The Benefits of Doubt

...red sky thinking for an open and diverse left

The Benefits of Doubt

The Benefits of Doubt

Whilst the media focuses on benefit scroungers, each year in the UK billions of pounds of benefits go unclaimed by those who need them most. Graeme McIver examines a system which is confusing, complex and daunting and arrives at the conclusion that it is deliberately so in order to save the Government money regardless of the personal and social consequences to those who desperately require funds to which they are entitled.

A cursory glance at television listings any night of the week highlights that a new type of reality programme has muscled its way onto our schedules. Alongside the poverty porn of Jeremy Kyle you can easily find Benefit Busters, Benefits Britain, Benefits Street, Can’t Pay We’ll Take it Away, Skint and On Benefits and Proud each night as you flick through the myriad of channels available. It makes one pine for those halcyon days when tornadoes, sharks and Nazis dominated TV listings.

These programmes, allied to a right wing assault in the tabloid press and cyber space paint a picture of the UK economy crumbling under the weight of benefit scroungers, dole cheats and fraudsters that threaten to bring the country to its knees. Radio phone in’s, discussion programmes and Parliamentary questions follow in their wake as the benefits culture is thrust under a spotlight afforded to few other political issues.

The Government has expended vast sums of money on advertising benefit fraud hotlines where you can shop a neighbour or work colleague who you believe is guilty. There are no consequences to anyone making spurious or false claims.

The bastion of honesty and integrity that is The Sun Newspaper, ran a campaign in 2010 to “shop” benefit cheats. The paper which at the time was running a criminal phone-hacking racket that included accessing the messages of a murdered teenager declared war on, “feckless benefits claimants to slash the £5 billion wasted in Britain’s shambolic handouts culture. Hundreds of thousands of scroungers in the UK are robbing hard-working Sun readers of their cash. They cannot be bothered to find a job or they claim to be sick when they are perfectly capable of work because they prefer to sit at home watching widescreen TVs — paid for by YOU.”

The campaign was enthusiastically backed by David Cameron who wrote, “We’re looking at every option — including tougher penalties for fraud, taking more people to court and more encouragement for people who know fraud is taking place to come forward.”

The “newspaper” added to a barrage of miss and disinformation about the scale of benefit fraud that has led to a huge discrepancy from the reality to the public perception.

In 2013 a parliamentary report highlighted the gap between this reality and perception when it recorded that a survey of the UK population showed that respondents believed that the level of benefits claimed fraudulently accounted for 24% of all claims. The actual official estimate was 0.7%, a difference of a factor of 34.

In July 2015, the National Audit Office published figures that showed that even this tiny 0.7% figure was complicated by the fact that many so called fraudulent claims were actually overpayment mistakes made by the Department of Work and Pensions rather than deliberate attempts to abuse the system.

The figure of benefit fraud pales into insignificance compared to tax avoidance. Neither the Prime Minister nor The Sun newspaper has been quite so forthright in tracking down and perusing wealthy tax cheats however.

Earlier this year, the publication “The Week” reported;

“According to official figures quoted by the BBC last year, in the 2012/2013 tax year the shortfall of tax that should have been collected by HMRC versus what it actually brought in had risen to £34bn. This eye-watering figure includes £14bn in uncollected income tax, national insurance and capital gains tax, and £12.4bn in uncollected VAT. Personal evasion and avoidance was a significant part of the problem. The Financial Times says tax evasion, which is defined as the illegal act of deliberately hiding information about your finances to reduce your tax bill, amounted to £4.1bn. A smaller £3.1bn was lost to tax avoidance, which is the legal use of tax loopholes, while £5.4bn was lost as a result of criminal activity such as smuggling.”

In February of 2015, The Mirror Newspaper compared the number of staff employed by the Government to chase benefit fraudsters compared to those employed to crack down on tax evasion. According to the DWP’s own figures 3250 staff were employed to pursue £1.2 billion lost to so-called fraud. In comparison, ten-times less staff, 300 in total were employed to pursue an estimated £70 billion in tax evasion by large corporations and the wealthy.

Lost in the propaganda war waged on the poor following the economic crash of 2008 has been the figures of either unpaid or unclaimed benefits. This is money that should have been issued by the state to those, more often than not either elderly, disabled or vulnerable individuals who are entitled to benefits they never receive.

In 2013 the Joseph Rowntree Foundation commissioned a report into unclaimed benefits;

“According to research undertaken by the New Policy Institute for the Joseph Rowntree Foundation, almost a third of eligible people in the UK in 2009-10 were not claiming the means-tested benefits they were entitled to. Just over half of the estimated £10 billion unclaimed benefits could have been claimed by working age families…take-up rates for most income related benefits declined in the decade to 2009-10. Take-up of tax credits increased after 2003-04 but in 2011-12 H.M. Revenue & Customs still estimated that £3.29 billion in Working Tax Credit and £1.19 billion in Child Tax Credits went unclaimed. Findings from this review of research literature show that improving take-up of means-tested benefits and tax credits would contribute to poverty reduction, with additional spending targeted at poorer families. The increased income associated with greater take-up could also contribute to improvements in other outcomes, such as health, family well-being and employment participation and retention.”

In July 2015, the charity Age UK published their Chief Economist’s Report which concluded that some of the very poorest pensioners are missing out on billions of pounds worth of benefits to which they are entitled. The report highlighted the growing inequality that exists in the UK with the number of people living below the poverty threshold increasing from 13% in 2012/13 to 14% in 2013/14

According to the report,

“Today, the total number of pensioners living in poverty sits at the 1.6 million mark, with around 900,000 of those living in severe poverty. This entrenched problem is partly explained by the huge numbers of pensioners who don’t claim the benefits that they are entitled to. Around £3.7 billion in benefits designed specifically to help low-income pensioners go unclaimed each year. In fact, the latest official figures show that around 1.3 million people entitled to Pension Credit, which tops up the income of the poorest pensioners, did not take up this vital benefit in 2013/14. This is an estimated £2.86 billion in total, or an average of around £2,132 per person per year. In addition around 260,000 pensioners missed out on Housing Benefit during the same period, sacrificing £820 million in total or £3,224 each a year. Age UK is warning that tens of thousands of pensioners are struggling to afford the basics every day and is once again calling on the government to develop and implement a national strategy to tackle the scandal of pensioner poverty across the UK.”

Caroline Abrahams, Charity Director for Age UK, said:

"This report shows that the older population is increasingly diverse and characterised by stubbornly persistent levels of poverty…worryingly, the poorest pensioners are losing ground the fastest, leading to a widening gap between 'the haves and the have-nots' among those in retirement. We urgently need a concerted effort to help the most vulnerable. Better access to good quality information and advice, and increased take-up of pensioner benefits would be a good start.”

Professor Jose Iparraguirre, Age UK’s Chief Economist and author of the report, added;

"Most commentators opined that the Summer 2015 Budget left older people untouched. Yet in view of the unacceptable levels of material deprivation and the alarming number of poor pensioners missing out on the benefits they are entitled to, “no news” in this case seems to be “bad news”. This report shows there is a lot to do on behalf of those who are most in need."

The Joseph Rowntree Report highlighted some reasons for this lack of take-up of entitled benefits,

“Why people do not claim what they are entitled to is the result of the dynamic interaction between social and economic circumstances, policy reforms, administrative structures and complex eligibility rules…A further recent factor is likely to have been the character of the public debate and media coverage of welfare dependency, which has increased the stigma attached to those claiming benefits, especially people of working age. Research findings suggest that this stigma is linked to reductions in take-up and a reluctance to claim among potential beneficiaries.”

Applying for benefits is not a straight forward process.

My own experience in dealing with the Department of Work and Pensions (DWP) will be by no means unique and offers an insight into just how difficult it is to access benefits even in cases where entitlement is obvious.

Last year, after a period of ill-health, my Dad was admitted to hospital and underwent a series of tests that has ultimately led to a diagnosis of Alzheimer’s. He stayed in hospital in total for over 6 months and after a few weeks I had been advised by the social work department that I would need to inform the DWP of his situation. His extended stay in hospital led to the suspension of his Attendance Allowance and Pensions Credits. Whilst I had a Power of Attorney document from the office of the Public Guardian of Scotland, I was not asked to produce proof of this when I phoned. Both benefits were stopped that day after a two minute phone call. It was a different story altogether however when I attempted to get them re-started on his discharge from hospital.

According to their own website, The DWP is responsible for, “welfare, pensions and child maintenance policy. As the UK’s biggest public service department it administers the State Pension and a range of working age, disability and ill health benefits to over 22 million claimants and customers. The DWP is a ministerial department, supported by 13 agencies and public bodies.” It claims that its first priority is, “helping to reduce poverty and improve social justice.”

Amongst other things the DWP is the agency responsible for dealing with the state pension, Attendance Allowance and Pension Credits. However, if you wish to speak to someone about all three you would find that instead you have to deal with separate departments within the agency. Departments that appear not to communicate with each other.

After a period of getting my Dad discharged from hospital and into sheltered housing I phoned the DWP to get his benefits re-established. I was notified that they could not speak to me regarding his case until they had received a copy of my Power of Attorney (POA). I emailed this to the DWP and then phoned again. I was told this time that I would have to make an appointment with my local Job Centre Plus to get my POA witnessed and signed by a member of staff along with my own signature and have them send the document back to the DWP. Over the next few weeks I phoned the DWP several times to be told that they had not yet received the signed document. I re-visited the local Job Centre who assured me that the signed and witnessed document had been emailed that same day as I brought it in. Eventually, after 4 weeks the Pension Credits department confirmed that they had my POA on file and agreed to speak to me about re-establishing my Dad’s benefits. They informed me however that no decision could be taken about his entitlement until a verdict had first been reached about his Attendance Allowance claim.

Whilst the Pension Credit Department of the DWP confirmed that they had received the POA, the Attendance Allowance Department said they had not. I explained to them that other DWP Departments were speaking to me as my Dad’s POA but they insisted that until “they” received the document they could not discuss the case. Eventually, after another delay of two weeks they agreed to speak to me. Despite my Dad’s financial circumstances not changing I had to provide a full breakdown of his income and at one stage was told by the call handler that I would need to re-apply from scratch. A form was despatched and a 32-page document duly arrived in the post with an accompanying 12 page booklet of explanatory notes.

Eventually, I spoke to one DWP agent who agreed, that as my Dad’s circumstances had not changed, his Attendance Allowance could be re-established. The answer you received on any given day seemed to change depending on the agent you spoke to. Some were helpful and understanding, others were obstinate and pedantic.

However, the DWP would only back date the claim for a total of three months. If I wanted to appeal the decision I could do so in writing, they would not discuss it further over the phone. I therefore sent a letter explain the entire case to the Attendance Allowance Mail Handling Centre in Wolverhampton. The letter was posted in mid- August and after hearing nothing other than that his appeal was under review, a decision was taken on November 16th that my Father’s benefits could then be backdated to his discharge date from hospital. This process took around 22 weeks to complete since my initial contact with the DWP. During all of this time my Dad was not in receipts of benefits he was fully entitled to.

On receiving the news I phoned the Pensions Credit Department to tell them that at last, after months, my Dad’s attendance Allowance case had been resolved. Any hopes I had of a quick resumption in Pension Credits were dashed when I was told that as it had been so long since the benefit had been stopped that I would need to reapply from scratch. This included providing proof of his State Pension entitlement, paid by of course, the DWP.

I was also told that they would only back date the claim three months. I explained that the delay had been caused by the Attendance Allowance case taking months to resolve. I have been told once again to appeal this decision in writing. I am currently in that process which I doubt will be resolved any time soon. Since his hospital discharge, and until the case is reviewed and adjudicated upon, my dad has not received Pension credits he is entitled to.

It has been a frustrating and infuriating process. Whilst I’d never make any claim to being the brightest tool in the box I would like to think that I have a degree of common sense and understanding. Yet it has taken me over 6 months to try and get a resolution. The whole process of contacting the DWP is confusing and daunting. The forms issued are particularly complex and intimidating, especially to older or vulnerable people. I can imagine that many may give up applying for their entitlement because they do not understand or are frightened of the process, are unaware of how they can access help or do not feel confident in approaching agencies such as Citizens’ Advice.

The confusion around benefit entitlement is also exacerbated by the Government making whole-sale changes to the system, abolishing existing benefits and replacing them with others. In 2013, as part of Government Welfare reforms the Personal Independence Payment (PIP) scheme replaced Disability Living Allowance (DLA). Chaos followed.

According to the Independent on Sunday in August 2015,

“Almost a quarter of all people applying for disability benefits to help them live independently are encountering serious difficulties, including delays, unfair dismissal of claims and confusion over eligibility… The scale of the problem with personal independence payments means that needing help with the benefit is now the most common reason for approaching the national charity Citizens Advice charity. In June last year, the Public Accounts Committee described the implementation of PIP as “nothing short of a fiasco”. Figures for April this year show 11,500 people in one month went to Citizens Advice for help with the benefit in one month. This is a significant number given that the Department for Work and Pensions (DWP) recorded only 52,000 new claimants and reassessments in the same month.”

These payments are a vital financial support to disabled people, whose average cost of living is much higher. The paper went on to explain,

“In the past year, Citizens Advice received more than 100,000 queries about eligibility for PIP and more than 50,000 approaches about issues with a claim, including problems with delays. A significant number – more than 20,000 – also needed help with challenges and appeals after being turned down for the payment. Gillian Guy, chief executive of the charity (Citizen’s Advice) said: “People’s ability to live independently is at risk due to PIP failures. People are experiencing problems with every part of the PIP application process, causing a huge amount of stress and anxiety for those going through a very difficult time. For too many people the system is not working. In order to fulfil its intention, the Government needs to ensure the PIP process is implemented properly and responds to people’s changing needs.”

Citizin’s Advice Scotland, (CAS) published a report in October 2014 stating;

“Evidence recorded by CAB advisers across Scotland shows that the new system is dogged by huge delays, which can leave the claimants in poverty for months, and many claimants are reporting that the assessment process is problematic and prone to mistakes. While some claimants are satisfied with the system, it is notable that many of the problems we have identified follow the pattern of previous welfare reforms like the Employment Support Allowance (ESA), suggesting that many lessons have not been learned.”

Head of Policy at CAS Susan McPhee added,

“The basic cost of living is generally higher for sick and disabled people than for the average citizen. This is because of the additional costs of special food, medicines or equipment they might need, extra heating and lighting costs for those who need to stay at home longer, or transport costs for those who are less mobile. These extra costs are not luxuries. They are essential to leading a basic life of dignity, and any civilised society should make it a priority to see that people who need this help get it without fuss. The evidence we are publishing here shows that, under the new Personal Independence Payment, too many disabled people are not getting that support, and many are falling into poverty as a result.”

The DWP has begun the process of rolling out Universal Credit across the UK. This new payment will replace six existing benefits. The process has already become mired in controversy and criticism. In February 2015 the BBC reported that a claimant who featured in a Government film about universal-credit said it is riddled with computer problems and could push people into hardship.

“In the Department for Work and Pensions (DWP) film, Daniel Pacey said it helped him find work and was far better than jobseeker's allowance. But he told the BBC a six-week delay before the first payment and further monthly payments were "a nightmare”. Mr Pacey, 24, from Wigan, Greater Manchester, said: ''It might be easy for a government minister to make their wages last a month. But I'd like to see them make £250 last four weeks while looking for work."

The DWP and the Government argue that at least part of the figure of unclaimed benefit is down to the fact that wealthier pensioners or middle class families do not claim what is due as they do not need the money. However there is no doubt that the vast majority of the benefits that go unclaimed each year are due to a system which is confusing, complex and daunting. It’s hard to arrive at any other conclusion than it is deliberately so in order to save the Government money regardless of the personal and social consequences to those most desperately in need. Allied to these obstacles and obstructions is the mass of humiliation, stigma and shame that is associated with claiming benefits thanks to the welter of media focus on, “scroungers” and “cheats.” Yet it looks like our television screens and columns of red-top papers will continued to be dominated by the White Dee’s of this world rather than the wealthy business men and women who continue to avoid paying their fair share in taxes.

Writing in 2012, Prem Sikka, Professor of Accountancy at Essex University stated;

“The avoidance of taxes results in transfers of wealth and those able to avoid democratically agreed taxes are able to have a free ride. Arguably, tax avoidance has ushered in a crisis of democracy. We can all be persuaded to vote for a political party that presents a very rational and feasible plan to make greater investment in education, healthcare, transport, pensions and security, but its electoral mandate is easily undermined by the tax avoidance industry whose operations ensure that the government cannot have sufficient revenues to deliver its electoral mandate. Thus there is a fundamental clash between the forces of democracy and the tax avoidance industry whose sole aim is to enrich its clients.”

It appears that the majority of TV executives have concluded that focusing on those whose avoided taxes could transform our society would be of less interest than watching vulnerable people, victims of economic circumstances beyond their control, drinking, betting and committing petty crime in order to get by.

Other articles by Graeme McIver in The Point (click on the articles)

Get up off our Knees - An interview with Paul Heaton

An Interview with John Cooper Clarke

Too Nice to Talk Too – An Interview with Dave Wakeling of The English Beat

Hillsborough – The Politics Behind the Smears

The Scandal of Low Pay in the Home Care Sector

From Indignado to Mayoress

Seismic Shift or The Feeble 56?

Curious George and the Case for Naw

The Dawning of a New Era – The History of 2 Tone

Thomas Muir of Hunterhill

Tony Benn – An Obituary