A speech by Lord David Freud, Minister for Welfare Reform.
It is great to see so many people here today focusing on health, work and well-being - especially since this is an area where we are seeing an interesting shift in perceptions.
Instead of talking in prosaic terms about protecting people at work, the health and well-being debate is now often conducted in terms of how work relates to concepts such as “purpose” and “happiness”.
That is not to say that when someone asks “What is the Meaning of Life?”, the answer is “Work”.
That would be too depressing.
But it does recognise that work, in its broadest sense, plays a significant role in sustaining health and well-being.
This shift reflects the thinking of academics such as the late Aaron Antonovsky.
He said, “We are coming to understand health not as the absence of disease, but rather as the process by which individuals maintain their sense of coherence.”
And he defined “coherence” as the idea that life should be comprehensible, manageable, and meaningful as it shapes our resilience in the face of change.
It is probably easier to understand this in the context of those who lack purpose and meaning in their lives.
And up and down the country you can find countless examples of what this means in practice for communities in the grip of endemic worklessness, welfare dependency and inter-generational poverty.
Benefit Growth / Cost
One of the surest barometers of social breakdown in this country is Incapacity Benefit.
Since the 1980s, we have witnessed a huge increase in the figures. From fairly modest levels, the numbers on Incapacity Benefit and Employment Support Allowance have ballooned to 2.6 million.
It now costs the Government - you and me as taxpayers - almost £13 billion per year.
To that, you can add the estimated cost of lost production from sickness absence at around £10 billion per year.
And further estimates suggest the annual cost of working age ill-health runs to over £100 billion.
Clearly, this represents a huge brake on the country’s economy.
But the biggest cost is measured in human terms - people up and down the country abandoned to a lifetime on long-term benefits.
That is the real tragedy of this story - individuals who have enough to get by, but not the real support they need to get back to mainstream society.
That is why the relationship between health, work and well-being is right at the heart of the welfare reforms we are implementing.
For too long, we have tagged people under this benefit as “incapable” - and once categorised in this way, they are ignored by the system, start lose confidence, see their skills atrophy and see their sense of self-worth drain away.
Even the social networks that most of us take for granted - as we meet friends and acquaintances through work - wither and shrink.
The long-term result is lost values, lost respect and lost communities.
That is why we have to look well beyond welfare measures that merely tinker around the margins.
The case for fundamental reform is clear, because the failing welfare system we inherited has left us with:
- 5 million people stuck on out of work benefits
- 1.4 million who have been receiving out of work benefits for 9 out of the last 10 years, and
- 1.9 million children living in workless homes.
Seen in this light, it is obvious just how disastrous a policy of passive benefits can become.
That is why we are setting our ambitions at nothing less than a complete overhaul of the welfare and benefit system to make it fit for the 21st Century.
WCA / Work Programme
There are a number of inter-linked elements in the reforms we are introducing, but the key pieces are:
- a Universal Credit to ensure that work pays - even for the poorest
- a new Work Programme, which I’ll talk about more in a moment, and
- the new Employment Support Allowance, which links into the Work Programme and will eventually allow us to move people off the old-style Incapacity Benefit.
Some of you will be aware that earlier this week we launched the first stage of our Incapacity Benefit reassessment in Burnley and Aberdeen.
Over the next three years we will reassess around 1.5 million people using the Work Capability Assessment.
I fully appreciate that the Work Capability Assessment has come in for some adverse comment and it is under review.
But while it may not be perfect - it does represent a new start for many people who were largely ignored under the old regime.
In this new system, those found unable to work will continue to get the support they need.
However, by focusing more on what people cando, rather than what they can’t, we expect to see many more people start the journey back toward work - and we intend to offer them the support they need on the way.
Looking further ahead, the new Universal Credit will also help.
When fully implemented, it will create a far more flexible benefits system that makes it easier to transition into and out of work - even if that amounts to just a few hours per week.
But in the meantime, we are already looking at other ways to smooth out the cliff edges and break down the barriers that trap people in welfare dependency.
It is important that we get this right, especially for people who suffer from fluctuating conditions.
If the welfare system is to work for them, they need real flexibility that allows them to work when they can, and stay out of work when they cannot, without the risk of losing benefits along the way.
It is also important that we focus on mental health conditions, since they make up 42% of all long-term Incapacity Benefit cases.
We know that mental health problems actually tend to increase when people have been on inactive benefits, so mental health is not just a symptom here - it is a contributory factor.
So it is clear that we must to take a holistic approach to health, work and well-being.
That is why, for example, we have designed the new Work Programme to allow providers to tailor their support to the individual needs of their customers.
Government can only do so much on its own.
We need to work in partnership with business and the Third Sector to make sure that we are all pulling in the same direction here.
Too many people are failing to get the right support at the right time - and that is especially true on mental health issues.
Working together, we need to do more to focus interventions at the trigger points when we know we can make an impact.
That is long before the 28-week cliff edge when Statutory Sick Pay ends and people drop out of work and on to Employment Support Allowance.
And it is long before the 12 months or so that some so-called ‘good’ employers let their staff take off sick before they finally take action.
Truly “good” employers are those who take a holistic view of employee well-being and offer early interventions.
We should all be worried about letting people drift along for months without support - especially when it is possible to quickly identify a large proportion of the 300,000 people who move out of work and on to benefits each year.
So all of us share a duty to champion a concerted, holistic, structured approach that provides the right help before people drop off the employment grid altogether.
We can’t let the things fester.
We have to look at interventions at 4 weeks, 6 weeks, 8 weeks or 3 months - but whatever the timescale, it must be long before the individual ramps up the escalator and on to the benefits budget.
That is the best way to provide meaningful support that works.
Fit for Work
The research shows that more than 90% of people with common health problems can be helped back to work by simple healthcare and workplace management measures.
So early intervention must make sense.
And that point was rammed home to me recently when I visited Fit for Work Service projects in Birmingham and Leicester.
What struck me most was that pure health problems accounted for the minority of cases.
In one case, a woman suffering from swollen wrists was forced to take on less demanding work and eventually ended up photocopying for much of the day - not a position designed to build confidence if you have been used to a certain level of responsibility.
But the Fit for Work Service Team managed to persuade the woman’s manager that her wrist problems needn’t affect her ability to drive and she successfully moved back into her previous role - transforming a demoralised individual into a high-performing staff member again.
This example seems to be fairly typical of the issues that the teams see - not always dealing directly with a health issue, but instead resolving problems by acting as an intermediary between the individual and the employer.
The really good news is that the pilots appear to have been successful. Indeed, the Leicester pilot is showing a success rate of 72%.
What came across most clearly from the visit, though, is that we can change attitudes and push the “Stop” button on the benefits escalator.
And perhaps - if we get really creative - we can find incentives from the private sector to ensure that the interventions are available and affordable for businesses.
In the meantime, the welfare reforms we are introducing present us with a real opportunity for change.
Together, we have to grasp this it and make these welfare reforms work - for individuals, for families, for the economy, and for the country.