Proposals on Incapacity benefits in the Welfare Reform Green Paper

Published on 24 March 2006

This further submission to the Select Committee’s inquiry into reform of incapacity benefits and Pathways to Work gives a welcome to the overall intention of the welfare reform green paper to help people with disabilities and long term health problems to participate in employment, and highlights important issues missing from the Government’s analysis and proposals. It expresses concern that the resources devoted to the planned changes in incapacity benefits seem unlikely to be adequate.

LITRG considers that the failure of the proposals to address either the needs of existing recipients of incapacity benefits, or the scope to help people to make a phased re-entry to employment are major missed opportunities. LITRG also points out that greater flexibility in the minimum hours of employment to qualify for tax credits, and changes in the benefits rules about permitted work and earnings disregards could help meet the Government’s objectives. Better tax credit fast track rules would help people with deteriorating health to remain in work.

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LITRG Submission - Incapacity benefits in the Welfare Reform Green Paper