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  1. Politics
  2. Welfare
15 March 2023

Why Jeremy Hunt’s Budget welfare reforms won’t work

The Chancellor announced the biggest benefit changes in a decade. But they may only make life harder for Brits who cannot work.

By Anoosh Chakelian

Sanctions and work tests. In my 11-year experience of reporting on the UK’s welfare system, these are the two aspects that cause people the most misery. The sanctions regime is a blunt tool that docks your benefits if you infringe sometimes nonsensical rules. Often dehumanising and frustrating work capability assessments declare you either fit or unfit to work.

These both came in for a Budget-ing today, when the Chancellor Jeremy Hunt announced some of the most significant social security reforms in a decade.

Work capability assessments (which are used for employment and support allowance) will be scrapped, and a voluntary employment scheme for disabled people is to be launched.

Meanwhile, sanctions for Universal Credit claimants will be applied “more rigorously”, and a more “intensive” conditionality regime – whereby claimants have to do work-related activities to receive the full allowance – is also to be introduced. Universal Credit claimants must also work 18 hours a week, below which they’ll need to meet regularly with a work coach. (This is up three hours from the current requirement, and now applies to people individually, not couples.)

The idea is to try and force unemployed people who claim benefits into work, and in-work claimants to do more hours. Britain is short-staffed, and the welfare system is one of the levers the government can pull to tweak the labour market. Figures publicised by the Spectator showing five million people on out-of-work benefits are a talking point in government; the Spectator’s political editor recently left the magazine to work in No 10. There is a feeling among Tory circles that the UK has a dormant workforce.

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However, it is questionable whether the threat of more sanctions and conditions will coax this cohort back into jobs. Claimants who aren’t searching for work usually cannot do so because of their own health conditions, life circumstances or duties to others. Punishing them doesn’t change these realities.

Indeed, the government’s sanctions system is already failing to move people from out-of-work benefits into work. “The numbers with ‘no work requirement’ surpassed the numbers ‘searching for work’ for the first time last year,” noted Daniel Edmiston, a sociology professor at the University of Leeds, and who runs the Welfare at a (Social) Distance research project on benefits during and since Covid-19.

“The numbers with ‘no work requirement’ surpassed the numbers ‘searching for work’ for the first time last year”

There is little evidence that sanctions like those announced by the Chancellor are effective. The Work and Pensions Select Committee, a cross-party group of MPs, found no evidence they incentivise people to work, but that they do knock claimants mentally and financially. The government has been trying to suppress its evidence on the effectiveness of sanctions since 2019; it is now being forced to release the data.

Just this morning, a 19-year-old boy was sanctioned for 45 days, leaving him with just £21 to live on for the next month. He simply mistook the time of one job centre appointment. His mother’s partner, Joe, told me the sanction makes it less likely he’ll be motivated to find a job. “It stops him trusting anybody: he’s a young lad, lost in the world, and now his only option is debt.”

Beefing up sanctions is likely to cause people distress, rather than focusing them on the workplace. “An ever-present threat of sanctions governs encounters at the job centre and can be profoundly damaging to people’s mental health, ironically pushing them further away rather than closer to the labour market,” said Ruth Patrick, a senior lecturer in social policy at the University of York, who leads Changing Realities, a research programme documenting life on a low income (of which Joe is a participant).

“Being sanctioned gave me a mental health problem”

I’ve heard from numerous claimants and former claimants who have suffered from sanctions. Andy Mitchell, who was claiming Jobseeker’s Allowance in 2013 after being made redundant, attempted suicide in 2014 after he was mistakenly sanctioned just before Christmas. He was doing a job centre-approved work course which meant he couldn’t attend appointments in that time.

The sanction left him with just £5 in his pocket for the whole of December; he stopped eating and broke down. This experience changed him; he can no longer work. “It gave me a mental health problem. I’ve only managed to work a little bit since then, but I struggle day to day,” he told me. “I have a blue badge [disability parking provision] now.”

It is hard to see, therefore, how Hunt’s strengthening of the sanctions regime will achieve his aim of getting more people into work.

The scrapping of work capability assessments will have a more nuanced effect. The binary approach of declaring someone with fluctuating health conditions as either fit or unfit to work is not necessarily helpful, and doesn’t give people the chance to experiment with work. It harms claimants’ mental health, and pushes those with mental health issues further away from the paid labour market.

After suffering a brain haemorrhage and stroke in 2010, Mathew Little, a 53-year-old freelance editor in Southend, was declared “fit to work” after a work capability assessment. “My sense of balance was shot through, my speech was slurred, I became breathless after the slightest physical exertion and tired very easily,” he recalled. “In short, I wasn’t in a fit state to do any job I’m aware of.”

“It felt like a tick-box exercise aimed at finding any excuse for culling you from the benefit rolls”

More than a year later, he managed to overturn the decision, but the process – a brief appointment involving questions about his daily routine – made him “angry”. “There was no genuine attempt to find out what was wrong with me… It felt like a tick-box exercise aimed at finding any excuse for culling you from the benefit rolls. I think I could have dropped down dead and no one would have been bothered.”

Nevertheless, he and other claimants – as well as policy experts and academics I’ve spoken to – are sceptical about the new reform. By removing this process completely, more people who are unfit to work may find themselves unable to prove it.

Claimants are concerned about what system would replace the work capability assessments. The government has said it will now be at a work coach’s discretion whether someone is fit or unfit to work. Yet with stretched resources and little time to build relationships, work coaches may use an assessment for a different benefit unrelated to employment, personal independence payments, to decide. This could exclude more people from disability benefits, as the two have very different eligibility criteria.

Indeed, the government’s new plan for disability benefits will use the personal independence payments assessment to determine if claimants can receive a new Universal Credit “health element”, which would involve conditionality. This means tighter rules for sickness and disability benefits.

“It worries me because I don’t know what they’re going to replace them with,” I was told by Victoria, a thirty-something single mum of two primary school-age children in the north-east of England (who also participates in Changing Realities). “Are they trying to force us into work when we’re not able to?”

“I dream of being able to work, but the last thing I need is to go back too soon and have a panic attack at work.”

Found unfit to work last year due to a mental health diagnosis caused by childhood trauma, she believes her work capability assessment outcome gives her “time to heal” and the chance to work again in future. “I dream of being able to work, but the last thing I need is to go back too soon and have a panic attack at work.”

Joe – a housing volunteer whose Asperger’s makes employment difficult – felt his work capability assessment six months ago had a helpful outcome. It was a “relief” not to have job-seeking requirements so he could volunteer and care for his family. “We’re in a society of cost-cutting now. If they get rid of these assessments, does that mean people like me will lose our benefits?”

Everyone I’ve spoken to who has claimed benefits because they cannot work has their own reasons. Some are positive about work capability assessment outcomes, and even work-related activity required by the job centre. All wish they could work, and fear punishment for circumstances beyond their control. It’s clear from these conversations that the government is trying to draw from a well of workers that doesn’t truly exist.

“The work capability assessment is being scrapped not because of the harms it has caused,” said Ellen Clifford, co-chair of the Commission on Social Security and author of The War on Disabled People (2020), “but because it failed in its aim of reducing the out-of-work benefit caseload on the scale that was hoped.

“It might be assumed that disabled people were relieved to hear the government’s plans to scrap it. The truth is we are terrified of what will come next… This is being billed as the ‘back to work’ Budget, which also includes the ramping-up of sanctions [against those not in work]. If the government’s priority is to remove barriers to work, sanctions should have no place in their plans.”

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