Incapacity Benefit

Incapacity Benefit (IB) is a United Kingdom state benefit that is paid to those below the State Pension age who cannot work because of illness or disability and have made National Insurance contributions. It is administered by Jobcentre Plus (an executive agency of the Department for Work and Pensions). As of May 2011 there were 2.6m people of working age in Britain claiming incapacity benefit, approximately 8.5% of the total adult workforce in the United Kingdom, at an annual cost to the tax payer of £12.5 billion.

History

Incapacity Benefit was originally introduced to replace Invalidity Benefit and Sickness Benefit in 1995 and was in its turn replaced by Employment and Support Allowance (ESA) in 2008. Some individuals who were already receiving Incapacity Benefit before the introduction of ESA have continued to do so provided they have remained eligible. They have been subject to a periodic "personal capability assessment" to establish that they remained incapable of work.

When ESA was introduced the intention was to transfer some of the Incapacity Benefit claimants to ESA on a rolling basis between 2010 and 2014 using the ESA "Work Capability Assessment" (WCA). Claimants deemed to have a limited capability for work were to be transferred to the new benefit.

Eligibility

An individual could have been eligible for Incapacity Benefit if:

• They were not entitled to statutory sick pay; and
• They satisfied the national insurance contribution test; and
• They were under pension age when the period of incapacity for work begins; and
• They were incapable of work.

It is also possible for Incapacity Benefit claimants to receive a 'top-up' of Income Support payments. These conditions are complicated and advice should be sought from Jobcentre Plus, Citizens Advice Bureau or a Welfare Rights Organisation.

According to the Daily Mail newspaper, approximately 1.3million tests were carried out on applicants for Incapacity Benefit between October 2008 and November 2010. Of these, 88,700 people were found unfit to work, a further 17% were found to be able to do some form of work with sufficient support, and the vast majority were found fit to work. Over one in three dropped out during the course of the application process.

Scope

As of May 2011 there were 2.6m people of working age in Britain claiming Incapacity Benefit, at an annual cost to the tax payer of £12.5 billion. The total annual budget of the Department for Work and Pensions in 2011-12 is £151.6 billion, representing approximately 28% of total UK Government spending.

The 2.6m claimant count represents approximately 8.5% of the total adult workforce in the United Kingdom of around 30.1m individuals. Of those claiming Incapacity Benefit, around a quarter of a million were unable to work due to mental illness.

2010 Reforms

In 2010 the United Kingdom's new Coalition government announced that it intended to re-assess Incapacity Benefit claimants and transfer any who are fully capable of work to Jobseeker's Allowance (JSA).

In April 2011 a rolling program began under which all existing Incapacity Benefit claimants are to be re-assessed using the WCA. Those who pass the assessment will be moved to ESA. Those who fail will be disqualified from both ESA and IB. They may be able to apply for JSA if they satisfy its conditions. This process is intended to be completed by March 2014.

During pilot projects which were carried out in Aberdeen and Burnley, results showed that 30% of existing Incapacity Benefit claimants were in fact fit to work. A further 39% of claimants were considered fit to work, but requiring "extra help". The remaining 31% of claimants were found not able to work, and as a result remained entitled to continuing support.

See also

• Demography of the United Kingdom
• Department for Work and Pensions
• Economy of the United Kingdom
• Ontario Disability Support Payment
• Severe Disablement Allowance
• United Kingdom budget

External links

• Daily Telegraph Blog Retrieved September 2011