Assessing the impact of benefit sanctions on health

The aim of this research is to examine whether benefit sanctions lead to claimants having worse physical or mental health, or making greater use of health services. It also seeks to add to our knowledge on whether sanctions encourage claimants to return to employment more quickly. The proposal is innovative in using a database of individuals' benefits, employment and health histories constructed from administrative records which have not previously been linked.

Background
People who claim some benefits, especially Jobseeker's Allowance (JSA) and Employment & Support Allowance claimants in the Work-Related Activity Group (ESA WRAG), have conditions placed on them. With JSA, for example, claimants must sign on at the Jobcentre Plus office regularly and take certain steps to find work. If they fail to meet these conditions, they can be sanctioned, i.e. their benefits are stopped for a period. There have always been conditions on unemployment benefits but they have increased in recent years, with the number of sanctions and maximum length rising. The introduction of Universal Credit has seen conditions extended to those in work as well as higher sanction rates for early cases.
Sanctions are meant to ensure that people return to work as soon as they can. This is good for public finances as it keeps claims down, good for the economy as it keeps labour supply up and, arguably at least, good for claimants since unemployment tends to be bad for our health. However, critics argue that sanctions may have unintended side-effects: harming claimant health, increasing homelessness, or putting stress on families which affects child welfare. Health effects may arise from restricted spending on food or heating but also from the psychological stresses of trying to cope without income. These unintended impacts could lead to greater expenditure on public services, off-setting savings from reduced benefit claims. There has been very little research on these unintended impacts associated with sanctions, and almost none which can provide convincing evidence that sanctions cause harm.

Proposed research
We will construct a database of individuals' benefit, work and health histories by combining information held in the administrative records of the Department for Work and Pensions (DWP) and NHS Scotland. The data are sensitive, personal information so we need special permissions to access them which we are in the final stages of securing. The database will cover people who claimed JSA or ESA WRAG in Scotland for 2010-17. We focus on Scotland because the health data are currently only available here. From DWP, we get records of claim spells and whether people were sanctioned. From NHS Scotland, we get information on: the prescribing of medicines which can indicate various physical and mental health conditions; use of Accident & Emergency or unplanned hospital admissions which can indicate incidents arising from risky behaviours such as alcohol abuse or the worsening of chronic conditions due to poor diet, stress, etc.; and mortality data, including suicides. We will also examine missed appointments since these are a significant concern for the health services.
From Oct 2013 on, DWP can provide data on employment spells so we can look at the labour market impact of sanctions in this period, and hence whether any health effects depend on whether people find paid work or not.
The main challenge for our analysis is to show whether sanctions cause a change in health. To do this, we have to rule out the possibility that there are other factors which mean that the people who are more likely to get sanctioned also tend to have worse health; examples might include a drug or alcohol problem, or a domestic crisis such as a bereavement. There are various techniques which let us do this.

The results of the research will feed into academic debates about the recent changes to welfare but are also intended to have an influence policy in this area.

This research has clear potential for economic and societal impacts, through its influence on welfare policy and debates, but also by demonstrating the value of linked administrative data for research.

The most direct beneficiaries of our research are current and future welfare benefit claimants. Evidence that the current sanctions regime has harmful impacts on physical and mental health would provide a powerful impetus for reforms to reduce those harms. The research will also provide new knowledge on the effectiveness of sanctions in relation to employment outcomes which could improve the ability of the system to support returns to work. A range of third sector organisations have campaigned on what they argue are the negative impacts of current sanctions policies for social welfare, including health. To date, they have drawn largely on qualitative research and case studies of their service users. Valuable as this is in identifying areas of concern, such research cannot provide convincing evidence of the causal impacts of sanctions. This work would provide important new information which could be used by these groups to inform public debates.

It should be stressed that the research may support or challenge the claims made by campaigning groups. There is valuable impact in either case: in providing evidence for change or a justification for current policies.

Evidence of impacts on health and health service use from sanctions would be of wider value to the general public as funders and users of these services. The research will examine whether sanctions put additional pressure on A&E services as well as hospital admissions, and whether they lead to more missed out-patient appointments. Indirectly, it looks at pressure on GP services, as increased prescribing rates indicate increased attendance at GP surgeries. All have been seen as being under great pressure in recent years. The health bodies responsible for providing these services will be interested in evidence of the impacts of welfare reforms on their activities, and likely to use these in future discussions with DWP.

Improving employment outcomes could produce fiscal gains as well as economic benefits from increased labour supply. There will be particular interest here from the devolved administrations such as the Scottish Government and from English local authorities whose funding is increasingly linked to the economic performance of their regions.

The identification of unintended impacts on health would bolster the case for using a similar approach to look at other potential side effects discussed in the academic literature and in public debates, notably on criminal justice and homelessness systems, and on family and child welfare. More fundamentally, it would add powerfully to arguments that welfare policy needs to consider potential unintended consequences and review evidence on likely effectiveness from the outset.

Lastly, by demonstrating what can be achieved through the analysis of linked administrative data, the research could bolster support for this kind of work and hence widen opportunities for similar work in the future, offering diverse potential benefits for policy making and public debate. At root, the ability to exploit linked administrative data relies on public support for data sharing. A clear case study of the benefits which can be achieved from data linkage research has the potential to boost such support and to reinforce to political leaders and public bodies the value to be gained from supporting this work. This project will be particularly valuable in this respect because of the novelty of the data linkages proposed and the high profile of the issues being examined.