27 March 2008 – More support to help people into work – Purnell announces rates for new Employment and Support Allowance

The poorest, most disabled people in society will be given more financial support from the Government, while other disabled and long-term ill people who could work will get greater help to find employment, Secretary of State for Work and Pensions James Purnell said today.

The announcement was made as regulations finalising plans to replace Incapacity Benefits (IB) in Great Britain for all new and repeat claimants with the new work-focused Employment and Support Allowance (ESA) were laid in Parliament today.

The move marks the next major phase in implementing the Government’s radical welfare reform programme and getting one million people off IB by 2015.

Mr Purnell also revealed for the first time how much money people on ESA will get. The new rates of payment will mean extra support to the poorest, most disabled members of society.

Mr Purnell said:

“Gone are the days when writing a sick note is writing people off for life. ESA will give more financial support to the poorest, most disabled people in society whilst extending the opportunity of employment to all those who can work.

“For those who can work, today’s measures are a key cultural shift in the benefit system which puts work at the heart of support.

“Work is the best route out of poverty and gives people independence over their lives - we want to help them to help themselves.”

From October this year, all new and repeat claimants will undergo the Work Capability Assessment (WCA) – a new medical test designed to look at what people can do rather than what they cannot. ESA claimants will then be split into two groups, depending on the outcome of the assessment:

• The “Work-related activity group”: Those claimants who pass the assessment and are identified as capable of taking part in some form of work-related activity will be entitled to claim ESA at a rate of £84.50 a week. They will be required to attend work-focused interviews through the pioneering Pathways to Work scheme, to help them overcome their barriers to work and support them into long-term sustainable employment. Those who don’t fulfil these conditions without a good reason could have their ESA partially cut.
• The “Support Group”: Those identified as not able to take part in any work- related activity (the most severely disabled group) will not be expected to take part in work-focused activities unless they want to, but will not face any sanctions. We are targeting more resources to the poorest in this group with a guaranteed income of £102.10 a week (£17.60 more than the long-term rate of Incapacity Benefit), while everyone else in this category will receive a minimum of £89.50 a week.

All people claiming ESA may also continue to be eligible for other benefits, such as Disability Living Allowance and Housing and Council Tax Benefit.

Those who do not qualify for ESA can instead apply for Jobseeker’s Allowance and will be expected to take part in the work-focused interviews and programmes to help them get back to work.

The main changes to the current system of incapacity benefits announced in the regulations are:

• A move away from an inactive benefit to an active benefit which takes away incentives to stay on benefit for a long period of time. At the moment the amount of money someone gets goes up after six months and then again after one year.
• Removal of the ‘age addition’ which gives more money to people who start their claim before they are 45 – taking away another outdated incentive to stay on incapacity benefit for a long time.
• Medical assessments to be conducted much sooner – within 13 weeks – helping to prevent people from falling into benefit dependency. Those who need it receive support much faster and those who are able to work get the help they need to get back into the workplace.
• A simpler benefit – people will apply for just one benefit instead of the current system where they either claim Incapacity Benefit or Income Support on grounds of incapacity, or even a combination of both.

The changes will build on the success that has already been made over the last ten years - claimant unemployment count is at its lowest level for 32 years, there is record employment and there are now more than one million fewer people on out-of-work benefits. The most recent statistics showed that there are currently 678,500 vacancies in the UK, so there are jobs out there for anyone who wants one.

Notes to editors

1. Media can obtain electronic copies of the statement to Parliament by Stephen Timms, the minister for Employment and Welfare Reform, from the DWP press office. The full regulations can be viewed at the following link: http://www.dwp.gov.uk/welfarereform/employment.asp
2. For further information call Patsy Cusworth on 0203 267 5125, Eltan Halil on 0203 267 5123 or Alison Clarke on 0203 267 5120.

 

DWP Press Office: 0203 267 5144
Out of hours: 07659 108 883
Website: www.dwp.gov.uk