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Government 'could breach its own welfare spending cap' Government 'could breach its own welfare spending cap'
(35 minutes later)
The government could breach its self-imposed cap on welfare spending as a result of the cost of the main sickness benefit, leaked documents say.The government could breach its self-imposed cap on welfare spending as a result of the cost of the main sickness benefit, leaked documents say.
Internal government memos seen by the BBC suggest Employment and Support Allowance (ESA) costs are rising and few cost-cutting options are available.Internal government memos seen by the BBC suggest Employment and Support Allowance (ESA) costs are rising and few cost-cutting options are available.
In March MPs agreed a 2015-16 welfare cap of £119.5bn, excluding the state pension and some unemployment benefits.In March MPs agreed a 2015-16 welfare cap of £119.5bn, excluding the state pension and some unemployment benefits.
Ministers say welfare spending will come in under the cap. Ministers have insisted they will not breach the cap.
They said they would take measures to ensure welfare spending comes under it.
If the limit is breached, ministers will have to explain to Parliament and ask MPs to approve additional spending.If the limit is breached, ministers will have to explain to Parliament and ask MPs to approve additional spending.
'Vulnerable' to breach 'Fiscal risk'
ESA was introduced in 2008 to replace Incapacity Benefit - intended for people who are unable to work because of sickness or disability.ESA was introduced in 2008 to replace Incapacity Benefit - intended for people who are unable to work because of sickness or disability.
Claimants undergo tests to see how their illness or disability affects their ability to work before learning whether they are eligible.Claimants undergo tests to see how their illness or disability affects their ability to work before learning whether they are eligible.
A key aim of the benefit is to get people off welfare and into work. Work and Pensions Select Committee chairman Dame Anne Begg told BBC Radio 4's Today programme that the ESA seemed to be doing no better than Incapacity Benefit.
Work and Pensions Select Committee chairman Dame Anne Begg told BBC Radio 4's Today programme that the ESA did not appear to be doing any better than Incapacity Benefit. She said: "The big criticism of Incapacity Benefit was that people were put on it and left and nobody reassessed.
"A lot of complaints and criticism of Incapacity Benefit can now be laid at the door of Employment and Support Allowance," she said.
Dame Anne, who is a wheelchair user, said "The big criticism of Incapacity Benefit was that people were put on it and left and nobody reassessed.
"With the ESA, there is constant reassessment, but of course that's expensive and that's putting a burden on the health assessors... in order to keep up with the numbers they have to deal with.""With the ESA, there is constant reassessment, but of course that's expensive and that's putting a burden on the health assessors... in order to keep up with the numbers they have to deal with."
It emerged on Thursday that the leaked memos say ESA is "one of the largest fiscal risks currently facing the government". The leaked documents say the cost of ESA is projected to rise by nearly £13bn between the current financial year and 2018-19 and is "one of the largest fiscal risks currently facing the government".
The cost of ESA is projected to rise by nearly £13bn between the current financial year and 2018-19, the documents say. The increasing number of claimants, caused by people moving off Jobseeker's Allowance and on to ESA, was cited as a main reason for the rising costs.
The papers suggest the main reason for the rising cost of ESA is an increasing number of claimants, caused by people moving off Jobseeker's Allowance and on to ESA.
BBC social affairs correspondent Michael Buchanan said that, according to those writing the papers, this was because ESA has fewer sanctions - when someone's benefit is stopped for misconduct - than Jobseeker's Allowance.BBC social affairs correspondent Michael Buchanan said that, according to those writing the papers, this was because ESA has fewer sanctions - when someone's benefit is stopped for misconduct - than Jobseeker's Allowance.
The documents also say the severity of ESA claimants' illnesses and disabilities has been underestimated - meaning people are staying on the benefit longer than expected.The documents also say the severity of ESA claimants' illnesses and disabilities has been underestimated - meaning people are staying on the benefit longer than expected.
The memos reveal a range of options for reducing costs, but conclude there appears to be "not much low-hanging fruit left".
"This leaves us vulnerable to a breach [of the cap]", says one memo.
'Fiasco''Fiasco'
Problems with the private firm Atos, which has carried out benefit health assessments for the government, have also increased ESA costs.Problems with the private firm Atos, which has carried out benefit health assessments for the government, have also increased ESA costs.
Earlier this month ministers said more than 700,000 people were waiting for an assessment for ESA.Earlier this month ministers said more than 700,000 people were waiting for an assessment for ESA.
It blamed the delays on Atos, which has agreed to end its contract early.It blamed the delays on Atos, which has agreed to end its contract early.
But the leaked documents say the new contractor - due to be appointed in early 2015 - is expected to cost roughly "three times as much" as the £100m annual deal with Atos. But the leaked documents say the new contractor - due to be appointed in 2015 - is expected to cost roughly three times the £100m annual deal with Atos.
The memos have come to light as a report by MPs brands the implementation of another disability benefit, Personal Independence Payments (PIP), a "fiasco". Meanwhile, a report by MPs brands the implementation of another benefit, Personal Independence Payments (PIP), a "fiasco".
PIP is replacing Disability Living Allowance, but the Commons Public Accounts Committee said the reform had been "rushed", with claims delayed by over six months in some cases. PIP is replacing Disability Living Allowance, but the Commons Public Accounts Committee said the reform had been "rushed", with some claims delayed by over six months.
Committee chairman Margaret Hodge said the Department for Work and Pensions had "let down some of the most vulnerable people in our society". Committee chairman Margaret Hodge told the BBC's 5live that seriously ill people were having to wait too long just to be assessed.
She told the BBC's 5live Breakfast programme that the introduction of the benefit had been "shambolic".
She said seriously ill people were having to wait too long just to be assessed.
"This is an example of a very shambolic introduction of a new benefit designed to help the most vulnerable group in our society to the extra costs in their living," she said."This is an example of a very shambolic introduction of a new benefit designed to help the most vulnerable group in our society to the extra costs in their living," she said.
"We are talking about people who probably face life changing conditions." Meanwhile, the government's flagship welfare reform is to be rolled out to more jobcentres from next week.
Universal Credit, which is six different benefits rolled into one, will be expanded in England's North West following a series of delays.
The new benefit is currently available in 10 places.
The government announced in April that it would be rolled out across 90 jobcentres in the North West from June for single people.
From Monday, four more job centres will offer it. The remaining 86 should be ready by the end of the year.
Dame Anne said the government had "a long way to go" with the credit.
Do you claim Employment and Support Allowance? Do you receive Personal Independence Payments? You can email your experiences to haveyoursay@bbc.co.uk using the subject line 'Welfare'.Do you claim Employment and Support Allowance? Do you receive Personal Independence Payments? You can email your experiences to haveyoursay@bbc.co.uk using the subject line 'Welfare'.