National Audit Office: PIP backlogs cause delays and uncertainty

Backlogs in the assessment process for the new Personal Independence Payment (PIP) have led to delays and uncertainty for claimants in the areas where it was introduced in April last year, according to a report from the National Audit Office, published on 27 February.

PIP is a non-means-tested benefit to support disabled people with their daily living and mobility costs. It replaces Disability Living Allowance for working age people and aims to match support more closely to claimants’ needs. By 25 October 166,000 people had started new claims for PIP.

According to the spending watchdog, the Department for Work and Pensions used a phased roll-out to reduce the risks in the programme, but left little time to test whether it could handle a large volume of claims. When the assessment process took longer than expected backlogs soon developed: by 25 October the Department had made only 16% of the number of decisions it had expected.

Claimants are experiencing long delays to benefit decisions and the department is not able to tell them how long they are likely to wait, potentially creating distress and financial difficulties. By October there were 92,000 people whose claims were outstanding with assessment providers Atos Healthcare and Capita Health and Wellbeing – almost three times the number expected by the department at that stage.

In response to its concerns about the readiness of providers to deal with a further expansion of claims from October last year, the department postponed the reassessment of many existing Disability Living Allowance claims. In a late decision, the department announced on 21 October that ‘natural’ reassessments would not be rolled out nationally from 28 October as planned, but would be phased in by postcode area based on the department’s assessment of the capacity of both assessment providers.

Today’s report highlights that the DWP introduced PIP despite its compressed timescale and has learnt from past experience in the way it manages contracted assessment providers. However, to achieve value for money the department will need to show that it can reduce delays for claimants and deliver planned savings while maintaining the quality of its decisions.

Today’s report finds that, in the current Spending Review period to April 2015, the DWP will not achieve the savings it originally expected. Because of the revised timetable for reassessments, savings during this period will fall from £780m to £640m. However, the department still expects to achieve long term savings of £3bn annually by 2018-19.

Among the National Audit Office recommendations is a call for the DWP to set out a clear plan for informing claimants about the likely delays they will experience while it works with providers to improve performance.

The head of the National Audit Office, Amyas Morse, said: “It is too early to conclude on the Personal Independence Payment programme’s overall success and all major programmes run the risk of early operational problems. However, the department did not allow enough time to test whether the assessment process could handle large numbers of claims. As a result of this poor early operational performance, claimants face long and uncertain delays and the department has had to delay the wider roll-out of the programme. Because it may take some time to resolve the delays, the department has increased the risk that the programme will not deliver value for money in the longer term.”