Welfare conditionality and activation in the UK: the mental health impacts of benefit sanctions

Abstract

Increasingly, social security systems in the UK and internationally stipulate work-related behavioural requirements for claimants of out-of-work benefits. These are accompanied by claimant monitoring as well as the threat and imposition of financial penalties, which are known as benefit sanctions. The growth in recent decades in the use of behavioural conditions and sanctions has generated significant debate and contestation, in terms of the ethical justification of such approaches and, relatedly, evidence regarding their overall effectiveness. An important topic concerns the impacts of benefit sanctions on claimants. Policymakers typically assume that sanctions will improve labour market outcomes for the unemployed, which will then lead to a range of individual and societal benefits. A well-developed literature exists in relation to the labour market impacts of sanctions, though less is known in terms of their wider effects. A small but growing body of research, nevertheless, links benefit sanctions with outcomes such as financial hardship and foodbank usage, and there is increasing concern regarding adverse impacts on mental health. This thesis investigates the relationship between benefit sanctions and mental health outcomes, and considers whether higher rates and/or longer durations of sanctions are associated with adverse mental health impacts. A quantitative study is undertaken that focuses on Jobseekers Allowance (JSA) sanctions during the period of Coalition government (2010-15). In this period, the frequency of sanctions varied significantly and their severity was increased following the Welfare Reform Act 2012. This exogenous variation is used to better estimate the independent effect of sanctions on mental health outcomes. Given data availability, the empirical investigation carries out four analyses involving different data sources, outcomes and research designs at separate data levels. The first two studies carry out longitudinal ecological analyses using local authority-level data and fixed effects models. They find that, following the Welfare Reform Act 2012: every 10 additional sanctions applied per 100,000 population per quarter are associated with 4.57 additional antidepressant prescribing items; and that every 10 additional sanctions applied per 100,000 working age population per quarter are associated with 8.09 additional people suffering from anxiety and/or depression. The third study carries out a multi-level analysis, which provides a robustness check on the aggregate-level analysis carried out in the second study. It finds that, in the post-reform period, increases in the area-level sanctions rate are associated with increases in the likelihood that JSA claimants suffer from anxiety and/or depression. Finally, the fourth study carries out a difference-in-differences analysis. It indicates that the harsher sanctioning environment brought about at the onset of the Coalition government is associated with an increase in JSA claimants newly experiencing anxiety and/or depression. These results combine to provide a robust indication that JSA sanctions are associated with adverse mental health impacts, which is an important contribution to the existing empirical literature. They suggest that UK sanctions policy is overly harsh, and that steps need to be taken to reduce the adverse effects that it entails for claimants.