Incapacity Benefit (IB) was a United Kingdom state benefit that was paid between 1995 and 2014. The benefit was paid to those below the State Pension age who could not work because of illness or disability and had made National insurance contributions. It was administered by Jobcentre Plus (an executive agency of the Department for Work and Pensions). The benefit began to be phased out when the Welfare Reform Act 2007 introduced Employment and Support Allowance (ESA) as a replacement benefit in 2008. Declining numbers of claimants continued to receive the benefit until 2014.
Income supplement for UK citizens suffering from long-term disability was introduced in 1971 under the title of Invalidity Benefit; payments increased substantially in the 1980s, and it was suggested by some that this was the result of a deliberate attempt to encourage take-up by the Thatcher government, elected on the slogan "Labour Isn't Working" but now anxious at a steepening rise in unemployment. However it has also been argued that the real cause of the rise in numbers was the increase in the value of Incapacity Benefit compared to unemployment benefits that took place in the 1970s during the governments led by Edward Heath and Harold Wilson.
In 1995 Incapacity Benefit replaced Invalidity Benefit and Sickness Benefit and in 2008 was in its turn replaced by Employment and Support Allowance for new claimants. In 2010 the United Kingdom's new Coalition government announced that it intended to re-assess all 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 were re-assessed using the Work Capability Assessment (WCA). Claimants deemed to have a limited capability for work were to be transferred to the new benefit. Those who passed the assessment were moved to ESA. Those who failed were disqualified from both ESA and IB, though they were able to apply for JSA if they satisfied its conditions. Nevertheless, many individuals continued receive Incapacity Benefit during this period until their claims were re-assessed. The conversion process took until March 2014.
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.
Some claimants were subjected to a periodic "personal capability assessment" to establish that they remained incapable of work.
It was also possible for Incapacity Benefit claimants to receive a 'top-up' of Income Support payments.
As the number of Incapacity Benefit claimants grew during the 1990s and 2000s the benefit attracted criticism for its cost and for the lack of assistance given to claimants in finding routes off benefit.
- According to the Daily Mail newspaper, approximately 1.3 million tests were carried out on applicants for Incapacity Benefit between October 2008 and November 2010. Of these, 88,700 people were found eligible, a further 17% were found to be able to do some form of work with sufficient support, and the vast majority were found ineligible. Over one in three dropped out during the course of the application process.
- 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. The total annual budget of the Department for Work and Pensions in 2011-12 was £151.6 billion, representing approximately 28% of total UK Government spending. The 2.6m claimant count represented 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.
- During pilot projects which were carried out in Aberdeen and Burnley during 2011, results showed that 30% of existing Incapacity Benefit claimants were ineligible. A further 39% of claimants were considered ineligible, but requiring "extra help". The remaining 31% of claimants were found eligible, and as a result remained entitled to continuing support.
- Department for Work and Pensions
- Economy of the United Kingdom
- Ontario Disability Support Payment
- Severe Disablement Allowance
- United Kingdom budget
- See http://www.dpac.uk.net/tag/invalidity-benefit/
- "The Welfare State We're In" by James Bartholomew (Politicos 2004 and 2006 and Biteback 2013)
- "The Coalition: our programme for government". p. 23. Retrieved 2010-05-12.
- "Social security benefits: incapacity benefit: summary". www.hmrc.gov.uk. Retrieved 2010-05-20.
- "Disability Alliance Factsheet: Incapacity Benefit". www.disabilityalliance.org. Retrieved 2010-05-26.
- Daily Mail 27 July 2011 Retrieved September 2011
- BBC news Retrieved September 2011
- out of a total Welfare bill of £192 billion Daily Telegraph Saturday 10 September 2011 Retrieved September 2011
- News Distribution Service Retrieved September 2011
- Article at www.wordpress.com Retrieved September 2011
- Daily Telegraph 4 April 2011 Retrieved September 2011
- Daily Telegraph Blog Retrieved September 2011