Benefit sanctions hit most vulnerable people the hardest, report says

The report found the way in which the DWP communicated with claimants was legalistic, unclear and confusing. The most vulnerable claimants were often left at a loss as to why benefits were stopped and frequently not informed by the DWP about hardship payments to which they were entitled, it said.

It also revealed serious flaws in how sanctions were imposed, with Work Programme providers required to send participants for sanctions when they knew they had done nothing wrong, leaving “claimants … sent from pillar to post”.

The independent report was written for the DWP by Matthew Oakley, a respected welfare expert who has worked as an economic adviser for the Treasury and for the centre-right thinktank Policy Exchange.

He is widely acknowledged as one of the leading thinkers on welfare on the centre right and as a result his criticisms, couched in careful language, are all the more damaging for a government that has consistently said the sanction regime is fair.

The DWP responded to the report by saying it would be updating the way it talked to benefit claimants, setting up a specialist team to look at all communications, including claimant letters, and working more closely with local authorities and advice centres to simplify the system.

The government will also streamline “the robust checks and and balances that are already in place that give claimants the opportunity to provide evidence why they have not complied with the rules”.

It will also clarify the guidance on how claimants can access hardship payments, as well as co-operate more closely with Work Programme providers so there is more integration about what a claimant is permitted to do without facing the threat of a benefit sanction.

Oakley’s report said: “No matter what system of social security is in place, if it is communicated poorly, if claimants do not understand the system and their responsibilities and if they are not empowered to challenge decisions they believe to be incorrect and seek redress, then it will not fulfil its purpose. It will be neither fair nor effective.”

Although Oakley said the regime was not fundamentally broken, he made 17 recommendations for reform.

His terms of reference confined him to the way in which sanctions are administered on mandatory back-to-work schemes, which cover a third of those claimants at risk of being sanctioned, but he said his proposed reforms were relevant to the entire benefits system.

The report said “letters were, on the whole, found to be complex and difficult to understand. Partly as a result of the legal requirements the department has to fulfil when it writes to claimants, regular concerns were that letters:

• Were overly long and legalistic in their tone and content;

• Lacked personalised explanations of the reason for sanction referrals;

• Were not always clear around the possibility of and process surrounding appeals or application for hardship payments; and

• Were particularly difficult for the most vulnerable claimants to understand – meaning that the people potentially most in need of the hardship system were the least likely to be able to access it.”

The report added: “Actual and sample letters that the review team saw were hard to understand (even for those working in the area), unclear as to why someone was being sanctioned and confusingly laid out.”

The review found that many people “expressed concerns that the first that claimants knew of adverse decisions was when they tried to get their benefit payment out of a cash point but could not”.

The report also said jobcentre advisers had highlighted the damage sanctions imposed on the most vulnerable. It stated: “Many advisers also highlighted the difficulties of communicating with particular groups of claimants. In particular, many advisers identified a ‘vulnerable’ group who tended to be sanctioned more than the others because they struggled to navigate the system. This concern for the vulnerable claimants was consistent throughout the visits.

“For these groups, particular difficulties were highlighted around the length of time it could take to ensure some claimants fully understood what was required of them and in conveying that a ‘sanction’ could entail the loss of benefit for a prolonged period of time.”

The report also criticised the failure of the jobcentre to highlight hardship payments. It said: “A more specific concern surrounding the hardship system was that only those claimants that asked about help in Jobcentre Plus were told about the hardship system. Advisers, decision makers and advocate groups argued that this means that groups with poorer understanding of the system are less likely to gain access.

“Since, on the whole, more vulnerable claimants are those with the poorest understanding of the system, this suggests that some of those most in need are also those least able to access hardship.”

The report also found that providers of mandatory work schemes were unable to make legal decisions regarding good reasons for missing appointments and so had to impose sanctions.

“This means that they have to refer all claimants who fail to attend a mandatory interview to a decision maker even if the claimant has provided them with what would ordinarily count as good reason in Jobcentre Plus. This situation results in confusion as the claimant does not understand why they are being referred for a sanction.

“A very high proportion of referrals for sanctions from mandatory back-to-work schemes are subsequently cancelled or judged to be non-adverse.”

A lack of coordination between the jobcentre and Work Programme can “result in a situation where claimants are passed from pillar to post, without either Jobcentre Plus or providers taking responsibility for explaining the claimant’s situation. More commonly, we heard that Jobcentre Plus advisers had to spend large amounts of time dealing with claimants’ queries about sanctions from mandatory schemes.”

Poor understanding of the good reason process mean claimants subsequently appeal a sanction and often win, at cost to the DWP and taxpayer.

A key reason the report found for the confusion was that, because different organisations use different IT systems, neither providers nor Jobcentre Plus hold all the information needed about a claimant’s current experience and potential sanctions.