How Britain’s benefits system ‘throws you on the scrap heap’

The first part of the problem is the welfare system. 

Allen loves his new job and is good at it – but for decades he felt written off. 

“They kind of throw you on the scrap heap,” he says regarding the benefits system. “It doesn’t give you the incentive to want to go back. Useless is basically how I felt.”

However, reform is coming. 

Liz Kendall, the Work and Pensions Secretary, is poised to publish a radical overhaul of the benefits system in a white paper that will be published close to the Budget, which will be announced by Rachel Reeves on Oct 30.

It comes after Mel Stride, Kendall’s predecessor, announced sweeping reforms to the work capability assessment, tightening the rules to push 400,000 people back into the workforce. 

The Office for Budget Responsibility (OBR) estimated that the savings to the public purse would be £3bn.

Reeves, the Chancellor, is expected to honour the Conservatives’ attempt to save £3bn from the welfare bill, but Labour has vowed to do so in a different way. 

A spokesman for the Department for Work and Pensions (DWP) said: “The work capability assessment is simply not working. It needs to be reformed or replaced, alongside a proper plan to support disabled people into work – bringing down the benefits bill and ensuring we continue to deliver the savings set out by the previous government.”

Regardless of reform, there is no doubt that Kendall’s task will be a massive one. 

Allen is a rare example of someone rejoining the workforce at a time when the cohort of people on sickness benefits is expanding rapidly.

The number of people claiming incapacity benefits has surged by 28pc between 2019-20 and 2023-24 to hit 3.2m. This is just under 8pc of the working adult population. The number of people claiming disability benefits has surged by 39pc over the same period.

The cost to the public purse is huge. Long-term sickness benefits can be split into two camps. 

Incapacity benefits, which consist primarily of the health element of Universal Credit and Employment Support Allowance (ESA), are received by people considered to have a limited capability to work. 

This year, the Government expects to spend a record £29bn on incapacity benefits for working-age adults, 40pc more than before the pandemic. By 2028-29, the figure will be £31bn.