Two million people 'not entitled to sickness benefit', says top government advisor

Last updated at 13:18 02 February 2008

Almost two million incapacity

benefit claimants

should not be getting the

money, the Government's

welfare adviser warns today.

David Freud, an investment

banker, claims the tests used to

award disability aid worth £81.35

a week are "ludicrous" and are

costing the taxpayer billions of

pounds each year.

And he attacked the system as

one where – compared to unemployment

benefit – "you get more

money and you don't get hassled,

you can sit there for the rest of

your life".

He added: "The system we have

at the moment sends 2.64million

people into a form of economic

house arrest and encourages

them to stay at home and watch

daytime TV. We're doing nothing

for these people."

Of the 2.64million incapacity

claimants, who cost the taxpayer

more than £12billion a year, Mr

Freud estimated that fewer than

one third are truly entitled to aid,

while between 5 and 7 per cent of

all claims are fraudulent.

Up to 185,000 are actively

defrauding the system by working

illegally while receiving the

benefit, he said.

He suggestedthe "real figure" of those unable to

work because of illness or disability

was closer to 700,000.

"When the whole rot started in

the 1980s we had 700,000," he


"I suspect that's much

closer to the real figure than the

one we've got now."

Since the 1980s, there have

been claims that successive governments

have allowed the incapacity

benefit total to grow inorder to keep down the more

politically sensitive count of the


Mr Freud said of the medical

tests needed to claim the handout:

"If you want a recipe for getting

people on to incapacity benefit

we've got it.

"It's ludicrous that the disability

tests are done by people's

own GPs – they've got a classic

conflict of interest and they're

frightened of legal action.

He went on: "The people who

are really disabled are often theones who are really desperate to

work but there are then a load of

people who don't want to be

made to work regardless."

Mr Freud's report into welfareto-

work schemes heavily influenced

reforms set out by James

Purnell, Work and Pensions Secretary.

on Monday.

Under the plans, private firms

could be paid "bounties" to help

get claimants off incapacity benefit

and into jobs.

Lone parents

would also be encouraged to go

back to work as soon as their

children started school.

In an interview with The Daily

Telegraph, Mr Freud said he

believed Gordon Brown was

ready to press ahead with the

biggest shake-up of the welfare

state for 50 years.

Mr Purnell would tackle the

problem with "much more single

minded ferocity" than his predecessor

Peter Hain, who quit last

week, he added.

Recent figures show more than

500,000 people under 35 are now

claiming incapacity benefit.

Around 40 per cent are claiming

for mental health problems,

250,000 for stress-related illness,

while others cite alcoholism,

obesity or eating disorders.

Shadow work and pensions secretary Chris Grayling said: "It is time to ask every claimant of Incapacity Benefit to go through a proper independent medical check.

"Those fit to work should have their Incapacity Benefit withdrawn immediately and those with the potential to work should get proper support to help them back into employment."

Liberal Democrat work and pensions spokesman Danny Alexander said: "David Freud's analysis is a stark condemnation of 10 years of Labour failure on welfare reform.

"Millions of people on Incapacity Benefit want to work and would be doing so today if the government had put the right support in place.

"Getting the private and voluntary sector more involved is the right approach, but progress is painfully slow. If the right help is there, people should have a responsibility to access it.

"Britain's welfare system is the most complex in the world, which is why errors and fraud are too high. Making the system much simpler, as we have proposed, is crucial to making sure benefits are going to the right people and that they are getting the right help to find a job."

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