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Welfare Reform Bill

My hon. Friend raises an important point. When I became the Minister with those responsibilities, there was no specific training in disability assessment for such doctors. The Royal College of Physicians introduced a postgraduate diploma in disability assessment medicine to train them and it was intended to ensure over time that all doctors working for the Department for Work and Pensions would be trained in disability management. That is an extremely important part of the package. There is a shortage of vocational rehabilitation services, including medical and psychological services and practical help with overcoming functional impairments. A study in 14 OECD countries, ““Transforming Disability into Ability””, which was published in 2003, compared the number of people who each year go through vocational rehabilitation with the number flowing on to long-term incapacity benefits. In Norway, Denmark and Korea, more people get access to vocational rehabilitation than go on to incapacity benefits. In Germany, Sweden, the Netherlands and the United States, about 50 per cent. of the number who go on to incapacity benefits get access to rehabilitation services. In Switzerland, Australia and Portugal, the figure is some 20 to 30 per cent. In the UK, it is still less than 5 per cent. We are second lowest of the 14 OECD states in the study. More revealingly, the study calculated that spending on vocational rehabilitation as a percentage of spending on disability benefits varies enormously. In Norway, Germany, Sweden, Switzerland, Portugal, Australia and Belgium, spending on rehabilitation is between 70 and 100 per cent. of spending on incapacity benefits. In Denmark, Korea and the United States, the figure is about 50 per cent. In the UK, along with Poland, Austria and the Netherlands, we spend less than 20 per cent. of the amount spent on benefits for long-term sick and disabled people on rehabilitation. It is therefore not surprising that fewer people are rehabilitated in the UK or that the number of incapacity benefit claimants here is higher than the number of people claiming similar benefits in most other OECD countries. It is important to complement the measures in the Bill by substantially increasing the resources available for vocational rehabilitation. That would gain widespread support from organisations representing disabled people. Within the national health service, there has been a substantial increase in resources for rehabilitation. However, its priority is to rehabilitate hospital patients to the point at which it is possible to discharge them so that they may return home, and not necessarily to continue the rehabilitation to the point where they can return to work. The NHS needs to earmark more resources for vocational rehabilitation. The Government should consider creating financial incentives to reward successful cases of rehabilitation. As the hon. Member for Runnymede and Weybridge said, huge savings accrue to the DWP and the Government when people come off incapacity benefit. Those savings should be recycled to pay for more people to be rehabilitated. There are lessons to be learned from abroad, although not necessarily from the Netherlands, where, as my hon. Friend the Member for Bradford, North (Mr. Rooney) pointed out, there is an incentive for employers to rehabilitate their staff because they carry the cost of somebody being off work for the first two years of absence. That is not the situation in this country. We could perhaps learn a better lesson from Germany or Switzerland, where, under the Bismarck insurance scheme, employers pay into a common fund that gives cover for health, rehabilitation and pensions. The German phrase for such funds is ““Rehabilitation vor Rente””—““rehabilitation before pension””. Those insurance funds have an incentive to rehabilitate, because the person then goes back to work and starts paying contributions again. If the scheme fails to rehabilitate, it ends up paying a pension for life. There have been similar experiments in Sweden, where pilots have merged benefits and health budgets at local level to pass benefits savings on to health care providers when rehabilitation successfully gets people back to work. I should like our Government to adopt a similar approach. Perhaps a simple way to pilot it would be to give a health and vocational rehabilitation purchasing budget to the managers of the pathways into work pilots. If the NHS does not have the incentive to rehabilitate to the point at which people get back to work, we need to create an incentive for the DWP to reap the financial benefits when somebody is successfully rehabilitated and returned to work. When the Conservatives were in power and unemployment broke the 3 million barrier for the second time, a Conservative Chancellor of the Exchequer said that, sadly, there was no alternative. The record of this Labour Government in their first two terms has shown that there is an alternative. For fit people of working age, unemployment has fallen dramatically to fewer than 1 million. That is something that this Labour Government will be remembered for. The challenge for the third term is to show that there is an alternative for people on long-term sickness and incapacity benefits. The Bill shows the way forward, but it needs to be complemented by greater investment in rehabilitation services.