Employment Injury Assistance delivery - next steps: consultation

Section 2 – Taking forward delivery of Employment Injury Assistance

Introduction

The section considers matters relating to the delivery of Employment Injury Assistance, including the transfer of current Scheme cases and sets out two options for implementation.

Our overriding priority in delivering new social security benefits is to ensure the safe and secure transition of existing claims in order to protect payments to which people are entitled and which they depend upon. This approach has involved maintaining existing eligibility rules, known as a 'like-for-like' delivery, in order to avoid a 'two-tier' system where different groups of people would be subject to different eligibility criteria whilst cases transfer between Governments. This approach has also been important to protecting existing clients' entitlement to other social security benefits and entitlements which continue to be administered by the UK Government. This is often described as 'passporting' arrangements.

Taking this approach has allowed the Scottish Government to move forward quickly to establish new benefits. However, we have still made significant improvements to the benefits we have delivered so far. These include enhancement of eligibility rules, such as the provision of Short-Term Assistance when people request a review of an award, and improved rules for people with a terminal illness. We have introduced a new client-centred approach to assessment, so that people applying for disability benefits are treated with dignity, fairness, and respect, in contrast to their experience under DWP. We have put in place a modern and efficient delivery system providing flexibility for applications to be made in a range of ways, including through a digital channel.

Option 1: Like-for-like benefit delivered with full case transfer with benefit reform to follow

The Industrial Injuries Scheme is largely administered on a clerical basis. This means that, unlike the Scottish social security system which routinely provides a choice, including a digital approach, application processes and Scheme records are almost entirely paper-based.

There are multiple manual systems involved in the processing of an application under the Scheme. Files are held in multiple locations and many of these files are decades old and in poor condition. Certain benefits under the Scheme require a review of the entire case history during a review of an award. Therefore, the number and size of case files is much greater than for other benefits. That also means that identifying which paper-based files relate to a Scottish client is much more complex than with other benefits we have delivered.

The devolution of all other benefits has involved building the required digital application portal and delivery system. Putting in place a similar system for Employment Injury Assistance would be time-consuming and expensive. It is estimated that it would cost around £39.8 million (including an estimated £2.1 million for a digital case transfer process)^[8].

The Scottish Government could choose not to develop a fully modernised digital approach and could instead choose to continue to run a paper-based system through Social Security Scotland. This approach would require a new operating system in order to administer Employment Injury Assistance. It is estimated that a non-digital system would cost around £13 million to build. A non-digital operating model would also not meet the standards and expectations set out in the Social Security Charter.

Either system would still have ongoing delivery costs and these have been estimated to be approximately £2 million per year. This accounts for; agency staffing, file storage, and staffing costs for healthcare professionals needed to undergo medical assessments.

The like-for-like delivery of Employment Injury Assistance presents significantly more challenges than for other disability benefits and would be very expensive to establish and administer for a very small number of new and existing claims. This approach would provide very limited scope to address the criticisms relating to equalities. A like-for-like delivery would not deliver substantive changes to eligibility, for example through the inclusion of new diseases or conditions.

As described earlier, the safe and secure transfer of awards to ensure people do not face a disruption to their benefit payments is our over-riding priority when delivering a new Scottish social security benefit. By the end of the current devolution programme around 750,000 cases will have transferred to the Scottish social security system.

For most benefits, the vast majority of documents pass electronically from the Department for Work and Pensions to Social Security Scotland and the information is uploaded automatically. However, the transfer of the Industrial Injuries Scheme would be particularly complex given its largely clerical nature. The physical transfer of up to 150,000 paper files would be required and the time and cost of transfer would be significantly higher than for other benefits. Paper files would need to be physically transferred via courier and securely stored. It is estimated that it could cost over £0.5 million a year to store these files and of course the transfer of paper files brings significant added risk to continuity of payment of current awards as a result of the age, condition, and location of the relevant files.

The delivery and administration costs associated with a like-for-like delivery are summarised below.

Although detailed work is required to determine precisely the resources required and the timetable for delivery, it is likely that a like-for-like benefit could be established before May 2026. Further work would be required, including with DWP, to determine whether case transfer would be practicable and on what timetable.

Importantly, delivering Employment Injury Assistance now on a like-for-like basis would use up resources which can be used more productively in the short-term, including to take forward policy development and design of a modernised benefit.

Option 2: Prioritise fundamental reform of Employment Injury Assistance

As set out in this paper there are unique challenges in taking forward the delivery of Employment Injury Assistance.

Section 1 described how the current eligibility rules for the Industrial Injuries Scheme need to be updated to reflect the modern economy and workforce. Section 2 described the unique complexities involved in administration of the Scheme and in transferring current cases and the significant costs of establishing Employment Injury Assistance.

Section 1 also set out that under current Scheme rules it is expected that around 1,000 new applications per year are likely to be submitted and around 900 of the current 24,000 people in receipt of payments are expected to leave the Scheme year on year. By way of contrast Scottish Child Payment cost around £31 million to develop and supports roughly 10 times as many people as the Industrial Injuries Scheme in Scotland.

In light of this evidence the Scottish Government believes a different approach to delivery may be required in order to provide a high-quality service to clients, ensure value for money and deliver the more fundamental reform which many stakeholders are calling for.

That approach would not involve delivery on a like-for-like basis to the current Scheme nor the transfer of current cases, given the need for modernisation of eligibility rules and to ensure value for money in establishing the administrative systems required. It would instead focus on the design and implementation of a new benefit with new eligibility criteria fit for purpose for all employment sectors not only traditional heavy industry.

As has been the case with all other benefits devolved, time and investment would be committed to the design of a new benefit, including reform of eligibility criteria. Developing a modernised and fit for purpose Employment Injury Assistance will rightly involve extensive research and engagement with stakeholders and experts to fully consider how best we support those who have become injured or developed a health condition in the course of their work. As a first step to driving that work forward, the Scottish Government proposes to establish a stakeholder advisory group.

Question 2: Of the two options which do you think the Scottish Government should proceed with? Please give reasons for your answer.

1. Prioritise like-for-like benefit delivered with full case transfer and benefit reform to follow in the longer-term

2. Prioritise reform to deliver an updated benefit and a modernised approach delivery)

A. Option 1

B. Option 2

C. Neither

D. Don't know

Please give reasons for your answer.