More than 100,000 people on sickness benefits are set to receive backdated payments averaging £5,000 after the Department for Work and Pensions (DWP) admitted to calculation errors. The mistakes occurred when claimants were transferred from incapacity benefit and severe disability allowance to Employment and Support Allowance (ESA). The total cost to the government is estimated at £1.67bn, including ongoing awards.
The DWP revealed that around 180,000 people may be owed arrears, with 105,000 expected to be repaid in 2018-19 and 75,000 in 2019-20. Some claimants have already received payouts exceeding £10,000. The government has 400 staff working on the claims, prioritising terminally ill individuals. So far, 18,000 payments totalling £120m have been made, with an average of £7,000.
Philip Stanton, 58, from Northampton, received a cheque for £2,250 in July. Living on £73 a week due to anxiety, depression, and back problems, he said: “You feel brilliant at first… but then you think, ‘what if they hadn’t found out?’” He added that a friend received more, prompting him to query his own payment. Mr Stanton has asked for an explanation of the calculation and is awaiting a response.
The Child Poverty Action Group (CPAG) legally challenged the government’s original decision to only backdate payments to 2014. CPAG chief executive Alison Garnham welcomed the compensation for 180,000 people but said the DWP “significantly underestimated” the number affected. She argued that “it should not have taken legal action to get vulnerable people the money they were entitled to.”
The DWP stated: “Anyone affected by this historic error will receive all of the money they are entitled to. We have worked with charities… to provide the right support and are hiring more staff.” Frank Field, chair of the Commons Work and Pensions Committee, called it “welcome news” but warned of lessons to be learned as the government moves people onto Universal Credit.
