Friday 8 January 2016

How Iain Duncan Smith's Reign of Terror costs far more to administer than it will ever save

In January 2016 a damning National Audit Office report revealed the fact that Iain Duncan Smith's Reign of Terror over the lives of sick and disabled people is costing far more in corporate administration fees than it will ever save the taxpayer in reduced benefits payouts.

What the report reveals

The NAO report (link to the actual report) reveals that the DWP is set to pay out at least £1.6 billion over the next three years in administration fees to the corporations that now run their health and disability assessment schemes.

The report also revealed that costs are spiralling out of control; that none of the outsourcing companies managed to meet the government's own quality assessment thresholds; that targets are being missed all over the place; and that nowhere near the mandated 95% of assessors are completing their training (additional source).

False economies

The administration fees alone are set to total over £1.6 billion by March 2018, yet the government's own figures indicate that their fit-to-work regime is unlikely to even save £1 billion in reduced disability benefits payouts by May 2020.

The concept of spending over half a billion pounds a year in administration fees in order to save less than a billion over the course of over four years is something that could only ever make sense to a Tory.

More false economies

Anyone who has been paying attention to Tory economic policy will be aware that they're ever willing to put ideology above evidence and pursue policies that cost far more in the long-term than they save in the short-term. This stems from their complete unwillingness to accept basic macroeconomic concepts like fiscal multiplication and the marginal propensity to consume.

One of the most glaring recent examples of a Tory false economy was their ideologically driven cuts in flood defence spending, even when it was pointed out to them that saving £1 in flood defence spending in the short-term results in £8 of avoidable economic damage in the long-term. They were warned that there would be severe consequences, yet they slashed away anyway.

The Tory willingness to squander hundreds of millions of pounds on hounding the sick and disabled should come as no surprise at all to anyone who has been paying attention to their bloody-minded economic incompetence and malicious disregard for the rights of sick and disabled people (especially the mentally disabled).

What we already knew about the WCA assessment regime

Before it was even revealed that these schemes cost far more to administer than they save in reduced benefits payouts we knew plenty of other damning stuff.

  • The French outsourcing company Atos walked away from the WCA contract early leaving a massive backlog of cases. One of the main reasons they bailed out from such a lucrative contract was the constant barrage of unrelentingly negative publicity caused by their (government mandated) mistreatment of sick and disabled people.
What happened to austerity?

Isn't it remarkable that the Tories use austerity as an excuse for underfunding public services, disempowering local government, sacking tens of thousands of police, repressing the wages of millions public sector workers, defunding rape and domestic abuse shelters, cancelling flood defence schemes, and conducting the biggest fire sale of public assets in history, yet they can somehow afford to continue squandering hundreds of millions of pounds on their regime of terror over the lives of sick and disabled people?

Surely when Atos walked away from their contract that was the perfect opportunity to scale back or completely abandon the whole demeaning, discriminatory and catastrophically mismanaged mess and save some money into the bargain? 

Yet the Tories decided to continue throwing money into yet another one of Iain Duncan Smith's failing schemes. Do the Tories really hate sick and disabled people with such a passion that they consider wasting hundreds of millions of pounds per year on making their lives miserable such an essential "service" that it's immune to their austerity agenda?

The corporate welfare system

The fact that the Tories demeaning and discriminatory regime for sick and disabled people costs far more in corporate administration fees than they will ever save in reduced benefits payments proves what most sensible people knew all along: Iain Duncan Smith's so-called welfare reforms have nothing to do with the stated objectives of "helping people" and "saving money", and everything to do with diverting as much of the taxpayer funded welfare budget to corporate interests as possible.

 Another Angry Voice  is a "Pay As You Feel" website. You can have access to all of my work for free, or you can choose to make a small donation to help me keep writing. The choice is entirely yours.

Austerity is a con
Iain Duncan Smith's Reign of Terror
Should the WCA regime be considered psychological torture?
How George Osborne has created more debt than every Labour government in history combined
Problem Solving - with Iain Duncan Smith
The Tory ideological mission
Austerity and economic illiteracy

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