Benefit Sanctions Rate Under Universal Credit Twice The Rate Under Jobseeker’s Allowance.

Benefit Sanctions Rise Under Universal Credit.

People may have thought that benefit sanctions had gone away.

Not only have they not disappeared into a new more liberal system but the numbers have got worse under Universal Credit.

Benefit sanctions may do more harm than good

The ultra-liberal Economist this week says,

Reforms to Britain’s welfare system are not nearly as helpful as their supporters claim

MORE than half Britain’s jobcentres now offer “universal credit”, which merges six working-age benefits into one. Most discussion of universal credit, which will eventually offer payments to one in four households, has been about its botched rollout. Less attention has been paid to its tough sanctions regime. Those who fail to comply with requirements that include spending 35 hours a week job-hunting may see their benefits docked. In America, where there is talk of tightening conditions for receiving food stamps, reformers are looking at the British experiment with interest.

…

From 2010 the coalition government enforced sanctions more vigorously still. Under universal credit, claimants who have received several sanctions are often made to serve them one after the other, rather than concurrently, as under the old system. Research by David Webster of Glasgow University suggests that the sanction rate for jobless universal-credit claimants is twice the rate for jobseeker’s allowance (JSA), the old unemployment benefit.

….

…the government has published little research on the impact of the tightening since 2010, despite sitting on a mound of data.

A new paper in the Cambridge Journal of Economics offers a pessimistic assessment. Focusing on the period from 2001 to 2014, it finds that sanctions under JSA increase the flow of people into work—but only in the short run. It may be that claimants, fearful of having their money cut off, take the first job they find, which turns out not to suit them. This also suggests that they may be taking jobs which do not pay as well as they might. In a speech last year Michael Saunders of the Bank of England drew a link between tough welfare rules and recent low wage growth.

As the evidence builds, the government may at some point have to tweak its approach. A recent study by Rachel Loopstra of King’s College, London, and colleagues, finds some correlation between tougher benefit sanctions and a rise in the use of food banks. A government that tones down sanctions would doubtless be accused of going soft. But it would have the evidence on its side.

This is the source:

BRIEFING 

David Webster (Glasgow University)

Benefit Sanctions Statistics 24 July 2018

Of the 920,000 claimants on Universal Credit at May 2018, two-thirds (67.3%) were subject to conditionality. For the first time, a majority (50.7%) of all unemployed claimants were on UC rather than JSA. UC is now significantly boosting the number of people recorded as claimant unemployed, by making people look for work who would previously not have done.

In the 12 months ended January 2018 there were a total of approximately 355,000 sanctions before challenges on all the four benefits subject to conditionality (UC, JSA, ESA and IS). This compares to 383,000 in the 12 months to October 2017. Of the 355,000 sanctions, approximately 264,000 or almost three-quarters (74.4%) were on UC.

The overall rate of sanction under UC is typically around 5% per month, and the unemployed sanction rate within UC will be considerably higher. Only for relatively short periods in 2010-11 and 2012-14 has the JSA rate ever been as high as 5%.

This is the crucial section of the research:

The rate of sanction under Universal Credit continues to be strikingly high. It is typically around 5% per month, far higher than the rate for JSA. In fact only for relatively short periods in 2010-11 and 2012-14 has the JSA rate ever been as high as this. It also needs to be remembered that this overall UC rate includes sanctions on groups with much lower sanction rates than the unemployed. The unemployed accounted for under three-quarters of the UC claimants subject to conditionality in the three months to January 2018. The unemployed sanction rate within UC will therefore be considerably higher than the overall rate shown in Figure 2.

Thus, “sanctions don’t just ‘appear’ higher in UC; they are higher.”

“Since summer 2017 about 8 % or 1 in 12 of all unemployed UC claimants has been serving a sanction at any one time, this proportion having reached a peak of over 10% in March 2017.  The proportion under sanction for unemployed claimants is now higher than it was when the statistics began in August 2015 – about 8% compared to about 6%, whereas for all other groups it is similar or lower. Evidently the administration of UC has become harsher towards unemployed claimants as the system has bedded in. Moreover it must be remembered that if 8% of claimants are under sanction at any one time, the proportion sanctioned at some point during, say, a year, will be much higher.

The second highest proportion under sanction is found among in-work claimants, running at around 2% except at the time of the backlog drive in early 2017. Rates for the other groups are around 1%.

A striking feature of the figures is that there are people serving sanctions who are in the groups which are not supposed to be subject to conditionality at all: ‘no working requirements’ and ‘working – no requirements’.

At January 2018 there were a total of 1,108 people in this position. This is  because they will have received a sanction when they were in a different group which was subject to conditionality.

One of the many problematic consequences of the ‘simplification’ of benefits by combining them into UC is that sanctions follow claimants into no-conditionality groups even though there is no longer any point to them. Previously the sanctions would have lapsed when people moved to another benefit. The number of people in this position will grow as UC expands.

Some other key findings from this survey of UC claimants relevant to issues of conditionality are:

• Fewer than two-thirds (63%) of claimants thought their Claimant Commitment was achievable, and only 54% and 55% respectively thought that it took account of their personal circumstances and would help them to obtain or increase employment (p.41)
• Around 40% of claimants found it difficult to complete the hours of work search or preparation required by their Claimant Commitment, and almost half (47%) had completed fewer hours. (p.59)
• For around one third of those finding it difficult to meet the Claimant Commitment, the main reason was a lack of jobs available in their area. Suitability of the claimant’s skills, childcare responsibilities, and health problems were other common factors. (p.60)
• Meetings with the Work Coach and the online Journal were generally favourably regarded, with around three-quarters taking a positive view (pp.50-51)
• long-term health condition (55 per cent). This suggests a serious mismatch between requirements and capabilities. (p.28)
• Claimants were asked to identify circumstances that could lead to a sanction. The circumstance which was least often correctly identified (by 80% of claimants) was failing to apply for a job when required by the Work Coach. This is serious as this carries the heaviest penalty, a ‘higher level’ sanction of three months for a first ‘failure’. (p.43)
• Two thirds (64%) of those sanctioned considered their sanction to have been unfair (p.52)
• 10% of those sanctioned did not know or understand the reason, while 7% believed that the sanction was due to an error made by the Jobcentre (p.52)

Benefit sanctions found to be ineffective and damaging

Observer May 2018.

Study concludes that punishing claimants triggers profoundly negative outcomes

Benefit sanctions are ineffective at getting jobless people into work and are more likely to reduce those affected to poverty, ill-health or even survival crime, the UK’s most extensive study of welfare conditionality has found.

The five-year exercise tracking hundreds of claimants concludes that the controversial policy of docking benefits as punishment for alleged failures to comply with jobcentre rules has been little short of disastrous.

“Benefit sanctions do little to enhance people’s motivation to prepare for, seek or enter paid work. They routinely trigger profoundly negative personal, financial, health and behavioural outcomes,” the study concludes.

Despite claims by ministers in recent years that rigorously enforced conditionality – including mandatory 35-hour job searches – incentivised claimants to move off benefits into work, the study found the positive impact was negligible.