The Impact of Welfare Reform in Scotland - Tracking Study

Executive Summary

The aim of the study is to explore the impact of on-going welfare changes on a range of households in Scotland over time. This report provides a review of the literature and presents the results of the first sweep of interviews which took place from September 2013 to January 2014. The study is being carried out for the Scottish Government by the Employment Research Institute at Edinburgh Napier University and the University of Stirling.

The research is concerned with those in receipt of working age benefits and addresses the impact of the current benefit reforms and new rules including the Benefit Cap; changes made to the payment of Housing Benefit (HB) relating to under-occupancy; changes to lone parents' obligations when their youngest child reaches the age of five; Disability Living Allowance (DLA) and the forthcoming changeover to Personal Independence Payments (PIP); and Employment and Support Allowance (ESA). The research also addresses participants' opinions about the move to Universal Credit (UC), including a shift to monthly payments, and the move towards making all claims through an online system.

The research utilises a longitudinal qualitative methodology, so that participants' experiences of the changes can be followed and understood across time. Forty three individuals have taken part in the research, each with different reasons for claiming benefits. Participants were recruited to the study from across Scotland, including rural and urban areas and the major cities, and had a range of demographic and other characteristics.

At the time of writing, some changes to welfare benefits have been implemented, while others are underway. All changes, including the transition to UC^[1], are expected to be implemented by 2017. The literature to date indicates a number of problems pertaining to the reforms. Other factors, not directly related to welfare per se, that impact on those claiming benefits are also important, such as the availability of transport and suitable employment opportunities.

Findings

Some issues arising from the participants in Sweep 1 include:

A lack of clear information and advice

• Participants in the study often found it difficult to access appropriate, clear and concise information about benefits and impending changes to benefits. The Jobcentre, and the Department for Work and Pension's (DWP) website and telephone line, were generally considered to be a poor source of information. Participants felt that Jobcentre staff often lacked knowledge about benefits, and that it required a great deal of effort on the part of claimants to obtain the information they needed. Official communications from DWP were also cited as being confusing and too lengthy, and some found them threatening in their tone. Participants expressed a preference for third sector organisations in seeking advice.
• The lack of suitable information regarding benefit changes caused participants considerable anxiety about how they would financially manage in future, if affected negatively by the changes.
• The current administration of benefits can be inconsistent and stressful
• The interviews illustrated very different experiences of claiming benefits and the way claims were handled. For example, sometimes errors and delays were a source of considerable financial instability for claimants, and several participants had experienced mistakes, including seven who reported that their benefit payments had stopped suddenly and without warning.
• There is evidence suggesting that Jobcentre staff were sometimes inconsistent in how they dealt with claimants. Some participants had extremely negative experiences at the Jobcentre, while others came into contact with helpful advisors. While specific circumstances and expectations may influence their perceptions, it would appear that a participant's experience is sometimes down to which advisor they dealt with.
• The assessment process for ESA placed a considerable strain on claimants. There was a general feeling among participants that the process was not dignified or fair, and that the criteria employed failed to truly encapsulate a person's ability to work, particularly for those with fluctuating or 'invisible' conditions.
• Support seemed to be more readily available once a person had reached a crisis situation; but it may be more effective to provide support earlier to prevent a crisis from happening in the first place.

The current benefit system is not meeting claimants' basic needs

• Most of the study participants reported struggling to manage financially. The current system does not appear to be meeting people's financial needs, and participants reported making difficult choices about which essential household items to prioritise. Some had got into debt, often due to unforeseen expenses such as the breakdown of household equipment, or simply in the process of trying to keep up with bills. Few were able to afford 'treats' that went beyond basic sustenance, such as days out, and a lack of money restricted opportunities for social interaction, which reinforced feelings of isolation and loneliness.
• Some participants had been able to turn to family and friends for support in an emergency, and this support was crucial in helping participants to manage their daily lives and make ends meet. However, some people did not have this option and were completely dependent on benefits income to survive. Those without any other source of support were hit hardest by any errors and delays in payments mentioned above.

Stigma, financial insecurity and anxiety about the future have a negative impact on well-being

• Participants all identified the stigma attached to being in receipt of benefits, and all believed that wider society looked down on them as a result of their benefit claimant status. Such sentiments were felt by all participants, irrespective of their reasons for claiming. The media was felt to be particularly stigmatising. Participants felt that the focus on particular groups of 'undeserving' claimants served to stigmatise all benefit claimants. Some participants had also experienced negative and stigmatising attitudes from Jobcentre staff when claiming benefits.
• Those claiming disability benefits experience high levels of anxiety in relation to the impending move to PIP and the required medical assessment related to that. The on-going uncertainty and associated stress of being reassessed, including the length of time for decisions to be made, and of the process of future reassessments, was strongly expressed.
• There was some concern about the proposed move to a monthly payment under UC, as it was widely felt by participants that it would be considerably more difficult to budget the small amount of money they received over such a long period of time.

The current benefit system fails to fully take account of the specific issues facing certain groups or types of claimant

• The movement of increasing numbers of disabled people and lone parents onto Jobseeker's Allowance (JSA) could be problematic, as the current JSA regime does not appear to adequately take into account the needs of all those with specific barriers to employment, and as a result does not effectively help them into employment.
• Most of the lone parent participants highlighted that they could not rely on regular (or any) child maintenance payments coming from the parent who was not primary caregiving role, so disruptions or changes to welfare payments affected them greatly.
• Disabled participants noted that they faced expenses that were not covered by the benefits they received, including higher heating bills and equipment costs. Those in rural areas argued that their cost of living was particularly high due to the higher cost of food and their reliance on private transport.
• Changes to occupancy rules in social housing, where households will have their Housing Benefit cut if they are seen to have 'additional rooms', do not adequately take into account households' unique and sometimes complex needs. Some disabled participants reported that they needed a spare room due to their condition (e.g. for occasional use by a carer). Some families also raised the issue of fluctuations in family size and the number of bedrooms required, for example in some cases children may move in to, or out of, or live between, households.
• The proposed move to monthly payments under UC may have a more adverse effect on certain claimants. For example, participants felt that those with a learning disability, or certain mental health conditions, may be unable to manage their finances sufficiently well to handle this more challenging budgeting situation.

Recommendations

According to participants, experiences with benefits could be improved by:

• Better communication from the DWP and the Jobcentre with regards to benefits, as well as continued support for third sector organisations providing impartial, specialist support - this is especially important at the moment with many changes on the horizon.
• Improved administration of benefits, including more sensitive service provision by departments, better administration of benefits changes and seeking to reduce the feelings of stress related to applying for them. There is a continued need for emergency funds to mitigate the impact of crisis situations when they occur.
• Consideration of the level of benefits and the cost of living for those on a low income, and the need for quicker intervention for those who are struggling to cope, to prevent crises rather than just responding to them.
• There is continued need for policies to mitigate some of the adverse impacts of specific aspects of welfare reform; for example the social housing occupancy rules, and specific circumstances such as lone parenthood.
• Stigmatising messages from the media need to be countered by education about those on benefits and of the true (limited) extent of benefit fraud. Jobcentre staff should receive more training in dealing with groups with specific needs and have specialist officials to deal with all those key groups (such as lone parents or those with different types of disability).

In addition to the recommendations for welfare benefits, the research also highlighted a number of issues affecting those on benefits, which policy could seek to address. One of these is the need for affordable childcare in order to enable parents, particularly lone parents, to compete for jobs that do not fit around school opening and closing times. Another is the development of a network of formal and informal support - this is especially important for groups such as lone fathers, who report a lack of support.

The next stage of research

Sweep 2, which will commence in April 2014, will shed further light on the impacts of benefit changes. In particular, it will follow up on the situation of participants awaiting news of appeals. Sweep 2 will also include a new block of questions to investigate the labour market opportunities and barriers to employment for jobseekers who were looking for work when interviewed in Sweep 1.