Struggling Economy Reaches a Milestone with Unprecedented Number of Benefit Recipients
The Centre for Social Justice (CSJ) has recently released a report highlighting the growing issue of long-term sickness and disability among older workers in the UK, and the potential benefits of implementing benefits reforms and a National Work and Health Service (NWHS) to address this problem.
The report reveals that nearly 2 million over-50 workers are currently out of work, claiming benefits, marking a 43% increase since 2020. This surge is largely due to rising long-term sickness, with the sickness certification system encouraging a default of full sickness absence (93% of fit notes certify “not fit for work”).
Labour MP Carolyn Harris, vice chair of the CSJ, has called this trend a "midlife crisis" for the UK economy. She has also advocated for a government pilot of a National Work and Health Service, which aims to help reduce unnecessary workforce drop-out for older workers.
The proposed NWHS would combine health and employment support tailored for older workers, providing quicker Occupational Health interventions and helping to modify working conditions, enabling phased or sustained returns to work. This could prevent long-term detachment from the labor market.
One of the key recommendations in the report is the simplification of benefit systems. By consolidating and simplifying claims, such as moving Employment and Support Allowance (ESA) claimants to Universal Credit by the end of 2025, the government could improve incentives and support for those with health issues to return to employment rather than remain on benefits.
Mercy Muroki, development director at the CSJ, believes that adopting the measures set out in the report can improve labour market outcomes for older people. She suggests that a modest rise in employment among economically inactive people over 50 could generate billions in tax revenue and welfare savings.
However, the report does not provide information about potential solutions or benefits reforms beyond the proposed NWHS. The Treasury faces a daunting warning from the National Institute of Economic and Social Research, stating that Rachel Reeves may need to raise more than £50bn in fresh taxes to stay within her fiscal rules.
The CSJ's report indicates a 21% increase since 2015 in older individuals leaving the workforce due to health conditions. GPs have been shown to lack the time and resources to provide assessments on adjustments that could allow individuals to stay in work, according to the report.
The new service is intended to keep older workers meaningfully engaged with employment, even at a reduced level. By facilitating earlier and supported return to work, reducing welfare dependency, and increasing tax contributions, these proposals aim to address the current systemic barriers that contribute to high long-term sickness absence rates and benefit reliance among the over-50s.
- The Centre for Social Justice's report indicates that the number of over-50 workers claiming benefits has increased by 43% since 2020, with a majority of this increase attributed to long-term sickness.
- Labour MP Carolyn Harris has advocated for a government pilot of a National Work and Health Service (NWHS), which aims to help reduce unnecessary workforce drop-out for older workers.
- Mercy Muroki, development director at the CSJ, suggests that adopting the measures set out in the report could generate billions in tax revenue and welfare savings, by improving labour market outcomes for older people.
- The Treasury faces a potential need to raise more than £50bn in fresh taxes to stay within its fiscal rules, as warned by the National Institute of Economic and Social Research, but the proposed NWHS and benefits reforms could potentially contribute to a reduction in welfare dependency and an increase in tax contributions.
