Vital back-up

Overall, there is much to commend about the Government's latest Green Paper in terms of helping disabled people on Incapacity Benefit (IB) return to employment. The spirit of the Paper, Pathways to Work: Helping People Into Employment, which aims to change current structures and create financial incentives to work, is to be applauded. Indeed, anything that can improve upon the current obstacles disabled people face in returning to work must be commended.

In the UK at the moment, less than 50% of disabled adults have a job and some 2.3 million find themselves on IB. Although in recent years there have been a number of reforms to strengthen incentives to make work pay, these have not worked particularly well for the disabled. Research shows the process of finding work can be difficult or even impossible for disabled people. And yet it is in everyone's best interest to help those disabled people who want to find jobs.

Righting the wrong

One in three UK companies complain about staff shortages and with an ageing and shrinking workforce this problem will grow. Despite this, in a recent survey of 200 company directors, one in five believes job applicants who provide details of any disabilities they might have adversely affect their chances of securing an interview. One in three respondents thought the majority of employers, when considering two candidates of equal experience, would opt for an able-bodied applicant in preference to a disabled applicant. In addition, 32% of respondents wrongly believed disabled employees have worse absenteeism records than able-bodied workers when in fact the opposite is true. Added to this, the average disabled employee has spent around 8.6 years in their current job.

It is also in the Government's interest to help disabled people back to work. For example, it could gain an extra £5bn a year if 500,000 people came off IB. If this is one of the motives behind the Green Paper, and economic inclusivity is another, how might it fulfil its aims?

The Government's proposal for changing the structure of support for IB claimants seems sensible enough. Earlier intervention with work-focused interviews, which are to be mandatory, is a sound approach as is a plan to increase the number of interviews. The move to also link the Personal Capacity Assessment (PCA) element of IB to work-focused interviews is also likely to be helpful.

Plans to change the name of IB and associative language are also highly commendable. At the moment, people pass a test to claim IB, which is antithetical to a positive expectation that the claimant will return to work.

This should link to an expectation even from the first interview, of a return to work. This should lie at the very heart of the interview, especially as those flowing on to IB may have come from other benefits and may not have worked for some time.

Will it deliver?

However, there is concern there is confusion in the Paper with regards to delivery. JobCentre Plus will be responsible for the interviews and additional support, but it is now known if they have the number of trained staff required. This concern is equally applicable to the second proposal for change, which is for easier referral for disabled people transferring from IB to other JobCentre Plus programmes.

Proposals for combining health-focused rehabilitation with work-focused support should be applauded, but in practice it is difficult to find enough trained people to deliver the rehabilitation services. The suggestion of NHS Plus ' a scheme that allows NHS rehabilitation teams to sell capacity to employers ' is also sound in theory, but the capacity must be there in the first place.

The issue of rehabilitation is becoming increasingly important for insurance companies, most of whom outsource this key element in helping disabled people return to work.

From UnumProvident's experience of handling rehabilitation in-house, there is a growing expectation from the market to focus more on this as a key benefit of an income protection (IP) policy. Rehabilitation should be one of the most important elements of a policy and is a true gauge of quality. More customers are looking for evidence of a strong track record of the insurer devoting time and resources into rehabilitation, which can be executed more effectively given the sufficient, personalised services of an in-house team.

In this way, changes to rehabilitation procedures, as proposed in the Green Paper, signal a significant move forward for the IP market and, in turn, those few insurance companies who recognise the importance of rehabilitation services.

Clarity

Overall, there is little detail on planned reforms in the document. However, there is correct emphasis on making incentives to work clear and easily understood. In particular, the Government's new initiative of a working tax credit ' effective from April 2003 ' for disabled people aims to integrate these people with the mainstream system of support while recognising the additional costs they may face when returning to work. This is a good idea, however, there are doubts about the amount of credit suggested ' £40 per week ' and the time limit imposed ' payable for 12 months ' should be further explained.

Despite these positive steps, we believe there is insufficient emphasis placed on giving people an incentive for looking for a job in the first place. It is all very well helping disabled people once they get a job, but the real issue is encouraging these people to seek employment. Many disabled people who qualify for higher rate IB do not want to take a job, even if it pays more, because they are worried they could not cope, be made redundant or suffer a relapse. In such a case, if they were to qualify for IB again, they may only do so at a lower rate and would be worse off than before they got a job.

There needs to be more recognition of the fact that returning to work is a continuum ranging from an hour a week therapeutic work to full-time employment. Disabled people enter this continuum at all different levels and can oscillate between each extreme. This means the system needs to be both flexible enough to cope with individuals' changing demands and encourage a return to work, but more importantly, it needs to be simple enough to be seen to do so.

The Government's Green Paper is a definite move in the right direction. The initiatives proposed are consistent with the overall aims of helping disabled people back to work, but there is insufficient focus on providing new incentives for seeking employment.

Last year, a new public/private partnership, New Beginnings, was launched with a call for major reform of the current system for helping unemployed disabled people find work. New Beginnings believes in a focused programme of action in line with the Government's objectives of social inclusion and making work pay. More specifically, the aim of the campaign is to help 250,000 disabled people back to work by 2010.

Proposals for structural and incentive change contained in the Green Paper go some way towards these aims. In particular, early intervention with work-focused interviews and the new working tax credits signal good progress in encouraging and providing incentives to unemployed disabled people.

From an industry perspective, the Green Paper should be welcomed by insurance companies for the acknowledgement that early intervention and rehabilitation is critical.

The Paper is also good news for those disabled people who want to find work with additional support given and new incentives for those hindered by the financial strain of returning to work after a period of incapacity. However, it remains to be seen if there is the necessary resource capacity to deliver these new benefits.

There is still much work to be done. More emphasis must be placed encouraging those disabled people who are fearful of returning to work. Also, the issue of employers' attitudes against the employment of disabled people must be rectified. When it comes to 'cultural change' this is still a long way off.

Joanne Hindle is corporate services director at UnumProvident