According to new figures from the Department for Work and Pensions, around 1.8 million Universal Credit recipients are not receiving any support in finding employment.
Since the pandemic the number of claimants who fall into the Limited Capability for Work Related Activity category (LCWRA), has almost quadrupled, going from 360,000 up to 1.8 millions – an increase of 383 percent in less than 5 years.
These figures show a dramatic increase in the number of young people who are affected. Since the beginning of the pandemic the number of 16-24-year-olds who fall into the LCWRA has increased by 249%, from 46,000 up to 160,000. Nearly one million young people do not have access to education, training or employment.
The government announced initiatives to address economic inactivity. These include changes to Jobcentres as well as increased powers for mayors at the local level and a Youth Garanty to ensure that all young people have a job or are in training. These figures are released ahead of planned reforms to the welfare system aimed at creating a more inclusive labor market.
Plans for Welfare Reform
Work and Pensions Minister Liz Kendall has laid out plans for reforming the welfare system. She says it fails to support people who want to be employed.
Kendall stated that “millions of people are locked out of the workforce by a failing social welfare system, which abandons them – while we know at least 200,000 want to work but are crying out for fair support and an opportunity.”
Work Capability Assessments (WCAs) determine whether claimants are “fit for employment” or “not suitable for employment”. Those deemed “unfit” are placed into the LCWRA categories, which means they do not receive any support for their job search and are no longer involved with the system. The government plans to reform or replace WCA in order to ensure that claimants who are interested in working do not lose out on employment opportunities.
Financial Incentives & Systemic Issues
Currently, those aged over 25 receive a standard Universal Credit of PS393.45 a month. Health conditions are rewarded with an extra PS416.19. The government claims that this structure provides an incentive to claimants to stay in the LCWRA group, since it offers a higher payment while removing access to employment assistance.
In the last five years, 67 per cent of Universal Credit applicants who underwent a WCA were classified as LCWRA. This is due to the government’s assessment system which, it says, forces people to prove that they are unable to work instead of supporting them to find employment.
Beyond Universal Credit
The government has committed to investing PS26 billion into the NHS in order to address barriers related health that prevent people from working. The government has pledged to invest PS26 billion in the NHS to address health-related barriers to work.
In addition to these measures, the Government has announced an investment of PS250 million in employment initiatives. The government will re-deploy 1,000 Work Coaches who will provide intensive employment assistance to 65,000 people with disabilities or health conditions.
