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Select committee inquiry

Employment and Support Allowance and Work Capability Assessments

Closed

Work and Pensions Committee · Opened 5 February 2014 · Closed 27 November 2014

20 recommendations · 9 conclusions
Inquiry on parliament.uk ↗

What the inquiry looked at

“Employment and Support Allowance is paid to people who have limited capability for work, and people who have limited capability for work related activity. The majority of claimants who apply for ESA are invited to a Work Capability Assessment to help determine whether they fall within either of these two groups or are fit for work. The Work Capability Assessment is carried out by Atos under its medical services contract with the Department for Work and Pensions. This inquiry considers: the delivery of the WCA by Atos; the effectiveness of the WCA in indicating whether claimants are fit for work; the process and criteria for procuring new providers of the WCA; the ESA entitlement decision-making process; the reconsideration and appeals process; and the impact of time limiting eligibility for contributory ESA. Committee staff lead: Joanna Welham, Tel: 020 7219 4984”

The committee's words, from the inquiry page on parliament.uk ↗.

What it found

In the committee's words, from the summary of 1st Report - Employment and Support Allowance and Work Capability Assessments ↗

Employment and Support Allowance (ESA) is the benefit paid to people who are unable to work because of ill health or disability. Concerns about the operation of ESA, and in particular the assessment used to help determine eligibility—the Work Capability Assessment (WCA)—have grown steadily since it was introduced by the previous Government as a new benefit in 2008, and were first examined by this Committee in 2011.

The current Government has made some welcome adjustments to the WCA as a result of the four independent reviews which have taken place since 2010. But problems with the ESA process persist, and many claimants continue to report a stressful and anxiety-provoking experience.

The scale and complexity of the challenge in determining eligibility for an incapacity for work benefit which is claimed by millions of people, with a vast range of conditions and disabilities, which affect them in very different ways, cannot be under-estimated.

Weaknesses in the operation of ESA

The WCA itself is flawed in that it frequently fails to provide an accurate assessment of the impact of the claimant’s condition on their fitness for work or work-related activity.

However, the problems with ESA are wider than this: it is also failing to fulfil its intended purpose of helping those claimants who can do so to “achieve their full potential through work” through an accurate assessment of the health-related employment barriers which an individual faces and, crucially, linking this directly to tailored employment support.

The outcomes of the ESA claims process are too simplistic. Claimants can be found “fit for work” and are then ineligible to claim ESA. Claimants found to have such limited functionality that that they cannot undertake any work-related activity are placed in the Support Group, where they are subject to no work-related conditionality. This leaves a large and disparate middle group of claimants who are not yet fit for work, and may even have a deteriorating condition, but who are required nonetheless to undertake activity which is meant to help them find work in the longer term. These claimants are placed in the Work-related Activity Group (WRAG). The WRAG covers too wide a spectrum of claimants with very different prognoses and employment support needs.

Contract for the WCA

Concerns about the WCA have culminated in the Department for Work and Pensions (DWP) negotiating an early exit from the contract with the private sector provider, Atos Healthcare.

The re-letting of the contract provides an opportunity to address some of the problems with the WCA itself and with the wider decision-making process for which DWP is responsible. The Government must ensure that this interim re-letting of the contract is used to improve the service to claimants and to build confidence in the fairness of the claims process.

What the government said

The government responded on 27 November 2014.

Summary written by Accountability Index from the government's response.

The government's response agrees with some recommendations, such as on reassessment frequency, and disagrees with others, including on paper-based IB reassessments and paying assessment rate ESA during reconsideration, while announcing new pilots from early 2015.

  • On reassessments, the Government "agrees with the Committee that reassessments should not happen too frequently or too soon after successful appeals". It is exploring a new reassessment period of up to five years for severe degenerative brain disorders.
  • It does "not agree" that claimants having IB reassessments should never be placed in the WRAG on a paper-based assessment, saying this is appropriate "where the individual facts justify it".
  • On the DWP issuing the ESA50 and triaging cases, it will not have such a system in place when Maximus starts, but "will continue to look into the options for earlier decision-making".
  • On mandatory reconsideration, it has committed to publishing statistics, aiming to release some "by the end of 2014". It says a time target "would undermine the aim" of quality decisions, but "will consider" an internal performance indicator once reliable data is available.

Read the government's response ↗ Read the report ↗ Report an error

How the inquiry ran

Each dot is a dated item listed on this page, from the inquiry's opening on 5 February 2014 to its close on 27 November 2014.

  1. Oral evidence 5 sessions
  2. Report 23 Jul 2014
  3. Government response 27 Nov 2014

What it recommended 20 recommendations · 9 conclusions

1It is too early to predict whether the current trends in ESA outcomes will stabilise.
Concluded (the committee's words)
It is too early to predict whether the current trends in ESA outcomes will stabilise. However, we note the recognition within the ESA system that a higher proportion of claimants than initially expected are not fit for work and are therefore eligible for ESA, and that, of these, many need the higher level of benefit and absence of work- related conditionality which the Support Group provides. Nevertheless, it is clear that many claimants still find the process very stressful. Many find themselves in an outcome group which does not reflect their health barriers to employment, because the current system is not sufficiently sophisticated to cope with the wide variety in prognosis and impact which arises from the huge range of conditions which claimants present with.
2We raise concerns about the current system and set out a number of shorter-term changes...
Concluded (the committee's words)
We raise concerns about the current system and set out a number of shorter-term changes which we believe will help ameliorate some of its most egregious flaws. However, our overall conclusion is that the design of the ESA benefit and assessment process is so problematic, particularly in relation to the confusion and limitations of the outcome groups, that its inefficiencies and the detriment inappropriate decisions cause to claimants can only be resolved in a fundamental redesign of the ESA claims process over the next few years.
3The current ESA process is too long and complex.
Recommended (the committee's words)
The current ESA process is too long and complex. We agree with Dr Litchfield that it would be improved if DWP itself, and not the assessment provider, issued the ESA50 and decided whether a face-to-face assessment and/or additional evidence was necessary. This would both speed up the process and put the DWP decision-maker at the heart of the process. We recommend that this change be implemented when the new provider starts delivering the WCA.
4As part of this new process we recommend that DWP decision-makers (DMs) proactively seek additional...
Recommended (the committee's words)
As part of this new process we recommend that DWP decision-makers (DMs) proactively seek additional evidence, from both health and social care professionals, rather than placing the onus to do this on claimants (although claimants should retain the right to submit evidence with their ESA50 if they wish to do so). DMs are best placed to know whether additional evidence is necessary, whereas claimants may not know what evidence would be most useful or from whom to seek it, and may not be able to afford the significant charges which some GPs and other professionals require. Although this change may lengthen the decision-making period and may incur some additional public expense, this is likely to be balanced by a reduction in the number of appeals, which are expensive, time-consuming and stressful for claimants. DWP should also make clear guidance available to both professionals and claimants on what 50 Employment and Support Allowance and Work Capability Assessments evidence is most useful in the process. This guidance should explain that supporting evidence needs to set out how a condition affects a claimant’s functional capacity. DWP might also wish to explore options for providing training on this for GPs and other professionals.
5We also recommend that DMs give much more careful consideration to whether a claimant can...
Recommended (the committee's words)
We also recommend that DMs give much more careful consideration to whether a claimant can be placed in the Support Group without having to undergo a face-to-face assessment. Paper-based decisions are quicker, cheaper and less stressful for claimants, and may well be possible for a greater number of claims than is currently the case. However, we do not believe that paper-based assessments are appropriate for placing people in the WRAG, as can currently happen with IB reassessments (but not ESA new claims), because moving a claimant to a lower level of benefit should be based on the widest available evidence, particularly given the additional job-search conditionality which arises from being in the WRAG. We recommend that DWP change this policy urgently so that IB claimants are not placed in the WRAG without a face-to-face assessment.
6We acknowledge that reassessments are a necessary feature of the ESA system, to ensure that...
Recommended (the committee's words)
We acknowledge that reassessments are a necessary feature of the ESA system, to ensure that claimants remain in the correct benefit group with the right level of conditionality placed on them. However, reassessments are occurring too frequently, particularly for claimants with progressive conditions and ones which are unlikely to change. They also often take place too soon after successful appeals. Unnecessary reassessments are distressing for the claimant and a waste of public money. We recommend that DWP implements the recommendations of the independent reviewers on reassessment intervals without further delay, and that it looks again at whether its current reassessment criteria are in the best interests of claimants and are a good use of public funds. A speedy decision on this would assist the new contractor to plan its work.
7We welcome DWP’s acceptance of Dr Litchfield’s recommendation that all ESA- related forms and letters...
Recommended (the committee's words)
We welcome DWP’s acceptance of Dr Litchfield’s recommendation that all ESA- related forms and letters should be reviewed. We recommend that DWP improve the way it communicates with claimants, both in writing and in telephone calls. It should ensure that forms, including the ESA50, and letters are user-friendly and in plain English; the language used should be clear, with explanations of the more technical terms; and confusing legal explanations should be in footnotes or annexes rather than the main text. The terms “limited capability for work” (for those placed in the WRAG) and “limited capability for work-related activity” (for those placed in the Support Group) are very confusing for claimants. We recommend that DWP finds more meaningful terminology to use in explaining decisions on ESA claims to claimants.
8Communication with contribution-based ESA claimants placed in the WRAG is particularly important because they need...
Recommended (the committee's words)
Communication with contribution-based ESA claimants placed in the WRAG is particularly important because they need to understand that their ESA will terminate after a year. The consequences for claimants of the 12 month time-limit and the options available to request mandatory reconsideration of the WRAG decision and to apply for income-based ESA at the end of the time-limit should be clearly set out. We recommend that DWP ensure that these claimants receive specific and clear information on the implications of this claim outcome, including when the time-limit starts and when it will end, both in the decision letter and in the Decision Assurance telephone call.
9More than 80,000 new ESA claimants and IB claimants undergoing reassessment, many of them with...
Concluded (the committee's words)
More than 80,000 new ESA claimants and IB claimants undergoing reassessment, many of them with progressive conditions, have been placed in the WRAG since ESA was introduced, with a prognosis statement that a change in their functional abilities is unlikely in the longer term. The purpose of the WRAG is to provide work-related support for people who are expected to be fit for work in the short to medium term. Work-related conditionality accompanies this designation. We believe that it is wholly inappropriate to place people in the WRAG if they have a condition which is unlikely to improve and which makes their prospect of returning to work remote. We therefore recommend that DWP changes its practice so that claimants with this prognosis are allocated to the Support Group and not to the WRAG.
10We welcome the Evidence Based Review as a step towards evaluating the effectiveness of the...
Recommended (the committee's words)
We welcome the Evidence Based Review as a step towards evaluating the effectiveness of the WCA descriptors. However we do not believe that the Review was sufficient in itself to lay to rest concerns about the descriptors. There were factors both in the way the Alternative Assessment was piloted, and in how its outcomes were compared with those of the WCA, which limit its value as a comparative test. To help address the limitations of the descriptors in the short term, we recommend that DWP remind both Atos assessors and its decision-makers that they must take proper account, in coming to a decision, of the claimant’s ability to undertake an activity reliably, repeatedly and safely. Clear guidance should be issued to HCPs to avoid reporting inferences from a claimant’s responses as factual statements of capability (as recommended by Dr Litchfield), and instead to use follow-up questions to ensure that they fully understand the impact of a health condition or disability on a claimant’s functionality. In the longer-term, DWP should reconsider the effectiveness of the descriptors as part of the redesign of the system that we recommend in Chapter 8.
11Atos has become a “lightning rod” for much public dissatisfaction with the benefit decisions people...
Recommended (the committee's words)
Atos has become a “lightning rod” for much public dissatisfaction with the benefit decisions people receive. This is unlikely to change if the WCA is simply “rebranded” by moving to a new provider, who will inevitably face a huge challenge in delivering the 52 Employment and Support Allowance and Work Capability Assessments new contract. We recommend that the Government takes steps to communicate clearly to claimants, the wider general public and the media, that it is DWP which decides on benefit eligibility, not the contracted provider of the WCA, and that the face-to-face assessment is just one part of the decision-making process.
12Although some progress has been made, concerns remain about the accessibility of Atos assessment centres,...
Recommended (the committee's words)
Although some progress has been made, concerns remain about the accessibility of Atos assessment centres, the overbooking of appointments, and the manner in which some claimants are dealt with by assessors. We recommend that DWP specifies exacting service standards relating to these aspects of the claimant’s experience of the WCA in the new contract. The Minister made clear that the Government is willing to pay more for a service that meets the standards that claimants and taxpayers are entitled to expect. We welcome this acknowledgement that, as assessments are to remain part of the welfare system, they should be adequately funded.
13If claimant confidence in the process is to be restored, the new contractor will need...
Recommended (the committee's words)
If claimant confidence in the process is to be restored, the new contractor will need to demonstrate that its staff have the expertise necessary to carry out effective assessments of claimants presenting with the more difficult conditions, including those which are progressive, fluctuating or relate to mental and cognitive health. We support Dr Litchfield’s recommendation that assessors should have suitable and sufficient experience in mental health. We recommend that this should be set out on the face of the contract and that DWP extend this to other conditions which are acknowledged to be difficult to assess.
14There have been fundamental problems with the current WCA contract in terms of meeting the...
Concluded (the committee's words)
There have been fundamental problems with the current WCA contract in terms of meeting the requirements on throughput and quality. The current backlog of 700,000 cases awaiting assessment is unacceptable. People with health conditions and disabilities should not be left for months with uncertainty about their benefit entitlement. The fault does not lie with Atos alone; DWP has changed the contract a number of times and its own forecasts of referral levels have sometimes been inaccurate. DWP should also have done more to manage the contract effectively, to prevent the problems which have caused detriment to claimants occurring in the first place.
15The new WCA contract needs to balance the quality of assessment reports with specified levels...
Recommended (the committee's words)
The new WCA contract needs to balance the quality of assessment reports with specified levels of throughput of referrals which avoid backlogs and delays to claimants. Achieving this balance will depend heavily on DWP providing accurate forecasts of referral levels, as well as the efficiency of the provider. To ensure transparency, we recommend that DWP publishes the forecast levels of referrals which will be specified in the new contract. These will need to include different levels to take account of: the initial period when the backlog is being cleared; the period when the IB reassessment is being completed alongside new claims continuing; and then the period when steady state is achieved and only ESA new claims and reassessments of existing claims are being processed.
16We recommend that DWP takes all necessary steps to assure itself that the new provider...
Recommended (the committee's words)
We recommend that DWP takes all necessary steps to assure itself that the new provider has the capacity to deliver both quality and quantity of assessments. Performance indicators should be challenging and transparent and financial penalties Employment and Support Allowance and Work Capability Assessments 53 should be applied if specified standards are not met. However, given the extreme negativity around the existing contract, the WCA is unlikely to appeal to the few private contractors with the necessary capacity to take it on. DWP’s willingness to offer incentives in the new contract, as well as imposing penalties, is therefore welcome.
17DWP also needs to demonstrate that it has sufficient expertise and capacity to manage a...
Recommended (the committee's words)
DWP also needs to demonstrate that it has sufficient expertise and capacity to manage a contract of this size and complexity, to ensure value for public money and that claimants receive an acceptable level of service. This does not appear to have been the case with the Atos contract. If this capacity does not currently exist, we recommend that it be developed as a matter of urgency, bringing in expertise from other parts of Government if necessary. We welcome the Government’s plans, in the longer term, to bring in multiple providers. This makes it even more important that DWP should develop its contract management expertise. Once the new contractor has been selected, we recommend that DWP make public the cost of the contract to the public purse (and how far that differs from the previous contract), the way payments will be calculated, and the basic service standards, including the average number of assessments to be carried out per assessor per day. Greater transparency on such matters would avoid some of the controversy which has dogged this benefit. The Government may also wish to take this opportunity to consider whether, in the light of the negativity around the delivery of the face-to-face assessment by a private provider, it would be more appropriate for the assessment process to be taken back in house.
18We have previously expressed concern about the high number of appeals against ESA decisions.
Concluded (the committee's words)
We have previously expressed concern about the high number of appeals against ESA decisions. Appeals are both expensive to the public purse and stressful for claimants and we welcome the introduction of mandatory reconsideration (MR) as a step towards reducing the number of unnecessary appeals. However insufficient information is currently available to allow us to evaluate whether it is likely to have this effect in the longer term. The reduction in the number of DWP decisions, due to temporary operational changes, is likely to have contributed to the significant reduction in appeals shown in the latest statistics, rather than representing a long- term change arising solely from MR. We welcome DWP’s assurance that an analysis of the reasons behind the reduction in appeals will be undertaken.
19Mandatory reconsideration will be a success if it results in a reduction in unnecessary appeals...
Recommended (the committee's words)
Mandatory reconsideration will be a success if it results in a reduction in unnecessary appeals to HMCTS. We are however concerned that its introduction may deter claimants who were likely to have been successful in their challenge from appealing, because the new dual process is more onerous. We recommend that the Department monitor claimant behaviour, to evaluate whether the policy is having this undesired effect, rather than fulfilling its intended purpose of ensuring a correct decision is reached more quickly and without needing to go to appeal.
20We recommend that the Department works with the Office for National Statistics to ensure that...
Recommended (the committee's words)
We recommend that the Department works with the Office for National Statistics to ensure that official statistics on the operation of mandatory reconsideration are published as a matter of urgency. These should include: volumes of reconsiderations received and processed since the policy was introduced; the outcomes of these 54 Employment and Support Allowance and Work Capability Assessments reconsiderations; the overall impact on ESA outcomes; and the length of time it is taking for reconsiderations to be completed.
21We acknowledge that DWP often needs to seek additional evidence as part of the reconsideration...
Concluded (the committee's words)
We acknowledge that DWP often needs to seek additional evidence as part of the reconsideration process, which can be time-consuming, and we agree that it is better for mandatory reconsideration to take a little longer if this results in the correct decision being made. However this should not be an open-ended process and we do not accept that either of these factors preclude DWP from introducing a reasonable time target for completion of reconsideration. The introduction of a time target would also help to drive better performance. We therefore recommend that DWP introduce and report against a reasonable time target for the completion of mandatory reconsiderations.
22We believe that it is inappropriate that those who have been determined by DWP to...
Concluded (the committee's words)
We believe that it is inappropriate that those who have been determined by DWP to be fit for work and who have asked the Department to reconsider the decision are ineligible for assessment rate ESA. Although these people may be eligible to claim JSA, many are reluctant to do so because of the accompanying conditionality requirements. There has also been a problem with some Jobcentre advisers not being aware of the flexibility to modify the attached conditionality appropriately for these claimants. Assessment rate ESA and JSA are the same amount of money, so there is no financial saving for the Department from the policy, and it may in fact cost the Department money due to the administrative burden of moving claimants from assessment rate ESA to JSA during reconsideration, and then back to assessment rate ESA if they decide to appeal. We therefore recommend that claimants deemed fit for work following the WCA process who have requested that the Department reconsider that decision be paid ESA at the assessment rate until they receive the reconsidered decision.
23We welcome the introduction of more extensive feedback from appeals through the provision of summary...
Recommended (the committee's words)
We welcome the introduction of more extensive feedback from appeals through the provision of summary reasons by tribunal judges. However it is critical that this feedback is used effectively by the Department to improve the initial decision-making process. We recommend that, in response to this report, the Government set out how it plans to handle the volume of information it is now receiving through summary reasons, and how it will analyse and use it to improve the initial decision-making process. We further recommend that feedback from summary reasons is also shared with the new provider of the face-to-face assessment, so that it can be used to evaluate how assessments could be improved.
24We welcome the efforts to streamline and speed up the appeals process by increasing the...
Recommended (the committee's words)
We welcome the efforts to streamline and speed up the appeals process by increasing the capacity of the Tribunals Service, and introducing direct lodgement and a target time for DWP to submit its case to the tribunal. We were, however, surprised to learn that documentation is exchanged between DWP and the Tribunals Service in hard copy through the post, given the Government’s emphasis on the benefits of using the internet for public services. There is clearly further scope for increasing efficiency and improving the service for claimants making an appeal by introducing an online appeal application form and enabling electronic transfer of documents between DWP and the HMCTS. We appreciate that there will be an initial cost, but the return in terms of Employment and Support Allowance and Work Capability Assessments 55 speed and efficiency would be worthwhile. We recommend that the Government set out the action it intends to take in this respect in response to this Report.
25There is a gap in the current system which means that a claimant’s employment support...
Recommended (the committee's words)
There is a gap in the current system which means that a claimant’s employment support needs are not being properly assessed as part of the ESA claims process. In particular, claimants should not be found “fit for work” where they would only be able to enter employment if significant adaptations and support were provided. We recommend that DWP urgently reassess where in the process an assessment of health- related employment barriers could most appropriately take place—either by reintroducing the Work-focused Health-related Assessment (WFHRA) as a second stage of the WCA, or at a later stage as an extended version of the Work-focused Interview once the claimant is referred to Jobcentre Plus (or to the Work Programme). In the meantime, we endorse the recommendation made by both independent reviewers, that information obtained through the WCA process should be shared with Work Programme providers and JCP employment advisers.
26We agree that an assessment of work capability of some sort is necessary for an...
Concluded (the committee's words)
We agree that an assessment of work capability of some sort is necessary for an out- of-work benefit paid on the basis of ill health and disability, and that eligibility should be based on functionality and not diagnosis. We also agree that this assessment should seek to distinguish between claimants who are unlikely to be able to return to work in the long-term, and those who, with the right support, could return to employment. Nor do we under-estimate the scale of the task involved in determining eligibility for an incapacity for work benefit, which is claimed by millions of people, with a vast range of conditions and disabilities, which may change over time and which affect individuals in different ways.
27However, the current ESA system is not working as well as it should, particularly in...
Concluded (the committee's words)
However, the current ESA system is not working as well as it should, particularly in terms of achieving the intended employment objectives for claimants. The ESA outcome groups are too simplistic: the WRAG has become a “catch-all” group for those claimants who do not meet the narrow criteria for being placed in the Support Group, but who are not fit for work. The conditionality attached to the WRAG, and the focus on moving into work in a relatively short period of time, means that this group, as it currently operates, is not appropriate for many of these claimants. Nor does the current WCA provide an accurate assessment of a claimant’s individual health-related employment barriers, or their distance from the labour market.
28We recommend that the Government undertakes a fundamental redesign of the structure of ESA outcomes.
Recommended (the committee's words)
We recommend that the Government undertakes a fundamental redesign of the structure of ESA outcomes. This should focus on identifying changes to the assessment process, to ensure that the health barriers to employment that an individual faces are properly identified. For claimants in the WRAG, proper account needs to be taken of where they are on the spectrum of readiness for work. Work-related conditionality should be matched to the identified employment barriers. The support made available to help the individual move closer to work should be tailored more closely to their 56 Employment and Support Allowance and Work Capability Assessments individual circumstances. It may be possible to use the different prognosis periods for when a claimant is expected to be fit for work as the basis for varying the conditionality and accompanying support. The redesign process will require a considerable amount of research, and will take time, but sufficient resources should be devoted to it to ensure that a new design is in place before the new multi-provider contract is tendered in
29The descriptors used in the WCA, and the way they are applied in the current...
Recommended (the committee's words)
The descriptors used in the WCA, and the way they are applied in the current points- based assessment, are not producing accurate outcomes of functional capacity in the workplace in many cases. The Evidence Based Review was a useful process, but more needs to be done to evaluate the effectiveness of the descriptors and to make them more responsive, particularly for claimants with progressive and fluctuating conditions, and those with mental, cognitive and behavioural difficulties. We recommend that the redesign of the ESA process includes a fundamental reassessment of the effectiveness of the design and application of the descriptors used in the Work Capability Assessment.

Evidence

Oral evidence sessions 5