Reducing the costs of sickness benefit

Recommendations to reduce the costs of sickness absence in the UK

Health and Business experts Dame Carol Black and David Frost have presented a report to the government of the results of an independent review aimed at reducing the cost of sickness to employers, taxpayers and the economy.

The review proposes a number of recommendations which aim to reduce the human and financial cost of sickness absence in the UK.

• For employers tackling sickness absence a key barrier to getting people back to work is the fit notes. The Review recommends a new Independent Assessment Service (IAS) that employers and GPs can refer long-term sickness absence cases to

•  The Review recommends that the State introduces a new Job Brokering Service for employees on long-term sickness absence who are unable to return to their current employer. This service could save the State up to £300m a year by reducing the benefits bill.

• The Reviewers observed that the current benefits system fails claimants with ill-health by directing too many people to Employment and Support Allowance but subsequently declaring most fit for work after a long delay. The Review recommends the removal of the assessment phase for claimants of Employment and Support Allowance.

David Frost former Director General, British Chamber of Commerce said:

“Evidence clearly shows that the longer you are out of work the harder it becomes to get back in. But in many cases sickness absence is due to health conditions that are nonetheless compatible with work – and can often be improved by work.

“The current certification system does not provide employers with the advice they need to make informed decisions about their employees’ capability for work. The establishment of the Independent Assessment Service will provide practical support and help to allow employers to make informed judgements about a return to work for their staff.”

Dame Carol Black, National Director for Health and Work said:

“Sickness absence from work can be unavoidable, but when unduly prolonged it is wasteful and damaging. We believe we have presented an urgent and compelling case to change the current system so that it unashamedly promotes work for those that can.

“If implemented these recommendations will ensure many more people with health conditions are able to enjoy the benefit of work; far fewer will needlessly lose work and fall into long-term benefit dependency.”

Welcoming the independent review today Lord Freud, the Minister for Welfare Reform said:

“The Government is committed to supporting more people with health conditions to work.  The economy loses £15bn in lost economic output each year due to sickness absence and we cannot continue to foot this bill. But even more important is the impact of needless inactivity on people’s lives; the damage to their aspirations and their health and the damage to their families and communities.

“The Government will undertake a comprehensive assessment of the Review’s findings and recommendations with the view to publishing a response during 2012.”

Click here to view the full recommendations

Amanda Frewin

Research & Project Support