Number of Benefits Claimants With No Requirement to Work at Nearly 3.9 Million

A man walks past a job centre in Manchester, England, on July 8, 2020. Phil Noble/Reuters

A sharp increase has been seen in the number of benefit claimants who don’t want to have to find a job, reaching nearly 3.9 million in 2023, social policy analysts have reported.

The number of Britons without work requirements is on the rise, despite post-COVID-19 reintroductions of health assessments, according to Policy in Practice analytical firm.

Out-of-work benefits include Employment and Support Allowance, Income Support and Pension Credit and other incapacity benefits.

A report by Policy in Practice warned there were twice as many people on means-tested benefits who are not looking for work (3.8 million), as those with work requirements (1.6 million).

“The rise in people on incapacity benefit is firstly because people are sicker, and unable to get the health support they need, secondly because the benefit system has become less generous and more punitive, and thirdly this makes going back into work if you are sick more of a risk for people,” Deven Ghelani, the author of the report, told The Epoch Times.

Pandemic

Looking at the factors leading to the surge in claimants, analysts said it was down to benefit-granting conditions before, during and after the pandemic.

While before the pandemic the government had a stringent tightening of work requirements in place, the health assessments were put on hold during the pandemic. Business closures and loss of jobs would normally see people move to having no work requirements following a health assessment.

Without the option of a health assessment in place, the economy experienced a “an artificial increase in work requirement figures,” the report said.

Moving to the post-pandemic period, when health assessments were reintroduced, the Department of Work and Pensions (DWP) inherited a bulging backlog of cases. This led to a 20 percent increase in the number of people not subject to work requirements.

As a result, the government has ended up with a significantly low labour force participation rate.

According to Monetary Policy Committee (MPC) member Catherine Mann, Britain has failed to recover from the pandemic, as effectively as the United States or the euro area.

When it comes to the labour force participation rate, there had been a “dramatic deterioration in the estimated potential supply for the United Kingdom,” she said.

Last week, Prime Minister Rishi Sunak said the current benefits system wasn’t “working properly.”

“We now have almost 2.5 million working-age people who have been signed off as unfit to work or even look for work, or think about working, and I don’t think that’s right. We now sign off three times as many people to be out of work than we did a decade ago. That just doesn’t strike me as a system that’s working properly,” Mr. Sunak said in a Sunday Times interview.

Reforms

The government plans to reduce working-age benefits in order to raise funding and abolish national insurance for workers.

Other measures, such as the Back to Work Plan and the overhaul of the Work Capability Assessment (WCA), are meant to bring more people into work and provide employment support for the long-term sick and disabled, and the long-term unemployed.

Under proposed changes, disabled people, found capable of work, will receive tailored support to their individual circumstances. Minister Tom Pursglove said this will benefit both disabled people, those seeking work, and the economy overall.

The government anticipates that WCA reforms will reduce by 66 percent the net flow of people forecast over five years to be assessed to have no work requirements as a result of their health condition.

Policy in Practice analysts warned that government reforms, brought up in the Spring Budget, “need to avoid finding a false economy.” Similar reforms in the past contributed to an increase in applications for more expensive types of claims, said the report.

“Ending the £30 per week additional support for people in the ‘Limited Capability for Work’ (LCW) group in 2017 in part contributed to an increase in applications for the (£100 per week more expensive) ‘Limited Capability for Work Related Activity’ (LCWRA) group,” analysts explained.

Without proper investment in health and support services, the government risks repeating the mistakes of the past and implementing another “false economy policy,” the report said.

“The government’s back-to-work plan is a step in the right direction, as the support is much more tailored and less directly linked to benefit receipt. But people also need faster access to health care and a more supportive approach from work coaches too,” added Mr. Gelani.