As the Government takes its first step towards introducing a conditionality regime for people receiving in-work benefits, we look at the dangers and opportunities of in-work progression.
Last week, the Department for Works and Pensions (DWP) published its In-work progression advice trial evaluation looking at how best to help people on ‘in-work’ benefits progress in the labour market. At first glance it appears a surprisingly altruistic and progressive move by a Government with a reputation for more punitive reforms. However, on closer examination there are far more worrying signs that this is the first tentative step towards introducing a regime of conditionality to approximately one million people currently receiving in-work benefits.
We firmly believe a clear distinction should be made between “in-work support” and “in-work conditionality”. In our recent submission to the Work and Pensions Committee inquiry into In-work progression in Universal Credit we recommend the Government focuses on developing supportive, trusted relationships and providing tailored advice as the most effective way of helping people into better paid work, reducing their dependency on benefit payments in the long term.
The carrot or the stick?
In the report the DWP state that they ‘cannot put in place an in-work, conditionality regime without building an evidence base of ‘What Works’ for those who are in-work but receiving financial support.’ In seeking to answer this question, they contacted 75,000 in-work Tax Credit claimants, encouraging them to take advice offered by the National Careers Service. In total just 848 claimants (1.1%) responded and engaged with the service. The DWP partly attributes this dismal response rate to many of the recipients misunderstanding their letters; believing they were intended for people out-of-work. Nonetheless, the poor response rate still poses an important question: what is the most effective way to support people to progress in work?
Community Links’ experience as a local charity helping people find and sustain employment is that people in work are, unsurprisingly, already highly motivated to improve their income. Our research report Just About Surviving found that people want to work for a variety of reasons; to gain financial security and a steady income, but also for the emotional and social benefits that employment brings, and to be a good role model for their children. They also want to escape the perceived stigma of claiming benefits and to have a sense of pride in their work.
A desire to progress?
The DWP report actually echoes some of our findings, with a majority of the 35 people they interviewed reporting they were “open to progression”. Only a small minority stated they weren’t willing to progress, with many of these citing old age as the reason. The report describes how many in-work claimants face ‘distinct constraints that either prevent them from taking steps towards progression or slow down their progress, even where motivation is strong’. The report partly attributes this to people’s attitudes, but also to more flexible and insecure labour markets. Our experience has shown these barriers to progressing include employers wanting to retain people on flexible contracts, not having access to personalised and knowledgeable careers advice, a lack of affordable childcare and individuals being unable to access funding for skills improvement.
With these factors in mind, the DWP should carefully as they explore how best to introduce in-work conditionality – especially as there is little or no evidence for the effectiveness of conditionality in getting unemployed people into work, let alone on what works for people in-work. Civitas recently published a report Fixing Broken Britain which questions the ‘social cost’ of sanctions and calls for the Government to commission an independent body to assess both their effectiveness and impact; a position we support. Logic follows that the DWP should act on such advice before even considering expanding the use of sanctions to those in work.
So as the DWP consider their next steps and the Work and Pensions Committee sit down to hear evidence, we hope they both duly consider the dangers of applying conditionality to people in work, and the significant opportunities for providing people with greater in-work support.