People with disabilities, whom the government urges to return to work, find that doing so often means they end up being financially worse off.
It’s all because for many sick and disabled people, including those of us with multiple sclerosis, self-employment is the only realistic option. Regrettably, this is because they face heavy discrimination in the employment market. Even though such discrimination is illegal, proving it is another matter.
Benefits guru Steve Donnison, of campaigning organisation Benefits and Work.co.uk, said: “Yet again, they are being punished by the DWP (Department for Work and Pensions) for the offence of being sick or disabled.”
The problem appears to stem from the way in which the self-employed are being treated under universal credit.
Writing on the benefitsandwork.co.uk website, Donnison explains: “A report by Policy in Practice has revealed that, if universal credit had already been fully rolled out across London, the average self-employed household would be £344 a month worse off than under tax credits and housing benefit.
“The huge drop in income is caused by the DWP using a ‘Minimum Income Floor (MIF)’ which minimum wage for every hour they are deemed to have worked.
“In reality, 91% of self-employed households in London, where the study was carried out, earn below the MIF,” he added.
Some years ago, I was self-employed, as a freelance consultant. From experience, I can say that not only are working hours liable to have lower income than the minimum wage, but that self-employment hours are likely to be fewer than a traditional working week.
Welfare reform rethink urged
According to The Guardian daily newspaper, the report’s revelation has led MPs and campaigners to call for a rethink on the government’s flagship welfare reform. It said:
Frank Field, the Labour chair of the work and pensions select committee, said it was ‘another razor cut at the vulnerable human underbelly of the labour market’. The government has already been forced to slow down the roll-out of universal credit and overhaul how claimants are paid after complaints that some waiting weeks for their payments and falling behind with their rent.
However, serious problems have now emerged in the treatment of the self-employed because of the way their earnings are recorded under universal credit. The issues have arisen because a “minimum income floor” (MIF), based on the national living wage, is used to calculate universal credit payments each month.
Because self-employed workers’ earnings fluctuate from month to month, they sometimes fail to meet the minimum figure and lose out compared with salaried counterparts. They are also only given a year to get their businesses off the ground before the MIF kicks in. Using analysis of cases from 19 London boroughs over two years, Policy in Practice found that 78% of self-employed households on low-income in London are set to become £344 per month worse off under the new system.
Ministers argue that the system has been designed to encourage people to increase their work and move into better jobs. However, the new report warns that some people (such as those with disabilities) have little choice other than self-employment.
Simplify the welfare system
But who, or what, is Policy in Practice, publisher of the report?
Its director, Deven Ghelani, “Policy in Practice believes the welfare system can work more effectively. It can help people towards greater independence if we make it simple for people and organisations to understand.
“We simplify the welfare system by showing people how policy affects them.
“We show local authorities how individual households are affected by all policy changes, now and in the future.
“We talk to government on a national level to influence policy.”
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0shadesofsun.com is the personal website of Ian Franks, a freelance medical writer and editor for various health information sites. He enjoyed a successful career as a journalist, from reporter to editor in the print media. He gained a Journalist of the Year award in his native UK. Ian received a diagnosis of MS in 2002 and now lives in the south of Spain. He uses a wheelchair and advocates on mobility and accessibility issues.
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Note: Health-related information available on 50shadesofsun website is for your general knowledge only. It is not a substitute for medical advice or treatment for specific medical conditions. I am not a doctor and cannot and do not give you medical advice. You should seek prompt medical care for any specific health issues. Also, consult a doctor before starting a new diet or exercise programme. Any opinions expressed are purely my own unless otherwise stated.
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