Disability Benefit Receipt and Reform: Reconciling Trends in the United Kingdom

Abstract

The UK has enacted a number of reforms to the structure of disability benefits that has made it a major case study for other countries thinking of reform. The introduction of Incapacity Benefit in 1995 coincided with a strong decline in disability benefit expenditure, reversing previous sharp increases. From 2008 the replacement of Incapacity Benefit with Employment and Support Allowance was intended to reduce spending further. We bring together administrative and survey data over the period and highlight key differences in receipt of disability benefits by age, sex, and health. These disability benefit reforms and the trends in receipt are also put into the context of broader trends in health and employment by education and sex. We document a growing proportion of claimants in any age group with mental and behavioral disorders as their principal health condition. We also show the decline in the number of older working age men receiving disability benefits to have been partially offset by growth in the number of younger women receiving these benefits. We speculate on the impact of disability reforms on employment.

Public Support for Older Disabled People: Evidence from the English Longitudinal Study of Ageing on Receipt of Disability Benefits and Social Care Subsidy

“…Diagnosed conditions are included in W i rather than in D j as it is generally accepted 27 Bridges et al, 2015. 28 Ermisch, 2014Banks, Blundell and Emmerson, 2015;Hancock et al, 2015;Vlachantoni et al, 2015. 29 Physical examination and performance data (for example, walking speed and tests on cognitive function) are affected by relevant and non-ignorable item non-response.…”

Long-run Trends in the Economic Activity of Older People in the UK

“…The first two of these reforms focussed on reducing the in-flow onto these benefits, while the third also strived to increase the off-flow from benefits into paid work. Trends in receipt of benefits is documented in Banks, Blundell and Emmerson (2015) who show that receipt is less related to age, and more related to education levels, then it was twenty years ago.…”

Resignation not accepted: employment, education and training in early intervention, past, present and future

“…Finally, in many jurisdictions around the world in which there is some form of welfare payment for disability, people with mental illness are now the largest single disability group accessing those payments, consistently accounting for approximately one-third of recipients. [18][19][20] In Australia, of the $A9.6 billion spent on mental health by the Federal Government, 48.8% ($A4.9 billion) is accounted for by the Disability Support Pension. 21 Combined, the lesson of these points is that in order to work in a collaborative and recovery-oriented manner, functional recovery in which education, training and employment goals are pursued must be a mainstay of treatment of mental illness.…”