Parliamentary Briefing: Welfare Reform White Paper, December 2008

Who we are and what we do

The Equality and Human Rights Commission (the Commission) is working to promote fairness, eliminate discrimination, reduce inequality, protect human rights and to build good relations, ensuring that everyone has a fair chance to participate in society. The Commission is a non-departmental public body (NDPB) established under the Equality Act 2006 – accountable for its public funds, but independent of Government.

The Commission brings together the work of the three previous equality commissions, the Equal Opportunities Commission (EOC), the Commission for Racial Equality (CRE) and the Disability Rights Commission (DRC) and also takes on responsibility for the other aspects of equality: age, gender identity, sexual orientation and religion or belief, as well as human rights. A separate Scottish Commission for Human Rights, with whom we work closely, covers aspects of the human rights remit in Scotland.

Why we need a Welfare Reform Bill

The Commission supports the general aim of the Welfare Reform Bill of improving support and incentives for people to move from benefits into work and to provide greater choice and control for disabled people. We want to ensure that people are able to reach their full potential, that everyone who can work is able to and we also want to see personalised services tailored to individuals’ needs.

Key points

The Commission supports the overall aims and objectives contained within the White Paper, in particular the right to control for disabled people. However for this package of reforms to be effective it is vital that there is:

  • A simplified system of benefits, which make clear the financial benefits of engaging in paid employment
  • Independent brokerage to support disabled people's right to control
  • Formal, flexible childcare that meets the needs of all parents in work, or preparing to return to work.
  • Access to flexible work for all to help enable individuals to both enter and remain in paid employment
  • An effective Child Poverty strategy that looks at both workless households and in work poverty.

Benefit Reform

The Commission supports movements towards simplification. Engagement with the benefits system is complex and confusing and individuals need help and support to understand the financial benefits of work.

All too often it can appear as though engaging in paid employment will not be of financial advantage to the individual. The move from benefits to paid employment requires support and advice so that individuals can both understand and benefit from the package of financial support that may be available to them in order that they can properly evaluate the financial benefits that can be associated with working.

We support the Government's acceptance that 'people entitled to carers' benefits should not be expected to engage in back to work activity, unless they volunteered to do so' . It is vital that carers who wish to engage in back to work activities such as education and training are supported in the same way as those with an obligation to engage in back to work activities.

An empowering welfare state

The Commission strongly supports the Government's intention to legislate for a right to control for disabled people, which would:

  • 'devolve power to individuals allow them to design services that fit their needs, not the needs of the system'.
  • 'allow individuals to make informed decisions about how to use the money available for their support'.

We strongly support that this is a right to control, rather than a right to request control as has been previously proposed. 
'it was felt, especially by disabled people receiving support, that a right to request control would not ensure choice and control for disabled adults, since there would be no obligation on public authorities to honour such a request'.

This approach has the potential to fundamentally alter the focus in respect of promoting equality and human rights, taking it from tackling institutional barriers or bias, to ensuring that individuals are able to navigate markets effectively and make sound choices in order to secure and satisfy their needs and aspirations.  The most critical element in promoting fairness and equity is independent brokerage.  Without this, differences in capability with respect to choice and control are likely to entrench and expand inequality, undermining the benefits of increased personalisation and autonomy. 

However it is vital that there are clear rules, consistent across different areas as to the what the right to control means, and to  ensure that 'as affordability and sustainability of services are essential, public authorities will take these into account when making decisions about the availability of the rights to control to ensure public funds are safeguarded' does not mean living in a different local authority area will cause a dramatic different in the outcomes achieved through a right to control.

The White Paper proposes that this will be piloted in 2010 in a small number of 'trailblazing' public authority areas.  It is vital that these pilots lead to a final process of a right to control for disabled people.

We welcome the proposal to allow greater flexibility in support provided to individuals via private providers, however we share the concerns that were voiced by many organisations about providers cherry picking the easiest to help back into employment.  It is vital that private providers are incentivised to not only get people into work, but to support those with the most complex needs into employment and give longer term support to ensuring an individual remains in sustained employment.

We support the development of a 'right to choose' between different providers for people on employment programmes , but it is vital that individuals are given independent support to help choose the correct programme for them.

The proposal to develop a 'customer experience measure' to help choose between providers of employment programmes' needs to take into account the differing and complex needs of different individuals.

We support the 'invest to save' financing agreement between the department and the Treasury, which enables future savings in benefits that can be achieved through increased participation in employment to be invested in supporting individuals into work.

Personalised conditionality and support

The Government is following Gregg's recommendations of 2 categories of individual, two of which should be either seeking employment, or preparing to seek employment.

The work ready group - who would be expected to meet existing Job Seeker's Allowance conditionality, but with certain groups receiving increased support. This would include lone parents of children over 6 years old.

The progression to work group - who have a good opportunity to secure employment with time, encouragement and support. This group should face a new set of conditionality requirements based around their co-ownership of the return to work process. This would include lone parents of children between 1 and 6 years old.

The importance of childcare

Whilst we support measures to support lone parents to work, it is vital that there are suitable, affordable child care facilities already in place before a lone parent returns to work, and increased conditionality is introduced.

The OECD’s latest report on benefits and wages finds that evidence 'clearly identifies childcare costs as the main culprit of inactivity traps'. The report notes that the UK has amongst the highest childcare costs in the OECD – childcare expenditure typically consumes more than a third of family incomes. This is significantly hampering the full-time participation of women in the labour force as lone mothers may see no financial gain from low-wage employment.

Formal, flexible childcare options must be available to support both the return to work and the process prior to this.

Supporting vulnerable workers

We support the Government's intention to ensure that the welfare-to work support policies remain in place 'to make sure that we do not, as in the last recession, condemn tens of thousands of people to virtually permanent inactivity'.

At this time of economic uncertainly we need to ensure that the most vulnerable workers are not those who are first to leave the labour market and last to return. The Government needs to not only maintain, but increase its focus on the most vulnerable in the labour market, including older workers, lone parents, disabled people, ethnic minority people who are already less likely to be engaging in paid employment.

A two phased approach should be used that not only looks at their skills and employability now, at a time when it may be more difficult to enter the labour market, but taking this opportunity to build skills and employability for when the economic situation improves.

The diversity of the working age population means they have complex needs. For example, a lone parent of a disabled child may require additional support to help them find appropriate child care, or an older worker with a disability will need support targeted to both their age and their impairment. This is likely to increase in the future as forecasts indicate that by 2010:

  • eighty per cent of jobs created over the past decade will have been filled by women
  • forty per cent of the workforce will be aged 45 or over, and
  • more than 20 per cent of the working age population will have a disability.

This will require working outside the confines of traditional employment support, finding creative solutions and drawing together the support of multiple agencies, including health, social care and childcare.

Flexible working

Access to flexible work could help enable individuals to both enter and remain in paid employment. Equal Opportunities Commission research showed that

  • 1.7 million people out of work (35% of those not in paid employment) say that flexible working would encourage them back into employment.

As well as helping people engage with the workplace, flexible working also enables people to utilise their skills. The EOC’s investigation report into the transformation of work (2007) ‘Working outside the box: changing work to meet the future’ found that:

  • 6.5 million people are working in jobs below their skills levels or outside the labour market because they are unable to find sufficient flexibility in work.

The benefits of flexible working are therefore clear, and although the Commission supports the extension of the Right to Request flexible working to parents with children up to the age of 16, we believe that this policy will be most beneficial if it is extended to all employees. Flexible working could help people with fluctuating health conditions especially mental health conditions and those on incapacity benefit.

The Commission is currently working on the Working Better project which will further explore the benefits of flexible working for all, across the life course, looking at the benefits not just for individuals but also for society, employers and the economy. We will be developing this theme over the next 3 years of our strategic plan.

No one written off

We support the Government's intention to implement the Gregg Review proposals, and the increased personalisation of support, and early intervention for individuals to ensure that they can return to paid employment as quickly as possible.

Improving skills

Skills support will be vital as people with low or no formal skills are the one group to have seen no marked progress in employment opportunity over the last 10 years. As Britain moves increasingly towards a high skilled 'knowledge economy' the opportunities for low skilled workers will diminish rapidly.

There are concentrations of people with low or no formal skills amongst the key groups the White Paper is targeting, for example:

  • 40% of disabled people have no formal qualifications (one third of the total population without formal qualifications)
  • The greater percentage of people from ethnic minority backgrounds in post-16 education is not reflected in the numbers that enter employment or government-sponsored training: only 4% are enrolled in work-based training or apprenticeships as compared with 10% for white young people.
  • Men are much more likely than women to be qualified to Level 3 (23% of men, 16% of women) and women are more likely than men to have no qualification, or qualifications below Level 2 (33% women, 29% men).

Ending child poverty

We welcome the focus on tackling Child Poverty and look forward to seeing the measures and targets contained in the forthcoming Child Poverty Bill.

Although we recognise the important role that work has in tackling poverty, it is important to remember that work alone will not be enough to eradicate child poverty. 23% of the children of working lone parents still live in poverty highlighting that poverty prevention is not just as simple as getting parents into work.

  • 1.4 million poor children are living in working households - this is the same number as in 1997
  • 1/2 of all poor children live in a household where somebody works - up from 1 in 4 a decade ago

Research carried out by Save the Children found that some of the worst cases of poverty are within families where parents have gone in and out of work perhaps several times over a period of time. Children in poverty were much more likely to have experienced transitions in household type than their peers who were not in poverty; 18% in persistent poverty, 15% in short-term poverty and 6% in no poverty, it is therefore that any support does not end the minute an individual moves into paid employment. Ensuring individuals have the right support not only to enter but remain engaged with the labour market is essential.

Last updated: 06 May 2016