So, 2/3rds of all Incap claimants are probably not entitled to Benefit - allegedly - GP's are are fault for signing sicknotes - allegedly - interesting to see that this press release came out almost as soon as Secretary of State No 8 sat at his desk for the first time: also interesting to see that said S of S appears to openly endorse Mr Freud's views.....

More to the point, what detailed and verified research supports these revelations - or is this just another one of those bland throw away statements beloved by spin doctors -

When they quoted this on the news yesterday my immediate reaction was "What the f*** does he know about it?" He's a banker who knew nothing about the welfare system before becoming an overnight expert. So where does he get his information from, I wonder???

Sigmund Freud was interested in phalluses; his great-grandson simply endorses fallacies...

I understand he trained as a merchant banker. Never in the history of rhyming slang has an occupation been more appropriate. If all bankers were like this, and rushed to judgement without checking their assumptions, and looking at the figures, the world's financial system would be at risk of - ah. Err, yes.

Err
Was the PCA abolished without us noticing?

or is that final confirmation that all that money spent on contracting out the medical services is happily paying for someone's get away yacht?

in the conservative language of the social security advisory committee, their verdict was corruscating. always worth a reminder...

http://www.ssac.org.uk/pdf/gp_response_version_8.pdf

but these bankers are brazen...
just when whitehall is reeling from the Hain non-think -tank and the Conway boys 'F*ck off I'm Rich party scandals...drops in the ocean of sleaze, greed and hypocracy which has earned them public contempt, you might expect them to brace themselves for the backlash...

but no...

we seem to have a counter-intuition strategy for managing public opinion, or maybe it's the old distract kitty with a ball of wool ploy.

nothing from this morally bankrupt lot would surprise me.
http://www.timesonline.co.uk/tol/news/uk/article3177616.ece

"Mr Freud's big idea is that the private sector be put in charge of the long-term unemployed. Companies taking part would receive a huge fee for getting somebody to stay in a job for more than three years but nothing if they fail."

hahahahahaha!

"He took three weeks to research and write the first draft of his report."

"For the companies that do well, the rewards could be huge. "We can pay masses - I worked out that it is economically rational to spend up to £62,000 on getting the average person on Incapacity Benefit into work."

actually, David, (Is he a lord yet?) that's not what my, and everybody elses national insurance contributions are paid for...not that they give a damn about such trivia...

"Specialists will spring up - he gives the example of Bangladeshi women, who are the lowest participants in the work force - "somebody will see a gap in the market and make their fortune."

as marie antoinette said, - il y a baucoup du monde a Versailles au jour d'hui.

!!!!!

What is the point of Employment & Support Allowance then - isn't it the reform of Incapacity Benefit etc that is supposed to address all these issue? Or, is Freud saying the new benefit is a waste of space? If so, isn't that a resigning issue for the Secretary of State (oh err he has already).

Is there a correlation between football teams who change their manager, and a government which changes the Sec. of State DWP, every other week and the quality of the end product??

Good question.

The imperative for reform is claimed to be a benign driver -'work is therapeutic', 'work is good for you' and cites Waddell and Burton 2006, whilst not making clear exactly the imperative.

http://www.dwp.gov.uk/publications/dwp/2007/welfarereview.pdf

Jim Murphy wept crocodile tears for the sheer waste of life of people on incapacity benefits who were more likely to die than get a job.

nb - it was not driven by a need to reduce spending - it's for our own good. and, try not to laugh, in the short term, "increased investment" will be required, including the development of IT systems. (i think we all know what that means by now...) primary legislation will be required for the funding change - avoided by David (short on evidence) Freud, but presumably involving a refund on the scrapped national insurance scheme ...only joking...as rights fly out the window and individual conditionality (oh is that what we're calling it now, massa? ) comes in.

David Freud seems to believe in the tooth fairy, and as a merchant banker, he might as well, and rather gives the game away...

"The scale of the potential market is large. It will be made up of the flow of new and existing hard to help clients from Jobcentre Plus. In the early years it would be further swollen as the existing customers on incapacity benefits were required to participate in labour market activity. Based on the analysis in this report, I have no doubt that this will be an annual multi-billion market. Such scale would attract commitment from a wide range of private service providers and voluntary groups.
The fiscal prize is considerable. Achievement of the 80% employment aspirationwould boost GDP, reduce benefit spending and increase Exchequer revenues to a material extent."

now i don't know much about football, and gave up on it when the stands became seats, but i think the common denominator might be the commodification of every aspect of life for profit, even other people's sickness, and i have absolutely no idea what business a state has in facilitating the turning of its most vulnerable citizens into a cash crop for greedy bastids, but what do i know...? i guess the clue is in the word 'business'.

some very interesting missing background to the above can be found in the following link - see below for taster

http://www.compassonline.org.uk/article.asp?n=563&offset=20

"In November 2001 a conference assembled at Woodstock, near Oxford. Its subject was ‘Malingering and Illness Deception’. Amongst the 39 academics and experts was Malcolm Wicks , Parliamentary Under Secretary of State for Work, and Mansel Aylward, his Chief Medical Officer at the Department of Work and Pensions (DWP).

What linked many of the participants together, including Aylward, was their association with the giant US income protection company, UnumProvident, represented at the conference by John LoCascio."

You could be right Peter. Gordon Brown supports Raith Rovers - nine managers since 1997, and now a pale reflection of former glories residing in the Scottish second division; compare DWP - eight Secretaries of State since 1997, and - well, you finish the sentence yourself.

About bankers Jan: there used to be a word current in my childhood, not heard much now, but maybe apt for a comeback? http://en.wikipedia.org/wiki/Spiv

Ariadne: do you think Freud and the smelly-graph might be susceptible to a defamation action, by IB claimants, or GPs, or both?

And now they're all losing the plot. One flint-hearted former DWP minister, now at housing, wants to evict social housing tenants for being unemployed: http://news.bbc.co.uk/1/hi/uk/7227667.stm
End child poverty? Easy: kick them and their parents onto the streets... Way to go, Caroline!

Just for clarity in case anyone's harbouring any illusions: the above remarks represent my personal views and not any corporate view taken by the trustees of the charity I work for.

Some time ago, one forum contributor raised the possibility of a "virtual pub" - a private cyber space where we could discuss matters freely away from public gaze and without having to remember disclaimers like this. Is that being considered, Shawn, Ken?

At the risk of sounding like Private Fraser from Dad's Army "we're doomed"

I don't think they are losing the plot, the current regime in power has made it clear it supports the free market and is a free marketeering political party, and what they are doing is implementing free market doctrine, in other words replacing the once Keynsian Welfare safety net, with a conditional punitive minimalist version of welfare. Nothing new in that e.g. poor laws and Work house. For all the talk of us living in a non-ideological age nothing could be further from the truth, the problem is because there is no polarity i.e. meaningful opposition opposing an unregulated free market economy. We've all made the mistake of underestimating them, which in part is due to their blundering and blustering ineptitude, greed, arrogance and falling into to the trap of believing its the leader and if so and so takes over the leadership, then hey sanity, justice and fairness will prevail. It hasn't and it won't!

She who hissed about "rolling back the frontiers of the state" was not just making a sound bite, it was a clarion call for the state to disengage and allow the market to arbitrate and dictate socio-economic policy, and that is what we have witnessed for the last 30 odd years.

This current phase is just part of the process, and is as i said earlier basically the powers that be implementing a conditional punitive minimalist version of welfare. Yeah there is definitely a cynical opportunistic side appealing to our reactionary instincts to get us to vote for the tweedledees instead of the tweedledums, but nevertheless its Neo-Con ideology and that is what we are witnessing unfold before our eyes and that is what the current regime offer and the one in waiting.

Mmmmmmmmm anyone for flower arranging or jam making.

Yeah these are my views and my views only, and represent my analysis of blah blah blah.

The Labour party is not, never has been and never will be a revolutionary party. - Lenin

Asking a finance capitalist to make proposals on welfare reform is like putting a fox in a chicken coop and telling it to do a head count.

Just one slight problem with your arguement.

The total proportion of U.K GDP accounted for by the state, the total tax burden and the total spending on welfare benefits have all increased quite substantially under this Government.

I believe that total welfare benefits spending in the U.K was somewhere in the region of £140 billion last year (using billion in it's accepted, though inaccurate sense of 1,000 million).

I don't agree with Freud or Flint, and I really don't think that Freud's should keep his position, but I don't see much sign that our Government is trying to model our state on the American model.

Hi Chris,

I take your point but stats they can obfuscate as much as the tongues of politico's.

"The total proportion of U.K GDP accounted for by the state, the total tax burden and the total spending on welfare benefits have all increased quite substantially under this Government"

Well the various western nations proportion of GDP/GNP accounted for by their national govt's increasing is a trend that's been going on for the last few decades, the US is a prime example.

One theory for this put forward by economists is special interest coalitions lobbying the govt to transfer wealth to them, economists call them rent-seekers. We call them the mega rich or worse.

So for instance Privatisation, Farm subsidies, PFI'S , tendering/contracting out govt services e.g. NHS services dentristy and surgical procedures and errrrrrr DWP, increased Military spending after post cold war decreases are just a few obvious examples, but it encompasses so much more e.g. underwriting the costs of foot and mouth and BSE, bailing out the private sector e.g. Northern Rock is a obvious one, but what about the examples when private contractors have pulled out of projects OR SCREWED THEM UP be it transport, education and so on and so forth.

Total tax burden? well its a good example of govt timidity when it comes to taxing big business and the rich and the mega rich. But it obscures the fact that billions of would be tax revenues is either ignored or not collected.

As for increases in welfare benefits, well we are an aging population and that is where the bulk of it goes, but it also reflects a low wage culture, so we are effectively subsidising employers through Tax credits and HB/CTB, and the jobs being created are predominantly low paid, low status, part time positions.

As for the American model, i'm not suggesting we are replicating the actual model, but i do think we are going down a similar road.

I'd argue that we shouldn't get too concerned about the mechanics of entitlement and assessment. Those follow the philosophies of the welfare system.

I think that the area we should lobby about is the change from a system which looked at the needs of the individuals and families concerned. What we now have, or are moving rapidly towards, is a system where the needs of the economy are assessed and the mass treatment and responses of claimants are designed around that.

...and just when you thought it couldn't get any weirder they now want to escalate homelessness too:

http://news.bbc.co.uk/1/hi/uk/7227667.stm

Must be time to put a fresh gloss on the 1834 New Poor Law Act.

I'm sure that 10 hours on the treadmill, the daily crushing of old bones and breaking of granite blocks, followed by a spoonful of gruel each night will have a dramatic impact on rising obesity levels too.

Might as well go for reintroduction of transportation too. Falkland Islands anyone?

As they said in 1998: things can only get betterrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrr.

Falklands- Nah I'll take Australia. Hold on! They had tax creds before we did-B****r that.

Well, that's why I changed that aspect. More penquins too.

These are the figures Freud uses -

Benefits Total annual spend

Unemployment benefits £2.5 billion

Income support for lone parents £3.4 billion

Incapacity benefits £12.5 billion

Disability and Carer benefits £6.3 billion

Housing & Council Tax benefits £11.9 billion



"Note: Benefit figures are estimated out-turn for 2006/7, published on the DWP website at:www.dwp.gov.uk/asd/asd4/expenditure.asp and consistent with Pre-Budget Report 2006. All figures are for “working age” (16 to State Pension Age). Disability and Carer benefits do not include Industrial Injuries benefits, Disability Living Allowance for children and those over State Pension Age, and smaller benefits."

The above comes to 36.6 billion. If you take out the £11.9 billion which goes to landlords and LAs that's £24.7 billion.

national insurance receipts came to this figure - £87,273 m. i always get confused by big sums - is that 8.7 billions? : )

http://www.hmrc.gov.uk/stats/tax_receipts/table1-2.pdf


i don't know whether the receipts table counts any receipts from the government itself - the original deal was a 3 way pot, remember? it's very hard to keep track of this - Freud has lumped IS for incap in with IB which doesn't help...and HMRC's notes refer to NI and tax being lumped together in PAYE...and split later...it's a nightmare...


the pensions service gets more confusing - there's a table here in here -

http://www.thepensionservice.gov.uk/pdf/annualreport/appendices.pdf

(and i'm really struggling to believe the £1.5 billion they say is paid in graduated retirement pension (which was a huge rip off by the way).

now that the social security scheme is way down on the DWP's priorities, certainly no longer its raison d'etre, it will well worth watching its entire budgetary spending, and they don't make it easy...


and i daren't even think about tax credits... i do think it's important this overpayment stuff is sorted out, because i don't see how the accounts can possibly be correct, and when policy and opinion is formed on hookey figures, not to mention er..reality... we're up sh*t creek before you can say mary poppins...

********************************************************************
useful to follow the money, both ways. just for a laugh, a quick recap.
http://www.spartacus.schoolnet.co.uk/Linsurance1946.htm

a quarter of my earning is taken by the government directly. i don't object to this providing it is used to fund the provision of essential public services to people in need of them, and for the benefit of society as a whole, and providing my rights as an individual are fully respected by the government. some public spending i do not approve of, and i accept that i won't approve all of it, and that is a price of democracy - opinions within that system will differ, and there are ways and means of influencing change. i have to draw a line however, around the public purse being turned into a private trough for profiteers, spivs, and war-mongers, and at imbecilic notions like caroline flint's - (are they really hers? - she speaks like someone with a gun at her back!)

http://www.guardian.co.uk/politics/video/2008/feb/05/housing.council.flint

any notion that the government and their pals have a divine right to my money to do with as *they* please threatens to disenfranchise me, and everyone else outside the elite circle. i don't take democratic freedoms and values for granted in the way that government takes its tax receipts for granted.

i notice she is repeating Jim Murphy's 'something for something'propaganda , when the insinuated 'something for nothing' accusation is projection, look at the facts.

"it's the economy stupid" - yes by all means, lets put it under the microscope.

see also http://www.guardian.co.uk/comment/story/0,,2252931,00.html
http://www.guardian.co.uk/humanrights/story/0,,2253082,00.html

Can we all please stop talking about this Government taking us back to the poor law.

I don't pretend to be an expert and I'm not a member of any political party but I do know this. What this Government has actually done is to massively increase benefits/welfare spending.

True, it is scandalous how much money they have wasted (see the Rightsnet story about £1 billion a year wasted on tax credits) but even apart from that there are far more people getting tax credits than got any previous support for low income working families.

In my borough I calculate that tax credits bring in about £100 million a year more than the old system (only a small proportion of that is accounted for by the minimum Child Tax Credit), true we all know that the system is a mess but millions of people have still benefited.

Yes there are other benefits which have been reduced but overall spending on benefits in the U.K is higher now than it has ever been

The people that we are concerned about are not those who are the working recipients of what might be described by some as an overly generous in work benefits system - probably more than 60% of the working population are supported by WTC and CTB/HB, and if this is because of the low wages that are being paid, then I have no problem with that. Just bear in mind though that we are indirectly subsidising an untold number of employers who are more than happy to pay as little as they can get away with.

Those we are concerned about are those who, (according to a merchant banker who clearly has no understanding of people or the Benefits system) apparently can work, even though a professional has certified that they can't.

Even more outrageous is the notion coming from a Government Minister that "Social housing" claimants should somehow be compelled to work, as part of their tenancy agreement - rather than trying to create a society where everyone is treated equally, it's this sort of thing that encourages and promotes social divisions.

Lone parents having to sign on when their youngest reaches the age of Seven - what happened to the much vaunted principles of "The family"?

What you are looking at is an attempt at social engineering - but being approached in their usual chaotic manner.....


I think I'm feeling better already ........couple more of those nice pink pills please nurse....

I particularly liked the bit in the Getelarph article where he explained that the benefits system was so complicated it took hime 3 weeks to understand it well enough to write his report.

The man is clearly a genius. I've been a welfare lawyer for 15 years, and an adviser for 7, and I reckon I'm just starting to get the hang of it (except tax credits, which I have decided I don't do).

What is deeply depressing is that "New" Labour have been in power since May 1997. Prior to that they had 18 years out of office to think things through. But let's be fair and just count the years from 1994 when T. Blair became leader. That's the best part of 14 years to identify policy issues and draw up strategies. It therefore comes as a surprise to find that the new housing minister has been shocked by the percentage of people who are unemployed and living in social housing.

Equally, that other oft repeated myth about GPs being the sole decision makers regarding incapacity for work is once again trotted out by Mr Freud.

Few people would argue that families (tax credits and child care) and the over 60s have been targeted for extra support by this government. Substantial investment has also gone into the NHS (let's not mention PFI though). There was also a big focus on education (but I've lost the plot on the outcomes).

Chrisdurhan says: "True, it is scandalous how much money they have wasted" and "true we all know that the system is a mess but millions of people have still benefited". So that's OK then is it? I'm afraid these are some of the key concerns for me (and the National Audit Office too I guess).

Then I think back to how our local (former) Benefits Agency office operated (efficiently) before the change to "delivery" centres and how customer focused they once were (yes really).

The Tribunals Service in Cardiff currently provides a really efficient service as far as I am concerned, but then I see on Rightsnet (19/11/07) that "...Tribunals Service and legal aid budgets to be cut by £230 million".

Over the last few years access to local legally funded welfare rights advice has vanished. I've also observed the manager of the nearest local law centre (30 miles away) making himself redundant to enable the centre to keep going (but they can't afford to offer welfare benefits advice).

There are many many other issues one could mention, but competent, confidential and effective administration of the social security system by fully trained and motivated staff should not be a luxury in this country. Nor should access to free legal advice for people on low incomes be either.

There are many ways the "system" can be improved, including claimants taking more responsibility for their lives, but such changes need innovative and highly sophisticated planning and implementation. When I see the sort of pronouncements trotted out this week in Westminster I can only conclude that we have little chance of progress in the foreseeable future.

Taking another cue from the 19th century, I would suggest it's now time for a 21st century version of the Representation of the People Act 1832.

Like others, I'm not a supporter or member of any political party and these are my personal views only, etc. etc.

Good new for your borough maybe Chris but bad news overall for disabled people, who have fallen more deeply into relative poverty over the last 10 years whilst these untold riches are arriving. (See JRF/PSI statistics).

Further, the government risk missing their own targets for child poverty and welfare to work if they don't begin to take proper account of disability poverty and the extra needs associated with disability (see Interact report from Community Links, LITRG & CPAG).

What Freud is proposing is for private sector companies to be able to make profits from an uncapped public budget, with his ideas for projected, or estimated, benefit savings made by services paid for under DEL to be recouped from AME. It feels like PFI for welfare but with even less risk for the private sector (see Freud's report).

By Freud's own admission in his report, there is no evidence that the private sector can perform any better than the public or voluntary sector in the provision of employment support provision, yet he is sure that because of the money on offer, they will want to get involved and do well (well, you would wouldn't you with access to an uncapped public fund budget underpinning your activities, see Freud's report).

In fact, the most recent reports have suggested that there are some serious questions about the efficiency, value for money and effects of currently contracted provision; that sanctions and compulsion are ineffective and unnecessary; that benefit rates and structures require attention (see Work and Pensions Committee report, DWP report, Freud's own report and the others mentioned).

Align all of the above with Freud's serious misrepresentation of the current situation and I would say that I have some pretty serious questions about the current approach, regardless of any perceived gains for "millions of people". We have quite a lot of people currently contacting us who are scared, angry, confused and also struggling for money. Welfare provision includes social care provision, housing, health, it's about more than tax credits. This feels like a rock and a hard place at the moment, because I don't think any choice is particularly attractive.

Well said, both of you.

...and just in case there is any doubt whatsoever about the commercial sector's "risk taking" in public/private partnerships, today we have this month's hit on the taxpayer, namely Metronet's collapse and a mere £1.7 billion out of the public purse, if you read the Telegraph):

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/02/07/cnmetronet107.xml

or £2 billion and rising if you prefer the Times:

http://www.timesonline.co.uk/tol/news/politics/article3321667.ece

I wonder how many merchant bankers were involved in that deal?