Official Statistics

June 2021: ESA underpayments: Numbers affected, expenditure and final update on checking

Published 8 July 2021

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This publication is available at https://www.gov.uk/government/statistics/esa-underpayments-progress-on-checking-june-2021/june-2021-esa-underpayments-numbers-affected-expenditure-and-final-update-on-checking

Policy background and introduction

1. Employment and Support Allowance (ESA) was introduced in October 2008 for people who have limited capability to work because they are disabled or ill. From March 2011 the Department for Work and Pensions (DWP) began reassessing people on incapacity benefits (for example, Incapacity Benefit and Severe Disablement Allowance) for eligibility for ESA.

2. More than 2 million claimants were receiving incapacity benefits before reassessment began and we have now reassessed around 1.5 million people, nearly all of those who required a reassessment.

3. The department has corrected some past underpayments of ESA, which arose while reassessing incapacity benefit claims.

What you need to know

4. There are 2 main types of ESA:

  • contributory, which is based on National Insurance contributions
  • income-related, which is a means-tested benefit – income-related ESA can be paid on its own or as a top-up to contributory ESA

5. Extra payments, called premiums, are available only to qualifying customers who are eligible for income-related benefits. These include the Enhanced Disability, Severe Disability, Carer, and Pensioner Premiums.

6. Largely between January 2011 and October 2014 some people receiving Incapacity Benefit and Severe Disablement Allowance had their claims converted to contributory ESA. However, the possibility of whether they may also have been entitled to income-related ESA was not considered for all cases. This means they may have missed out on the payment of premiums, such as the Enhanced Disability Premium.

7. The department announced it would be undertaking an exercise to review cases to check entitlement for income-related ESA in December 2017, with work on the exercise commencing that month.

Purpose of publication

8. This analytical release follows previous publications on ESA underpayments in 2018, 2019 and 2020. This publication presents a final update, from the department’s management information, on checking potentially affected cases as at 1 June 2021. It includes a final update on a number of areas for the exercise as a whole and separately for cases where the claimant has died:

  • the number of cases which started the reassessment journey
  • the number of cases contacted
  • the number of cases completed
  • the number of cases found not to be due arrears payments
  • the number of cases found to be due arrears payments
  • the total amount of historical arrears the department has paid out in correcting these cases
  • the average arrears payment

Final update on checking cases

9. Table 1 summarises the department’s final management information from the whole of the ESA underpayments checking exercise at 1 June 2021. The table includes work across the:

  • Phase 1 cases encompassing those converted from previous incapacity benefits to contributory ESA and still active from the 21 October 2014 in line with the original scope of the exercise
  • Phase 2 cases which came into scope following the Secretary of State’s announcement in July 2018 to pay all cases back to the point of conversion
  • 30,000 cases in Phase 3 that were converted from previous incapacity benefits into the Support Group from 2015 onwards

10. Since the last publication, the focus of the exercise has been on processing cases where claimants have died as well as cases in Phase 3. Since 12 January 2020 around 19,000 additional cases have completed the reassessment journey, bringing processing of the potentially affected group across all 3 phases to 100% complete [footnote 1] overall.

11. The government committed to complete the original 320,000 Phase 1 cases as well as the additional 250,000 Phase 2 cases (see paragraph 9 above) by the end of 2019. As of 12 January 2020, 98% of the cases in Phases 1 and 2 had been completed. As part of the department’s response to the unprecedented demand for our services as a result of the coronavirus outbreak, it took the decision to pause all activity on administrative exercises. This affected the progress on checking past underpayments of ESA from March 2020 to December 2020.

Table 1: Cases potentially affected by underpayments of ESA on conversion from previous incapacity benefits

Out of the 600,000 cases to be checked 1 June 2021
Number of cases that started the reassessment journey (see note 6) 600,000
Number of cases the department contacted to gather data to review their claims (see note 7) 519,000
Number of cases that completed the reassessment journey (see note 8) 600,000
Number of cases that completed the reassessment journey without payment of arrears (see note 9) 482,000
Number of cases qualifying for arrears payments 118,000
Total amount of historical arrears paid £613 million
Average arrears payment £5,000

12. Around 53,000 of the 600,000 cases to be checked were where the claimant is deceased. Table 2 shows that 100% of these cases have completed the reassessment journey. Cases where the claimant has died took longer to process due to challenges in identifying and contacting the next of kin and obtaining information on which to assess entitlement.

Table 2: Cases where the claimant is deceased and were potentially affected by underpayments of ESA on conversion from previous incapacity benefits

Out of the 53,000 cases to be checked where the claimant is deceased 1 June 2021
Number of cases that started the reassessment journey (see note 6) 53,000
Number of next of kin the department contacted to gather data to review cases (see note 7) 22,000
Number of cases that completed the reassessment journey (see note 8) 53,000
Number of cases that completed the reassessment journey without payment of arrears (see note 9) 45,000
Number of cases qualifying for arrears payments 7,000
Total amount of historical arrears paid £26 million
Average arrears payment £3,000

Notes to tables 1 and 2

1. Data is reported without detailed verification. Figures are not directly comparable with previous releases due to a change in the management information reporting. Towards the end of the exercise a reconciliation of cases highlighted some inaccuracies in the recorded data for January 2020. Identified errors have now been corrected and the latest data is accurate.

2. The figures date from 1 June 2021. These are the final figures for the exercise to check potentially affected cases.

3. The numbers of cases that have started the reassessment journey or have been contacted and the number of cases completed and qualifying for arrears payments are rounded to the nearest 1,000; the total amount of historical arrears paid is rounded to the nearest £1 million and the average arrears payment is rounded to the nearest £1,000.

4. Figures may not sum due to rounding.

5. Table 1 provides a final update on the exercise as a whole, including both cases where the claimant has died and where they are still alive.

6. Starting the reassessment journey includes checking information held on various departmental administrative systems to identify which cases needed to be contacted or contacting cases with a high risk of underpayment without conducting prior checks.

7. Around 77,000 cases, including approximately 28,000 cases where the claimant had died, have been identified as not entitled during checks of DWP administrative systems prior to making contact, and consequently have not been contacted.

8. Completing the reassessment journey includes individuals:

  • identified on DWP administrative systems as not entitled
  • who had identified themselves as not entitled prior to assessment
  • who had not responded to multiple attempts to contact by phone or post over an 8-week period
  • deceased for whom no next of kin could be traced
  • who have been through the full journey to assessment

For around 4,000 cases, including approximately 3,000 cases where the claimant had died, we were unable to contact the individual or the next of kin. For around 72,000 cases, including approximately 4,000 cases where the claimant had died, the individual or the next of kin did not provide the information needed to review the case. If people who have not responded do get in touch in future, their case will be actioned.

9. Completing the reassessment journey without payment of arrears includes individuals:

  • identified on DWP administrative systems as not entitled
  • who had identified themselves as not entitled prior to assessment
  • who had not responded to multiple attempts to contact by phone or post over an 8-week period
  • deceased for whom no next of kin could be traced
  • individuals found not to be entitled at assessment

If people who have not responded do get in touch in future, their case will be actioned.

Source for tables 1 and 2: DWP management information from the ESA underpayment checking exercise at 1 June 2021.

Statement of Compliance with the Code of Practice for Statistics

The Code of Practice for Statistics (the Code) is built around 3 main concepts, or pillars:

  • Trustworthiness
  • Quality
  • Value

The following explains how we have applied the pillars of the Code in a proportionate way.

Trustworthiness – is about having confidence in the people and organisations that publish statistics

The final update on the ESA underpayments checking exercise is based upon DWP management information, supplied via a data capture tool built to allow consistent and efficient recording of case review progress in the ESA Underpayments checking exercise.

Quality – is about using data and methods that produce assured statistics

The data presented is from the data capture tool developed to accurately record checking and levels of arrears payments. Drop down menus and built-in validation checks assist in reliable data recording. Data recording checks are carried out by operational staff. Small samples of figures have been cross-checked across jobcentres. The department’s analysts have challenged some figures and definitions to ensure accurate representations of the activity undertaken.

Value – is about publishing statistics that support society’s needs for information

This release provides a final update on the checking exercise following on from the last release on 12 January 2020, together with context for those figures.

In addition, it aims to reduce the administrative burden of answering Parliamentary Questions, Freedom of Information requests and ad hoc queries to ensure timely responses to public queries.

To support financial planning and management of departmental business, figures have been seen in advance by Ministers and officials, as pre-release access restrictions do not apply for management information.

Contact information

For media enquiries, contact DWP Press Office, telephone: 0115 965 8781.

If you think that you have been affected by ESA underpayments on conversion from previous incapacity benefits and have not been contacted about this, please call 0800 169 0310.

Where to find out more

  1. Completion rates rounded to the nearest 1%. Fewer than 100 cases were outstanding as at 1 June 2021. ↩

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