Welfare Reform: In whose interest?

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Last Thursday saw the publication of the UK Coalition Government’s Welfare Reform Bill, which will now begin its passage through Parliament and onto the statute book probably some time later this year.

Most of the contents of the Bill (which can be seen here) are familiar enough, having been well publicised in the White Paper which preceded last week’s First Reading in the House of Commons.  The key ‘highlights’ are:

  • the introduction, from 2013, of a new Universal Credit to replace Working Tax Credit, Child Tax Credit, Housing Benefit, Council Tax Benefit, Income Support, Income based JSA and Income based ESA
  • increased focus on ‘work related requirements’ and a ‘claimant commitment’ (with extended benefit sanctions for non-compliance
  • the replacement, from 2013/14, of Disability Living Allowance by a new Personal Independence Payment
  • removal of Discretionary Social Fund (Community Care Grants, Budgeting Loans, Crisis Loans) and replacement by arrangements yet to be determined by the Scottish Government.

Fortunately, one of the White Paper proposals which didn’t make it into the published Bill was the suggestion that unemployed claimants should have their housing benefit cut by 10% after 12 months if they couldn’t find a job.   The argument that this measure would simply have led to increased homelessness was so compelling that it was sensibly dropped.

While cautiously welcoming the intent to unify and simplify the current over-complex benefit system through the new Universal Credit, CHAI has some concerns over the way in which the reforms may impact in practice – particularly given the extent of cuts to the benefit system already announced in last year’s Spending Review and Budget.

At the end of this month we will see the impact of the previous Government’s policies as those still in receipt of Incapacity Benefit (IB) start to be re-assessed under the tougher Employment & Support Allowance (ESA) rules (ESA replaced IB for new claimants in 2008).  This is predicted to increase the number of claimant appeals against adverse decisions, placing even more pressure on an Independent Appeal Tribunal system which is already creaking under the pressure.  The level of ESA related appeals is already putting considerable pressure on claimants, advice agencies and the appeals system – with it currently taking anything from 6 to 9 months for appeals to be heard.

CHAI currently has 190 appeals pending (submitted on behalf of claimants, but no date yet fixed for the hearing).  Our success rate at these Independent Appeal Tribunals is running at over 75%, so it is clear that there is something fundamentally wrong with the original decision making process.  This is a justice issue, with the length of time it takes for cases to come to appeal adding insult to the original injury.  An issue which was highlighted in the media this week, with ‘The Herald’ reporting on two cases where claimants have died while awaiting their appeals to be heard.  CHAI has also seen this happen recently in a case where, with the consent of the claimant’s family, we went on to represent at the delayed tribunal which took place after the claimant had sadly died.

The extra 2.5m people who may now be sucked into the appeals system following the rolling out of the new medical assessments of existing IB claimants will simply add to the these problems.looking for work form

The proposals around the replacement of DLA with Personal Independence Payment have caused concern among Disability organisations.  The Disability Alliance estimates that up to 750,000 disabled people may lose support under the new provisions, as the Government aims to remove £2.1Billion from the current DLA system.

CHAI is one of the organisations that will find itself at the coal face of the welfare reforms as they start to impact on individuals, families and communities.  Our Advice Service is already under significant pressure from demands for income, debt and housing advice.  Many of the clients of our Addictions and Housing Support Teams will be among the first to have their health and benefit positions re-assessed under the new ESA rules.  Work we have been doing to promote employability for those most marginal to the labour market has clearly demonstrated that there is no single straightforward path from benefit to employment that works for all people, and that we will have to ensure support is always available for those who can’t easily be catered for by mass programmes.

Ironically enough, on the day that the Welfare Bill was published at Westminster, I found myself in Glasgow at the Poverty Alliance’s ‘Scottish Assembly for Tackling Poverty’ listening to a range of academic speakers point out where we were failing to meet the Child Poverty targets that were established under the previous Government, and how things were heading in the wrong direction.  In fact, most child poverty now takes place within families who are in work, indicating that without a more progressive ‘joining up’ of the Tax/Benefit system the Welfare Reform Bill’s aim to move more people into employment will not, of itself, address the problems of poverty.

Even more depressingly ironic, the publication of the Welfare Reform Bill occurred at the end of the same week in which, with unfortunate timing, Barclays Bank reported paying Corporation Tax of a mere 1% on £Billion profits .  One of the academic findings reported at the ‘Scottish Assembly for Tackling Poverty’ was that the gap between those at the lowest end of the income scale, and those at the highest, has increased in recent years.

The poor get poorer; the rich get richer – and organisations like CHAI continue to be important in addressing and alleviating the symptoms of poverty in our communities.

CHAI can be contacted through our website at www.chaiedinburgh.org.uk.

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