Rising number of disability benefit claimants sparks more stringent policy

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In mid-2000, the rising number of disability benefit claimants in the Netherlands prompted the Lower House of parliament to encourage the State Secretary of Social Affairs to make renewed efforts to address the issue. Indeed one of the ruling coalition parties joined forces with one of the opposition parties in a bid to stem the influx of disability benefit claimants. In response, the State Secretary proposed more stringent and extensive medical examinations for claimants, along with sanctions for employers guilty of inactivity in this area. Employers' associations believe that employers are being unjustly held accountable, while the FNV trade union confederation believes that more attention should be paid to more effective reintegration into work during the first year of sickness.

The number of people claiming disability benefit (WAO) has been one of the most persistent and controversial issues in Dutch society, politics and industrial relations for many years (NL9902124F). Recent indications of an increased number of WAO claimants have rekindled debate on how to stem the growth. In the early months of 2000, the number grew by more than 5,000, and if this trend persists, the number of new claimants will exceed 30,000 by the end of the year, bringing the overall total to 932,000. If the upward curve continues, the number of people claiming disability benefit will exceed 1 million in 2002. However, the National Institute for Social Security (Landelijk Instituut Sociale Verzekeringen, LISV), believes that the level will increase less dramatically, and that by the end of 2003 a total of 810,200 employees will be claiming disability benefits. In its view, the ageing population and the increased participation of women in the labour market are the most significant factors in determining the volume of growth in claimant levels (NL9910167F).

Political debate has been fuelled by the release of these new statistics. One of the parties in the coalition government, the liberal People's Party for Freedom and Democracy (Volkspartij voor Vrijheid en Democratie, VVD) has sought an alliance with one of the opposition parties, the Christian Democrats (Christen Democratisch Appèl, CDA), in an effort to launch a joint plan to reduce the influx of new claimants. This VVD initiative has certainly not met with the approval of the largest coalition party, the Labour Party (Partij van de Arbeid, PvdA). The VVD is looking to solve the disability benefits problem through more stringent medical examinations for claimants, especially those with psychological problems, who now account for a third of new disability benefit claimants. The VVD and CDA are also seeking to withdraw disability benefits currently paid to people deemed to be less than 35% disabled. Finally, the two parties are of the opinion that only those people with a relatively lengthy working history should be entitled to claim benefits should they become disabled. According to calculations carried out by the Central Planning Office (Centraal Planbureau, CPB), this approach could ultimately cut the number of disability benefit claimants by between 40,000 and 100,000. The PvdA and other left-wing parties believe the onus for finding a solution to the disability issue should rest more with employers: they would like to assign more responsibility to employers for seeking ways of achieving earlier reintegration into work for claimants and make it impossible for employers to take on only healthy employees.

More stringent policy

Hans Hoogervorst, the VVD State Secretary of Social Affairs, is seen as probably being less than enthusiastic about his party's initiative, even though the Prime Minister himself admitted in the Lower House of parliament that the "disability portfolio" was a little thin. Eighteen months ago, the State Secretary presented a plan that has gained little ground to date. The Lower House claims that the State Secretary has invested too much energy in reorganising the manner in which social security policy is implemented (NL0002179N).

The State Secretary has now emerged with a renewed plan, which includes disability benefit claimants being entitled to retain their benefits even after resuming work. The State Secretary has also put forward proposals in an attempt to reach a compromise with both the left and right of the political spectrum. Claimants will have to undergo more stringent medical entrance examinations, through tightening the regulations governing such examinations. This could compound problems for employees with vague complaints, who will once again be subjected to increased pressure during their examinations, and more extensive reporting should therefore also make it possible to request a second opinion. Corrective measures should be adopted if it appears that some institutions examining disability claimants favour reaching conclusions of complete disability sooner than others. This is the case in the healthcare and educational sectors, for example. In the former sector, 85% of disability claimants are declared completely unfit for work, while in the latter this figure amounts to 40%. The State Secretary considers these differences to be unduly large.

Under the plan, employers too should be be subject to a stricter approach. They will face sanctions if, during an employee's first year of sickness - when employees are covered by the sickness benefit system before moving on to disability benefits - they do not adopt an active approach, in consultation with their occupational health and safety service, to reintegrating the employee into work. If they remain lax, the disability benefits authority will be able to reject the findings of the medical examination. The employer will then be obliged to continue paying the employee's wages for as many months as necessary. In the case of a disability benefit claimant's file not being in order, this could lead to sanctions, possibly obliging the employer to continue paying wages until the file is sorted out. Finally, the State Secretary wants companies at which relatively large numbers of employees end up claiming disability benefits - and this also applies to various large companies such as Philips, KPN, the NS national railways and a few banks – to be visited by disability benefits inspectors with the aim of clarifying the options for reintegration. Apart from this, a differentiation in employers' WAO contribution levels dependent on the numbers of new disability benefit claimants among their employees will affect companies financially, and perhaps encourage them to be more open to adopting preventative measures.

The question of accountability

On the whole, representatives of both VNO-NCW, the largest employers' association, and the Federation of Small and Medium-Sized Businesses (Midden en Klein Bedrijf, MKB-Nederland) reacted negatively to the State Secretary's plans. MKB is disappointed because it believes that employers have been accused of being guilty too quickly and one-sidedly. MKB also believes that it is unjust that its members have been grouped together with large companies, while the influx of disability benefit claimants originating from the small and medium-sized business sector remains below the average figure. VNO-NCW finds it difficult to accept that employers are seen to be the only party held responsible for the influx of disability benefit claimants. It highlights the administrative "red tape" that characterises contact with industrial doctors, occupational health and safety services and other bodies responsible for implementation during the first year of an employee's sickness. VNO-NCW would far rather see all the parties involved establishing contact more quickly to discuss redeployment outside the company. It is not opposed outright to fines for employers deemed to be in default of the regulations, but this would have to be in exceptional circumstances - such as companies failing to engage occupational health and safety services.

Both the employers' associations and the largest trade union confederation, the Dutch Trade Union Federation (Federatie Nederlandse Vakbeweging, FNV), believe that the first priority should be improving the level of cooperation between the occupational health and safety services and the bodies responsible for the implementation of disability benefits. At present, some 40% of people who claim sickness benefits move on to claiming benefits on the basis of the Disability Benefits Act after a year, without passing through a medical examination before acceptance. Even so, FNV does not perceive advantages in lengthening the period spent claiming sickness benefit before moving to the disability benefits system. On the contrary, individuals are seen as claiming sickness benefit for too long, making reintegration even harder. FNV is completely in agreement with the State Secretary's goal of coercing the larger companies to meet the obligations imposed on them and to explore all avenues for reintegration. It does, however, point out the Social Secretary's primary responsibilities as far as the healthcare and educational sectors are concerned.

Commentary

The sheer volume of people claiming disability benefits is a concern involving many parties and diverse interests in the Netherlands (NL0002179N). The latest reorganisation plans stir recollections of the previous situation whereby employer and employee representatives had an important say and – by way of the Disability Benefits Act – could be seen to have hurriedly sought to bring about a shift from an industrial to a post-industrial economy, in that many older workers, regarded as being surplus to requirements, exited the labour market by way of the disability benefits system. Today, the main cause for concern is the influx of (younger) employees with psychosomatic complaints, particularly women, while the influx of older employees has scarcely slowed. During the debate in the Lower House, the State Secretary presented a new, more balanced perspective on the issue by shedding light on a number of broader aspects: from European comparisons involving all social benefits, it appears that the Netherlands does not fare too badly. In other words, while people claim unemployment benefits elsewhere in Europe, they might be entitled to disability benefits in the Netherlands. In terms of the economically active population, fewer individuals are entitled to benefits in the Netherlands than in most other European countries. While comparisons at this level do expose the problem itself, they do little to address the underlying causes or consequences. (Marianne Grünell, HSI)