Disabled People and the Budget

Yesterday’s International Fiscal Studies (IFS) report claims that George Osborne’s budget was not progressive, as was claimed at the time, but regressive. How will the measures taken in the budget impact on disabled people living on benefits?

Here is the summary of the Emergency Budget given by the Disability Alliance at the time.

Three key issues:

  • Changes (p36) to the qualifying criteria for Disability Living Allowance, assuming that this will result in a 20% reduction in caseload and expenditure. That is, 20% of people who currently qualify for DLA will no longer qualify.
  • Local Housing Allowance (Housing Benefit) will be altered so the maximum payable is 30% of the median in the local area, down from 50%.
  • All benefits will have smaller annual increases, due to tying in with the Consumer Price Index (CPI) instead of the Retail Price Index (RPI).


This reassessment will be carried out using a new medical, despite the fact that medical evidence is already submitted by a claimant’s care team, and that currently ATOS medicals for Employment and Support Allowance are producing a result of only 6% found unfit for work, far lower than was expected. This includes finding people undergoing chemotherapy fit for work, and terminally ill patients finding themselves having to undergo mandatory work focussed interviews. This may be due to the increased use of nurses as assessors, the use of doctors not adequately trained in assessing disability, the failure to make use of medical records, and/or by the inflexible computer programme used by ATOS to assess claimants. These costly medicals are particularly difficult to pass for those with hidden or variable disabilities, such as ME, mental health difficulties, learning difficulties, or epilepsy. Requiring a person to diagnose themselves, and prove this diagnosis without full medical records, in a stressful situation, under threat of losing their only income is ridiculous. Many people fail, and lose benefits for months at a time, while appeals go through, many of which are successful. Tribunal numbers have increased dramatically (p7) since the introduction of ESA in the autumn of 2008, with 42% of appeals against ESA and IB decisions in the final quarter of 2009-10 being found in the favour of the claimant. Many who have had their ESA cancelled in these circumstances find that their DLA is automatically cancelled, leading to extreme poverty, risk of homelessness and distress. We know of the suicide of at least one person this year after cancellation of benefits, although he didn’t leave a note saying that was the reason, he left both DWP letters on the table next to him. It is likely there will be more. Try googling suicide and benefits cut.

Contrary to recent media reporting DLA is not easy to claim. It does require medical assessment to get it. The medical assessment is largely carried out by Government employees – not ATOS, but generally GPs, CPNs, OTs, Psychiatrists and hospital consultants. These are NHS staff, who complete reports that are then sent to the DWP, along with an incredibly complex form filled in by the claimant, and more often than not their care coordinator or a representative of a charity such as the Citizen’s Advice Bureau. According to the DWP only 0.5% of DLA claims are suspected of being fraudulant, compared to 0.8% of claims being overpaid through DWP errors.

DLA is not a benefit, but is a non means tested allowance paid to disabled people with specific care or mobility needs, in order to improve their quality of life, and allow them to access services or facilities. It may be used to help a person access employment or occupational therapy. It is awarded to people, who may be in work or not, who may be children or adults, because their disabilities lead to a more expensive life.  It is supposed to add dignity to their lives, through more control over their care, and increased opportunity to access services and the things that non disabled people take advantage of easily. Given that DLA may be paid to people in order to help them access employment, training and therapy, who may be in the 20% of people most likely to be found no longer eligible in the new reassessment, it seems reasonable to assume that some will no longer be able to access these pathways to increased independence and prosperity. They are more likely to remain or return to full dependence on the state.

A significant percentage of people on DLA have conditions that are unlikely to improve. For example many physical disabilities, impaired vision, learning difficulties, and autism are likely to stay the same, or deteriorate over time. Severe mental health problems such as Bipolar Disorder and Schizophrenia are not curable. They are treatable in many cases, but treatment effectiveness is variable, and again they are likely to get worse with time. According to DWP figures “2.0 million of the total 2.9 million DLA claims – 69 per cent – are made indefinitely”. Others are made for fixed periods. Are all of these people with indefinite awards going to be reassessed medically?

A knock on effect for those 20% who will no longer eligible for DLA is that other benefits may then be cut. Being in receipt of certain levels of DLA provides a passport to Income Support, and increased levels of Housing and Council Tax Benefit. Being on Income Support means automatic entitlement to free prescriptions and eye tests.


Although there are several changes being made to LHA one of the key changes is the drop to 30% of the local median rent. This means that disabled people who are unable to work, will need to find lower quality housing to live in, possibly further away from amenities or healthcare support, possibly away from family and friends. They might lose their garden, or their pet, two things which can make all the difference to the quality of life of a disabled person. The alternative is to remain in their current housing, but to find the shortfall from their other income.  Following a DWP report on the impact of changes to LHA the Guardian published a summary of the data illustrating what the difference could be for tenants. A family eligible for a two bedroom house in West Pennine may only have to find an extra £1.30pw, whereas the same family in Brighton would need to find £17.26, or in Central London £65.73.

Additional changes include the removal of upto £15 a week excess, and the capping of LHA payable to a maximum depending on the number of bedrooms a family is eligible for. These will both impact on the disabled, especially those that live in inner city areas where rents are more expensive. See the DWP report linked to above for greater detail on the results of these two measures.


All benefits and tax credits increases will be tied into the Consumer Price Index, instead of the Retail Price Index. This includes Carer’s Allowance as well as ESA, IS and DLA. This will inevitably impact on the disabled and their carers. In cash terms benefits would have gone up by 31% in the last 10 years under RPI, but only 20% under CPI.

There are other potential impacts of the budget on the disabled. The freeze in child benefit for three years, regardless of a person’s income, is one. Another is the proposed raising of eligibility of winter fuel allowance to those aged 66 or above, instead of 60 as it is currently. This is related to the raising of the pension age, assuming that if you are working you can afford to pay for your fuel. I haven’t yet seen any mention of what would happen to over 60s who are disabled and unable to work. Another is the cutting of Support for Mortgage Interest for homeowners who are out of work. This has helped many disabled people to remain in their own homes after becoming disabled, and others to take part in Shared Ownership schemes and gain some housing security. There are also uncertainties over the future of the Independent Living Fund.

Another concern is the 10% cut to JSA after claimants have been on it for 12 months. Many people previously on IB, who will all be reassessed by ATOS from spring 2011, may find themselves moved immediately onto JSA instead of ESA. The likelihood of them finding work easily is low, and they may find their already reduced income further cut.

The Coalition talks about improving the quality of a person’s life through employment, rather than dependence on welfare. However, for genuinely disabled people who are unable to work, welfare is often their only means of support, and the path to a more independent and dignified life.

There are a few good measures in this budget which could benefit disabled people. The raising of personal tax allowance by £1000 is one, and I hope the Liberal Democrats manage to get this raised further. However there are more than enough negative ones to ensure that disabled people who are unable to work will find the next few years taxing on their budgets and their stress levels.


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