Incapacity benefit changes to include forced interviews

The Government pledged yesterday to stop sick and disabled people using incapacity benefit as a "pre-retirement option" by forcing claimants to attend regular interviews to help them find jobs.

Andrew Smith, the Work and Pensions Secretary, announced a new drive to stem the rising cost of benefit payments to people deemed unfit to work, which has risen from £3bn a year in 1979 to £16bn this year – even though there is no evidence that the health of the population has got worse.

In an attempt to head off a repeat of a backbench Labour rebellion over the decision to means-test incapacity benefit, Mr Smith unveiled a "tough and tender" package, including plans to pay claimants £40 a week for a year when they take jobs worth less than £15,000 per annum and a further £300 to help them make the transition to work.

Under a pilot scheme to be launched next year, between 50,000 and 60,000 people in six areas will be called to mandatory interviews, probably about six times a year, rather than left to languish on incapacity benefit. If they refuse to attend, they could lose 20 per cent of their income support payments as a penalty. The scheme will apply initially to new claimants but may be extended to the 2.7 million people on the benefit.

Mr Smith told the Commons: "This is not about forcing sick or disabled people into work. It is about encouraging people to look at their options and helping those who want to work to achieve their goal of getting a job." He stressed that people with the most severe conditions will not be required to attend the work-focused interviews with personal advisers based at job centres.

Mr Smith continued: "We want as many as possible of those moving on to incapacity benefit to be seen as people with a working future – not people at the end of their working life ... We need a cultural change. There is something of a culture of incapacity benefit being a pre-retirement benefit option. There is now clear evidence of the medical, psychological and therapeutic benefits work can have. Those claiming incapacity benefit will, I believe, respond to a focus on what they can do rather than on what they can't."

A consultation document published yesterday said the name of the benefit could be changed because it sent a negative signal. One option is to rename it a "capability assessment allowance."

David Willetts, the shadow Work and Pensions Secretary, said a previous initiative aimed encouraging claimants to interviews had produced only a 3 per cent response rate. "Why are these interviews going to be any more successful?" he asked.

In the annual statement uprating social security benefits, Mr Smith saidthe basic state pension will rise by 2.5 per cent next April, giving a single pensioner £77.45 a week and a couple £123.80 a week.

The minimum income guarantee for the poorest pensioners will rise to £102.10 a week for a single person and £155.80 for a couple. Most other benefits will rise by 1.7 per cent in line with inflation.