8 October 2008

Rt Hon James Purnell MP

Secretary of State for Work and Pensions

SMF launch of Mental Health and Welfare Reform

House of Commons

Wednesday 8 October 2008

[Check against delivery]

On Friday we recognise World Mental Health Day. One day a year, when mental health is brought into the light and exposed to the attention of policy makers and the public.

For me, at least, it is astounding that the day is needed.

That we should need reminding that one in six of all working age adults in this country are living with mental illness. That there are more people of working age who have a mental health condition [17%], than who write with their left hand for example.

We should be astounded that a day is needed to raise awareness of the prevalence and impact of mental ill health. But it is.

Stigma and ignorance still surround these often hidden conditions.

It is a cliché to say that we need to lift that stigma.  We all agree that it should be done.  But few say how it should be done.

Part of the answer is helping people with mental health issues find work or stay in work.

Because this stigma grows out of ignorance.  Research shows that most employees with mental health problems would rather lose their job than tell their employers or colleagues.  Yet mental health problems are a normal part of life. So, we need to make them a normal part of work too – and hence an accepted part of our society.

How do we do this?

Through reports such as the one the SMF is launching today.  It starts from the same analysis as the government’s that depression, and anxiety, phobia and severe stress take an often heavy toll on individuals and on their families.

That mental health problems cost the economy of Great Britain more than £40 billion each year. That nearly two-thirds of this is the impact on people’s ability to work.  But that work is generally good for people’s health and well-being.

However, your report challenges the government’s response – I’m sure most people in the room will know that we commissioned Dame Carol Black to advise on what should be done to improve the health of Britain’s working age population. Your report agrees that we should replace GPs’ sicknotes with a fit-note focused on what patients can do, rather than what their illness stops them doing. You agree with the need for earlier intervention to prevent avoidable job loss. You agree that employers have a key role to play

But you question Dame Carol’s recommendation of piloting a Fit for Work service.  You are worried that the NHS will not find enough resources to make this a universal service.  You question whether the NHS will have the capacity to tackle what you say is a business problem, whether putting the emphasis on primary care will over-medicalise the treatment of common conditions, whether the move will undermine existing employer funded occupational health provision.

These are important points.  We don’t want to have identified an elephant of a problem but produced a mouse of a solution.  That’s why, in the Green Paper on welfare reform, we stepped up our approach to these Fit for Work for pilots.  We challenged local areas to pioneer these services, and pool funding from across health, skills and work budgets to give them critical mass. In return, we have said that we will devolve power and funding to the areas that come up with ambitious approaches that bring in additional funding.

And I also want to make clear that we are not assuming that an NHS-led model will be the right approach, or that occupational medicine should be in the lead.  We have an open mind and will be looking to test a number of models including with the private sector to best understand what works.

But it’s also worth saying that the NHS will provide the backbone of any solution.  Alan Johnson has made clear that the NHS in the future needs to be as much about preventing illness as much as curing it.  And he has made mental health a central part of that work – with investment rising to £173 million a year to extend the successes of Improving Access to Psychological Therapies to half the Primary care Trusts in England by 2011.  Bringing the benefit of talking therapies to people with depression and anxiety

So, we have the building blocks of a solution that could be up to the scale of the problem.  To achieve that, we must make sure these investments are pointing in the same direction. So, we are piloting having employment advisers working as part of the IAPT pilots to support early intervention and employment retention  But I’m sure we could integrate these pilots better.  Local communities can achieve this by coming up with integrated pilots

So, I am less sceptical than your report is of the benefits of this rash of pilots.  But I agree that we shouldn’t only look to the State, or only address the symptoms.

Because there is a paradox here: employers bear the costs of ill health but too many don’t do enough to prevent it developing.  So, employees end up on sick pay who could stay in work.  They wait up to six months before they get any help from government.  

There is a market failure here and a government failure. 

The market failure is that we are not doing enough to prevent illness – the government failure is we intervene too late, leaving over one million people receiving Incapacity Benefit for mental health conditions- more than the total number of people who claim Jobseekers Allowance. 

And to top this, we know that our support for this group works less well than it does for those with physical disabilities.

So, I want to conclude by raising some questions about how we address these problems.

First, how could we address the market failure that means too many people are drifting out of work through ill-health.  Should we consider the Dutch model of sickness absence, where employers bear more of the cost of the ill-health of their employees in return for a reduction in the social costs they face?  This has created an effective market for insurance against ill-health, and for occupational health to reduce its incidence and rehabilitate people quickly.  Statutory Sick Pay alone costs employers over £1 billion each year, and while many employers offer significantly more than the statutory minimum it seems that others are content to bear these costs.  How can we make this market work better?

Second, how could we help people before they reach Incapacity Benefit, or its replacement the Employment and Support Allowance?  How can government programmes help people at the right time without creating huge deadweight costs of providing intensive support to people who will get better quickly?

Third, what can we do to improve the employment rates of people with severe conditions, and learning disabilities?  We know our solutions for mental health are not working well enough, so I’m attracted to devolving power to the local level so that specialist organisations have the freedom and incentive to develop better answers.  We recently finished our consultation on our specialist employment programmes, and this is one of the issues we are thinking about in our response.

Fourth, should we be thinking about subsidising jobs or working with employers to provide jobs that are flexible to the needs of people with mental health issues?  We’re already having some success with our Local Employer Partnerships which have now placed over 38,000 people in work and developed over 7000 business partnerships to do this. But other countries such as Denmark and the Netherlands have tried an alternative approach of subsidising work, and this approach may be something we should consider for people who are the furthest from the labour market.

Instead of paying people to be at home on benefits, should we be spending some of this money on subsidising jobs for certain people? Should we make the public sector an exemplar, employing as it does 3 out of every 4 disabled people with a job?

Should we consider specific disability leave to allow people to deal with the impact of fluctuating conditions?

Fifth, should we be changing the way we think about how depression and anxiety are treated within our system?  Mild to moderate conditions should not have to be reasons for not having a job. Are too many people dropping out of work who we should be helping to stay in work?  Is the current gateway allowing too many people on to Incapacity benefit when they could be on JSA?

To enable us to tackle issues such as this and ensure that we are providing the support appropriate to the different sorts of mental health problems - and to different ways in which they affect people's capacity to work - Dame Carol has been invited to develop a new strategy for mental health and employment.

As most of you will know, we announced in the Green Paper that we would double the funding for Access to Work – the scheme that pays for the extra costs of employing people with disabilities or ill-health. 

Thanks to that increase, today I am able to announce that we will test a whole new way to take advantage of the money available.

Because we recognise the difficulty around finding the right support at the right time for those with fluctuating conditions, we have been working collaboratively with MIND, the mental health charity, about how we might provide more flexible help.

We will make support available for people with mental health conditions either already in work and experiencing difficulty, or those about to enter employment, as well as for their employers. Crucially, the support will be available when it is needed, waiting in reserve to respond quickly when mental health deteriorates or problems emerge. 

This approach should help increase the confidence of the employee and remove the fear factor from the employer. From Autumn we propose to pilot a programme in London which will enable us to test the demand and monitor the effects.

The Green Paper was not the last word on reform.  I’ve raised questions today that still need to be answered.  None all them will be solved today. And none of the problems that I have spoken of will be solved by any one group or sector. We must all, think-tanks, medical professionals, charities, employers and Government, we must all work together to improve the way that this country deals with the problems of mental ill health.

Not just on one day, or one week of the year. But every day, every week, every year.

Thank you very much.