Sickness benefit: nine quick fixes

Welfare reforms that could be made in a week

Reforming welfare will take years - but some changes can be made instantly. Moving people back into work is harder the longer that you have been on welfare. That’s why it’s important to triage: move fast, to stop the 2,000 a day being signed on sick. Big changes can be made instantly, by operational changes to the infamous Work Capability Assessment.

The Oct24 OBR Welfare Trends report says the huge rise in onflow - 270k a year - is not, as you might think, from a surge in sickness benefit claims. They are up, but that accounts for just 70k of the 270k. Some 130k of the onflow is down to the decline in the dropout rate - that’s people applying, then not going through with the actual assessment (below). A rise in the approval rate accounts for another 70k. The below graph shows where the sickness benefit rise comes from.

Tories and Labour agree the notorious ‘WCA’ assessment is unfit for purpose - but it is being left to inflicting damage on families, communities and the economy ever single day. Liz Kendall says she will introduce a new system: in three years’ time! But the below, from the DWP in April, shows what will have happened in those three years:-

Steve Hilton talked about ‘nudge’, making it easier for people to make the right decisions. The Tory-run DWP went the other direction, removing obstacles to people claiming sickness benefit until it was a cursory phone call, where the maximal payout is guaranteed to those who Google around for the script. That was the vibe at the time: reduce hurdles, make it easy.

Procedure matters. Nine small changes - that can be done within a week - can have a huge effect and save tens, perhaps hundreds of thousands from being written off.

1. End the scandalous bonus system for WCA assessors. Right now they are expected to process five claims a day but they are paid £80 for every extra one a day they process. The only way to whiz through more is to ‘curtail’ - that is, to cut off the assessment after 25 mins by deciding straight away that the claimant qualifies for the highest award: LCWRA. You cannot ‘curtail’ by deciding that they do not qualify. This means that the assessment process heavily incentivises all WCA assessors to lean towards ‘curtailment’ and maximal award. This is a clear invitation to abuse and should end. This need not wait until the next round of contracts are agreed. You can…

2. Tell Maximus and other private WCA firms to expect spot checks on the quality of assessment for claims that are approved - as well as rejected. One assessor told me that they expect to be hauled up on rejected claims, because the applicant may appeal - costing Maximus money. But no one will ever check to see if an assessor wrongly assessed someone as LCWRA. This gives them an incentive: if in doubt, approve the claimant for the highest payout. The DWP pays a fortune and the applicant is unlikely to ever work ever again - at huge personal and social cost. But Maximus is judged by speed of handling claims: not the quality of the assessment. No one quality-checks approved claims: ever. This needs to change. The DWP can tell Maximus it would like the ability to do spot-checks on LCWRA acceptance claims - and if they want their contract renewed, they will agree no this zero-cost request right now. This will trigger the necessary vibe shift. Even if the DWP doesn’t have the staff to check, the threat of being audited will improve the quality of the WCA assessments.

3. Claimants should be told the default will be an in-person assessment. Even if it’s phone call, don’t tell them until the last minute. This can be an immediate change that doesn’t cost Maximus anything, or need parliamentary approval. People who are not really sick are far less likely to sit there in person and brass-neck it. But since the DWP switched up assessments via phone calls, it saw a huge decline in drop-offs in applications (see above chart, and below).

   Remember, the OBR found that biggest factor in the sickness benefit increase, bigger than the rise in number of claims is the change in the dropoff rate. Far fewer claimants now get cold feet ahead of their appointment. More than anything else, this is what’s pushing numbers up.

   Maximus may say it cannot find enough staff to do interviews in person (one minister told me that that it was not possible to hire that many people, because welfare dysfunction had deprived the economy of available workers: vicious circle).The DWP has a glacial mindset so it will say “yes, we’ll do more in-person from 2027” or something. Not good enough. What matters is what the claimant expects: so just have more of them expecting a proper in-person conversation. This will deter people who are not really sick. Big effect, zero cost.

4. Record all telephone-based assessments. One assessor, a former NHS nurse, told me he was appalled that none of the assessments were recorded. They always were in the NHS, he said: basic quality control and an ethical norm in healthcare This, he said, allowed malfeasance for his colleagues who were gaming the system by ‘curtailing.’

5. Change the assessment question format regularly, so it cannot be gamed by “Sickfluencers”. Unbelievably, the assessor handbook is published online: why?Assessors find it bizarre how the rules they are given are public: it means that claimants know the phrase that pays. So-called ‘sickfluencers’ online will charge £950 to coach a claimant, even fill in the forms (many WCAs are still paper-based). There are calls to make ‘sickfluencing’ illegal, as if the sickfluencers are anything other than a symptom of government failure. The obviously-flawed system is the problem. Changing the questionnaire every three months - just small changes - would make it harder to second-guess or scam. A former army nurse who spent time as an assessor told me claimants know that (for example) if they claim to be suicidal, the assessor has no choice but to approve.

6. Allow Assessors to veto, or flag and use their own judgement. One assessor, a GP, told me people she speaks to are coached and she knows that they are blagging but has no remit to apply her medical judgement. What a waste of a medical professional. There should be an override section where an assessor can flag that their personal opinion differs from the recommendation that the official guidance mandates them to make. This could put it forward for a second, more serious look.

7. Restart reassessments. Sickness benefit is always for a limited period (say 18 months) after which there is a new assessment. Or there’s supposed to be. Around the time of Ken Loach’s film I, Daniel Blake there was a vibe shift at the DWP. The move to new assessors had created a major backlog which they wanted to address by focusing on new claims and giving up on reassessments - or, rather, giving up on those who deserved to be considered again for how they could, with the right support, get into work. The below chart (which you can mine from the complex DWP database) shows how easily our fellow countrymen can be forgotten, pushed out of the economy and written out of the public debate. Click on ‘numbers’ to see the full horror.

8. Publish daily data for onflows Maximus and others should say every day how many assessments conducted, what per cent were put in the highest category (LCWRA) - the aim should be to get that from 80 per cent back down to 10 per cent when the system was originally set up to counter the sickness benefit inflation. Also: how many bonuses were paid? How many reassessments were handled and what were the outcomes? A daily dashboard, as per Covid, is not is difficult to set up and the DWP should be across this - not waiting for monthly, or even quarterly data to drop. The act of publishing daily data itself has a coercive force: Maximus etc will feel more under scrutiny. Remember, the lives of thousands of people are shaped by the quality of these decisions. The progressive case for maximal transparency is inarguable.

9. The DWP must do far more to make it crystal clear that those on sickness benefits won’t be penalised if they work. The DWP will say ‘nothing’s stopping them working! We changed the rules!’ but it ignores the behavioural point: what matters is the rules as they are understood, not as they are. In Manchester I met Michael (clip here) who has been more than two years on LCWRA - and, statistically, has 1 per cent chance of escaping the system. But he is trying. His health had improved. He was sick of living in a hostel, wanted his life back - and had a plan. He’d actually secured a place to train as a plasterer. We went to film him on day one, but he didn’t show. He suddenly panicked that he’d lose his benefits, called up the JobSeekers’ helpline and said he was told that if he did any training then yes, he could lose it all.

   I heard this fear, or versions of it, from everyone I spoke to. They feel victims of a Kafkaesque system and fear if they come off they may never get back on. They do not trust anyone in authority. Michael had called the JSA helpline anonymously. If he did receive this advice, it was wrong: you can earn as much as you like on LCWRA but it’s tapered after a point. You are liable for a reassessment that could see you losing your benefits but, as we saw above, this never happens in practice. Michael could have continued training and by now he’d be halfway to a better life.

   But here’s the point: how was he to know? This advice is not stated anywhere in language that people can understand. It took the Ch4 team days to understand Michael’s case, same with all we were dealing with. And if a bunch of nerdy graduates cannot work it out, the demographic we’re talking about can be expected to understand it.

Solution: There could be an easy DWP online tool where you get advice and allow you to print out the verdict which is legally binding. “Are you claiming LCWRA? Do you wish to start training for a job? Your benefits are not under threat while you train. This advice is reference 76SH7 and we will stand by it, as long as the info you give is accurate.”

This is what HMRC do (link) with employers asking if employee counts as self-employed or not: the piece of paper is assurance.

None of the above changes cost a penny, but they could save millions of pounds - and, more importantly, thousands of lives. Kendall’s legislative reform will be hugely important: she strikes me as a minister who does have the determination and willpower to pull this off.

But the big battles aren’t the only ones. Just as this situation became so bad via small changes, the tide can also be turned with a zero-cost improved reporting and structures.