Committee says withdrawing benefits for those judged unwilling to seek work risks driving claimants into 'crime or prostitution'
Iain Duncan Smith's own advisers have urged a softening of his benefits crackdown after hearing evidence that it risked pushing the poorest in society into "crime or prostitution".
The work and pensions secretary should relax the punishment he plans to mete out to unemployed people judged unwilling to seek work, they warn.
Testimonies heard by the Social Security Advisory Committee (SSAC), a Whitehall body responsible for monitoring Duncan Smith's planned welfare reforms, suggested that there is a danger of driving vulnerable families out of mainstream society.
The tougher sanctions regime was introduced in October. It is due to be continued under the universal credit scheme, the new catch-all benefit payment designed to simplify the system and make work pay. But the committee's report told Duncan Smith he should offer some hope of state aid for those on the most severe sanctions.
In the most extreme cases the unemployed will lose their £71-a-week jobseeker's allowance for up to three years if they are believed to have serially breached the tough new conditions for the universal credit, including the duty to attend job interviews, accept job offers or carry out unpaid work experience.
The committee recommended that those who are barred from payments but subsequently show a willingness to find work should have their benefits returned to avoid damaging outcomes.
The report's authors wrote: "The higher-level sanction of three years drew a lot of comments from – and raised concern among – most respondents. Such a severe penalty could, they fear, result in claimants turning to the black economy, crime or prostitution, would not incentivise someone to enter employment, and would almost certainly damage children in a family where income is severely reduced for a prolonged period.
"US research was cited as evidence that severe conditionality can result in families becoming disconnected from society: they are neither in work nor receiving state support. Given the government focus on supporting families with children in their early years, respondents urged this level of sanction should be used with extreme caution.
"The committee is sympathetic to the concern expressed by respondents that if sanctions are to be effective in encouraging compliance, continuing a sanction beyond the point of re-engagement may well be counter-productive."
Under the rules, where there are "low and intermediate level" issues, such as failure to actively look for or be available to work, claimants would lose their benefit for one month for the first offence and three months for subsequent events.
The higher level of sanction for people who refused a job or left one without good reason would be three months for the first time, six months the second time, and three years subsequently.
However, the SSAC cited international evidence that vulnerable claimants do not set out to be noncompliant but often led chaotic lifestyles, having poor organisational skills and frequently forgetting conditions they are supposed to fulfil.
"There is evidence from several countries that sanctions are experienced disproportionately by more disadvantaged and vulnerable claimants, those who are more socially deprived or isolated and longer-term benefit recipients," it said.
The committee added that there was "compelling and consistent evidence" of the short-term effects of sanctions in raising the numbers of those coming off unemployment benefit and starting a job. But it claimed "evidence on the duration of effect is mixed". It said: "There is also evidence that those exits prompted by sanctions result in poorer quality employment, lower earnings and job instability. When lone parents, for example, moved into work they tended to be in unstable and low-paid jobs."
The government has rebuffed advice to allow those who have been sanctioned to be put back on benefits should they reengage with the jobcentre. The coalition's written response emphasised the importance of the incentive to work, although it has agreed to monitor the impact of sanctions under the new regime.
Professor Janet Walker, deputy chair of the SSAC, said the report reflected the fears of concerned groups but she was pleased by the government's assurances it would step in to deal with any "unintended consequences".
Anne Begg, the Labour MP and chair of the influential Commons work and pensions select committee said she had raised the issue of the toughest benefit sanctions with the prime minister, describing them as "inappropriate".
She said: "If someone has got to the point where they have got a three year sanction why has there not been interventions earlier to stop them reaching that stage. Obviously the sanctions given them up to that stage aren't working.
"Those people don't go away. They pop up somewhere else in the system, probably being a burden in the taxpayer, whether it is in the criminal justice system, homelessness, drugs or alcohol abuse.
"I said to the prime minister: 'If you take money away from people what do you think will happen?'.
"They don't get benefits but they still have to live. Punishing people by taking the benefit away from them doesn't necessarily make them behave the way you want but can cause other problems."
Ellen Broome, Policy Director at The Children's Society said her organisation hoped the coalition would think again about the SSAC's recommendations.
She said: "It is vital the government thinks carefully before putting into place any measures that could punish huge numbers of children in families already struggling to make ends meet."
A DWP spokesperson said: "We do not accept this. Under universal credit all jobseekers will sign up to a personal claimant commitment and receive individual help and support so that they can look for and take up work – as they are required to do now.
"We expect most claimants to meet that commitment, and only those who fail to engage with us or play by the rules will be sanctioned."
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Guardian