News

The Department for Work and Pensions (DWP) has forecast a big increase in the amount it expects to have to spend on employment and support allowance (ESA), suggesting that many more incapacity benefit claimants are likely to be awarded ESA.

The Office for Budget Responsibility was set up in 2010 to provide independent analysis of public finances. It presented a report “​Economic and fiscal outlook”​ to Parliament in November 2011. The report states that one of the “​most significant”​ changes in assumptions about the cost of welfare benefits relates to ESA (para 4.108, p 147 and table 4.21, p 146 of the report).

Many more people are expected to qualify for ESA as result of the reassessment of incapacity benefit (IB) claimants. This in spite of the harshness of the of the revised work capability assessment (WCA) introduced in March of this year.

The DWP also anticipates more people than expected being placed in the Support Group of ESA. As a result, by 2015-16 the DWP anticipates an increase in expenditure on ESA by £​1 billion compared to the amount it had forecast it would spend in its previous forecast in March of this year.

The full report can be found here.