Report

by the Comptroller
and Auditor General

Department for Work & Pensions

Supporting disabled people to work

HC 1991 Session 2017–2019 28 March 2019

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The National Audit Office scrutinises public spending for Parliament and is independent of government. The Comptroller and Auditor General (C&AG), Sir Amyas Morse KCB, is an Officer of the House of Commons and leads the NAO. The C&AG certifies the accounts of all government departments and many other public sector bodies. He has statutory authority to examine and report to Parliament on whether departments and the bodies they fund, nationally and locally, have used their resources efficiently, effectively, and with economy. The C&AG does this through a range of outputs including value-for-money reports on matters of public interest; investigations to establish the underlying facts in circumstances where concerns have been raised by others or observed through our wider work; landscape reviews to aid transparency; and good-practice guides. Our work ensures that those responsible for the use of public money are held to account and helps government to improve public services, leading to audited savings of £741 million in 2017.

Report by the Comptroller and Auditor General

Ordered by the House of Commons
to be printed on 26 March 2019

This report has been prepared under Section 6 of the National Audit Act 1983 for presentation to the House of Commons in accordance with Section 9 of the Act

Sir Amyas Morse KCB
Comptroller and Auditor General
National Audit Office

25 March 2019

This report is about the Department for Work & Pensions’ support to help disabled people overcome barriers to work. This includes people whose long-term health problems have an effect on their ability to get or keep jobs.

© National Audit Office 2019

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The National Audit Office study team consisted of:
Chris Battersby, David Betteley,
Josie Kendall-Reed, Colm Molloy and Andy Nichols, assisted by Marc Adams, Jennifer Bayliss, Sarah Dixon, Jamie Kendrick, Thomas Newman and Tom Tyson, under the direction of Joshua Reddaway.
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Key facts

Summary

1 Some 7.6 million working-age people in the UK identify as disabled. Although the number of disabled people who are employed is rising, disability and long-term health problems continue to be associated with greater poverty, lower educational attainment and reduced access to work. Only 51.5% of disabled people are in work, compared with around 81.7% of non-disabled people. Some disabled people – including those with some mental health conditions and learning disabilities – are even less likely to be in work.

2 This report evaluates the government’s progress in reducing the disadvantages that disabled people and people with health problems face in getting and keeping jobs. The government believes people who want to work should be supported to do so. It also recognises that some disabled people are less likely to be able to work and that it would not be appropriate to expect everyone who is found less fit for work to seek employment.

3 In 2017, the government set a goal to see 1 million more disabled people in work in the 10 years to 2027. The Department for Work & Pensions (the Department) and the Department of Health & Social Care also produced a command paper, Improving Lives, to support this. This set out activity across health, welfare, employment and wider partnership settings. The government considers that helping people into work will benefit them through increased income, better life chances and better health, and that this will save public money. It estimates that a 1% fall in the incapacity benefits caseload would save £240 million a year. It advocates the ‘social model’ of disability, which views disability in terms of the social barriers that create disadvantage for disabled people, rather than the underlying condition. It views its role as working with disabled people, employers, service providers and others to overcome those barriers.

4 This report is about the Department’s support to help disabled people overcome barriers to work. We use the term ‘disabled people’ to mean people whose disability or long-term health problems have an effect on their ability to get or keep jobs.

5 The Department has two key roles:

assessing disabled people’s entitlement to both work-related and disability-related benefits and administering benefits accurately to ensure people receive the benefits to which they are entitled; and

providing employment support, through coaching and training provided directly through its network of jobcentres and through external providers; making grants to help people stay in work; and encouraging employers to be more confident about employing disabled people. It spent £386 million on this in 2017-18.

6 This report focuses on the Department’s employment support role. It examines the Department’s:

strategy, working across government, for supporting disabled people to work, and what is currently being achieved (Part One);

employment support programmes for disabled people and its approach to developing the evidence base (Part Two); and

efforts to improve the way it engages with disabled people in jobcentres (Part Three).

7 We do not cover how disabled people access, or are incentivised to work by, the benefit system. We published our latest report on contracted-out health and disability assessments in January 2016. Our methodology is set out in Appendices One and Two.

Key findings

On what government is currently achieving

8 The government’s goal of 1 million more disabled people in work from 2017 to 2027 cannot be used to measure the success of its efforts. The number of disabled people in employment, based on the Office for National Statistics’ Labour Force Survey, rose by 930,000 in the five years to 2018. The Department acknowledges that the increase cannot be attributed directly to any particular cause, including its policies or programmes, but believes sustaining this rate of increase would require government to do a lot more. The evidence indicates that broader factors, such as more people reporting a disability, have a substantial effect on this measure, alongside high and rising overall employment levels. The Secretary of State for Work and Pensions announced in March 2019 that the Department intends to review the goal in the coming months to see if it can make it ‘even more ambitious’ (paragraphs 1.15 to 1.18 and Figure 4).

9 The recent increases in the number of disabled people in work have not been matched by a reduction in the number of disabled people who are out of work. While the number of disabled people in work has risen by 930,000 (31%) in the last five years, the number of disabled people who are out of work remained broadly the same at around 3.7 million. The number of people claiming incapacity benefits and Universal Credit equivalents has fallen by around 60,000 over the same period to 2.4 million, and is falling as a proportion of the rising working-age population (paragraph 1.20 and Figures 1 and 5).

10 The potential demand for the Department’s support is substantial. We estimate that at May 2018, there were at least 600,000 people with disabilities or health conditions whom the Department has assessed as either able to work, or to do work-related activity. Some people whom the Department found fit for neither work nor work-related activity, have also said that they would like to work given the right support, although most considered that they were not currently able to (paragraphs 1.7 and 1.8).

11 The Department has not yet demonstrated how it will measure its progress more effectively. Other measures that have been proposed by external commentators include disability pay and job satisfaction gaps. The Department told us that it plans to report progress against a range of statistical measures, such as employment rates and gaps, disability prevalence and flows in and out of employment. As it has not yet done so, we cannot assess whether the measures will enable it to evaluate its progress more effectively. The 1 million goal replaced the government’s 2015 goal to halve the disability employment gap (the difference in the employment rates of disabled and non-disabled people). The gap has reduced by around 4 percentage points since 2015 and is currently around 30 percentage points (paragraphs 1.9, 1.19 and 1.20 and Figure 5).

On government’s strategy for supporting disabled people to work

12 Two years into the 10-year period of the goal, the government has not yet developed a full implementation plan to achieve it. Over the five years to 2022, the Department for Work & Pensions and Department of Health & Social Care are focusing on improving the evidence base around employment support programmes, to build a case for change, and making improvements to their existing programmes. In the Improving Lives command paper, they deferred significant change in occupational health services, the role of employers, or assessment processes for disability benefits. They are currently developing proposals in these areas, but these were not sufficiently advanced for us to consider as part of our review. The Department for Work & Pensions is recruiting a new Director General, Work and Health Services, to strengthen its activities to deliver working-age and disability benefits. The command paper also recognised that cross-government action may be needed to bring about transformational change but it is less clear how other departments will be involved (paragraphs 1.10 to 1.14 and 1.21).

13 Establishing the Work and Health Unit is a useful first step towards cross government collaboration on supporting disabled people to work. The Department established the Work and Health Unit (the Unit) with the Department of Health & Social Care to produce the Improving Lives command paper, coordinate cross-government research and evaluation and develop policy. For example, the paper contains a commitment and actions to help make employment a recognised health outcome (paragraphs 1.10, 1.13 and 1.14 and Figure 3).

14 The Department recognises that it has limited evidence of what works. The Department has had employment support programmes in place for several decades. Over that time it has evaluated aspects of many of its programmes. However, it has only rarely undertaken rigorous evaluation of programmes’ impact on disabled people’s employment outcomes. While undertaking this kind of evaluation can be challenging, the Department recognises that doing so puts it in a better position to make informed decisions. For example, it discontinued the Pathways to Work programme after an impact evaluation found it had insufficient impact. Although evaluations are planned, the Department has not completed robust impact evaluations on any of the programmes it currently has in place, meaning neither we nor the Department can yet say whether they are effective or not (paragraphs 2.3, 2.8, 2.9, 2.13 and 2.16 and Figure 7).

15 The Department’s current focus on evidence is welcome. The Department has allocated £100 million to pilot initiatives and evaluation, including impact evaluations, over 2017-2019. This represents a clear commitment to improving the evidence base of its programmes. More recent programmes, such as the Work and Health Programme, have impact evaluation built in from the start of the programme (paragraphs 2.4, 2.16 and 2.17 and Figure 8).

16 Turning the results of trials into a clear and funded strategy for more transformational change will not necessarily be straightforward. We consider the Department faces two key challenges. First, there may well not be a ‘silver bullet’ that would lead to significant improvements in effectiveness. Second, developing any business case for cross-government action has historically been difficult. The Department is not expecting results from most of its trials until at least 2020. This means it will not have them in time for the next spending review, which the Treasury has said will be in 2019, and there will be little time to develop plans before 2022 (paragraph 2.18 and Figure 12).

17 The Department has made improvements to the way it manages its current employment support programmes. While it creates an improved evidence base, the Department has focused on improving its programmes through ongoing small changes. We found recent improvements to the way the Department manages its programmes, including how it manages contracts with external providers of employment support programmes, such as the Work and Health Programme (paragraphs 2.15 and 2.16 and Appendix Three).

18 The Department continues to underspend its budgets, particularly where the programmes are voluntary. The Department continues to overestimate the take-up rate of some of its programmes and consequently underspends against its budgets. For example, the Work and Health Programme has so far had significantly lower take-up than expected. This is partly because these programmes are now voluntary; the Department believes that there are enough eligible claimants but that it needs to increase their willingness to engage. We also found that the Department could do more to use frequent and regular customer feedback to manage its programmes (paragraphs 2.10 and 2.14 and Figures 9 and 10 and Appendix Three).

On the Department’s efforts to improve the way jobcentres engage with disabled people

19 The Department now believes its previous target-driven culture created perverse incentives. These included encouraging work coaches to focus on helping the easiest-to-help into work, however temporary that work might be. The Department told us that since 2017 it had stopped local reporting of targets, benefit off-flow and other performance measures because it wanted to move away from its previous target-driven culture (paragraph 3.4).

20 The Department’s new approach to supporting disabled people focuses on providing personalised support to meet claimants’ needs. As part of rolling out Universal Credit, the Department has said it wants to create a more supportive environment and culture in which work coaches, who are the front-line staff in jobcentres, deliver personalised and tailored support to claimants. In practical terms, this means engaging with claimants to: understand their circumstances to help assess their barriers to work; agree appropriate goals; refer claimants to specialist employment support; and tailor the conditionality regime for their benefits. Although the Department has not set out how it will objectively measure the change, we saw this new culture in practice across the jobcentres we visited and it was supported by the work coaches we spoke to (paragraphs 3.3, 3.8, 3.11 and Figure 13).

21 Work coaches can only be expected to do so much. The Department does not expect work coaches to directly address claimants’ other needs, such as their health or housing needs, only to signpost claimants to other sources of support. Work coaches are executive officers (broadly equivalent to a graduate entry to the civil service) who are required to undertake relatively limited formal training in disability issues or coaching techniques (paragraphs 3.7, 3.11 and 3.17).

22 The Department is providing more support to work coaches to help them understand disabled people’s needs better. The Department is providing more training to work coaches and is also investing in support roles, such as disability employment advisers and community partners with experience of disability issues. The aim is to help work coaches understand claimants’ needs and identify other sources of support available locally. The Department is spending £53 million over 2017-2019 on these support roles. Work coaches we spoke to told us that they valued this support highly (paragraphs 3.9, 3.10 and 3.12).

23 The Department has also changed the way it measures jobcentres’ performance. Its intention is for work coaches to provide a personalised service to claimants, rather than respond to targets. Local managers observe the quality of work coaches’ interactions with disabled people and can look at each claim if necessary. The Department is also developing national performance indicators, such as timeliness of payments and job outcomes, based on emerging evidence of what it is important to monitor to achieve its intended level of performance. It uses these indicators to assess when to intervene locally (paragraphs 3.4 and 3.13).

24 The development of management information for Universal Credit is still ongoing. We recommended in 2015 that the Department design in management information from the start of its programmes with leading indicators to highlight any risks or problems. Judged against this benchmark, the Department is considerably behind where we would expect it to be at this stage of the Universal Credit roll-out (paragraph 3.14).

25 The Department’s approach means there are gaps in its understanding of how its jobcentres are providing services to disabled people. It is not always possible to rely on local observation and analysis of outcome data to understand the way jobcentres are interacting with disabled people. For instance:

there are a number of indicators the Department has chosen not to measure. For example, the Department is not tracking the length of time work coaches spend with claimants. It is tracking the frequency of contact with claimants and uses the frequency of contact with non-disabled people as one of its performance targets. It also does not measure claimants’ satisfaction with all of its disability employment support providers and programmes. It collects more general user feedback using a range of methods including national surveys. It is at an early stage of mapping externally provided services locally and does not record all its referrals;

it is difficult to measure whether the Department is providing the best support for disabled people. Many disabled people are not expected to look for work and, for others, work may be a longer-term goal. Relying on outcome data, such as whether people enter and retain work, may not pick up variations in the service provided to this group. The Department does not have a way of measuring claimants’ progress towards work. It is currently considering whether this is possible, as part of its evaluations; and

the Department cannot assess whether disabled people receive a consistent service between jobcentres or over time. Its systems do not allow it to assess the content of claimant commitments, which should set out the goals that claimants and their work coaches have agreed, without reviewing each one. (paragraph 3.15 and Appendix Four).

26 There is a risk that service levels will not be sustained as pressure on jobcentres increases. Each work coach’s caseload is expected to increase from around 130 currently to over 280 as jobcentres take on more Universal Credit claimants. Within this, the number of claimants per work coach in the intensive work search group (who require the most time with work coaches) is expected to increase from 96 to 133 (an increase of 39%). This is based on revised forecasts that provide more detail than was set out in our 2018 report: Rolling out Universal Credit.1 There remains a risk that work coaches will not be able to maintain the time they spend with claimants who have barriers to work or meet the stated aim to spend more time with disabled people who are furthest from the job market. This risk is likely to increase if there is a fall in general employment. The Department told us that it might require additional funding to maintain service levels if the caseload grows above its forecast (paragraphs 3.16 to 3.17).

Conclusion on value for money

27 The Department has recognised that it does not understand enough to frame a full implementation strategy for helping more disabled people to work. It is positive that it is making an effort to improve disabled people’s experience when they enter a jobcentre. It is also positive that it is starting to work more closely with the Department of Health & Social Care to improve the evidence base of what works. And it is positive that there has been recent growth in the number of disabled people in work. However, neither we nor the Department can tell how much of the improvement is a function of changes in how people already in work report disability, ‘all boats rising with the tide’ of high employment, or its actions to support more disabled people to work.

28 Given the Department has had programmes in place to support disabled people for over half a century, it is disappointing that it is not further ahead in knowing what works and that it lacks a target that it is willing to be held to account for. While the commitment to gathering evidence is welcome, until it has a clear understanding of what works, and a plan to use that evidence, it is not possible to say the Department is achieving value for money.

Recommendations

29 We recommend that the Department, working with the Department of Health & Social Care and the Work and Health Unit as appropriate:

Cross-government strategy

a Lead in establishing a clear cross-government strategy supported by:

a full implementation plan for the 10-year strategy, with clear accountabilities;

appropriate forums for coordinating delivery across government, building on the Unit; and

a robust set of performance indicators that reflect each department’s performance. For example, we would expect the Department’s performance measures to include clear and direct measures of each of its own programmes’ performance as well as the overall impact of government policy against a set of measures.

Test and learn

b Develop its strategy for its test and learn activity relating to disability employment support, by:

setting out clearly how current gaps in evidence will be addressed by its test and learn activities;

ensuring it is making best use of external research, such as academic research, to address gaps in the evidence base; and

developing a plan for turning evidence into a practical delivery plan and investment case.

Strengthen the management of coaching in jobcentres

c Develop better oversight of all the services it uses and refers people to, by:

mapping the provision and funding available for disability employment support;

developing a framework for assessing the quality of the provision to which work coaches refer customers and using this to manage the approved provider lists; and

making the approved lists open and transparent to create a fair and innovative market.

d Improve and use management information, by:

accelerating development of management information for Universal Credit;

developing systems for tracking claimants’ barriers to work and how these are being addressed (distance to work measures); and

improving the use of customer feedback, including gathering claimant satisfaction measures in its digital systems, and capturing satisfaction with specific interventions such as training or work coach sessions.

e Provide work coaches with a framework for setting goals with disabled people and develop a way to monitor claimant commitments to ensure that discretion is applied fairly and wisely.

f Identify the time work coaches require to have a positive impact on addressing claimants’ barriers to work and develop a plan to manage the risk that their time may come under pressure as caseloads increase.

1 Comptroller and Auditor General, Rolling out Universal Credit, HC 1123, 2017–2019, 15 June 2018.

Part One

The government’s strategy for supporting disabled people to work

1.1 In this part, we set out:

the disadvantages disabled people face in getting and staying in work, and current trends; and

the government’s strategy for increasing the numbers of disabled people in employment.

Disabled people face multiple disadvantages

1.2 Some 7.6 million people aged 16 to 64 report a disability – 18% of all working-age people in the UK. The number of working-age people declaring a disability is rising. This may be due to an increase in people’s willingness and ability to report their disability (Figure 1).

1.3 The government advocates the ‘social model’ of disability, which emphasises that disabled people face multiple barriers to leading a sustainable, independent life in the same way as non-disabled people and that these barriers are created by society rather than their underlying condition.

1.4 One of the challenges these barriers create for disabled people is getting and staying in work. In the final quarter of 2018, the employment rate for disabled people was over 30 percentage points lower, at 51.5%, than the rate for non-disabled people, at 81.7% (Figure 2). The Department for Work & Pensions’ (The Department’s) analysis also indicates that disabled people are twice as likely to fall out of work, and three times less likely to move into work, as non-disabled people.

1.5 People with some disabilities and health issues are more likely than others to be out of work. For example, the House of Commons Library found in 2018 that less than a quarter of people with learning difficulties, a speech impediment or mental illness or nervous disorders were in employment.2

1.6 There are many reasons why disabled people face disadvantage getting into and keeping work. The government has said that, despite some progress, many disabled people continue to face low expectations from employers, limited access to services, and a welfare system that does not provide enough personalised and tailored support to help people into work and to stay in work. It also believes that, although appropriate work can bring health and well-being benefits, the importance of employment is not fully reflected in the way welfare, health and other services work in practice.3

The potential for more disabled people to work

1.7 Not all disabled people are able to work. The Department recognises this through its benefits assessment process, which determines people’s fitness to work when they apply for benefits such as Employment and Support Allowance, or Universal Credit. Around 1.6 million disabled people on incapacity benefits or Universal Credit equivalents are not expected to seek any work or undertake work-related activity, such as training (Figure 1). These people are referred to as the ‘support group’ under Employment and Support Allowance and the ‘limited capability for work-related activity group’ under Universal Credit.

1.8 There are at least 600,000 disabled people claiming Employment and Support Allowance or Universal Credit equivalents, or claiming Jobseeker’s Allowance with a self-reported disability, that the Department expects to seek work or undertake work-related activity.4 This is a substantial number with whom the Department has direct contact through the benefits system. A survey undertaken by the Department in 2013 indicated that more than half of people claiming incapacity benefits, including those in the support group, would like to work, although most considered that they were not currently able to do so. Additionally, not everyone who is out of work and who considers they are disabled will necessarily claim out-of-work benefits.

The government’s aims for supporting disabled people into employment

1.9 The government’s May 2017 manifesto committed to a goal of seeing 1 million more disabled people in employment over the 10 years to 2027.5 This replaced the 2015 target to halve the disability employment gap, which is the difference between the employment rates for disabled people and non-disabled people (paragraph 1.4).

1.10 In November 2017, the Department for Work & Pensions (the Department) and the Department of Health & Social Care published a joint command paper called Improving Lives.6 This built on the work of the Work and Health Unit (the Unit). The Unit is a joint body established by the two departments in 2015 to work across government and the wider public sector to develop policies and programmes that benefit disabled people and those who support them (Figure 3). It clarified that the government’s goal is to increase the number of disabled people in employment from 3.5 million in 2017 to 4.5 million in 2027. It also set out the government’s vision for improving people’s work and health prospects, identifying three settings in which action is needed:

the welfare setting;

the healthcare setting, led by the NHS; and

the employer setting, including occupational health services.

1.11 We considered the government’s strategy in line with principles of good practice that we have identified in our past work on accountability and integration across government.7 We considered whether the strategy demonstrated:

collaboration: a strong commitment on the part of all bodies involved in implementing the strategy to realising its potential benefits;

clear accountability: clear roles and responsibilities so that Parliament knows who to hold to account for spending, projects or programmes – for joint programmes, clarity about which department is accountable, for example appointing a lead department;

robust data on performance and costs: accurate, trusted, comparable and up- to-date data on performance and costs allow Parliament to assess value for money for the taxpayer; and

evidence base: a solid base on which to develop practical proposals (Part Two).

Collaboration and accountability

1.12 Both we and the Committee of Public Accounts have found in our past work on joined-up working and integration across government that, even where there is a clear, identified need to join up work, delivering the benefits of joint working is challenging. Delivering any policy, particularly one that involves multiple departments, requires clear accountabilities, robust performance measures and a clear plan for implementation that all parties agree to.

1.13 The Improving Lives command paper was a joint publication that included a number of actions that both the Department for Work & Pensions and the Department of Health & Social Care would undertake over several years. The Departments have established the Unit as a key mechanism for delivery and policy development across the two departments (Figure 3). The Department for Work & Pensions is also recruiting a new Director General, Work and Health Services, to strengthen delivery of working-age and disability benefits. It is less clear, however, how other departments will be involved in the future. Should other departments become more directly involved, the government will need to set out a much broader and clearer implementation plan, including where accountability lies for each department’s contribution to the plan.

1.14 Improving Lives deferred significant commitments in important areas that will require collaboration between government and non-government bodies, such as employers. These included: occupational health; the role of employers; and the assessment processes for the two key incapacity benefits: Universal Credit and Employment and Support Allowance. The Department is developing policy proposals in these areas, but these were not sufficiently advanced for us to consider as part of our review. For example, the paper contains a commitment and actions to help make employment a recognised health outcome, but it is too soon to see the impact of this on government policy or implementation.

Performance measurement

1.15 The command paper sets out a single headline goal: to increase the number of disabled people in employment by 1 million over the 10 years to 2027. At the time the strategy was published, the number of people in work reporting a disability was already increasing significantly. However, the Unit believed that the rate of increase between 2013 and 2017 was likely to be unsustainable over the 10-year period of the strategy without further policy intervention. It considered that the goal was likely to be challenging enough to support a case for developing policy across the welfare system, the workplace and the healthcare system.

1.16 Since 2017 the number of disabled people in employment has continued to increase. From the October-December quarter of 2013 to the same period five years later, the total number of employed disabled people increased by 930,000 to 3.9 million. At this rate of growth, the goal would be met five years early, in 2022 (Figure 4). However, this is in the context of continuing high levels of overall employment; any downward change in overall employment levels would have a downward effect on the number of people, including disabled people, in employment.

1.17 This growth in the number of disabled people in employment cannot be linked directly to any particular government policy. The key data source for measuring progress towards the goal is the Labour Force Survey, which is used to produce national statistics. It is not possible, using the survey data, to identify specific causes of growth and the reasons for the rapid increase in disability employment recorded in the survey are not clear. The evidence indicates that it is likely to be due to more people already in work reporting a disability rather than more disabled people who were out of work, moving into work. However, there are also disabled people moving in and out of work, and the low overall unemployment rate is likely to be a factor particularly in the retention of disabled people.

1.18 The Unit and the Department’s analysts acknowledge that the 1 million goal cannot be used to directly measure the Department’s performance. They told us that they do not view the goal as a performance measure but as an overall indicator of the outcome the government would like to see. The Secretary of State for Work and Pensions announced in March 2019 that the Department intends to review the goal in the coming months to see if it can make it ‘even more ambitious’.8

1.19 The Department has not set out a clear set of interim or leading indicators of success to measure progress towards the goal, or other outcomes it wants to achieve. The Department told us that it plans to publish a first annual statistical release later in 2019, setting out progress against a range of statistical measures including employment rates and gaps, disability prevalence and flows in and out of employment among disabled people. As the Department has not yet published this update, we cannot currently assess whether its measures will provide a balanced overview of performance. External commentators have suggested a focus on employment alone neglects the in-work disadvantage experienced among disabled people and have recommended national monitoring of measures such as disability pay and job satisfaction gaps.9,10 Meanwhile, the 1 million goal is the main method by which the Department and others report progress.

1.20 Other indicators present a much less clear picture of progress in reducing the disadvantages that disabled people face in the labour market.

The 930,000 (31%) increase in the number of employed, disabled people over the last five years meant that the proportion of disabled people in work rose from 44.2% to 51.5%. However, there was not a similarly sized fall in the overall number of disabled people who are out of work, which remains at around 3.7 million.

the number of people claiming incapacity benefits and Universal Credit equivalents has fallen relatively slowly to around 2.4 million over a longer period and by around 60,000 in the last five years (this means that it has decreased as a proportion of the growing working age population). The number of people on incapacity benefits does not, however, include people who have been found fit for work and who may be claiming benefits such as Jobseeker’s Allowance, but who still consider they are disabled. The Department does not have reliable historic data to allow analysis of trends in this group.

The disability employment gap, the measure the government previously used to assess its performance in this area, has fallen in recent years but remains significant at around 30 percentage points (Figure 5). This is around 4 percentage points less than at its highest point in 2015, when the government set its previous target to halve the gap.11,12 The Department told us that this target was not time-bound.13

Evidence base

1.21 Importantly, the Improving Lives command paper stated that the government wants disabled people to receive personalised employment support that meets their needs, but does not yet have the evidence to know how best to do this. It therefore committed the two departments to a period of intensive ‘test and learn’ activity comprising research, evaluation, trials and pilots, up to 2022. During this time, the Department intends to use the results of its research to improve its current programmes before using the evidence it generates to support further ‘transformational change’ which it considers will require action across the wider welfare, healthcare and employer settings. We set out our findings on the Department’s test and learn activity and future plans in Part Two.

The Department for Work & Pensions’ role

1.22 The remainder of this report focuses on the Department’s and the Unit’s current activities and more immediate plans. We examine how the Department:

provides a range of national programmes aimed at disabled people and is attempting to improve its evidence base for these (Part Two); and

offers support for disabled people and people with health conditions through its jobcentres (Part Three).

2 House of Commons Library, People with disabilities in employment, Briefing Paper no. 7540, 30 November 2018.

3 Department for Work & Pensions and Department of Health & Social Care, Improving Lives: the Work, Health and Disability Green Paper, CM 9342, October 2016.

4 We have estimated this number at 600,000 but it may be higher. Our estimate includes people in the Employment and Support Allowance work-related activity group and its Universal Credit equivalent, as well as people claiming Jobseeker’s Allowance who have self-reported a disability. The Universal Credit and Jobseeker’s Allowance data are unpublished, have not been subject to the quality assurance of official statistics and we have not fully audited them. We have also not included other Universal Credit claimants who have self-reported a disability but have not been through the work capability assessment process.

5 The Conservative Party, Forward, together: our plan for a stronger Britain and a prosperous future, 2017.

6 Department for Work & Pensions and Department of Health & Social Care, Improving Lives: the Future of Work, Health and Disability, CM9526, November 2017.

7 Comptroller and Auditor General, Integration across government, Session 2012-13, HC 1041, National Audit Office, March 2013; Comptroller and Auditor General, Accountability to Parliament for Taxpayers’ Money, Session 2015-16, HC 849, National Audit Office, February 2016.

8 Secretary of State for Work and Pensions, Health and Disability Announcement: Written statement HCWS1376, 5 March 2019, available at: www.parliament.uk/business/publications/written-questions-answers-statements/written-statement/Commons/2019-03-05/HCWS1376/

9 Fevre, R., Foster, D., Jones, M. and Wass, V. 2016. Closing Disability Gaps at Work: Deficits in evidence and variations in experience, Cardiff: Cardiff University.

10 Jones, M. 2016. Disability and perceptions of work and management. British Journal of Industrial Relations, 54(1) pp. 83-113. 10.1111/bjir.12043

11 Jones M and Wass V (2017) Response to Improving Lives: The Work Health and Disability Green Paper. Available at: www.disabilityatwork.co.uk/wp-content/uploads/2018/09/JonesWassgreenpaperfinal.pdf

12 Wass, V. and Jones, M. (2017) A Tales of Two Commitments: Tracking Progress on the Disability and Employment. Available at: www.disabilityatwork.co.uk/research-areas/a-tale-of-two-commitments/

13 Neither the 2015 Conservative Party manifesto nor the 2016 Improving Lives green paper set a target date for closing the gap. The Secretary of State also said in evidence to the House of Commons Work & Pensions Committee in 2016 that it was not time-bound. However, the Work & Pensions Committee referred to a target date of 2020 in its subsequent report, reflecting a press release on the Department’s website. The Department could not find written evidence that it had corrected the Committee.

Part Two

The Department’s programmes for supporting disabled people to work

2.1 In this part we examine:

the Department for Work & Pensions’ (the Department’s) current support to help disabled people into work;

the evidence base and information that the Department uses to manage its interventions; and

the Department’s recent efforts to improve its evidence base.

The Department’s current support

2.2 The Department’s current employment support programmes fall into four broad categories (Figure 6):

national contracted programmes of employment support for disabled people, such as the Work and Health Programme;

jobcentre-based provision, including direct support from work coaches (also see Part Three);

grant-based employment support for disabled people such as Access to Work; and

initiatives targeting employer behaviour, such as Disability Confident.

2.3 The Department has operated employment support programmes for disabled people for several decades. Many of its current programmes have either been in place for many years (such as Access to Work) or build on programmes with a broadly similar operating model, such as the model of contracted-out welfare-to-work provision that underpinned the Work Programme, Work Choice and now the Work and Health Programme (Figure 7). In the last 10 years the main developments have been to:

stop subsidising institutions such as Remploy factories in favour of supporting individuals;14,15

increasingly pay contractors based on the employment outcomes individuals achieve;

provide a range of interventions to support disabled people’s employment support needs;

explore forms of occupational health support (a scheme called Fit for Work was introduced in December 2014 but withdrawn in May 2018 due to a lack of demand);16 and

gradually move away from mandating individuals’ involvement in programmes and move towards voluntary participation.

2.4 The Department estimates that it spent £386 million on disability employment support in 2017-18 (Figure 8). Overall, the Department is now spending less, in real terms, compared to 2011-12. In particular, it is also spending less on its core contractual programmes, such as the Work and Health Programme, but more on support to work coaches, such as specialist support roles and on trials, evaluations and pilot initiatives. The Department has allocated £100 million to pilot initiatives and evaluation, including impact evaluations, over 2017-2019. It spends very little on employer-based initiatives.17,18 For context, the Department spent around £15 billion on working-age incapacity benefits in 2017-18.

2.5 The Department could not provide us with reliable and comparable data showing spending before 2011-12 and its data do not show total spending on disabled people. Our past analysis indicates that the Department has spent significantly more on disability employment support in past years. For example, programme spending on the Department’s Pathways to Work initiative alone was £247 million in 2008-09.

Information used to manage employment support interventions

2.6 We reviewed eight of the Department’s current and recent interventions, including a trial led by the Work and Health Unit, against our core management cycle to assess how well the Department is using information to support its approach. We set out our approach and findings more fully in Appendix Three. The three key issues we found from our review of the eight interventions were:

opportunities to improve impact and cost-effectiveness may have been missed because evaluations were not carried out in a way that allowed the Department to robustly assess the programmes’ impact;

in turn, this meant that business cases for individual interventions are weakened by a lack of evidence about what works; and

although the Department undertakes research and surveys to gather their claimants’ views, user feedback is not gathered or used systematically as part of how it manages its programmes’ performance.

However, we also found that:

the Department has continuously improved some aspects of existing programmes, particularly how it manages contracts with external providers.

2.7 We set out our findings on these four issues below.

Impact, efficiency and cost-effectiveness

2.8 In 2005, we recommended that the Department should develop a better understanding of disabled people’s needs and analyse how its programmes address those needs.19

2.9 The Department told us that it had conducted randomised controlled trials and other formal impact assessments in the past on some of its previous programmes and used the results from these assessments to inform the design of new interventions. Some of these assessments identified that programmes were not effective. For example, we reported on the Department’s evaluation of its Pathways to Work programme in 2010. This evaluation found limited evidence of the programme’s effectiveness: once accepted onto incapacity beneﬁts, new claimants were just as likely to move into employment without Pathways support as they were with this support and the voluntary aspects of support appeared to have no additional employment impact.20 The Department has not yet completed a robust impact evaluation for any of its current programmes. Without robust evaluation, the Department does not have good information on the effectiveness and cost-effectiveness of its support.

2.10 The Department has underspent resources allocated to its programmes (Figure 9). This has been because implementation has been slower than anticipated and demand for some new programmes, such as the Work and Health Programme, has been low. This is partly because these programmes are voluntary; the Department believes that there are enough eligible people to go on them but that it needs to increase their willingness to engage. The Department has also allowed contractors to overstate what they can achieve, so programmes consistently underperform against contracted expectations (Figure 10). The Department told us it has put measures in place to try to address this, but it is too early to see if these have been effective.

2.11 Access to Work, the Department’s most expensive programme, is demand-led. Some external commentators have estimated that there is likely to be more demand for the programme than it is currently meeting. The Department also relies in part on applicants to get quotes for support they identify, so has less direct control over costs. The Department has not evaluated the impact of Access to Work. The Department recently sought external advice which indicated that it would be challenging to undertake a formal impact evaluation of Access to Work because it would be difficult to identify a ‘comparator’ group of people against which to assess the impact of the programme.

2.12 Conversely, for its contracted employment support, the Department makes good use of data on unit costs over time and between programmes to inform its negotiations with contractors. However, it could do more to understand the costs that contractors incur in providing services on the Department’s behalf. It is trying to do this by undertaking ‘open book’ accounting on the Work and Health programme to develop this understanding of providers’ costs.

Evidence base

2.13 Without clear evidence about what programmes are effective, decisions on how to allocate resources to each intervention cannot be based on knowledge of effectiveness, even when the programmes have been running for a long time. Our analysis of the business cases for the eight programmes we reviewed showed that the evidence base for most was weak or unavailable. There was no formal business case for the Flexible Support Fund, as it is a collection of different activities. This meant that the success criteria were not clear for this programme, and the governance arrangements were not always clearly set out. There is stronger evidence for the more recent health-led employment trial on Individual Placement and Support, which is adapted from international best practice supported by randomised controlled trials. We discuss the Department’s more recent efforts to improve its evidence base in more detail in paragraphs 2.16 and 2.17.

User feedback

2.14 The Department gathers feedback from claimants via a combination of surveys and user groups. For example, the Access to Work Service holds insight forums with users, monitors complaints and compliments and gains feedback from its digital channel. However, the Department does not gather ongoing user feedback through all its digital systems and therefore does not use feedback to monitor and manage the performance of its programmes, contractors or individual jobcentres. The Department does not collect feedback on the courses it sends claimants on, and it has no transactional data on user satisfaction.

Continuous improvement

2.15 The Department has made improvements to its interventions over recent years. These have been clearest in its recent investment in its commercial capability in line with wider developments of the Government Commercial Function.21 For example, it is:

developing and reporting against a 10-year employment support market strategy to build supplier capacity and improve relationship management; this is trialling new guidance from the Government Commercial Function;

implementing clearer measures of contractors’ performance, allowing for swifter intervention where performance is weak and developing a deeper understanding of provider business models; and

devising practical purchasing tools to standardise, speed up and monitor local jobcentre procurement, using the 2015 procurement regulations on dynamic purchasing systems.

The Department’s efforts to improve its evidence base

2.16 The Department and the Unit have recognised that neither the evidence of the Department’s own programmes’ impact, nor the wider international evidence base, is strong enough to build an informed case for investment in the future. As a result, they are now trying to strengthen the evidence of what employment support works for disabled people, as part of a ‘test and learn’ strategy. In addition to the Department’s own past evaluations, the Unit reviewed international evidence to identify strengths and weaknesses in the evidence base (Figure 11). It is trying to better understand:

how to improve engagement with disabled people, particularly those receiving incapacity benefits who, the Department’s own research shows, do not trust the Department;

what employment support works for people with different disabilities and circumstances, and the best balance between interventions to help disabled people stay in work as well as move into work; and

what works best in targeting employers, and the balance between targeting employers and individuals.

2.17 Following publication of the Improving Lives command paper in November 2017, the Department committed to a range of ‘test and learn’ activities (Figure 12). It is conducting:

a randomised controlled trial of the Work and Health Programme to assess its impact in helping people into work, and an impact assessment of the Intensive Personalised Employment Support Programme, which may also be a randomised controlled trial (from December 2019);22

four other trials, including two of Individual Placement and Support, a programme that has shown promising results in other contexts; and

other research and evaluation, which will not necessarily involve formal trials but will help the Department understand how its interventions might work.

2.18 The Department’s investment in evaluations, trials and pilots is welcome, particularly as we have previously found that government’s general commitment to evaluation is poor.23 The trials should provide a better basis for informed decision-making. However, there is a risk that there is not a ‘silver bullet’ that will significantly improve the performance of the Department’s programmes, that its trials will not find any areas for improvement, or that it will not be able to turn the results of its trials into a meaningful plan. Specifically, it faces three challenges:

Research strategy: the Department showed us its evidence strategy which identifies research priorities aligned to the Department’s strategic objectives. Although the Department and the Unit have devised a programme of research, evaluations and trials to fill some of the gaps in the international evidence base (Figure 11), we did not see evidence that they had developed a plan that identified all the gaps, or what evidence they were seeking, or specified evaluation and research pieces that respond to all of those gaps. This could include work undertaken by external bodies as well as the Department and the Unit.

Research design: the purpose of controlled trials is to identify whether an intervention produced a measurable impact against a control group or comparator. This presents challenges:

There can be no guarantee that any trial will produce clear results or identify ways to improve significantly on current performance. The Department is testing interventions that in some cases are similar to, or extensions of existing provision, while its testing of programmes in relation to occupational health, employer behaviour and the assessment process is much less developed.

The Department now asks people to volunteer for provision and relies on claimants engaging with work coaches. Work coaches are understandably likely to want to help their claimants onto the best programme available. We observed work coaches in one jobcentre signposting claimants, who had been placed in the control group for the Department’s Work and Health Programme trial, to the Individual Placement and Support trial. These trials can use a broadly similar approach. Elsewhere, work coaches told us that they would seek to place those in the control group of the Department’s Work and Health programme trial with alternative third-party provision, some of which also use a similar underlying approach. This means that its control groups may include people who, in fact, received other interventions similar to that being tested, albeit varying in the degree of support provided and time available with a coach. This will tend to dilute the recorded effect of its interventions.24

Financial planning context: the Department is aiming for a long-term strategy that may require cooperation between departments. However, the system of financial planning across government, particularly within spending reviews, has historically involved bilateral deals between departments and HM Treasury, and incentives to meet short-term spending targets (though the Treasury has said it wants to focus more on performance, and cross-government work will be a key focus of the upcoming spending review). In practical terms, the next cross-government spending review is likely to be in 2019, and most of the Department’s trial results will not be available until after 2020.

14 Remploy was established under the terms of the Disabled Persons (Employment) Act 1944, to directly employ disabled persons in specialised factories. It opened its first factory in Bridgend, Wales, in 1946.

15 Comptroller and Auditor General, Remploy’s disposal of its Enterprise Businesses, Session 2013-14, HC 1183, National Audit Office, April 2014.

16 Comptroller and Auditor General, Contracted-out health and disability assessments, Session 2015-16, HC 609, National Audit Office, January 2016.

17 We do not cover in this report other support that may be provided through programmes operated by other government and public bodies. This may include apprenticeships, traineeships and supported internships, and locally provided employment support.

18 The Department does not record spending on the Work Programme or Flexible Support Fund targeted at Jobseeker’s Allowance customers reporting a disability, so the figures may underestimate total spending.

19 Comptroller and Auditor General, Gaining and retaining a job: the Department for Work and Pensions’ support for disabled people, Session 2005-06, HC 455, National Audit Office, October 2005.

20 Comptroller and Auditor General, Support to incapacity beneﬁts claimants through Pathways to Work, Session 2010-11, HC 21, National Audit Office, May 2010.

21 National Audit Office, A Short Guide to Commercial Relationships, December 2017, available at: www.nao.org.uk/wp-content/uploads/2017/12/A-Short-Guide-to-Commercial-relationships.pdf.

22 A randomised controlled trial is an experiment which aims to reduce bias when testing a new treatment or intervention. The people participating in the trial are randomly allocated to either the group receiving the treatment or intervention being tested or to a group receiving the standard treatment or usual intervention as the control. The Work and Health Programme also involves a ‘public sector comparator’ to assess contracted against the Department’s ‘in-house’ provision.

23 National Audit Office Evaluation in Government, available at: www.nao.org.uk/wp-content/uploads/2013/12/10331-001-Evaluation-in-government_NEW.pdf.

24 The Unit believes it has designed the trial to minimise this risk through ongoing trial monitoring. It intends to account for possible contamination issues when analysing the trial results.

Part Three

Jobcentre support for disabled people

3.1 In this part we examine:

how the Department for Work & Pensions (the Department) provides disability employment support in its jobcentres;

how the Department manages its jobcentre-based support; and

the sustainability of the quality of jobcentre-based support.

The jobcentre delivery model

3.2 The Department mainly supports disabled people by engaging with Jobseeker’s Allowance (JSA) and Employment and Support Allowance (ESA) claimants, and now Universal Credit claimants. This typically means providing direct support through, or on referral from, a work coach in a jobcentre. Figure 13 shows the key processes for accessing jobcentre-based employment support.

3.3 The Department is attempting to change the culture and focus of its jobcentres. It characterises this as moving away from its prior focus on individual benefits and getting people off benefits and towards personalised support adapted to claimants’ needs, which links to healthcare and other support services. Under ESA and JSA, disabled people were supported by work coaches and sometimes met with specialist disability employment advisors. Under Universal Credit, claimants should typically have their own individual work coach, who is supported by the disability employment advisers. On average, one third of the people in a Universal Credit work coach’s caseload have self-reported a disability or health condition.

3.4 The Department now believes its previous target-driven culture created perverse incentives. These included encouraging work coaches to focus on helping the easiest-to-help into work, however temporary that work might be. The Department told us that since 2017 it had stopped local reporting of targets, benefit off-flow and other performance measures because it wanted to move away from its previous target-driven culture and create a more supportive environment where work coaches tailor support to claimants’ needs.

3.5 The design of Universal Credit also means that work coaches will tend to see disabled people earlier in their claim period. Under ESA, disabled people did not meet a work coach more than once until after their work capability assessment. This is currently an average of 15 weeks after initial claim. The Department believes that, in the meantime, the claimant would often move further from the job market. Under Universal Credit, the claimant meets the work coach in the first week of their claim and may continue to meet regularly up to the work capability assessment.25 The Department hopes that working with claimants who may subsequently be assigned to the limited capability for work-related activity group earlier on will encourage them to engage voluntarily after the work capability assessment. The same work coach will also continue to see a claimant if they enter work but remain on Universal Credit.

3.6 Although the Department has implemented many of the interventions that would be expected in a major culture change programme, it has not set a baseline or sought to measure progress in changing its culture or improving jobcentre capability. Nor has it assessed the impact on its disabled claimants.

The role of work coaches

3.7 Work coaches are executive officers (broadly equivalent to graduate entry-level roles in the civil service). They are not required to have prior qualifications in training in coaching, and may not have any formal training experience in health and disability issues when they enter their role. The Department’s policy is for work coaches to receive five weeks of introductory training on the Universal Credit system (or three weeks if transferring from another benefit).26 The Department also provided work coaches with two days of mandatory training on mental health issues in 2018. They are also encouraged to undertake formal training while in post. The Department told us it has a commitment to have 11,000 work coaches qualified or working towards a Level 4 qualification (equivalent to a Certificate of Higher Education) by 2021. It told us that as of December 2018, 4,061 had enrolled, 207 (5%) of which had completed the course.27

3.8 Universal Credit provides a structure for coaching, including agreeing the claimant’s commitments, setting out what they are expected to achieve, and regular reviews. However, work coaches have a lot of discretion in how to take a claimant’s disability into account, for instance in the:

frequency and form of meetings with the claimant;

support to which they refer or signpost claimants; and

expectations set in the claimant’s commitments.

3.9 As part of its four-year Enhanced Support Offer programme, the Department received £140 million from 2017 to 2019 to expand and improve the support offered to those with disabilities and health conditions, including the capability of jobcentres in supporting this claimant group. This was funded in part from the removal, in April 2017, of the premium paid to disabled people in the work-related activity group of ESA. The Department plans to allocate £10.5 million to staffing in 2019-20 to allow work coaches to spend more time with people with disabilities and health problems. The Department also allocated £43 million from the Enhanced Support Offer to fund two specialist roles to support work coaches, out of total planned spending of £53 million on these roles from 2017 to 2019:

Five hundred full-time-equivalent disability employment advisers, including those redeployed from coaching roles with ESA claimants, to provide direct support to work coaches and conference support on specific cases; and

Two hundred community partners, on fixed-term contracts, with ‘lived experience’ of disability or relevant disability expertise, to improve jobcentre staff’s awareness of disability issues.

3.10 The Department has recently reviewed these roles and, from April 2019, it intends to combine the disability employment adviser and community partner roles with annual funding of at least £24 million. The Department is still finalising the number of posts for 2019-20 but does not expect this to reduce from 2018-19 levels. Funding for beyond 2019-20 will still need to be agreed as part of the next Spending Review.

Our observations of work coaches

3.11 We visited four jobcentres to observe work coaches and to interview and hold focus groups with staff. The Department told us that under its new approach of personalised support, it expected work coaches to engage with claimants to understand their circumstances to help assess their barriers to work, agree appropriate goals and tailor the conditionality regime for their benefit. It does not expect them to address directly the full range of barriers individuals may face. Our observations broadly support this account. We observed work coaches:28

engaging positively with claimants, trying to build rapport, trust and empathy so that they can identify the claimant’s needs and refer them to the right provision;

understanding that employment may not be a realistic short-term objective for some people and tailoring their approach to claimants’ assessed needs;

meeting with disabled claimants with multiple and complex barriers to work that were difficult to address in the limited time available. Work coaches we spoke to thought they were seeing more claimants with complex needs, particularly claimants with mental health issues. Some mentioned that they were the only regular contact claimants would have outside their home;

using their understanding of local provision. We saw them being briefed by local providers and national contractors about the types of support to which they could refer people. Providers were also often able to speak to claimants and staff in the jobcentre. We spoke to local authorities who told us they had good working relationships with the jobcentre; and

focusing on monitoring claimants’ compliance with the conditionality regime for their benefits and signposting claimants to other provision.

3.12 The work coaches we saw had varying experience. They told us that the ‘classroom’ training they each receive would not have been sufficient to prepare them for their role. However, they also confirmed that they benefited from on-the-job support, for example:

work coaches can draw on support from specialists such as disability employment advisers. They viewed these specialist support roles as important and valuable, particularly when holding ‘case conferences’ about claimants with complex needs;

work coaches can access on-the-job training, including online learning and mentoring; and

the Department has developed guidance to help work coaches support claimants with particularly complex needs, such as those who are experiencing suicidal thoughts, including guidance on other services to refer people to.

The Department’s understanding of the quality of its service

3.13 The Department aims to gain assurance on the quality of its coaching and customer service in three ways:29

Local observations: the Department uses line managers’ observations and peer reviewers in each jobcentre, using its own quality assurance framework to assess the quality of service in jobcentres. These checks are performed locally and are not collated into centrally tracked management information.

National management information: the Department told us that, under Universal Credit, it has developed its information system to measure as much as possible and is now in the process of refining what information it considers it needs to use to manage quality and performance. It is developing management information by identifying the factors that most influence the outputs and outcomes it is seeking to control, such as timeliness of payments, labour market outcomes, appeals and customer contact. It set this up for: payment timeliness in January 2017 prior to the roll out of Universal Credit full service, and developed the indicator set over time, with the current set in place by May 2018; for customer contact with non-disabled people in February 2019; and is still establishing it for evidence of earnings at three and six months after each initial claim; and30

Escalation and independent reviews of quality: the Department told us it expects front-line staff to report any quality issues with their coaching to managers, and these are then escalated through its National Quality Forum, which is made up of area directors, the central operations team, and the quality lead from each jobcentre. There have been no central reviews of service quality in jobcentres.

3.14 We have previously recommended that the Department designs in management information from the start of its programmes, including on leading indicators, to highlight any risks or problems.31 Judged against this benchmark, the Department is considerably behind where we would expect it to be at this stage of the Universal Credit roll-out.

3.15 We also consider that its approach, on its own, leaves large gaps in the Department’s ability to monitor and track activity and performance. Local observations alone cannot provide assurance on the consistency of the quality of service over time or across locations and its chosen labour market outcome measures are only remotely related to the quality of its service. This approach also hinders its ability to respond promptly to requests for information from Parliament and other bodies wishing to scrutinise its work. For example, for this review, we found that extracting information on measures such as how work coaches spend their time was surprisingly complex and time consuming. The key gaps in its management information regime that we identified are:

Customer satisfaction: the Department does not measure, on an ongoing basis, claimants’ satisfaction with all of its disability employment support providers and programmes. It collects more general user feedback using a range of methods including national surveys.

Time spent with customers: the Department is not tracking the length of time work coaches spend with claimants. It is tracking the frequency of contact with claimants and uses the frequency of contact with non-disabled people as one of its performance targets.32 There is some evidence indicating that increasing the intensity and frequency of contact with claimants can be beneficial to their engagement and employment outcomes.

Progress towards work: the Department’s national monitoring of employment outcomes for claimants is too removed from the front line to be of use in monitoring the effectiveness of coaching or assessing jobcentres’ performance. The Department has not developed any measures to assess claimants’ progress towards work in cases where employment might not be a realistic short-term aim, which will be the case for some disabled claimants. It is currently considering whether it is possible to identify ways of measuring factors that indicate a claimant is closer to getting a job as part of its evaluations. This means the Department cannot currently evidence progress towards work that is positive but does not quickly result in a job outcome for good reasons. In our view, this may represent a significant part of work coaches’ activity with some disabled people.

Consistency of service quality and application of policy: the Department cannot readily assess how consistently work coaches apply discretion. This is because much of the data in the Universal Credit system, including the claimant commitment and journal, which are the key digital documents setting out what claimants are expected to achieve and how they are doing it, are written as unstructured text. The Department does not believe it is possible to analyse these key digital documents without reviewing individual cases. This means the Department cannot readily know if policies are being applied consistently over time, or between jobcentres. It told us it could, if necessary, use a sampling approach.

Operational planning and impact: the lack of structured data means that, despite the Department’s commitment to testing and learning, it is missing learning opportunities from its business-as-usual activity. The lack of data available at a local level is also hindering jobcentres’ efforts to develop innovative and efficient solutions for claimants. Two of the four jobcentre sites we visited had developed tools to identify claimants’ needs and target provision. In both cases, this was time consuming, with staff working through claimants’ cases to identify basic information on disability and health conditions and employment barriers. One site had used this information to run an open day for providers to speak to claimants with a health condition. Based on the success of this, it intended to run similar events in the future.

Third party provision: the Department has limited assurance that work coaches refer people to appropriate provision. Although it has good information about referrals to the provision it has contracts for, it does not record when it refers customers to local charities or other services under Universal Credit (except in the claimant’s journal, which it cannot analyse without reviewing each case separately). Nor does it have information on the quality of providers or customer feedback on whether they found the provision appropriate. Jobcentres have started to map local providers and collate the information available. These third-party referrals are likely to form a large part of the activities that work coaches ask claimants to undertake.

Sustainability of jobcentre support

3.16 The Department previously told us that it expected each Universal Credit work coach’s caseload to increase from 85 to 373 by 2024-25.33 It has since developed its forecasts to take account of:

The delay in managed migration (the transfer of claimants from existing benefits): the delay of the expected completion of managed migration, announced in 2018, will affect the timing of the additional effort this process will require from work coaches. When people migrate to Universal Credit they go through the process of setting up a new claim, which is typically more time consuming for work coaches than meeting existing claimants.

Claimants’ different work search requirements: some claimants do not need to see a work coach because they are not expected to look for work, or are already working enough.

On this basis, the Department expects the actual number of people each work coach needs to meet to rise from around 130 currently, to over 280 by 2024-25. Within this, the number of claimants per work coach in the intensive work search group (who require the most time with work coaches) is expected to increase from 96 to 133 (an increase of 39%). The Department hopes that using more digital support will mean that work coaches have more time for those who need more intensive support.

3.17 An increase in caseload continues to present a risk that work coaches will not be able to maintain the frequency of contact or the amount of time they spend with claimants that the Department expects, which could affect the quality of outcomes. Although the Department is aware of this risk, as we note in paragraph 3.15, the Department is not monitoring the time work coaches actually spend with claimants. The risk to the quality of the service would be exacerbated if there is a fall in general employment and jobcentres were required to process an increasing number of claims from newly unemployed people, without a commensurate increase in resources.

25 Work coaches do not meet with those placed in the ‘no work-related requirements’ group following their work capability assessment. Before the work capability assessment takes place, under ESA, disabled people met their work coach at week four, for a mandatory ‘health and work conversation’ (prior to their work capability assessment). Under Universal Credit, claimants may meet their work coach more often before their work capability assessment. Work coaches do not need to meet with claimants with some specific conditions or undergoing certain treatments, or where it would be unreasonable to expect them to engage in work related activity.

26 The work coaches we spoke to told us they had received either three weeks or one week of training respectively. We were not able to reconcile this discrepancy.

27 Completing the course is mandatory for those with a new contract.

28 We have based our observations on our visits to jobcentres. The Department does not have quantitative evidence that we could use to demonstrate that these are typical across all jobcentres. However our findings are broadly supported by the Department’s own research.

29 These align with the ‘three lines of defence’ model of assurance.

30 Metrics on customer contact and decision-making will also follow.

31 Comptroller and Auditor General, Welfare reform – lessons learned, Session 2015-16, HC 77, National Audit Office, May 2015.

32 For the purpose of this target, disabled people are identified as those who report a disability as part of their Universal Credit claim, and who have not been found fit for work by a work capability assessment.

33 Comptroller and Auditor General, Rolling out Universal Credit, Session 2017–2019, HC 1123, National Audit Office,
June 2018.

Appendix One

Our audit approach

1 This study examines how the Department for Work & Pensions (the Department) is improving the support it provides to disabled people and people with health conditions through employment support programmes, and through its network of Jobcentre Plus offices.

2 To assess the value for money of the Department’s employment support for disabled people we applied an analytical framework with evaluative criteria, which consider what arrangements would be optimal for strategy, portfolio management and delivery. We reviewed:

the government’s and the Department’s strategy for supporting disabled people to work and what is currently being achieved;

the Department’s current portfolio of support for disabled people and its approach to enhancing the evidence base; and

the Department’s efforts to improve the way it engages with disabled people within its Jobcentre Plus offices.

3 In reviewing the Department’s current portfolio of support, we applied our core management cycle framework (see Figure 15). This model assesses value for money against six stages in the management process: strategy, planning, implementation, measurement, evaluation, and feedback. We reviewed interventions across the range of the Department’s employment support, including:

local jobcentre-based support;

employment support programmes for disabled people;

grant-based employment support for in-work disabled people; and

support for employers.

4 Our audit approach is summarised in Figure 14. Our evidence base is described in Appendix Two.

Appendix Two

Our evidence base

1 Our independent conclusions on whether the Department for Work & Pensions’ (the Department’s) employment support for disabled people delivers value for money were reached following our analysis of evidence collected between September and December 2018.

2 We applied an analytical framework with evaluative criteria, which consider what arrangements would be optimal for strategy, portfolio management and delivery. Our audit approach is outlined in Appendix One.

3 We tested our findings through peer review and an expert panel involving charities, academics and independent experts with experience of disability issues.

We assessed the government’s strategy for supporting disabled people to work and what is currently being achieved

4 We drew on our previous work collating all existing NAO evidence relevant to disability employment support, including reviews of financial audit management letters; recent value-for-money studies; and performance improvement work.

5 We reviewed published and internal client strategy documents, primarily the joint Department for Work & Pensions and Department of Health & Social Care Improving Lives green paper.

6 We analysed data from the Office for National Statistics’ Labour Force Survey.

7 We consulted with a wide body of academics and independent experts and completed a review of stakeholder evidence including published documents and internal documents shared by our expert panel. The expert panel highlighted existing research and analysis on key issues covered in this report, such as measuring progress in reducing disadvantage faced by disabled people and the performance of disability employment support programmes. Our expert panel members were:

Dr Ben Baumberg Geiger, Senior Lecturer in Sociology and Social Policy at the University of Kent;

Professor Kim Hoque, Warwick Business School, University of Warwick;

Professor Nick Bacon, Cass Business School, City, University of London;

Professor Dan Finn, Professor Emeritus, University of Portsmouth;

Professor Melanie Jones, Cardiff University;

Professor Victoria Wass, Cardiff University;

Dr Ben Barr, University of Liverpool;

Dr Serena Bartys, Principal Research Fellow in Work & Health, University of Huddersfield;

Professor Karen Walker-Bone, University of Southampton;

Professor Clare Bambra, Professor of Public Health at Newcastle University;

Stephen Evans, Chief Executive at Learning and Work Institute;

Liz Sayce OBE;

Diane Lightfoot, Chief Executive Officer at Business Disability Forum;

Philip Connolly, Policy and Development manager at Disability Rights UK;

James Taylor, Head of Policy, Campaigns and Public Affairs at Scope;

Beatrice Barleon, Policy Development manager at Mencap;

Laura Boothman, Senior Policy manager at Arthritis Research UK; and

Other representatives from Citizens Advice, Mind, Leonard Cheshire and Social Finance.

8 We held interviews with senior officials from across government departments including the Office for Disability Issues, Department of Health & Social Care, Department for Education, Ministry of Housing, Communities and Local Government.

We assessed the Department’s current portfolio of support for disabled people, considering how it uses information across the core management cycle, and reviewed its recent approach to improving the evidence base

9 We conducted document and file reviews of published and internal client documents, including:

business cases;

internal audit reports;

commercial documents;

performance reports, research and evaluation reports and statistics; and

governance documents including terms of reference, meeting minutes and papers.

10 We conducted interviews with relevant Department and Work and Health Unit officials and held a series of workshops with officials for the interventions we assessed in Part 2.

11 We held a workshop with members of the Employment-Related Services Association (ERSA) and with members of the British Association for Supported Employment (BASE), speaking to more than 40 providers of employment services for disabled people to get their views on the Department’s commercial approach and lessons for service delivery.

We assessed the Department’s efforts to improve the way it engages with disabled people within its Jobcentre Plus offices.

12 We visited four jobcentre sites across the UK: Pontypool; Kingston upon Thames; Barnsley; and Blackpool. These sites were selected based on their varying employment rates, disability prevalence and the stage they were at in the rollout of Universal Credit Full Service (three sites were fully rolled out, one site was preparing for rollout).

13 We conducted semi-structured interviews and focus groups with key jobcentre and district staff, local providers and local authorities to establish how disability employment support is delivered in practice and to get their views on both the Department’s strengths and areas to improve. We interviewed:

work coaches;

eight work coach team leaders;

eight district management staff;

a total of 22 people in supporting roles including disability employment advisers, community partners, small employer advisers and partnership managers;

eight local providers of employment support including Work & Health programme and Individual Placement & Support providers; and

local authority representatives.

14 We observed 10 work coach interviews with claimants.

15 We reviewed locally held documents including local provision tools, complex needs plans and management information.

16 We analysed available management information relevant to jobcentre activity and performance.

17 There were some areas where our ability to analyse and present data was subject to limitations:

spend on disability employment support programmes over time. The Department provided us with its breakdown of spend on disability employment support, but was unable to provide reliable and comparable spend data before 2011, which would have enabled a clearer analysis of long-term trends.

the content of claimant commitments. It was not possible in the time available, to arrange a sampling exercise, or gather from the Department an electronic data set, which would have been required to analyse these data; and

case worker bookings. The complexity of this dataset meant that we were unable to undertake sufficient data review, quality assurance, or test our findings with the Department in the time available.

18 The Department has committed to working with us to improve and speed up our access to available data and advise us at an early stage of limitations or gaps in the data that we may reasonably expect to be able to access.

Appendix Three

Analysis of the Department’s employment support

1 For our analysis in Part Two, we drew on our core management cycle to assess the Department’s use of information across eight employment support interventions targeting disabled people. In Figure 15 we set out the evaluative criteria we used for this purpose. In Figure 16 we summarise our assessment for each intervention against those criteria. In Figure 17 we set out the broad themes that came out of our review.

Appendix Four

Implications of the Department’s management environment

1 The Department’s management information approach is limiting its ability to learn from and improve its jobcentre support. Figure 18 sets out our key findings. This figure shows helping and hindering factors in the management environment and draws on observations from our jobcentre case study visits to illustrate the impact for jobcentre support.

Design and Production by NAO External Relations
DP Ref: 006343-001