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‘Welfare to work’ market will increase

The FT lists ResCare (US), Maatwerk (Neth), Maximus (US), Igneus (Aus), Mission Australia, Capita and Serco (both UK), as contenders for the contracts for New Labour's "Welfare-to-Work" programme:

James Purnell, the work and pensions secretary ... will announce bigger and longer contracts – for at least five years rather than the present three – expected to be worth around £360m a year for the “flexible New Deal”. At present £100m or so is spent on the independent sector contracts.

Some 80 per cent of a contract’s payment will be dependent on actually getting people into work and keeping them there. The biggest payment is likely to depend on people staying in work for six months rather than the present 13 weeks. ...

FT 28 February 2008

A reminder of the current line of travel:

The Independent reports that in 2007 no less than 26.5 million people in the US were dependent on food stamps, and that the figure was likely to rise to 28 million as a result of the subprime lending crisis
. [IND]




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A History of the War on the 'Sick Note Culture'

1992

The 'war on benefit scroungers', and in particular those 'Going on the sick', started with the-then Secretary of State for Social Security, Peter Lilley, in 1992.

Despite what at the time was presented as a draconian crackdown on IVB claimants, nothing much seems to have changed according to the right wing press. 'Sick Note Culture' Links

The 2006 Welfare Reform Bill [set] a target of an 80 per cent employment rate amongst working age adults.

To achieve this Pathways to Work [is to] be rolled out across the country by 2008.

The numbers on Incapacity Benefit will need to be reduced by one million.

One million more older people and 300,000 extra lone parents will need to be motivated into work.
[Compass]
2006

Work and Pensions Secretary, John Hutton, announced a further 'crackdown' in December 2006, which was followd by the publication of the Freud Report

2007

This recommended:

Greater use of private and voluntary sector resources and expertise so harder-to-help benefit claimants receive more employment support.

A new focus on long-term mentoring to tackle the problem of repeat benefit claimants.

Greater rewards for organisations that are successful in helping claimants find and stay in work.

Greater personalisation of employment support, with higher financial incentives for organisations to target resources at the hardest-to-help who need more support before they are ready to return to work.

Retaining Jobcentre Plus’ role in helping customers during the early stages of their period on benefit and creating a new role for the organisation to assess how much support individual claimants are likely to need before they are ready to return to work.

Rebalancing rights and responsibilities in the welfare system - matching increased support with greater obligations on claimants to look for work.

Simplification of the benefits system.

Further changes were announced by Peter Hain in November 2007:

New incapacity benefit tests are to be introduced, which ministers say will mean fewer sick and disabled people will qualify for being unable to work. Work and Pensions Secretary Peter Hain says the changes, introduced next year, will end "sick-note Britain". [BBC]

In the meantime, David Cameron's Tories were taking an active interest in welfare schemes across the pond, and in particular the Wisconsin Works scheme.

Shadow work and pensions secretary, Chris Grayling, told the Telegraph:

2008
Last week I was in New York, meeting the people who run the city's successful programmes to get people off benefits and into work. One of the most impressive of these programmes helps people off their equivalent of incapacity benefit. Their experience is that the majority of claimants can go back into work, even if a medical condition makes it impossible to do the same job they used to. A building worker with a bad back may be able to do something different even if continuing to work on a building site is not realistic. Indeed, they say that, in their experience, one in 10 people should never have been claiming the benefit in the first place.

'Going on the sick' shouldn't be a career option 06 January 2008

Mr Grayling went on to make the claim - which is at variance with the experience of claimants I have met - that:

The majority of people signed on to this benefit by filling in a form and sending in a note from their doctor. Most claimants are then simply left to their own devices ...

The Telegraph returned to its 'campaign' in February 2008:

Up to two thirds of people claiming incapacity benefit are not entitled to the state handout, the Government's new welfare adviser warns today.

David Freud, an investment banker hired by James Purnell, the new Work and Pensions Secretary, said the disability tests used to award state aid were "ludicrous" and could be costing billions of pounds.

More than 2.6 million people claim incapacity benefit at a cost of more than £12 billion a year to the taxpayer.

However, Mr Freud suggested that less than a third may be credible recipients while several hundred thousand work illegally on the black market.

Under his review, the private sector is to be brought in to run large sections of the welfare system and lone parents will be encouraged to work as soon as their children go to school.

People refusing to co-operate and find a job will have their benefits "sliced" under the plan to get about 1.4 million people back to work. The system should be in place within five years, he said.

Private companies will be put in charge of finding jobs for the long-term unemployed. They will be paid by results, with large fees if they succeed in keeping people in work for more than three years and nothing if they do not.

"We can pay masses," Mr Freud said. "I worked out that it is economically rational to spend up to £62,000 on getting the average person on incapacity benefit into the world of work."

1.9m on benefit 'should go back to work'

In a side-swipe at Peter Hain, Mr Freud told the Telegraph:

...there had been a transformation in the Government's approach to welfare since Mr Purnell's appointment. "Purnell is showing astonishing energy - there is going to be a much more single-minded ferocity". Peter Hain, his predecessor, had been more "worried about the Left".

The Economist took a more realistic view of the prospects for success:

Much cited are America's 1996 reforms, which encouraged states to impose time limits on benefits and pay private companies and charities to help people find employment. One such company, America Works, recently offered its expertise to both big British parties.

The firm has found that getting welfare recipients into the rhythm of work by making them show up for a good part of the working week, coaching them for interviews and holding their hands through the early days of a new job are as successful as compulsion in reducing welfare rolls—suggesting that British politicians are thinking along the right lines. But it warns against a preoccupation with pre-job training, which often teaches the wrong skills and misses basic graces (such as time-keeping and not being cheeky to the boss) that many claimants lack.

American employers, it seems, are keener on having a decent, low-hassle workforce than on subsidies for training or incentives to hire the jobless. And they co-operate with welfare-to-work programmes when they get it.

But British employers already have good workers on tap, thanks to the endless stream of eager east Europeans seeking jobs. Whether they can be persuaded to take on long-idle locals instead—even ones who have their hands held—is moot.

Welfare reform - Going to work

Several concluding comments:

  • The sweeping claims made about the numbers of claimants who are "swinging the lead" are not matched by any of the forecasts as to the numbers likely to return to work;


  • The LSE Depression Report found that there are more mentally ill people on incapacity benefit than there are registered unemployed, but the waiting time for treatment - if available at all - is over nine months.
    Perversely, at a time of growing need, services for the mentally ill are actually being cut back. Karen Reissman    Super Mental Health Hospitals


  • The likelihood of a return to full employment - as it was known in the 1950s - is vanishingly remote;


  • A Newsnight reporter, speaking from the North East, airily told viewers that industry might have vanished, but there were plenty of jobs in IT and call centres.

    This sort of flipancy is challenged by the work of Gareth Williams in South Wales who has made the effort to find out why so many fall into mental illness.

    His findings are consitent with the writings of David Smail, Oliver James, and Paedar Kirby.


  • The possibility that the minimum wage, and the tax regime [AW] might be changed so as to make work more attractive, do not seem to figure in the thoughts of New Labour or Tory commentators on this subject;


  • The sort of approaches suggested by Claus Offe, NEF, and Talis Fotopoulos, are also off the radar. [Alternatives to Welfare]


  • The warning from the Crime and Society Foundation of the trade-off between benefits and incarceration rates has also failed to register with the political elite;


  • Finally, the intimate involvement of U.S. insurance corporation UnumProvident in Pathways to Work suggests that the familiar "broken privatization" agenda is also in operation.

    The grim reality of 'welfare' across the pond - which seems to be the line of travel of the current round of reforms - is examined in greater detail by Johann Hari.

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Welfare Policy Links

[Re-announcing old policies]

Freud Welfare Review

Big ambitions, but little new funding - February 29 2008
‘Welfare to work’ market will increase - FT - 28 February 2008
Jobless multinationals: welfare-to-work is becoming a globalised business - February 27 2008
'Tougher' work tests for disabled - 19 November 2007
New Labour, the Market State, and the End of Welfare - August 29th, 2007
CPAG - May 2007
Corporate Watch - 14 May 2007
Compass - April 25, 2007
New Statesman - 12 March 2007
Disability Alliance - after 5 March 2007
Is Hutton jobless plan different? - 18 December 2006
Plans to take one million people off incapacity benefits - 25 January 2006
Blair to act on sickness benefit - 13 September 2004
Tougher checks on incapacity benefit claimants - 04 July 2001

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'Sick Note Culture' Links

Jobless drug addicts who lie to get benefits could face jail in welfare blitz - July 20 2008
Work in the community to get dole, benefit claimants to be told - 18 July 2008
Incapacity benefit claimed by more than 800,000 - 22 June 2008
TaxPayers Alliance - 10 June 2008
GET TOUGH ON SCROUNGERS 'TOO STRESSED' TO WORK - 09 June 2008
Benefit fraud 'needs firm action' - 08 July 2008
1.9m on benefit 'should go back to work' - 07/02/2008
Welfare is a mess, says adviser David Freud - 04 Feb 2008
Welfare reform - Going to work - Jan 31st 2008
Tories to strip benefits if jobless refuse work - 08/01/2008
'Going on the sick' shouldn't be a career option - 06/01/2008
Parties compete over 'tough love' mantle as Hain unveils new plan - 3 December 2007
Hain to force unskilled benefits claimants into training - November 26, 2007
Freud Report - 05 March 2007
David Freud - Welfare Review - 2007
Is Hutton jobless plan different? - 18 December 2006
Plans to take one million people off incapacity benefits - 25 January 2006
Blair to act on sickness benefit - 13 September 2004
Tougher checks on incapacity benefit claimants - 04 July 2001



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Contrarian Links

Paying the Price -  28 May 2008
Jobs needed for 'sick' Britain - 19 May 2008
Privatised welfare system plan 'open to abuse' - 14/04/2008
ME Association
ME Association - 09 April 2008
Incapacity tests raise concerns - 13 March 2008
Millions of benefits claimants who get jobs are back on dole in six months - 29.02.08
Stopunum.com

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Alternatives to Welfare

Incapcity

A flawed philosophy
Basic Income
Welfare State or Economic Democracy?
"A Non-Productivist Design for Social Policies"
Full employment will strip-mine neighbourhoods
It's the tax system that needs more means-testing
Guardian_Welfare
Social_model_of_disability

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Incapacity: 'loss of meaning and respect'

There are very high rates of incapacity benefit claims in a number of Britain’s classical post-industrial regions: areas dominated in the past by coal, steel, dock work, ship-building and various manufacturing industries. South Wales, the north east of England and the Glasgow conurbation have particularly high rates.

There are a number of reasons why incapacity is a problem for public policy. First, the number of people on incapacity benefits has more than trebled since 1979. Whilst what is known as the inflow onto incapacity benefit has stabilised over the last ten years or so, 7.6 per cent of the population of working age are in receipt of incapacity benefits. Moreover, the duration of time on incapacity benefit has increased, and there is evidence that duration is strongly linked to the likelihood of a return to work.

Secondly, rates of incapacity claims are unequally distributed across social classes and regions. Although this may seem to be common sense, the discussion of what is to be done tends to be undertaken without any clear sociological analysis of either the cause or meaning of this inequality.

Thirdly, incapacity is a ‘wicked issue’. Therefore, although incapacity benefit has traditionally been the responsibility of the Department of Work and Pensions, it relates in complex ways, to patterns of ill-health and wider issues of economic development, poverty and social exclusion that are the responsibilities of other departments of government. ...

The interesting feature of incapacity, as understood in this way, is that it is both a health indicator and an economic indicator. Indeed, we could say that incapacity and its distribution tell us something important about the functional relationship between chronic ill-health, the labour market and forms of social and economic life in different groups and localities.

Enduring political anxiety about the growth of a population of working age unable to work because of ill-health or impairment lies at the heart of the way in which States screen and process populations. Most of the discussion of incapacity benefit at the present time examines it in the context of what are referred to as New Labour’s ‘activation policies’ (Walker and Wiseman 2003), their strategy to modernise the welfare state by encouraging movement from welfare benefits into work, and by making that movement worthwhile in financial terms: work for those who can, security for those who cannot ...

Inequalities in limiting-long term illness
... The proportion of adults aged 45-64 who have a limiting long-standing illness in Wales, the north-east region of England and Northern Ireland is almost double that in south-east England.

When we examine the different regions those with the lowest rates are uniformly in south-east England. Of the worst ten, five are in south Wales, two are in northern Ireland, one is in the west of Scotland (the city of Glasgow, of course), one in north-west England, and one – the worst of all – is in north-east England. Indeed, in most tabular representations of this issue, Easington, Merthyr Tydfil and Blaenau Gwent (which includes a number of former coal and steel towns like Ebbw Vale) appear to jostle for a position at the top.

In reality of course, people living and working in these areas are often profoundly depressed by such public representations of what is increasingly discussed judgmentally as a matter of personal, professional and municipal failure ...

Localities with high rates of LLTI are the same areas with the highest rates of incapacity benefit claimants.
Loss and Change
You would of course expect economic inactivity to be higher following redundancy in areas in which there are fewer appropriate opportunities for work. However, Robert Cornwall [] is also conveying something else: that the relationship of these men to their work and the manner in which the work was taken away from them are also partly responsible for subsequent long-term economic inactivity.

The sense of loss of meaning and respect, and impending hardship are palpable.

Let me give you another example of this sense of loss, and the way in which it affects more than the immediate workforce. Following a major strategic review in February 2001, Corus the steel makers announced that they were going to restructure their enterprise and activities in Wales. The company had 64,900 employees at the end of 2000, with approximately 33,000 of those employed in the UK, and almost 11,000 of them working in Wales.

The main element of the restructuring was the announcement of the closure of the well-known Ebbw Vale steelworks. Most of the Corus jobs were those of full-time, relatively well-paid men (£26,000 per annum on average, at 2001 prices), occupying posts that encompass a wide range of skills.

Contrary to popular impression, many – possibly most – of the job losses occurred amongst men aged between 30 and 50, with long-term domestic responsibilities and financial commitments. Most of these ex-steel workers would have found it very difficult to transfer to similar jobs with comparable levels of remuneration. Moreover, the loss of the wages of the steel workers was sharply felt throughout the local economy.

As part of a rapid analysis of the impact of the announcement of steelwork closure, during 2001 we interviewed a small number of people working in the towns and villages within the local authority area of Blaenau Gwent close to the Ebbw Vale steelworks. They comprised health professionals, church ministers, welfare officers, and other ‘key informants’, and were asked about what they thought was going to happen to the area. Here are two community psychiatric nurses:
The deterioration in Blaenau Gwent has been on-going for many years… [But] this has been a big blow for the community because this has been a steel working community for years. This is just the final nail in the coffin…

[Closure] has always been a threat. My father-in-law worked there in the 1930s. He said they always said that it was going to shut and it never has. And so they automatically think that it is never going to happen…it’s always been said but it’s never happened. [Now] I think the community is a bit shocked.
... The impact of the loss of employment in coal and steel, and the manner in which it was handled by both national governments and local agencies had a huge impact on the people who lost their jobs and on the wider networks, communities, societies and economies in which they lived. In research undertaken by Huw Beynon and his colleagues, comparing the impact of colliery closure in different coalfields, they make a number of important points, nicely encapsulated in the following Durkheimian proposition:

[In South Wales] this was not just a case of localised economic decline but rather one of cultural crisis. The collapse of coalmining undermined a range of mechanisms of social regulation that were grounded in the politics of the workplace and the trades unions, but spread more widely into local society and politics. There was an acute sense of loss in places in which coalmines closed after decades of existence. This was typically accompanied by a period of grieving as people in these places tried to come to terms with the manifold implications of the precipitate ending of the economic raison d'être of their place. ...

It is interesting how quickly the massive contribution of these now stigmatised communities to Welsh, British and global capitalism can be forgotten, and how any attempt to understand their contemporary predicament in historical terms is pushed to one side by the false positivism of evidence-based policy.

It seems to me that there are opportunities here for an historically-informed sociology of work and non-work related ill-health. The complex patterns of long-term illness and incapacity in localities of the kind I have described are the product of the interaction of a number of processes: a long-term legacy of working class hardship, the political destruction of the economic base in which those working class lives had been rooted, the impact of this on what is nowadays referred to as the ‘resilience’ of once robust communities and ways of life, the growth of poverty in those communities and inequality in relation to other communities nearby, and the modernisation of the welfare state into one which seeks to place people in work of any kind, however time-limited, insecure, low paid, disrespectful and purposeless it may be.

Medical Sociology September 2007
NB: This link seems to be no longer available;
an email to the author has not been returned

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'No such thing as society'

'Prozac nation'

The Depression Report

Rethink

Mental Illness - BBC Links



'Prozac nation'

Clegg warns of 'Prozac nation' Britain as pill-taking soars

Nick Clegg, new leader of the Lib-Dems, has homed in on the "Prozac Nation" problem:

Britain has become a "Prozac nation", with the use of antidepressants spiralling out of control amid a crisis in mental health care, the Liberal Democrat leader, Nick Clegg, will warn today. In a speech to the Guardian public services summit, Clegg will commit his party to a maximum 13-week wait for NHS treatment for mental health problems. If the NHS misses the target, the patient will be entitled to go private and make the health service pick up the bill, he will say.

The government is committed to an 18-week deadline for consultant-led care only, from March.

Clegg will highlight figures showing one in four Britons suffering from mental health problems at some point in their lives, with one in six at any one time. The cost of mental ill-health is estimated at £77bn a year.

He will also point to an "explosion" in antidepressant use, with 31m prescriptions issued in 2006, including 631,000 for children.

"Britain has become the true Prozac nation. I believe this trend has gone too far," Clegg will say. "That is not to say that medication has no role to play in tackling mental health problems; of course it does. But [it] should not be the default option, prescribed by doctors because of a lack of access to psychological therapies ... pills must not be a crutch for the wider issues in our society which cause mental health problems." ...

Guardian 08 February 2008


The Depression Report

In June 2006, the LSE "Depression Report" claimed that:

• There are more mentally ill people on incapacity benefits than the total number of unemployed people on benefit. ..
• One in six of all people suffer from depression or chronic anxiety, which affects one in three of all families.
• Only a quarter of those who are ill are receiving any treatment – in most cases medication.
• Modern evidence-based psychological therapy is as effective as medication and is preferred by the majority of patients.
• In most areas, waiting lists are over nine months, if therapy is available at all.
• A course of therapy costs £750 and pays for itself in money saved on incapacity benefits and lost tax receipts.
• We can therefore provide a service in every area at no net cost. This would require 10,000 therapists and 250 local services, with 40 new services opened each year till 2013.With proper leadership from the centre and protected funding, this is totally feasible.

Nick Clegg's problem is two-fold: where's the money coming from; and where are the trained staff?

Britain 'is true Prozac Nation'

Rethink

On 03 September 2007, mental health campaigning group Rethink

... backed a new report from the Healthcare Commission showing that years of investment were beginning to produce 21st century services ...

However:

Rethink Director of Public Affairs Paul Corry ... pointed out that, even with recent improvements, half of service users were failing to get the support they needed.
“This is a terrible reflection on decades of neglect when people with a severe mental illness were badly failed. The government is planning its next three-year spending round now and mental health must be at the top of its list of priorities.

“Only last year, the Commons Health Select Committee warned that mental health was a ‘soft touch’ for cuts. The government cannot afford to let down service users and carers now, when there is real evidence that reform is working for so many people.


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Mental Illness - BBC Links:

'I was walking the streets screaming' - 08.02.08

Elderly mental health care 'poor' - 13.08.07

'No services' for depressed elderly - 12.08.07

Elderly mental health 'neglected' - 09.10.05

Long-term mentally ill 'ignored' - 14.04.04

Young mental health care slammed - 11.04.04

Younger pupils' mental health risk - 23.08.03


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More Links

Cheap Labour
Depression and anxiety - June 18, 2006
Oliver James
Rethink
SANE
Unicef Report
Vulnerability and Violence, Peadar Kirby, Pluto Books 2006
Martin Buber
The “Relating Cure”


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The crime equation

It is in the countries most committed to what British-based criminologists Michael Cavadino and David Dignan describe as "minimal and residual, mainly means-tested benefits with stigmatised entitlement" that prison populations are highest. Research by the men confirms there is "an almost watertight divide between the different types of political economy as regards imprisonment rates" in a study of 12 contemporary capitalist countries.

Guess which two countries top the imprisonment-rate league table:

... a new publication from think-tank the Crime and Society Foundation makes matters more explicit. Examining research across US states, then replicating it across 18 OECD countries including the UK, the foundation has found an intimate link between the amount of welfare spending and the level of imprisonment. The seven countries with the highest imprisonment have the lowest rates of welfare spending, while the eight with the highest welfare have the lowest imprisonment rates. ...

Deborah Orr - The Independent 22 November 2006

Prison Service's 'cost savings'






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