scottish ‘health’ offer national forum edinburgh 26 january 2012 health at work
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Health Works. Scottish ‘Health’ Offer National Forum Edinburgh 26 January 2012 Health at Work Dame Carol Black Expert Adviser on Health and Work Department of Health, England. Independent Sickness Absence Review. Announced by PM 17 Feb 2011 Co-chairs: Carol Black , - PowerPoint PPT PresentationTRANSCRIPT
Scottish ‘Health’ Offer National Forum
Edinburgh 26 January 2012
Health at Work Dame Carol Black
Expert Adviser on Health and Work
Department of Health, England
Health Works
Independent Sickness Absence Review
Announced by PM 17 Feb 2011
Co-chairs:
Carol Black, National Director for Health and Work
David Frost,former Director-General British Chambers of Commerce.
“ We simply have to get to grips with the sick-note culture that means a short spell of sickness absence can far too easily become a gradual slide to a life of long-term benefit dependency.”
Terms of Reference
• to explore how the current sickness absence system could be changed to help people stay in work, reduce costs and contribute to economic growth
• to examine whether the balance of these costs are appropriately shared between the state, individuals and employers
• to make tangible recommendations for system change
Review established to consider the
overall sickness absence system State
(Worklessness benefits; foregone taxes; extra healthcare)
Employers
(SSP/OSP; costs of staff turnover; time spend
managing absence; OH where offered)
Individuals
(Emotional and physical costs of ill-health, loss of
income)
Cost of sickness absence to UK economy c £15bn plus c £13bn in health-related benefits
Employers pay around £9bn annually in sick pay
Some key basic principles
• Work is - in most instances - good for health and wellbeing
• Worklessness is – for most people – harmful
• Much sickness absence and worklessness associated with common health conditions which are compatible with work (given right support)
• There should be minimal delay in making assessment of people’s capability for work
Work Sickness absence
Claim to Employment
Support Allowance
(ESA)
Work Capability
Assessment
ESAbenefit and support
JSAbenefit and support
Work
Inactivity
28 weeks 39 weeks
The current journey
Each year 140,000 ESA claimants come straight from work without a period of support from their employer.
Claim to Employment
Support Allowance
(ESA)
Work Capability
Assessment
The State’s main interventions are focused on the after job-loss period. Huge delays in assessing benefit claimants’ work capability.
Too few drivers in the journey keeping people in work.
Management of sickness absence by employers is inconsistent. Lower paid, lower skilled employees and those from smaller firms have less support. 85% of fit notes sign people off completely unfit.
Employees
24.0m
Self- employed
3.5m
Out of work/
inactive
11.4m
Claim to Employment
Support Allowance
(ESA)
650,000
Short time sickness absence
Long-term sickness absence
320,000
80,000
140,000
110,000
11m 1m
12-15 months after ESA claim
Economically
inactive 310,000
Figures may not sum due to rounding.
Economically
active 340,000
But the real pathways are more complicated….
System is broken
• Poor advocacy guiding some individuals
• Some employers lack confidence in medical evidence and legal rights/duties
• The State is too slow to get the right support to individuals
Our recommendations address problems throughout the sickness absence journey
WORK
24m
Short-term
absence
11m
Long-term
absence
1m
0 8 days 4 wks 8wks 28 wks
IAS - reducing flows into long-term sickness(2.9m off sick withGP’s certificate)
Tax relief, public sectorrecommendations –
managing absence in employmentJob Brokering -
helping people move jobs
1.9m 0.5m 0.5m
ESA reforms -reducing flows on to ESA
from work(140k)
ESA reforms -reducing flows on to ESA
from sickness (110k)
ESA
Recommendations
Sickness Absence reduction
Independent Assessment
Service
Tax relief on Vocational
Rehabilitation
Abolition of Payment
Threshold Scheme in
SSP
Public Sector –
Review of Sick Pay
Job Brokering
Service
Changes to Employment and Support Allowance
Independent Assessment Service
• The Fit Note is used to verify illness and fitness for work – GPs act as the entry into system.
• A new Independent Assessment Service will provide an in-depth assessment of an individual’s physical and/or mental function.
• This will act as a functional assessment for employers and employees as well as doctors seeking specialist occupational health advice
• It should be supportive and early (after no more than 4 weeks of absence).
IAS - Referral system
Tax Relief on VR and medical expenditure
• Early intervention key, yet tax system can discourage employers from investing in early medical intervention (classed as a benefit in kind)
• Discouragement is particularly clear in the more marginal cases (lower paid, lower skilled workers)
• We propose retaining tax relief for Employer Assistance Programmes and introducing tax relief on vocational rehabilitation and medical expenditure for basic rate taxpayers
A Job Brokering Service
• Some people’s health condition may not be compatible with their current job but is compatible with different work
• We propose that the State provides a job brokering service for anyone with a sickness absence period of 20 weeks or more
• The service could be delivered as an extension of the Work Programme
• Would keep people attached to labour market, save employers some sick pay, and save the state expenditure on benefits
Abolition of the Percentage Threshold Scheme (PTS)
• Government currently reimburses around £50m of Statutory Sick Pay per year through the PTS.
• We think that this is sending the wrong messages re managing sickness absence and could be better spent elsewhere – therefore propose abolition of the PTS
• Alongside this we propose reducing admin burdens around SSP recording – this amounts to over £40m per year
Review of Public Sector Sick Pay
• Overall, sickness absence is higher in public sector than in private sector
• Low sickness absence is associated with good management practice.
• We recommend that public sector employers take action to bring worst performers up to standard of best
• Also recommend that government reviews public sector occupational sick pay
Reforms to ESA system
• Concerns with the ESA system: – the length of wait before a Work Capability Assessment (WCA) is
carried out– the large proportion of claimants for ESA who are, in fact, found ‘fit
for work’ (over 50% even after appeals)
• Assessment phase is wasteful and not fulfilling purpose – we recommend that the assessment phase for ESA should end altogether
• People should go onto ESA only if:– they qualify after a WCA, or – as at present, they qualify to pass directly onto ESA without a face-
to-face WCA.
• JobcentrePlus should better direct people onto the right benefit – giving them the support they need
New Journey
• More focus on employer support
• Independent Assessment Service offers authoritative medical advice
• Job Brokering Service provides a new pre-benefit intervention
• Better benefit advice and early WCA to supply quicker more relevant support
New Journey - details
Employees
24.0m
Self- employed
3.5m
Out of work/
inactive
11.4m
Claim to Employment
Support Allowance
(ESA)
350,000
(650,000)
Short time sickness absence
Long-term sickness absence
140,000 (320,000)
60,000 (80,000)
120,000 (140,000)
30,000 (110,000)
Outcome
12-15 months after ESA claim
Economically
inactive 210,000
(310,000)
Figures may not sum due to rounding.
Economically
active 140,000
(340,000)
New flows….(estimated, current figures in brackets)
The Savings
• We have been motivated, first and foremost, by the waste and damage, personal and financial, to those suffering ill-health
• Our recommendations could also:• save £400 million a year for employers, • save £300 million a year for the State • boost economic output by over £1 billion
Detailed savings – impact of measures (£m pa) UK
Government Employers Economy
Independent Assessment Service
-10 +100 +150
Job brokering Up to +300 Up to +50 Up to +800
ESA system +100 +300
Tax incentives -150 +250 +100
Percentage Threshold Scheme
+50 Up to -50*
Total Up to +300 Up to +400 Up to +1,400
* this offset comes from the associated reduction in admin burdens
Conclusions
• The current system lacks coherence and is wasteful of human and material resources
• We made recommendations to:– support employees at work, to stay in work– improve the benefits system to offer better
advice and support, towards work– tackle sickness absence through various
interventions throughout the process