Delivery is being farmed out to private agencies paid by results - which means, of course, the setting of targets. The next few years will be a bad time to have a crippling accident or succumb to a serious disease, particularly a psychiatric or neurological one that does not have obvious outward symptoms.

Blaming the "cheats"

The reform of incapacity benefit has been over ten years in the making, leaving in its wake a dense trail of commissioned reports. A curious thing about this voluminous material is how little information it contains on the actual health conditions for which benefit is paid. This is no accident, for the reformers long ago made up their minds that claimant numbers are too high, therefore a large proportion - usually put between a third and a half, but lately upped to 70 per cent in some quarters - must be spurious. An appeal to history is repeated like a mantra that, back in 1979, only 700,000 claimed the old sickness/invalidity benefits. Since then, money has been poured into the NHS while health care, living standards and longevity have improved beyond all expectations. People must be healthier, which proves that huge numbers are exploiting a slack and obsolete system. Who is to blame, apart from outright cheats? It can only be the self-indulgent, who fancy themselves sicker than they really are, and complacent GPs who let them think they are too ill to work.

Crucially, the reformers bracketed illness with disability. The disability lobby had long argued that "disability" was a discriminatory label imposed by society, and it was bent on removing the barriers to work that excluded those so labelled and kept them in poverty. But the bracketing brought confusions - for those with disabilities may be extremely fit (consider the disabled athlete), whereas the able-bodied can be extremely ill. More confusion arises with conditions such as "stress", "anxiety" and "chronic fatigue" that sound trivial. As for "back pain", how unreasonable is it to take time off sick for something best dealt with by a stiff upper lip and the odd aspirin? It is easy for those in good health to pooh-pooh such things, agreeing with the government that "Work is the best therapy".

The government's declared mission is to "liberate" claimants, to bring them into its "reformed, coherent welfare state for the 21st century". It seeks to overturn a culture based on the "medical model" of illness that allows them to "drift" on to long-term benefits without realising that "symptoms, feeling unwell, sickness and incapacity are not the same" - hence the appeal of cognitive behavioural therapy, which it understands as a treatment that will talk the sick into believing they can lead normal lives.

Doctors - so often the refuge of desperate people trying to find out what is wrong with them - should as far as possible be excluded from the process. Even those working for the DWP have opinions that are "unfounded, of limited value and counter-productive", while GPs are "unaware of the importance of work, the absence of which leads to depression, poor health, higher rates of suicide and mortality, poverty, and social exclusion". (The quotations are from a 2005 study from the Unum Provident Centre for Psychosocial and Disability Research at Cardiff University, whose ideas and rhetoric infuse the reform. Unum Provident is an American firm, the largest disability insurance company in the world, which is currently in litigation in different countries for refusing to pay out on some of its policies.) A private agency has now taken over the running of its first GP surgery here, and doctors dealing with disability living allowance are advised not to invite patients to explain how their condition affects them.

Features of the reform are familiar from other policy areas. First, a demonisation of a needy or vulnerable group, followed by a rebranding: so claimants become not even "clients" but "customers" (as in the just published "Commissioning Strategy" document); incapacity benefit becomes employment and support allowance; sick notes are redrafted for doctors to certify, not what patients can't but what they can do. Next come "partnerships", on an unchallenged assumption that the public sector has failed. The new system is farmed out to for-profit or non-profit-making agencies paid by results. This entails targets, and where targets are set, sanctions follow, for any who "fail to recover".

There are features of the new programme that look intelligent and humane, doubtless owing much to the efforts of the disability lobby. They include a longer and more flexible bridging period (and a back-to-work grant) between benefits and work, and a broader view of "work- focused" activities. The crunch will come with those described as not able or prepared to engage "because [of] the nature and severity of their health condition, or more a matter of attitudes, perceptions and expectations which may or may not be accurate . . . It is a question of what the claimant cannot do vs what they will not do."

For the reform stakes everything on a gamble: that a large proportion of claimants, present and to come, are fit enough to work. There seems no way of proving or disproving this, other than trying it out, at the risk of much waste of public money, and much personal grief. Deliberate rejection of the "medical model" deprives us of all we might have learned (from the wealth of data available) of the impact of illness on our society.

I have scratched my head long and hard over this reform (among other things sending out lengthy submissions to all concerned during the long consultation phase in 2005-2006) because so much in its theory and rhetoric contradicts my own experience: of chronically and seriously ill family members and friends, of several years as a Mind volunteer, and further years of peripheral involvement in action groups for chronic fatigue conditions. All this has indelibly impressed me with the courage of many who live with horrible complaints, the sheer hard work involved in their day-to-day coping, their relentless search for any amelioration, let alone cure, often at costs hard to spare from limited resources.

I have witnessed, too, and at close quarters, the hurt and stress of living difficult lives as people have to do, in a perpetual culture of disbelief and threat, where some of the most valiant are blamed for their conditions and conflated with the alleged "can't work, won't work" unemployed. For the message of the reform that comes across, for all its fashionable rhetoric, is that a person is valued only as a productive unit. Compassionate cases aside, those too ill to work are outside society and money spent on them is wasted. Sickness, disablement and inability to work have no place in a modern society - they can't and shouldn't be afforded.

No one pretends that illness is not a blight, imposing personal and social costs going far beyond the financial; but - pace the government - no one as yet knows how to remove it from the human condition. Why waste valuable time and resources on an ill-founded reform, when they could instead be used to further understanding of the real impact of illness on our society?

Alison Ravetz is a professor emeritus of Leeds Metropolitan University who writes on housing policy and welfare reform

This article first appeared in the 05 May 2008 issue of the New Statesman, High-street robbery

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The dustman and the doctor: fairness and the student fees debate

The idea that education – all education – should be free is intoxicating and liberating. But there's a problem.

The most toxic political imagery of the student fees debate dates from 2010. First, there was Nick Clegg brandishing a sheet of paper bearing his election pledge that the Liberal Democrats would vote against “any increase” in tuition fees. Then, a few months later, there was the sight of protesters scrawling graffiti and urinating on the statue of Winston Churchill in Parliament Square. Churchill was rapidly restored, but Clegg – who, I am told, did not believe in the pledge when he signed it but could not resist the prospect of those student voters in university towns – never properly recovered.

The issue of how to fund English universities had been febrile for years – long before the 2008 financial crisis, the ballooning of the Budget deficit that followed and the 2010 Lib Dem vote for the vertiginous increase in English tuition fees. (University funding is a devolved matter, with the Scots going their own way.)

In 2004, Tony Blair, enfeebled by the absence of weapons of mass destruction in Iraq, had almost been knocked off his prime ministerial perch when he, too, trebled fees, albeit to a mere £3,000, to be paid back after graduation. Gordon Brown’s allies, smelling post-Iraq weakness, hovered over the Labour leader before allowing him – by a sliver – to survive.

The Conservatives have historically been less troubled by the matter. Students largely have not voted in high enough numbers – certainly not for them – to impinge on their chances of electoral success. Meanwhile, the centre left has had lumps kicked out of it while wrestling with the problem of how best to fund higher education. Jeremy Corbyn’s 2017 manifesto significantly changed Labour’s position, promising to abolish fees altogether; he would also, he told the NME, “deal with” student debt. That half-pledge has now become a vague “ambition” because of its estimated £100bn price tag.

As a piece of campaigning, it worked. By contrast, Ed Miliband got nowhere in 2015 with his promise to reduce fees by a third to £6,000. It was too little, too late to mobilise student voters or their concerned parents, but more than enough for George Osborne, an unrepentant Vince Cable and a nervous higher education sector (sotto voce) to raise questions about Labour’s fiscal rectitude and/or the financial security of universities.

The Institute for Fiscal Studies (IFS), in its disinterested and peskily rigorous way, joined in – and with a more subtle point, suggesting that cutting fees would benefit higher-earning graduates the most. Those who earned less over their lifetime would, in any event, not have to pay all of the money back.

Until Corbyn’s swashbuckling manifesto simplified matters, or oversimplified them, the left had been tied in knots on the fairness point from the moment that tuition fees were introduced, relatively quietly, in the peak-Blair year of 1998.

The idea that education – all education – should be free is intoxicating and liberating. It is intoxicating because one’s Enlightenment reflexes are happily triggered: the pursuit of knowledge is wonderful; knowledge leads to individual self-fulfilment and should be made available to the largest possible number. We all benefit from a better-educated population, not least by the spread of liberal values. Utilitarians rejoice – the country becomes economically more prosperous, though the evidence for this is irritatingly murky.

It is liberating because it is a beautifully simple proposition, and thus the complexity of nasty trade-offs – between those who go to university and those who don’t, between generations, between different sorts of universities, between disciplines and courses, between funding higher education and funding a zillion other priorities – is washed away by the dazzling premise. Free.

Alas, there is a problem. Once upon a time, a British university education was for the very few. The state, in the form of the general taxpayer, footed the bill. Now, around 40 per cent of 18- to 19-year-olds are at university and nobody in front-line politics is keen on hauling down the number, notwithstanding the occasional hyperventilating headline about useless degrees in golf course management or surfing studies.

The Liberal Democrats’ ill-fated 2010 manifesto had a little-noticed passage that called for scrapping the participation target of 50 per cent – alongside the now ritual aspiration to improve vocational training and apprenticeship schemes, a promise that is yet another reminder of a long-established and debilitating British weakness that nobody seems to know how to reverse. But mass higher education is here to stay – and it’s a good thing, too.

We could have chosen (and could still choose) both to fund increasing numbers of people going to university and to pay for all of their tuition, but that would not have been a self-funding investment – at least, not for a very long time. Other European countries with decent universities have indeed managed without asking graduates to contribute anywhere near as much as ours. The Swedes pay nothing for tuition. Dutch students pay a quarter of their English counterparts. The Germans have proportionately fewer students in tertiary education (though their vocational education is widely known to be heaps better), but their students are at university for longer and they pay very little for the pleasure. You get the picture.

It would require a lot of extra taxation if we were to go down that route – and there are many other competing demands beyond deficit reduction. Yet the issue is not only framed by tax priorities. We can’t easily afford to have the state picking up the tab because – an ugly fact – we are less well off than most northern European countries that charge less. Yes, we are the fifth-largest economy in the world – how could any of us, since the Brexit vote, not know that? – but we are far from being the fifth most economically prosperous country in the EU, once you allow for the intrusion of vulgar reality in the form of GDP per head. On that measure, we sit somewhere in the middle of the pack.

So who pays? Asking students to pay something is not in itself an outrage. The massive social and economic privileges that my generation accrued from our gloriously free university education may now be spread more widely but that has not eliminated the personal advantages that, on average, follow a degree. Graduates are more likely to get jobs, more likely to get better jobs and more likely to keep their jobs in a recession. The Department for Education puts the graduate premium on average at £250,000 before tax over a lifetime for women and £170,000 for men. These figures may be overstated and might not be sustained, but it is overwhelmingly likely that most graduates will still benefit materially from their degrees.

From the starting point in 2004 – long before the deficit soared – Blair and his then education secretary, Charles Clarke, decided that graduates should pay more once they began to earn sufficient money. I remember Blair at the time doing a BBC Newsnight special with an angry audience, packed with students telling him that he was wrecking their lives and had insufficient respect for their contribution to the greater good. A very articulate trainee doctor told Blair that she faced a mountain of debt (those were the days – that would now be several mountains). Blair responded with a range of left-wing arguments – at least, if you are of a redistributive frame of mind. Here are some highlights of the exchange:

Blair: I think it is unfair to ask general taxpayers – 80 per cent of whom have not been to university – when you have got an adult who perhaps wants to get an additional skill and they have to pay for it if they don’t go to university, to say to those people: we are not giving you education for free. And to say to under-fives, where we are desperately short of investment, to say to primary schools, where again we need more money, that we are going to give an even bigger subsidy to university students. Believe me, if I could say to you, “You can have it all for free,” I would love to.

The student, more than matching the prime minister’s passion, was spectacularly unimpressed.

Student: It really infuriates me that you say, “Why should the dustman fund the doctor?” When he has [a] heart attack, he will be pleased that I went to university and graduated as a doctor. Therefore he should contribute towards the cost of my degree.

Blair: But surely there should be a fair balance. He is contributing to the cost of your degree. Five-sixths of the cost of any degree, even after our proposals come in, will be contributed by the general taxpayer.

Not bad for a prime minister who was not often associated with causes dear to the dustmen part of his Labour flock – nor associated with redistribution in general. Of course, the figure of five-sixths paid for by the state is now, since the introduction of £9,000 tuition fees, a great deal smaller. The trainee doctor of 2017 is expected, over the course of their lifetime, to fork out much more. The average student debt is getting on for £50,000.

The current numbers are the result of decisions taken by Vince Cable of the Liberal Democrats and David Willetts of the Conservative Party. Unlike Blair, these two men were on the left of their parties, with a firm belief in the importance of education and its positive impact on social mobility. The hike in fees led to protests and occupations but also to universities getting much of the extra money that they needed, even if they were markedly reluctant to say so, doubtless for fear of stirring up their students.

There has been no drop in the participation rate of students from poorer family backgrounds. Quite the reverse – despite Jeremy Corbyn’s personal refusal to believe the evidence. But the repayment of fees means that, in effect, recent graduates pay income tax at a rate of 29 per cent once they earn more than £21,000. (The Department for Education cheerily call this “a contribution”, as if it were voluntary.)

The repayment point could have risen with inflation to ease the load but it hasn’t. That allows the Treasury to recoup more money. Why hasn’t the £21,000 limit been raised? The reason is that, under the current IFS estimates, three-quarters of graduates will not pay back all of their debt after 30 years, at which point it is forgiven. Worse, interest rates on this fee debt are 3 per cent above inflation – and thus nearly 6 per cent above the base rate. That is not quite at Wonga levels but it is patently demoralising and much too steep.

That is far from the end of the matter. Until last September, poorer students received a maintenance grant of up to £3,400 to help with their living costs. For better- off students, the state’s supposition has always been that their parents should and would contribute financially to ensure that their offspring could lead a reasonable life while at university. No government has chosen to make this very explicit: there are only so many enemies you want at any one time on any one issue.

But as the number of students rose, so did the number entitled to the grant, and as part of the strategy to reduce the country’s Budget deficit, those grants were turned into loans, too.

The Labour Party, before Jeremy Corbyn became leader, opposed the change when it was announced but not with much elan. From my Oxford eyrie, I was astonished at how little excitement this generated. Perhaps everyone was exhausted by the failed protests five years earlier.

There is mitigation. It is worth remembering that nobody pays anything for their tuition up front (part of the Blair package, too) and some universities, including mine, have good and reliable schemes to help those from poorer backgrounds and hardship funds for those whose circumstances – normally their parents’ circumstances – change while they are studying.

But I know from direct experience that many students worry a great deal about the debt that awaits them. And if graduates were feather-bedded before 1998 (and that includes me), it is hard not to sympathise now. The debt is too much for too many.

Blair defined the problem correctly – the question of who pays is about striking a fair balance – even if Corbyn seems uninterested in the pain involved in thinking it through and has opted for the easiest answer. But what should that balance be? A graduate tax for those of us who went to university when it was both a much scarcer resource and cheap would offend people who want as little retrospection as possible in the tax system. However, it would do something to deal with generational injustice, a subject on which Corbyn’s credentials are sullied by his fondness for the “triple lock” on pensions.

Labour’s policy of telling English students that they will pay nothing for their tuition is nowhere near as left-wing as it sounds, but it was far too successful a piece of retail politics for anyone in his team to consider going back to the drawing board. So now it is the Tories, facing an energised student vote, who have to engage with the issues for the first time since the tumult of 2010. The least they can do – and they should do it fast – is cut the interest rate. They won’t want to do any of it but, as the man said, the times they are a-changing.

Mark Damazer is master of St Peter’s College, Oxford

This article first appeared in the 05 May 2008 issue of the New Statesman, High-street robbery