Welfare sanctions may work in the short term, but at what cost?

The research was carried out for the Joseph Rowntree Foundation by a team from Oxford University, who undertook a comprehensive study of evidence from a variety of different countries about how their different sanction regimes work.

The research shows that:

• Many international studies only examine the short-term effects of benefit sanctions. Few looked at the long-term impacts and none considered wider effects of benefit sanctions in the welfare system such as the impact on benefit take-up levels.
• In Europe, sanctions have had positive short-term effects such as reducing the amount of time people stay on benefits and raising employment rates. However those who leave benefits early due to the threat of sanctions often experience poorer earnings and job stability. 
• Some studies showed imposition of sanctions resulted in criminal behaviour, ranging from fare dodging to stealing food or items to sell. 
• In the US, full family sanctions (where the entire grant is suspended) have reduced benefit claims. However sanctions have had unfavourable impacts on earnings, hardship and outcomes for children.
• Benefit claimants have low levels of awareness of sanctions. Although people realised penalties were part of the system, they rarely knew when penalties could be imposed or how they could be reversed. Claimants facing multiple barriers to work were at higher risk of sanctions.
• There is a long-standing association between unemployment benefit entitlement being conditional on people actively seeking work. Such conditionality is increasing in scope to include groups such as lone parents and people with health conditions. However, there is little evidence this will achieve the changes in behaviour sought.

The report was produced to inform the debate on changes to the benefit system, and to provide evidence in the formation of sanctions policies.

Report author Julia Griggs said:

"Over the past decade or so, we have witnessed the ever increasing use of sanctions and conditionality by governments to help promote employment and also, in some cases, to change claimant behaviour. However such welfare policy has been formulated without good evidence on whether such sanctions yield long-term positive gains for both the claimant and the state. This study raises concerns about the gap between rhetoric and evidence for the effects of sanctions in welfare reform."

Joseph Rowntree Foundation Chief Executive, Julia Unwin CBE, said:

"The impact of imposing sanctions and conditions on the most vulnerable in society must be assessed properly. This research shows that short-term gains are sometimes achieved at the expense of long-term pain for claimants. Welfare reform which has the potential to remove benefits from these claimants needs to be formulated with the use of evidence. I urge policy makers to examine these findings thoroughly to make sure sanctions policies don’t undermine anti-poverty policies."