Government extends disability benefit contracts for 'failing' private firms

But Capita and Atos warned to 'start delivering, or else'

A pair of private companies that have been repeatedly accused of failing to meet standards for disability benefit assessments have had their contracts extended by the government for another two years.

Atos and Capita have been assigned by the Department for Work and Pensions (DWP) to carry out personal independence payment (PIP) assessments since 2013, when they were brought in.

Minister for disabled people Sarah Newton said on Tuesday that she was looking at extending the companies’ contracts until 2020 to “better allow for a stable transition to any new provision”.

But indicating they would be stripped of their contracts after this period, she added that the DWP would also start work on IT systems so it could bring the work in-house.

The announcement comes after it emerged both companies were failing to meet the government’s own quality standards in a DWP report earlier this year.

It found that inaccurate or incomplete assessments had been made as a result.

Capita and Atos received nearly £255m between them to perform PIP assessments last year.

This was the highest amount spent on the scheme since its launch in 2013 and a 19 per cent increase on the previous year, according to figures obtained by The Independent.

Disability campaigners said extending the current contracts risked “dragging out” a system that has seen people’s PIP payments being wrongly or unfairly denied.

Frank Field, the chair of the Work and Pensions Committee, warned that Capita and Atos must “start delivering, or else”, while welcoming the move to bring the PIP IT system in-house.

“This is the most the committee could have asked for at this stage and is further credit to the thousands of disabled people who sent evidence to us,” he said. “The government is making the important first steps to enable it to get out of a hole of its own making. Having the capacity to bring assessments back in-house will put it in a far stronger position to turn the screws on its hitherto failing contractors, in the interests of claimants and all taxpayers.

“This should serve as notice for Atos and Capita to start delivering, or else.”

The announcement came after February’s report, which found failings in the assessment process had contributed to a “pervasive lack of trust” in the system and “untenable human costs” to claimants, as well as financial costs to the public purse.

Of the 170,000 appeals for PIP claims that had been taken to the tribunal in five years, it found claimants had won 63 per cent of cases.

In the same period, claimants won 60 per cent of 53,000 employment support allowance (ESA) appeals.

Responding to the announcement about the contract extensions, James Taylor, head of policy and public affairs at disability charity Scope, said it would not address the “fundamental flaws” in the system.

“Life costs more if you’re disabled, but the current PIP assessment does not accurately reflect these extra costs,” he added.

Genevieve Edwards, director of external affairs at the MS Society, meanwhile said: “It’s good the government recognises further improvements to PIP are needed. But extending the current contracts must not drag out a system that doesn’t make sense.

“Thousands of people with MS have been wrongly denied PIP or had their support unfairly cut because the assessment process and criteria don’t reflect the realities of this unpredictable condition.

“During this transition the government must take responsibility to make sure this changes, so people with MS get the right decisions and the vital support that they need.”

Laura Cockram, head of policy and campaigns at Parkinson’s UK, said she welcomed the government putting the assessment companies on notice to improve, but was disappointed they had extended the contracts.

“We know over two-thirds of PIP decisions are incorrect and upheld on appeal. This indicates a broken system, of which the appeals is just one part,” she said.

“By themselves, today’s changes are not enough. The government must ensure they scrutinise the quality of assessments and implore Capita and Atos to do more to improve assessor’s knowledge of conditions like Parkinson’s so people get the right decision first time.”

A spokesperson for Independent Assessment Services, the branch of Atos which deals with PIP assessments, said: “We welcome today’s statement from the minister and look forward to ongoing discussions with the department to achieve our shared objectives on continuous improvement.”

Capita did not wish to comment.