DWP's billion pound mistake on sickness and disability benefits: government forced to revise up forecast spending on ESA
H/T Declan Gaffney
The independent Office for Budget Responsibility has said that spending on Employment Support Allowance will be £1bn higher in 2014/15 than previously forecast by the government. It says that this is because fewer people are expected to be assessed as 'fit for work' and more people are expected to be given unconditional support than the government had previously assumed.
This is a major revision to DWP's earlier forecast of £9.7bn ESA expenditure in 2014/15.
The OBR says ''ESA changes have resulted in an increase in expenditure of £1bn by 2015/16 *
They go on to say 'The latest administrative data suggests that fewer people than previously assumed will be judged 'fit for work 'as a resut of the initial ESA work capabability assessment and reassessment of incapacity benefit cases, and more will be placed in the support group.This accounts for four fifths of the increase.'
That sounds a bit wonkish doesn't it? Trust me, this is fascinating news! What it means is that the government has to find a billion pounds more than the Chancellor included in his calculations to spend on Employment Support Allowance. And what that means is that a billion pounds more has to be spent on ESA mainly because the DWP will not be able to find as many people fit for work or 'work-related activity' through their work capability assessments as they'd claimed.
So although they aren't saying this explicitly, the DWP would seem to be admitting that their previous assumptions about how many people were able to work were grossly exaggerated. This implies that thousands of sick and disabled people have been wrongly denied ESA over the last three years and thousands placed in the Work Related Activities Group who should have been put in the Support Group and given unconditional support
It's not hard to see the reasons for this change. Since the first report of the Harrington review of the WCA last year, many more people have been placed in the ESA support group than previously, and fewer found fit for work. It is clear now that the WCA has been a disaster, driven by lazy assumptions about claimants and spending targets plucked out of the air.
However, the government is still going ahead with its plans to time limit contributory ESA to just 12 months for people in the WRAG and to deny contributory ESA to people who have been disabled from childhood.
*in fact, their tables show the increase is £1bn by 2014/15 p.146-7
This is a major revision to DWP's earlier forecast of £9.7bn ESA expenditure in 2014/15.
The OBR says ''ESA changes have resulted in an increase in expenditure of £1bn by 2015/16 *
They go on to say 'The latest administrative data suggests that fewer people than previously assumed will be judged 'fit for work 'as a resut of the initial ESA work capabability assessment and reassessment of incapacity benefit cases, and more will be placed in the support group.This accounts for four fifths of the increase.'
That sounds a bit wonkish doesn't it? Trust me, this is fascinating news! What it means is that the government has to find a billion pounds more than the Chancellor included in his calculations to spend on Employment Support Allowance. And what that means is that a billion pounds more has to be spent on ESA mainly because the DWP will not be able to find as many people fit for work or 'work-related activity' through their work capability assessments as they'd claimed.
So although they aren't saying this explicitly, the DWP would seem to be admitting that their previous assumptions about how many people were able to work were grossly exaggerated. This implies that thousands of sick and disabled people have been wrongly denied ESA over the last three years and thousands placed in the Work Related Activities Group who should have been put in the Support Group and given unconditional support
It's not hard to see the reasons for this change. Since the first report of the Harrington review of the WCA last year, many more people have been placed in the ESA support group than previously, and fewer found fit for work. It is clear now that the WCA has been a disaster, driven by lazy assumptions about claimants and spending targets plucked out of the air.
However, the government is still going ahead with its plans to time limit contributory ESA to just 12 months for people in the WRAG and to deny contributory ESA to people who have been disabled from childhood.
*in fact, their tables show the increase is £1bn by 2014/15 p.146-7
9 comments:
IDS and Osborne will conspire to move the goalposts and ensure that fewer people qualify for unconditional support.
Mark my words.
I dunno. I'm taking this with a hefty pinch of salt. It sounds good on the surface, and yeh, it's getting publicity.
But it's surely a quango?
The important bit isn't the money so much as the very, very quiet, not leaked to any of the 'benefit scrounging brigade' press, admission by the DWP of a massive balls up. The kind of balls up that *should* lead to James Purnell making a full apology on newsnight. It probably won't happen...but it should!
The numbers are set to rise? Does that mean they are planning to get rid of the incompetent ATOS that judges virtually everyone fit to work then?
What 'unconditional support' is that then? Thought once you were in the Support Group you were just left to rot .... am I missing something?
I wouldn't say it's been a complete disaster. In terms of transfering money, public money, taxpayer money, from the public purse to a giant private conmpany from which we're unlikely ever to retrieve it, it's been a resounding succuss. Consider, the science behind these assessments is non-existent so there was never any medical basis for them. What was their purpose then? Theft from the public purse is my view and the collars should be being felt of everyone involved, Carol Black, Chris Grayling, IDS, whoever it was signed the original contracts with Atos et al.
Bill
Your first setence summed it up wonderfully. Currently reading Naomi Klein's The Shock Dotrine. If anyone is wondering WTF the government are up to, then I recommend it. It will even give you an insight into what's coming next!
I have got Acaerd Communication Hydrocephalus and learning difficulties and heart mummer i have applyed for ESA in August got the assement phrase on the 2/8/2011 in Sept i had to fill in a medical questionair then in November i had my medical
I am still waiting for weather i am in the support group or the work related group
I Have Dandy Walker Syndrome and Hydrocaphulus (water on the brain) I find it hard to comunicate with people, had numerouse of jobs but lost them because of my behaviour this illness courses, not saying I want to be on my bum for the rest of my life, I've been put on the WRAG yet still stuggling! I do think its wrong to get rid of esa for people that struggle, fall behind on payments, ect! For me that has panic attacks everynight knowing I'd have no money, can't get a job due to my illness, its a bugger!! Its not our fault our countrys gone down hill, its the banks!! If they didn't give money out to every tom dick and harry then we wouldn't be in this mess!!!
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