The British government's plans to get a million people off long-term sickness and disability benefits and back into the workplace will only have a limited impact unless a lot more is done to encourage employers to take on such people in the first place, employers' organisations have warned.
The plans unveiled yesterday by work and pensions secretary John Hutton in the government's Welfare Reform Green Paper would lead to a "sustained and gradual" reduction in the number of Incapacity Benefit claimants, the Chartered Institute of Personnel and Development said.
The government's plans intend to save some £7 billion a year and will mean severely disabled people receiving a higher rate of benefit, but other claimants having to take part in back-to-work schemes or risk losing their benefits.
Claimants will be able to access individual counselling, training and advice, and it will be compulsory for those assessed as able to work to take part in such schemes.
But the plans are unlikely to make a great deal of difference to the job prospects of most of those already receiving the benefit, said John Philpott, CIPD chief economist.
"Although the government is spot on with its rights and responsibilities approach to welfare reform, the main effect… will be a gradual long-term reduction in the number of people joining the IB count plus an increase in the number leaving the count after a short period of on it, rather than any major impact on the bulk of existing long-term claimants," he predicted.
"The latter will, rightly, be required to attend work focused interviews and draw up return to work plans but this alone is likely to do much to improve the chances that employers will hire them.
"This may be the only realistic approach, and is anyway a major improvement on the current system, but it will nonetheless disappoint those who might be expecting an immediate improvement in the job prospects of most existing claimants," Philpott added.
He called on ministers to engage with employers and encourage them to recruit potentially employable people who have already been on the benefit for a long-time.
A study by the CIPD has shown considerable reluctance among employers to take on people who have been off work because of long-term sickness or disability.
One in three employers in a recent poll of 750 employers said they deliberately excluded people with a history of long-term sickness or incapacity when recruiting staff.
Even among employers who did not exclude the long-term sick hardly any (3 per cent) actively targeted them as part of their recruitment strategies.
Nearly half – 43 per cent – thought long-term IB claimants would be less productive at work and 60 per cent worried they would be more prone to absence.
There were also concerns over their adaptability, teamwork and whether they would produce a lower standard of work.
"Overcoming employer resistance to hiring long-term IB claimants may require greater use of direct financial incentives to employers, such as the offer of recruitment subsidies or low cost work trials for claimants," said Philpott.
"This, however, could increase the budget needed to win the so-called 'war on worklessness' and thus reduce any net savings to the Treasury," he added.
John Cridland, deputy director-general of the Confederation of British Industry, said many employers welcomed the proposals as a way of tackling the UK's chronic skills shortages.
But he echoed the CIPD is urging ministers to consider more closely the sort of support employers will need to make the plans work.
"Sixty per cent of all firms already offer rehabilitation schemes to help people return to work," he said.
"Many employers are also willing to play a full role in bringing those wanting to return to a job back into the workplace.
"But the Government must support companies in reskilling those who have been out of work for some time, and by contributing to the consequential costs of special equipment, transport or mentoring," he added.
Brendan Barber, general secretary of the TUC, said there were enough positive in the proposals to give them a "guarded welcome".
But he added: "The government's problem has been that it allowed the debate about Incapacity Benefit reform to become a challenge to them to 'get tough'.
"Incapacity Benefit claimants cannot be neatly divided into those who can easily get a job and those who are too sick or impaired ever to work. Instead there is a full spectrum of people between these extremes and people's circumstances can and do change. The success of this package will be the extent to which policies reflect this."
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