6 Mandatory reconsideration and appeals |
90. In our 2011 report on IB reassessment,
we expressed concern about the high number of ESA appeals.
In recent years, the proportion of ESA decisions appealed against,
and the proportion of those that are overturned on appeal, has
remained high: between April 2012 and March 2013, around 35% of
fit for work decisions for ESA new claims were appealed against,
and 33% of these were overturned on appeal. This equates to just
over 1 in 10 initial fit for work decisions being reversed at
tribunal. In 2013-14,
232,639 appeals were lodged against ESA decisions. This clearly
involves considerable expense to the public purse: the average
cost of an appeal is estimated at £248;
and in 2013-14 the total cost to DWP of appeals was £69.9
million. We were
therefore keen to revisit this area, and to consider the steps
the Department has taken to try and reduce the need for a large
number of appeals.
91. Mandatory reconsideration (MR) was
introduced in April 2013 for Universal Credit and Personal Independence
Payment claims, and in October 2013 for all other DWP administered-benefits
and child maintenance cases, including ESA. Prior to its introduction,
those wishing to challenge DWP's decision could immediately lodge
an appeal with HM Courts and Tribunals Service (HMCTS). The introduction
of MR means that those wishing to challenge a decision must ask
DWP to reconsider it first, and only when DWP has done so may
the person then proceed to appeal if they remain dissatisfied.
As part of this inquiry, we considered what impact the introduction
of MR was having on those who had gone through the WCA process
and wished to challenge DWP's decision. Some of the issues raised,
and the recommendations we make, are equally applicable to the
reconsideration of other DWP decisions.
92. DWP has stated that MR was introduced
disputes as early as possible;
unnecessary demand on HMCTS by resolving more disputes internally;
revising a decision where appropriate;
a full explanation of the decision; and
claimants to identify and provide any additional evidence that
may affect the decision, so that they receive a correct decision
at the earliest opportunity.
93. HH Judge Robert Martin, President
of the Social Entitlement Chamber of the First-tier Tribunal,
believed that MR was based on a "false premise" as,
prior to its introduction, DWP already reconsidered every decision
that went to appeal. This information was also provided to us
by the then Minister for Employment in March 2012, who stated
that virtually all appealed decisions were already going through
reconsideration, before it became mandatory.
Judge Martin argued that the introduction of MR was of "dubious
advantage", as the claimant now had to make two applications
(one for reconsideration and one for an appeal to HMCTS), whereas
under the old system they only had to make one. The only advantage
he saw to its introduction would be if it led to "a much
more rigorous reappraisal by the Department of its decisions."
Jason Feeney told us that reconsideration of decisions was now
a "much more rigorous, independent process", as it was
"more focused on getting further medical evidence where it
is needed" and because it was now undertaken by independent
teams in different locations to the original decision-makers.
94. Judge Martin also believed that
the introduction of MR, rather than leading to a justified reduction
in appeals, might discourage claimants who might have had "winnable"
cases from appealing, because they found the process too onerous.
He argued that it was "crucial" that research be undertaken
into claimant behaviour in this respect.
Z2K and Citizens Advice, although not against the principle of
MR, were concerned about how it was operating in practice.
These concerns are considered below.
EFFECTIVENESS OF THE POLICY: IMPACT
ON THE NUMBER OF APPEALS
95. The most recent statistics show
that there has been a large reduction in the number of appeals
against ESA decisions received by HMCTS: in January to March 2014
there were 11,455 ESA appeal receipts, compared to 109,033 in
the same period for the previous year. This represents a reduction
of 89%. Kevin
Sadler, Director of Civil, Families and Tribunals, at HMCTS, told
us that they were still working with DWP to understand the reasons
for the reduction, but DWP operational decisions about slowing
down the WCA process had affected the number of appeals: "If
they make fewer decisions, we get fewer appeals."
96. The Minister acknowledged that there
were "lots of different reasons" for the reduction in
the number of appeals. In the absence of a proper analysis at
this stage, he was unable to say whether it was entirely down
to the introduction of MR, but he was hopeful that it was at least
in part down to changes that had been made to assessments. He
assured us that DWP would be analysing the reasons behind the
Sadler believed that it was possible that the introduction of
MR would reduce the proportion of decisions that are overturned
on appeal but pointed out that, because it might also leave the
tribunal with only the "most finely balanced cases",
it might not.
have previously expressed concern about the high number of appeals
against ESA decisions. Appeals are both expensive to the public
purse and stressful for claimants and we welcome the introduction
of mandatory reconsideration (MR) as a step towards reducing the
number of unnecessary appeals. However insufficient information
is currently available to allow us to evaluate whether it is likely
to have this effect in the longer term. The reduction in the number
of DWP decisions, due to temporary operational changes, is likely
to have contributed to the significant reduction in appeals shown
in the latest statistics, rather than representing a long-term
change arising solely from MR. We welcome DWP's assurance that
an analysis of the reasons behind the reduction in appeals will
98. Mandatory reconsideration will
be a success if it results in a reduction in unnecessary appeals
to HMCTS. We are however concerned that its introduction may deter
claimants who were likely to have been successful in their challenge
from appealing, because the new dual process is more onerous.
We recommend that the Department monitor claimant behaviour, to
evaluate whether the policy is having this undesired effect, rather
than fulfilling its intended purpose of ensuring a correct decision
is reached more quickly and without needing to go to appeal.
STATISTICS ON THE OPERATION OF THE
99. Statistics are not yet available
on how many requests have been made for reconsideration of ESA
decisions, and how many of these decisions were changed as a result.
Current statistics on the outcomes of WCAs take account of adjustments
to decisions that have been made following reconsideration; however
a breakdown of the figures, showing the difference between the
outcomes of initial decisions, and the outcomes once readjustments
following reconsideration are taken into account, is not provided.
DWP has stated that, although data is being collected on the volumes
and outcomes of MR, "it is not sufficiently robust and reliable
to make available."
DWP told us that it does not yet have a date for publications
of the full statistics.
100. We recommend that the Department
works with the Office for National Statistics to ensure that official
statistics on the operation of mandatory reconsideration are published
as a matter of urgency. These should include: volumes of reconsiderations
received and processed since the policy was introduced; the outcomes
of these reconsiderations; the overall impact on ESA outcomes;
and the length of time it is taking for reconsiderations to be
TIME-LIMITS FOR MANDATORY RECONSIDERATION
101. Statistics are also unavailable
on the time it takes for reconsiderations to be completed.
DWP does not have a target completion time for reconsiderations
and a number of witnesses suggested that a target time or time-limit
should be introduced.
For "straightforward cases", where it is not necessary
for further information to be sought, DWP expects the process
to take around 14 days. However, DWP emphasised that it could
take longer, especially if additional information is needed, because
the Department must allow claimants a month to submit it.
 Z2K told
us that, in its experience, the time it takes "varies greatly
from two months to much longer".
The Minister said that the current time taken was affected by
the backlog of ESA reconsiderations which had built up, but that
DWP was "working on it." He reiterated that he would
not be setting a time-limit because of the need to allow time
for additional evidence to be submitted. His view was: "If
we get the decision right, then it is worth the time." However
he wished to speed up the process.
102. We acknowledge that DWP often
needs to seek additional evidence as part of the reconsideration
process, which can be time-consuming, and we agree that it is
better for mandatory reconsideration to take a little longer if
this results in the correct decision being made. However this
should not be an open-ended process and we do not accept that
either of these factors preclude DWP from introducing a reasonable
time target for completion of reconsideration. The introduction
of a time target would also help to drive better performance.
We therefore recommend that DWP introduce and report against a
reasonable time target for the completion of mandatory reconsiderations.
ELIGIBILITY FOR ESA AND JSA DURING
103. Claimants deemed fit for work who
request reconsideration of that decision are not able to claim
ESA at the assessment rate; instead they can claim Jobseeker's
Allowance (JSA) if they are eligible. (Claimants who are placed
in the WRAG and ask for reconsideration on the basis that they
should be in the Support Group are paid ESA with the WRAG component
during this period.) If, after MR, the claimant appeals to HMCTS,
then assessment rate ESA is reinstated.
104. Certain conditionality requirements
have always been attached to JSA. As part of the introduction
of Universal Credit, all JSA claimants are now required to sign
the Claimant Commitment, which requires them to undertake extensive
job-search activities, which may be up to 35 hours a week, in
return for receiving the benefit.
If claimants do claim JSA, they may be sanctioned if they do not
fulfil the conditionality requirements. If claimants do not claim
JSA, this can cause other problems, including a claimant's Housing
Benefit being stopped because the local authority has been informed
by DWP that the claimant is no longer in receipt of a relevant
105. The Minister for Employment has
previously said that "DWP advisers have the flexibility to
tailor conditionality to suit a claimant's circumstances and appropriate
guidance is issued to DWP staff in Jobcentres."
Despite this assurance, we have heard a number of reports of claimants
being told by JCP advisers that they are unable to claim JSA on
the grounds that they will not be able to meet the conditionality
requirements because they are not fit for work.
This leaves claimants unable to claim either ESA or JSA and therefore
financially vulnerable while their case is reconsidered. Jason
Feeney told us that not all Jobcentre advisers had been aware
of the flexibility to offer tailored conditionality but DWP had
recently issued new guidance on this.
106. We have also heard reports that
claimants are reluctant to claim JSA because they fear it will
count against them in the reconsideration of their ESA decision.
A number of witnesses also point to the inappropriateness of requiring
claimants to claim a fit for work benefit when they are arguing
that they are not fit for work.
We have also heard that not paying claimants ESA during the MR
may have the negative effect of deterring them from submitting
further evidence at the MR stage, so that they can proceed to
appeal more quickly.
107. Citizens Advice pointed out that
it is "time and resource intensive to move people from ESA
to JSA and back to ESA within a few weeks" (with claimants
becoming re-eligible for assessment rate ESA once an appeal has
been lodged). Moreover, assessment rate ESA and JSA are the same
amount of money, so there is no financial saving for the Department
(unless it expects fewer people will claim JSA as a result).
Therefore, not only is there no obvious saving, but there may
be an administrative cost to this policy.
108. The Minister defended this approach:
"A decision has been made by the decision-maker that that
person is fit for some type of workand that is the decision".
However it is also the case that claimants have been determined
as fit for work during the appeal process, but in that situation
they are paid ESA at the assessment rate. The Minister told us
that he would look again at the policy.
109. We believe that it is inappropriate
that those who have been determined by DWP to be fit for work
and who have asked the Department to reconsider the decision are
ineligible for assessment rate ESA. Although these people may
be eligible to claim JSA, many are reluctant to do so because
of the accompanying conditionality requirements. There has also
been a problem with some Jobcentre advisers not being aware of
the flexibility to modify the attached conditionality appropriately
for these claimants. Assessment rate ESA and JSA are the same
amount of money, so there is no financial saving for the Department
from the policy, and it may in fact cost the Department money
due to the administrative burden of moving claimants from assessment
rate ESA to JSA during reconsideration, and then back to assessment
rate ESA if they decide to appeal. We therefore recommend that
claimants deemed fit for work following the WCA process who have
requested that the Department reconsider that decision be paid
ESA at the assessment rate until they receive the reconsidered
Role of tribunals in improving
110. In his independent reviews of the
WCA, Professor Harrington pointed to the value of feedback from
the tribunals in improving the initial decision-making process,
and therefore reducing the number of appeals. In response, in
June 2013 HMCTS introduced the provision of "summary reasons"
on a "controlled start basis" for ESA cases where DWP's
decision was overturned or upheld. Written summary reasons are
provided in the Decision Notice which is issued by the tribunal
and sent to both the claimant and DWP after the hearing. This
was introduced initially at four tribunals for ESA cases, and
since April, summary reasons have been provided nationally in
ESA and PIP cases.
HH Judge Martin explained: "It is national in that we are
running it at those centres where we have the IT support that
allows us to use computerised decision notices. The coverage is
not 100%, but the majority of centres are now linking up and generating
111. Judge Martin believed that summary
reasons would not only enable decision-makers and HCPs involved
in a particular case to learn what went wrong, but that "it
is also possible to aggregate the data to find out whether there
are systemic shortcomings." He was however concerned about
DWP being able to handle the volume of information it was receiving
through this process. He pointed to the "crucial feature
of feedback", which is "that it should do something".
Richard Mason from the Ministry of Justice agreed that there was
"little point" collecting feedback unless it would be
used, but he explained that DWP was using the feedback "in
training for decision-makers, in reviewing their guidance for
decision-makers, looking to identify trends and pulling out useful
112. DWP acknowledged that communication
between tribunals and its DMs about what happens in an appeal
is an "important feedback loop". It explained that it
is using the summary reasons "to broaden its understanding
as to why its decisions are upheld or overturned, and to identify
areas where the approach to decision-making can be strengthened
as a part of its continuous improvement work."
The Minister told us that DWP needed to "listen very carefully"
to the feedback given.
Atos told us that feedback from appeals would be helpful for its
assessors but they do not receive this under the current arrangements.
113. We welcome the introduction
of more extensive feedback from appeals through the provision
of summary reasons by tribunal judges. However it is critical
that this feedback is used effectively by the Department to improve
the initial decision-making process. We recommend that, in response
to this report, the Government set out how it plans to handle
the volume of information it is now receiving through summary
reasons, and how it will analyse and use it to improve the initial
decision-making process. We further recommend that feedback from
summary reasons is also shared with the new provider of the face-to-face
assessment, so that it can be used to evaluate how assessments
could be improved.
Efficiency of the appeals process
114. In our 2011 report on IB reassessment,
we pointed to the significant delay in appeals being heard, taking
on average 21.8 weeks to be disposed of at that time.
The most recent statistics, for cases disposed of by the
Social Security and Child Support Tribunals in the quarter January-March
2014, show that delays are still significant for some claimants:
although half of all cases were cleared within 22 weeks or less,
the average case clearance time was 25 weeks.
115. HMCTS witnesses explained that
the capacity of the tribunal service had been a substantial cause
of the delays in the past, However, Judge Martin believed that
it now had the capacity to deal with the volumes and had made
"tremendous inroads" in reducing the backlog of cases.
Kevin Sadler explained that the initial appeal forecasts provided
by DWP had been too low, "by a factor of 10". He said
that HMCTS had been working with DWP "ever since to get better
forecasts and better management information."
116. Another change in the process for
challenging decisions, introduced at the same time as mandatory
reconsideration, is "direct lodgement". This change
was intended to simplify the process and to bring it in line with
other appeal processes in HMCTS.
Previously, claimants submitted their appeal to DWP, and it was
then transferred to HMCTS. Under direct lodgement, claimants must
submit a letter of appeal to HMCTS within a month of the MR letter
being issued. Once HMCTS has received the required
documentation, it will inform DWP that an appeal has been lodged.
DWP will then consider the case again and may change the original
decision being appealed at any time before the case is heard at
the tribunal. It may also object to the appeal, for example if
it believes it to be "unreasonably late" or "to
have no likelihood of succeeding."
117. DWP must provide a written response
to the appeal. A hearing then takes place in the First-tier Tribunal.
Kevin Sadler explained that delays in DWP providing its response
promptly had also been a factor in appeal delays. Before MR was
introduced, it took nine weeks on average for DWP to provide its
submission to a case.
A time limit of 28 days for returning a response in benefit cases
will be introduced from October 2014 and DWP is currently working
to that timeframe.
Kevin Sadler believed that "around 10 weeks" was
the best outcome you might expect for the age of case at disposal
in the tribunal. Based on an even flow of appeals, and with the
current capacity, he expected that timescale to be met "often
in this financial year". However, he emphasised that he was
"entirely dependent on what DWP send me."
118. Officials explained that, when
they receive an appeal, they currently notify DWP in a form sent
by post. We challenged the efficiency of continuing to use a hard
copy system. Kevin Sadler acknowledged that "in an ideal
world with an IT system that did everything I wanted it to"
these forms would be sent electronically and, indeed, an electronic
appeal form accessible via the internet would also be a goal,
if HMCTS had the funding available for this.
119. We welcome the efforts to streamline
and speed up the appeals process by increasing the capacity of
the Tribunals Service, and introducing direct lodgement and a
target time for DWP to submit its case to the tribunal. We were,
however, surprised to learn that documentation is exchanged between
DWP and the Tribunals Service in hard copy through the post, given
the Government's emphasis on the benefits of using the internet
for public services. There is clearly further scope for increasing
efficiency and improving the service for claimants making an appeal
by introducing an online appeal application form and enabling
electronic transfer of documents between DWP and the HMCTS. We
appreciate that there will be an initial cost, but the return
in terms of speed and efficiency would be worthwhile. We recommend
that the Government set out the action it intends to take in this
respect in response to this Report.
132 Work and Pensions Committee, The role of incapacity benefit reassessment in helping claimants into employment,
para 146 Back
DWP, ESA: outcomes of WCAs, Great Britain - tables, June 2014,
table 3 Back
Ministry of Justice, Tribunals statistics quarterly: January-March 2014 - tables,
June 2014, table 1.4; Q123 Back
HC Deb 7 July 2014, col 103w. This breaks down as £28.7 million
in DWP operating costs and £41.2 million paid by DWP to HMCTS
for appeals handled in excess of the volume for which baseline
funding was provided. Back
DWP (WCA0202) paras 45-51 Back
DWP, Appeals Reform: An introduction, August 2013, p 4 Back
Oral evidence taken on 19 March 2012 on the Work Programme, HC
1903-i, Q6 Back
Q96 Judge Martin
retired from his post as President of the Social Entitlement Chamber
of the First-tier Tribunal on 1 June 2014. Back
Ministry of Justice, Tribunals statistics quarterly: January-March 2014 - tables,
June 2014, table 1.4 Back
DWP, ESA: outcomes of WCAs, Great Britain, Quarterly official
statistics bulletin, June 2014, para 1.1.1 Back
HC Deb 8 April 2014, cols 218-19w Back
supplementary written evidence Back
Deb 8 April 2014, cols 218-19w Back
Q59 [Citizens Advice]; Z2K (WCA0019) para 55, St Mungo's (WCA0180)
para 2.5 Back
HC Deb 25 November 2013, col 121w Back
Z2k (WCA0119) paras 51 Back
See Work and Pensions Committee, The role of Jobcentre Plus in the reformed welfare system,
paras 39-48 and 76-80 Back
HC Deb, 5 Nov 2013, col 153w Back
Disabled People against Cuts (WCA0152) para 60; Spartacus (WCA0159);
Citizens Advice (WCA0160) para 39 Back
Scope (WCA0151) para 4.12.1, Citizens Advice (WCA0160) para 39 Back
Q60 [Z2K] Public and Commercial Services Union (WCA0102) para
John Slater (WCA0028) para 2, Citizens Advice (WCA0160) para 39 Back
Citizens Advice (WCA0160) para 37 Back
DWP (WCA0196) para 59 and Q164 Back
DWP (WCA0196) para 59 Back
Work and Pensions Committee, The role of incapacity benefit reassessment in helping claimants into employment,
paras 142 and 146 Back
Ministry of Justice, Tribunal Statistics quarterly: January-March 2014-tables,
table 4.2 Back
DWP, Appeals Reform - An introduction, August 2013, p 4 Back
DWP (WCA0196) paras 53 and 57 Back
DWP (WCA0196), para 58 Back
Qq107-8 and 138 Back