Press Release - Department for Work and Pensions: Support to
incapacity benefits claimants through Pathways to Work
28 May 2010
A Department for Work and Pensions programme to reduce the
number of people claiming incapacity benefits and help them into
work has had a limited impact and, while a serious attempt to
tackle an intractable issue, has turned out to provide poor value
for money, according to a report published today by the National
Audit Office.
The report gives credit to the Department for trying to tackle
the problem but, whilst the number of people claiming incapacity
benefits has fallen slightly in recent years, the volume of
claimants has remained in excess of 2.5 million for over a decade.
The precise contribution of the Pathways to Work programme to a
reduction of 125,000 in the number of people claiming incapacity
benefits is not clear, but is likely to be limited. The reduction
is likely to be due to the earlier medical assessment to determine
benefit entitlement. Other elements of Pathways employment support
- at an estimated cost of £94 million in 2008-09 - appear to have
had no impact on claimants, with new claimants just as likely to
move into employment without Pathways support as they are with
it.
Pathways is led by Jobcentre Plus in some areas but is
contracted out to third sector and private organisations in over 60
per cent of the country. The National Audit Office found that there
is no evidence that the programme is performing better or costing
significantly less in contracted out areas than in those run by
Jobcentre Plus.
Contractors have universally underperformed against targets set
by the Department, the NAO points out, and the Department has had
to make concessions as part of contractual renegotiations to
support the continuation of businesses and services. The NAO also
found that the Department lacked adequate information on the
Pathways supply chain. With a third of contracts making a financial
loss, the programme's contracted out delivery does not appear to be
sustainable. Looking forward, however, the Employment and Support
Allowance looks likely to be a key instrument in reducing the
number of incapacity benefit claimants.
Amyas Morse, head of the National Audit Office, said
today:
"The Department for Work and Pensions has made a
concerted effort to reduce the number of people claiming incapacity
benefits and deserves credit for grappling with a problem often
seen as intractable.
"However, the Pathways to Work programme has turned out
to provide poor value for money and it is therefore important that
the Department learns from the experience. In the future it should
base its programme decisions on a robust and clear evidence base,
follow best contracting practice and establish a measurement regime
which allows it to understand better what happens to those whom
they may have helped."
Notes for Editors
- The Department for Work and Pensions spent £12.6 billion on
incapacity benefits during 2008/09. There are currently 2.63
million people (7.2 per cent of working age population) in Great
Britain who receive incapacity benefits. This is the ninth highest
rate of incapacity benefits claimants across 28 OECD
countries.
- As part of its strategy to reduce the number of incapacity
benefits claimants the Department for Work and Pensions first
introduced Pathways to Work in 2003-04 and was rolled out
nationally between December 2007 and April 2008. The programme had
cost £538 million by the end March 2009. It consists of an early
medical assessment, six mandatory interviews and additional
voluntary support. The Department expected Pathways to reduce the
number of incapacity benefits claimants by 160,000, contributing to
its objective of reducing the number of claimants by one million by
2015.
- Press notices and reports are available from the date of
publication on the NAO website, which is at www.nao.org.uk. Hard copies can be
obtained from The Stationery Office on 0845 702 3474.
- The Comptroller and Auditor General, Amyas Morse, is the head
of the National Audit Office which employs some 900 staff. He and
the NAO are totally independent of Government. He certifies the
accounts of all Government departments and a wide range of other
public sector bodies; and he has statutory authority to report to
Parliament on the economy, efficiency and effectiveness with which
departments and other bodies have used their resources.
Press Notice 27/10
All enquiries to Sarah Farndale, NAO Press Office: Tel:
020 7798 5350
Mobile: 07985 794421