Tag: DWP

Pension underpayment scandal

The Department for Work & Pensions (the Department) estimates that it has underpaid 134,000 pensioners OVER £1 BILLION in State Pension.

This was due to repeated human errors over many years, some level of which was almost inevitable given the complex rules and high degree of manual review necessary when assessing claims, according to the National Audit Office (NAO).1

The errors affect pensioners who first claimed State Pension before April 2016, do not have a full national insurance record, and should have received certain increases in their basic State Pension.2  

The errors were brought to the Department’s attention by individual pensioners, concerned experts and the media. The Department started exploring the ‘potential for error’ from April 2020 and confirmed that there was a significant issue in August 2020. It started to review cases from January 2021 and will contact pensioners if it finds that they have been underpaid.3

The Department estimates that it will need to pay the affected pensioners it can trace a total of £1,053 million, representing an average of £8,900 per pensioner affected. The Department has not assessed the demographics of pensioners likely to be affected, but most are likely to be women. The Department’s estimates are highly uncertain and the true value of the underpayments will only become clear once it has completed its review of all affected cases.

The errors occurred because State Pension rules are complex, IT systems are outdated and unautomated, and the administration of claims requires a high degree of manual review and understanding by case workers. This makes some level of error in the processing of State Pension claims almost inevitable.

The Department’s caseworkers often failed to set (and later action) manual IT system prompts on pensioners’ files to review the payments at a later date, such as their spouse reaching State Pension Age or their 80th birthday.

Caseworkers also often made errors when they did process prompts because frontline staff found instructions difficult to use and lacked training on complex cases.

The Department’s approach of measuring, identifying and tackling the largest causes of fraud and error means it missed earlier opportunities to identify underpayments. It does not have a means of reviewing individual complaints or errors, such as how many people are complaining about the same issues, to assess whether the errors have a systemic cause.

Quality assurance processes focused on checking changes to case details, such as a change of address or the death of a spouse, rather than the overall accuracy of the payments.

In January 2021, the Department started reviewing cases at risk of underpayment in a Legal Entitlements and Administrative Practices (LEAP) exercise. This exercise was originally expected to take over six years to complete, but following a ministerial decision to recruit additional staff, the Department revised the completion date to the end of 2023.

The Department expects to increase the number of full-time staff working on the LEAP exercise from 184 in March 2021 to 544 by the end of January 2022. It expects the administration of the LEAP exercise to cost £24.3 million in staff costs.

Between 11 January and 5 September 2021, the Department reviewed 72,780 cases it had identified as being at risk of having been underpaid or who contacted it querying their payment, and paid £60.6 million of arrears to 11% of these cases.

The Department is prioritising individuals who fall into “at risk” categories, such as those who are widowed or over age 80.

The Department may find it particularly difficult to correct underpayments of pensioners who have died. It does not know how many pensioners who have died have been underpaid as, for data protection reasons, it does not usually keep records for more than four years after a pensioner’s death, and if married, their spouse’s death.

As at August 2021, the Department had not approved a formal plan to trace the estates of deceased pensioners.

Investigations We conduct investigations to establish the underlying facts in circumstances where concerns have been raised with us, or in response to intelligence that we have gathered through our wider work. The Department for Work & Pensions has underpaid an estimated £1,053 million to pensioners due to human errors it has made dating back many years. This investigation sets out who has been affected, how it happened, how the Department assessed the scale of the problem, and what it is doing about it.

Gareth Davies, Head of the National Audit Office, said: “The impact of the underpayment of State Pension on those pensioners affected is significant. It is vital that the Department for Work & Pensions corrects past underpayments and implements changes to prevent similar problems in future.”

Investigation-into-underpayments-of-State-Pension-SummaryDownload

Rethink Mental Illness survey: Stop Benefit Deaths

The DWP has investigated 268 cases of death or serious harm caused by the benefits system since 2012.

Charity Rethink Mental Illness thinks that might be the tip of the iceberg.

If you’ve been seriously harmed by the benefits system, take our survey.

Help us #StopBenefitsDeaths👇

https://bit.ly/3iXARVm

Committees unite to call for UC uplift to be made permanent

The UK Government should make the £20 per week uplift to Universal Credit and Working Tax Credit permanent, according to a joint letter issued by cross-party committees from Westminster, the Northern Irish Assembly, the Welsh Senedd and the Scottish Parliament.

The Chancellor of the Exchequer, Rishi Sunak and Work Pensions Secretary, Thérèse Coffey, have confirmed that the uplift will come to an end in October.

However, if the uplift is removed, the 6 million people claiming Universal Credit will lose £1,040 in annual income overnight. According to the Joseph Rowntree Foundation this could force 500,000 people, including 200,000 children, into poverty.

The letter also raises concerns that the benefit will be removed from families at the same time unemployment is due to peak as the Coronavirus Job Retention Scheme comes to an end.

The Committees call on the uplift to be extended to legacy benefits, to make sure those in need do not miss out.

The letter was signed by Neil Gray MSP, Convener of Holyrood’s Social Justice and Social Security Committee, Stephen Timms MP, Chair of Westminster’s Work and Pensions Select Committee, Paula Bradley MLA, Chair of Stormont’s Committee for Communities, and Jenny Rathbone MS, Chair of the Senedd’s Equality and Social Justice Committee.

Neil Gray MSP, Convener of the Social Justice and Social Security Committee, said: “The UK Government did the right thing at the start of the pandemic to increase Universal Credit and Working Tax Credit to give better support to people during these incredibly challenging times.

“But removing the uplift in October would have devastating consequences for our most vulnerable in society, who have been hit hardest by this pandemic.

“This risks sending many more people into poverty at a time when we should be doing all we can to support them.

Mr Gray added: “All four of our Committees agree that by spending this money now on social security, we can avoid putting more people into poverty, helping save more money in the longer term on health, education, justice and other social services.”

Rt Hon Stephen Timms MP, Chair of the House of Commons Work and Pensions Committee, said: “To sweep away such a vital lifeline from people who have felt the very worst effects of the pandemic risks plunging hundreds of thousands of people into poverty at a time when they will have had little or no chance to get back on their feet.

“Six Conservative former welfare secretaries have warned the Chancellor of the grave consequences of his proposed course of action. The strength of feeling on all sides of the political divide, and across the UK, could not be clearer. The Government must change course.

“At the same time, the Government must also increase support for the people who, through no fault of their own, are still claiming older benefits and have received no pandemic-related increases at all – despite their living costs rising during the pandemic.”

Jenny Rathbone MS, Chair, Equality and Social Justice Committee, said:

“Whilst, in Wales, policy relating to Universal Credit and other social security benefits is reserved to Westminster, we are deeply concerned about the impact removing the uplift might have on widening social inequality in Wales; growing indebtedness as a result of the economic impact of Covid; and the ability of low income families to eat as well as pay their rent.”

One in Six: Working family poverty hits record high

  • Billions spent on state support enrich private landlords, while one in six working households face poverty 
  • Action needed to bring down housing and childcare costs, and make work pay, to prevent further increases in poverty  
  • Stark new figures show the need to rethink economy and end constant house price spiral, report says 

The UK’s relative poverty rate among working households has hit a record high this century of 17.4 per cent, according to the first comprehensive analysis of official data released last month. 

Working poverty rates among families with three or more children have reached 42 per cent, up more than two thirds over the past decade. 

The figures, reflecting the position just before the pandemic struck, show that working poverty rates have risen across the entire country but are highest in London, Wales and the north of England. Families of all sizes have been affected, with single parents, couples with a single earner and large families affected worst. 

The sharp rise in working poverty (poverty faced by anyone living in a household where someone is in work) is revealed in a newreport by the IPPR think tank.

The report, No Longer Managing, lists four factors behind the growth in poverty: spiralling housing costs among low-income households; low wages; a social security system that has failed to keep up with rental costs; and a lack of flexible and affordable childcare.  

It identifies the economy’s over-dependance on house price growth as a key factor in driving poverty higher, as more families have to rely on renting privately and housing costs for private tenants have risen by almost half (48 per cent) in real terms over 25 years. One in four households is projected to be renting from private landlords by 2025. 

As a result, it says, much of the multi-billion pound benefits bill supports housing costs in the private sector, with any increase effectively channelled into the pockets of private landlords. IPPR estimates that £11.1 billion of housing support spending went to private landlords last year. 

Detailed IPPR analysis of DWP survey data also found that: 

  • Two-earner families where one partner works full-time and one works part-time are increasingly being pulled into poverty, a significant shift. For people in this group, the chances of being pulled into poverty have doubled over the past two decades, from one in 20 to one in 10.
  • Even for households with two people in full-time work, the chances of being pulled into poverty have more than doubled over the same period, rising from 1.4 per cent to 3.9 per cent.
  • Couple households with one full-time earner now have a poverty rate of 31 per cent, almost as high as working households where nobody works full time.
  • London has the highest rate of in-work poverty – 22 per cent – with Wales, the Midlands and the north of England next highest on 18 per cent. The rate is lowest in Northern Ireland (13 per cent). 

The IPPR report argues for new and different long-term targets for welfare, economic and housing policy, which reflect housing, childcare and travel-to-work costs as a percentage of families’ income. 

It says that the government’s current ‘levelling-up’ agenda is “unlikely to benefit working families if it remains largely focused on physical infrastructure” and fails to address growing inequalities. These include rapidly rising house prices and the growing gulf between property owners and renters – often in the most affluent parts of the country. 

Instead it urges developing wider objectives to bear down on some of the highest costs faced by working families – housing and childcare – and to ‘make work pay’. 

The report calls for long-term reforms to: 

  • Contain housing costs as a share of household income. This could include setting a house price inflation target as part of the Bank of England’s remit; greater taxation of property wealth; and investing at least £15 billion in capital grants to help vastly increase the rate of new housebuilding. 
  • Contain childcare costs as a proportion of household income, and make it more flexible. Measures to achieve this would include higher state subsidies for children under five and wraparound care for school-age children, with funding going directly to childcare providers.
  • Make work pay, through labour market reforms, skills policy and higher income support. Greater collective bargaining and unionisation, bearing down on insecure work and increased access to training and skills would all help to raise incomes; but greater support through the social security system, eroded during the transition to universal credit, is also needed so that people are better off in work. 

It also proposes measures to alleviate the problem in the short term, ranging from increases in local housing allowance to changes in childcare payments made through Universal Credit, and a 20 per cent higher minimum wage for zero hours contracts. 

But it warns that without underlying long-term reforms, government will face a perpetual choice between paying constantly rising social security bills to offset growing in-work poverty – or allowing the number of working families in poverty to increase unchecked, as is currently the case. 

Clare McNeil, IPPR associate director and head of its Future Welfare State programme, said: “These shocking new figures should be a wake-up call for everyone concerned about our future.

“The UK economy’s dependence on ever-rising house prices, and the lack of affordable housing, have trapped us in a vicious circle which, unless broken, will condemn us either to a constantly rising social security bill, or to ever-increasing poverty among working households. 

“A growing private rented sector coupled with high rents enriches property owners at the expense of renters, and represents a transfer of wealth away from people who already have very little, into the hands of others who are steadily accumulating more.  

“We need an alternative to what the government calls ‘levelling up’. That should look beyond headline incomes to the true costs and obstacles people face when struggling to make work pay. Otherwise more and more families who were once ‘just about managing’ will join the growing number who are ‘no longer managing’. 

“Short-term fixes are needed to alleviate the immediate crisis, but to solve the underlying problem we need a far deeper rethink of housing, childcare, social security and work.” 

The Bishop of Dover, the Rt Revd Rose Hudson-Wilkin, who is a member of IPPR’s welfare state advisory panel, said: “The system is broken and it is our responsibility to see that it is changed. 

“Providing a home and building a future for your family is something we all strive for and this report shows that one in six households are trying as hard as they can but still finding it impossible to feed their families and provide a safe roof over their heads. 

“The gulf between the rich and the poor is growing, as the pandemic showed us all too clearly. We must do more as a country to ensure that the resources we have been blessed with are shared more equally – now, and in the future.”

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Children’s Commissioners appeal to UK Government to end ‘discriminatory’ two-child limit on benefits

poverty family JRF

The Children’s Commissioners of Scotland, Wales and Northern Ireland have today published a letter they have sent to the Secretary of State for Work and Pensions calling for an end to the two-child limit on Universal Credit and Child Tax Credit. 

In the letter, the Commissioners state that the policy, which disallows benefits payments to the third and subsequent children born after April 2017 in most circumstances, is ‘a clear breach of children’s human rights’ that “is inconsistent with the commitments made by the UK through the ratification of the United Nations Convention on the Rights of the Child. 

The UK Parliament’s Work and Pensions Committee will today hear evidence from Bruce Adamson, Children and Young People’s Commissioner for Scotland who will present the collective views of the Commissioners in Scotland, Northern Ireland and Wales, that the efforts of their devolved governments to tackle child poverty are being restricted by UK benefits rules. 

He will talk about the impact of current welfare benefits on child poverty in Scotland and explain that even before Covid-19, poverty represented the greatest human rights issues facing children.  

Children and Young People’s Commissioner for Scotland,  Bruce Adamson, said: “With more than a quarter of a million children affected, poverty is the most significant human rights issue facing children in Scotland. Living in poverty affects every aspect of a child’s life, including their educational attainment and mental and physical health.  

“The UK’s approach to poverty was examined in 2019 by the United Nations’ top expert on poverty and human rights who highlighted that it is political decisions by government that are leading to disastrous levels of poverty.

“When Professor Alston came to Scotland to meet with children and their families he heard from them about the serious impact that poverty is having on their human rights. Now after over a year of the Covid-19 pandemic, the situation for children in Scotland has become much worse.” 

The open letter from the Commissioners to the Right Honourable Thérèse Coffey, MP states that the two-child limit breaches children’s rights to an adequate standard of living and is contributing to a rising gap in poverty levels between families with three or more children and smaller households.

The Commissioners note that the policy also has disproportionate impacts on social groups where larger families are more common, such as some minority faith and ethnic groups and in Northern Ireland where families are larger than the rest of the UK. 

Bruce Adamson added: “The Scottish Government has taken some action to reduce the number of children in poverty including rolling out the Scottish Child Payment during the pandemic, however I remain concerned that children’s rights are continuing to be breached in Scotland by the two-child limit on child tax credit and universal credit. That is why we have taken the step of writing to the UK Government to urge that this policy is reversed. 

“We will continue to hold our devolved governments to account in relation to their obligations to respect, protect and fulfil children’s rights, but these governments can only go so far in their efforts to ensure children and their families get the support they are entitled to while this discriminatory policy also remains in force at a UK level.” 

The Commissioners conclude their letter by stating that the ‘levelling up’ agenda signalled in the Queen’s Speech earlier this month must start by discontinuing the two-child policy: ‘With the focus in the Queen’s speech in May 2021 on ‘levelling up’, there can be no excuse for continuing to breach children’s rights through this discriminatory policy that will continue to harm and prevent children and families from moving beyond the impact of the global pandemic.’

Letter-from-CCommissioners-to-TCoffeyDownload

 

Jobcentre ballot over return to workplaces plan

Jobcentre workers are to be balloted in a move that could lead to industrial action. The move is in response to the Department for Work and Pensions’ (DWP) insistence that staff and customers return to jobcentres to deliver face to face services.

Civil service union PCS says that since 12 April, DWP “has been asking considerably more staff to return to jobcentres to carry out face to face interviews with customers. This is despite staff working from home successfully for up to a year, carrying out these interviews by phone.”

The union argues “that coronavirus still poses a threat to safety and that to extend services in jobcentres now is unsafe, and places staff, their families and customers at risk. We are therefore balloting PCS members working in jobcentres to ask if they would be prepared to take industrial action over DWP’s decision.”

The ballot is consultative and a further ballot of members would be required before strike action could take place.

PCS said its demands include “stopping the extension of face to face services, with face to face interviews taking place only with those identified as most vulnerable until the vaccine programme is complete and low rates of infection have been sustained for a significant period.

“We are also asking that DWP sticks to the agreement made in autumn last year, that work coaches can decide how to progress their own workload, including making decisions about how to interview customers.”

The electronic ballot closes on 21 May.

Strike action not ruled out as DWP reopens jobcentres, PCS warns

The PCS trade union has condemned the decision to fully reopen jobcentres, reopen jobcentres, warning that it will increase the likelihood of avoidable Covid-19 infections.

Pre-lockdown opening hours for jobcentres will resume allowing a huge increase in face-to-face appointments for people to claim Universal Credit and other benefits.  

However, the union has said that the move unnecessarily risks further outbreaks of Covid 19 and pointed out that DWP staff were delivering services to claimants successfully, working from home.  

PCS are clear that the vast bulk of the interviews now expected to be done face to face can still be carried out remotely, and fear the real driver for targeting 18-24 year old UC claimants and customers in receipt of JSA back in to jobcentres, is less about providing much needed support to customers and more about reinstating the previous labour market and conditionality regime which saw thousands sanctioned, having their benefits removed.

The government’s instruction for civil servants to work from home if they can, is also still in place.  

PCS said DWP management had ignored their concerns over potential Covid outbreaks, and the union added that its members would now consider all options, including taking strike action.  

General Secretary Mark Serwotka said: “This reckless move by Ministers is wholly unnecessary and risks putting both claimants and job centre staff in harm’s way.  

“DWP staff have been doing an incredible job delivering key services such as Universal Credit and helping those most in need, access the assistance they require, throughout the pandemic.  

“It is counterproductive and arrogant for ministers to risk staff and the wider public’s health by resuming normal jobcentre opening hours before the vaccine is fully rolled out and when these services are being successfully delivered from home.  

“The anger of our members is palpable and we are not ruling out strike action, until a just settlement is found.”

Digital job surgeries launched to help 160,000 back into work

More than 150,000 jobseekers across Great Britain will benefit from new employment support, helping them build their interview skills, find local vacancies and quickly get back into work.

  • New Job Finding Support service launched to benefit 160,000 people over the next year
  • Support ranges from job searches and interview practice to advice on how to switch careers
  • Service to run in parallel to existing support available in jobcentres and by work coaches, as part of UK Government’s Plan for Jobs

A new team of 325 Job Search Advisers are now available online or over the phone, to support those recently unemployed who already have the skills and experience needed to move into a new career, but might not be sure where to start.

Over the next 12 months, an expected 160,000 jobseekers will receive digital support and advice, as part of a new Job Finding Support (JFS) service in a further boost to the Government’s Plan for Jobs.

The ‘quick-fire support’, which takes place across four one-to-one sessions and aims to be completed in a matter of weeks, offers mock interviews, help to identify transferable skills and advice on how to switch industries, as well as online group sessions to improve job search techniques.

Secretary of State for Work and Pensions Therese Coffey (above) said: “Job Finding Support will help jobseekers brush up on interview skills and advice, giving them a helping hand to move back into work quickly.

“Our Plan for Jobs is helping us build back better and fairer, getting job support to people who need it right across Britain and levelling up opportunity.”

The service is completely voluntary to all jobseekers who have been unemployed for less than 13 weeks and are claiming benefits. Participants are referred to the scheme through their Work Coach.

As the Department for Work and Pensions drives forward the Plan for Jobs, it has supported over 40,000 people to retrain and upskill on the Sector-based Work Academy Programme; and recruited 8,500 new Work Coaches to spearhead efforts to get Britain working again.

Chief Executive of ERSA, Elizabeth Taylor, said: “The government’s Plan for Jobs package of labour market initiatives is helping people to provide for their families throughout the pandemic, and Job Finding Support is another important step in helping jobseekers in these difficult times.”

Job Finding Support will run in parallel to existing support that is available in jobcentres, and will complement the role of Work Coaches who provide more intensive support for jobseekers, including anyone facing specific difficulties returning to work.

This service will also free up frontline staff as they continue to help people access the financial support they need through the welfare safety net.

Devolved nations call for joint effort to reach those in need

Letter urges UK-wide benefit strategy

The devolved administrations have united to call on the UK Government to ensure those who are entitled to financial support are receiving it.

Social Security Secretary Shirley-Anne Somerville has joined Ministers from Wales and Northern Ireland in writing to the Secretary of State for Work and Pensions, Thérèse Coffey, asking to work together to create a benefit take-up strategy.

The devolved nations have also asked the UK Government to make permanent the current £20 a week increase for Universal Credit (UC) and extend it to the benefits which will eventually be replaced by UC, such as Working Tax Credits. The uplift was introduced to help low-income families cope with the extra cost of the COVID-19 outbreak, and is to come to an end in April 2021.

Ms Somerville said: “It’s vital that we make every effort to ensure everyone is aware of and able to access the support available to them.

“Maximising benefit take-up is a moral obligation, especially in these uncertain times when there is clear evidence of increased need for support.

“The £20 uplift was needed before the pandemic, and so it is vital now. People must be given the certainty that it will be made permanent and that they are not facing a cliff edge in a matter of months when this support is pulled.”

The Welsh Government’s Deputy Minister for Housing and Local Government Hannah Blythyn said: “The pandemic will cast a long shadow on those who are most in need and has reiterated the importance of a robust financial safety net for individuals and families, ensuring existing funding programmes have the maximum impact on the lives of those in poverty.

“Having a strategic UK approach will ensure that everyone can get the support they need during this difficult time.”

The Scottish Government published its first Benefit Take-up Strategy in October 2019, and will publish the next one by October 2021.

The Welsh Government has outlined steps it will take to maximise the incomes of families living in poverty in its Child Poverty Income Maximisation Action Plan.

Northern Ireland’s benefit take-up initiative Make the Call has generated over £260 million in additional annual benefits for its residents since 2005.

It aims to ensure that every individual and household is receiving all the social security benefits and other supports and services to which they are entitled. The most recent results for 2019/20 show that this has benefited just under 10,000 people who are now better off by an average of £88 per person per week.

The Department for Work and Pensions has no published approach to promoting UK benefits or supporting people to access the money which they are due.

Many people need to be in receipt of a DWP benefit in order to claim other benefits – for example the Scottish Child Payment, where eligibility is reliant on receipt of UC, or Pension Credit which means people can claim a Council Tax reduction, or those over 75 qualify for a free TV licence. So it is vital people are aware of what they are entitled to.

The letter can be read in full here:

Joint-Ministerial-letter-Secretary-of-State-DWP-Benefit-Take-upDownload

As part of their Benefit Take-up Report – published 11 March 2020 – the Scottish Parliament’s Social Security Committee recommended that the UK Government develops a strategy that aims to maximise take-up of reserved benefits across the UK.

A report by the National Association of Welfare Rights Advisors, published in September, showed a 40% reduction in claims for Personal Independence Payment (PIP) being made during the pandemic. Almost 90% of those surveyed have never seen a take-up advert for PIP.

Independent Age has called for ‘an ambitious action plan detailing how the UK government will work to increase the uptake of Pension Credit over the next five years’. More details here.

This follows research which concluded that if Pension Credit take-up was lifted from 61 per cent to 100 per cent, then almost 450,000 pensioners could be lifted out of poverty, reducing pensioner poverty to its lowest ever level, and resulting in substantial savings to the NHS and social care systems over the long term. 

An end to ‘traumatic’ disability assessments

New approach will ensure dignity, fairness and respect

There will be no DWP- style assessments to access disability assistance under the new Scottish social security system, says Social Security Minister Shirley-Anne Somerville.

Decisions will be made using information gathered through the applications process including from health care providers

Should more detail be required to make decisions on an application for the new Adult Disability Payment, it will be gathered through a consultation which will be based on a conversation between a healthcare professional employed by the Scottish Government and the client. There will be no private sector involvement in this process.

Most consultations will be by phone but can be face to face in a GP practice or even at home, whatever works best for the person applying. No-one will be asked to carry out tasks in order to prove the impact of their disability or health condition.

Cabinet Secretary for Social Security and Older People, Shirley-Anne Somerville, said: “Two of our principles enshrined in law is that social security is a public service and an investment in people – it is there for all of us when and where we need it. So no one should ever experience stress when accessing the support they are entitled to.

“People who require disability assistance will already face a number of challenges and interacting with a benefit system shouldn’t become another one. That is why I am pleased to set out plans for Scotland’s new system – plans that will make sure that people are treated with dignity, fairness and respect.

“We want people to feel that they have been treated well and fairly at every stage – from having an application form that is clear and easy to use right through to how we make sure someone is still able to access money when they want to appeal our decisions.

“Getting rid of degrading assessments that our Experience Panels told us were ‘traumatic and intrusive’ is the right thing to do. It is an obvious change but one that will make a massive difference to people.

“I’d like to thank the people who have worked with us to design this service – the volunteers on our Experience Panels and stakeholders. Together we will deliver a markedly different benefit system and create a public service that we can all be truly proud of.”

This has been confirmed in a series of papers that outline the future of disability benefits in Scotland. These detail what people should expect from application right through to appeals.