Government welfare reform adviser’s basic errors call into question proposal for £167bn privatisation spend

Responding to government welfare reform adviser, David Freud's, inaccurate comments in today's Daily Telegraph on basics of the benefits system, and unfounded allegations about disabled people reliant on benefits for their family security, Kate Green, Chief Executive of Child Poverty Action Group, said:

"Ministers will surely be alarmed that the man charged with major reform of the welfare system and family security rights gets basic facts wrong about benefits that he could found out in a second with a google. His suitability must be under question for the task Work and Pensions Secretary, James Purnell, has set him.

"Freud confesses to having known nothing about the benefits system, thinking it too complicated to understand. He clearly spent most of the 3 weeks writing and researching his welfare reform report playing around with financial models on the back of an envelope instead. The result is a proposal to hand over £167 billion of tax payers' money to private companies with incentives to keep as much as they can. But while the private companies get the cash, he wants more powers to cut benefits to families kept form work by disability.

"There is a real danger that lack of value for tax payers' money, at the expense of vulnerable disabled people, could make concerns about NHS spending decisions look like peanuts.

"James Purnell inherited the Freud Review and should not lack the courage to drop it in favour of addressing the real barriers that keep disabled people form work. The Government must now look seriously at the genuine investment disabled people require to meet their additional needs and overcome discrimination from employers that keeps them out of work."

 

Notes for editors

• Freud incorrectly stated a person's own GP determines their entitlement to Incapacity Benefit. A google search for "incapacity benefit test" took 0.06 seconds to return a top result explaining the stringent Personal Capacity Assessment carried out by independent doctors contracted by the Department for Work and Pensions.
• Freud makes a claim, without providing any foundation, that: "There are probably five to seven per cent of the people on IB today who are on the black economy. They're doing jobs and claiming too but they won't have a free lunch any more." But the most recent official measure of Incapacity Benefit fraud suggests it is below 0.5%. Benefit fraud generally has been on a downward trend for several years.
• Freud proposes a spend of £62,000 on private sector contracting out for the typical IB claimant. With around 2.7 million incapacity benefit claimants, this typical spend per claimant totals £167.4bn.
• 38% of employers say they would not employ someone with a mental illness.
• 1 in 3 employers think people with mental health problems are less reliable than other employees.
• CPAG is one of over 100 member organisations of the Campaign to End Child Poverty, campaigning for public and political commitment to ensure the goals of halving child poverty by 2010 and ending child poverty by 2020 are met.

For further information please contact:
Tim Nichols
CPAG Press Officer
Tel. 020 7812 5216 or 07816 909302
tnichols@cpag.org.uk