Disability Living Allowance (DLA) does not incentivise work and there is still a widespread belief among claimants that they would be better off on benefit than in work, according to a new report.
It also concludes that for those making a new claim (the majority of whom are out of work or on sick leave) DLA provides a ‘badging' of disability, seen by some as proof of not being able to work.
The exploratory study, conducted by Insite Research and Consulting for the Department of Work and Pensions (DWP), contacted 1005 people who made claims in September and October 2008, and followed their outcomes.
The results are particularly important following the Government's decision, as announced by COVER, to re-assess all DLA claimants in three years time as part of a bid to cut the state welfare bill.
It sought to explain already existing evidence indicating that employment rates among DLA recipients are very low, noting two studies in 2002 and 2006 which both estimated a rate of 9%.
The report continued: "Among DLA recipients who were out of work in 2007, more than three-quarters were claiming what are generally regarded as ‘inactive benefits' which do not require recipients to be available for work or to look for work.
"Within the working age population, people who receive DLA are much less likely to be in work than disabled people who do not, who in turn are much less likely to be in work than non-disabled people."
Its findings did explain that part of the greater distance from the labour market among DLA recipients derives from a greater severity of disability and a concentration of certain types of particularly disadvantaging impairments.
"However," it continued, "our research supports the hypothesis that there is also a DLA specific factor which makes it less likely that they will work.
"We found this DLA factor to comprise two key elements: one deriving from the widespread perception that DLA is a ‘compensatory' income for those unable to work because of their disability or health condition; the other deriving from a possible financial disincentive effect of the greater benefit income of DLA recipients, and the perceived risk to complex benefits packages from any change in circumstances."
The research concludes that the best way to tackle this problem was in job retention practices, reinforcing previous study results.
This includes measures such as supporting DLA recipients, countering disincentive pressures and addressing employment viability.
