The case against time-limiting Employment and Support Allowance

By Sue Marsh
January 11, 2012

On 11 January 2012, peers will vote on whether or not to time limit Employment and Support Allowance. This is a short, emphasis-pointed briefing about this vital issue.

* 700,000 people with serious illnesses and impairments will be affected by this policy, many losing any right to an independent income.

* The means test is set at just £7,500 per year, meaning that a partner must support an unwell or disabled loved one if they earn more than this.

* Families already overwhelmingly living in poverty will lose £4661 per year. This is three times as much as higher rate taxpayers will lose in child benefit.

* This policy only affects working families and savers as it only applies to those who have contributed National Insurance (NI) or have savings over £6000.

* It is a disincentive to work and will only encourage families to break down

* It overwhelmingly affects the poorest most. The percentage impact falls from the highest in the 1st decile of earnings to the lowest in the 10th.

* It estimates that 60 per cent will simply switch to income based ESA and not be affected. Those individuals with low or no other income may apply for income-related ESA. However, it is expected that only 60 per cent of people losing their contributory ESA will be compensated by income-related ESA, even partially.

* The report concludes that 90 per cent of those placed into the Work Related Activity Group (WRAG) will be affected.

* ALL groups will lose income on average through this measure.

* It is based on an assumption that 50 per cent of claims will be appealed. This is ridiculously inaccurate.

* The government claims that 700,000 will be affected by the Time Limit - a figure previously hotly debated, ranging from 400,000 to 1 million. It is expected to cut benefits for those not fully fit for work by 1.2 billion per year.

* The government acknowledges that this is a disincentive to work and may push couples into divorce or into giving up on work altogether. However, they admit that they have no idea how significant this will be.

* Even though they are still ill, those who do not qualify for income-related ESA will have to move onto the Work Programme.

* Almost half the contributory only ESA customers in the WRAG are aged 50 to 64, so the policy will impact on more people in this age group. As a result the average loss in household net income for those aged 50 or over is slightly higher than for other age groups - precisely the group that will find it difficult to get back into work due to their age. It is likely that a higher proportion of older recipients will not be eligible for income-related ESA and will see a loss in income.

* Sick and disabled people with limited capability for work are conflated with jobseekers as ministers claim ESA must be brought into line with JSA.

* The government admit that 94 per cent of those affected will not have found work by the end of the year. They also insist that it is irrelevant whether or not they have recovered.

* The government admit that there is only a possible indirect effect of increasing movement back into work for those affected, but state however, this effect is uncertain and has not been quantified.

* The only justification ministers have given for this policy is that "We can't afford it".

* People with serious, lifelong, and degenerative conditions will all be affected by this. People with MS, Cancer, Parkinsons, Bowel Disease, Kidney Failure, Heart Disease, Lung Disease, Schizophrenia, Bi-Polar and many, many more conditions will lose benefits, left in limbo until they are judged unable to do any kind of work at all.

* 7,000 cancer patients will be affected by the one year time limit.

* However, people with heart disease, kidney failure, Parkinson’s, MS, Bowel disease, Schizophrenia, Bi-Polar, Cerebral Palsy, Motor Neurone disease and any other condition you could imagine may also lose all of their support after the year is up.

* While assessments are so flawed, a time limit will only compound an already desperate situation: 40 per cent of rejected claims go to appeal and of those, up to 70 per cent win with representation.

* The assessment system is so backlogged, that targets are already being missed, with many fewer people being assessed every week than intended. With the tribunal system also under so much strain due to the vast number of appeals and the work programmes warning that over 90 per cent may miss targets for placing the sick and disabled in work, this is a system in crisis. A one year time limit may well be the final straw.

* Time Limiting will be retrospective. Those who have already been on contributory ESA for over a year, will find that their support stops in April.

* Despite this policy still being debated in the House of Lords. Ministers warned those who may be affected back in September by letter at a cost of £2.7 million.

* Possibly the most astonishing part is the claim that the Social Impacts did not need to be investigated, neither under the categories of Health and Well-being, Human Rights or the Justice System.

* The government admit that they did not consult with any external stakeholders prior to the Chancellor’s announcement in the House of Commons on 20 October 2010. They say it is only now that they have started to engage with both internal and external stakeholders (October 2011)

* Most people in receipt of contributory ESA for more than a year are likely to be covered by the Equality 2010 disability definition and so these reforms have considerable significance for disabled people - those who are unable to work due to their health condition or disability.

Chris Grayling has said that assessments used to determine whether or not someone is "fit for work" or not are "not money driven".

However, when asked if after one year these vulnerable sick or disabled people would have found work or even be fit for work he replied it " not about recovery times. It is not about a decision that 12 months is an appropriate time for recovery. These are people who have other means of financial support, so what we have sought to do in difficult times financially, and by taking tough hold the line on this difficult issue and do not accept the Rt Hon Gentleman’s amendments. We do not believe that financially we can do so."
Full transcript here :


© Sue Marsh is co-author of the report 'Responsible Reform' ( on the government's flawed Disability Living Allowance (DLA) reform. A commentator, blogger and campaigner, she writes regularly at The Diary of a Benefit Scrounger (, from which this is excerpted.

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