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UK needs to tackle high cost of mental-ill health, says OECD

cost the UK around GBP 70 billion every year, or roughly 4.5% of GDP, in lost productivity at work, benefit payments and health care expenditure. Better policies and practices by employers and the health system are needed to help people deal with and get back to work, according to a new OECD report.

Mental Health and Work: The United Kingdom says that around one million claimants on Employment and Support Allowance (ESA), and as many on Jobseeker’s Allowance (JSA) and other working-age benefits, have a mental disorder such as anxiety and depression that is hurting their prospects of finding work.

Acting early is the best way to prevent poor mental health leading to benefit dependency, both when people are still at work and early on during the sick-leave period, the report argues. Retaining a job is easier than finding a new one. Up to 370,000 Britons move onto disability benefit every year (1% of the working-age population), the highest rate in the developed world and twice the OECD average. The leading cause for such benefit claims is mental illness, now accounting for around 40% of all new claims.

Some of the recent UK welfare reforms designed to tackle stubbornly high disability benefit caseloads go in the right direction. However, further improvements are needed to ensure that reforms live up to their promise to bring people into work. If welfare cuts are to be made, they need to be matched by increased efforts to address the barriers to finding and remaining in work, says the report.

The new Work Programme is struggling to place ESA and JSA claimants with into work. People with a mental illness continue to fare badly compared to their counterparts without such illness: their unemployment rate is more than double the overall rate; and the risk of falling below the poverty threshold is almost double the overall risk. Indeed, the risk of poverty among people with is the highest in a comparison of ten OECD countries including seven other European countries, Australia and the US.

The majority of benefit claimants with mental health problems need a combination of health and employment interventions to improve their chances of finding a suitable job. The health sector has increased services, so that access to common mental health treatments is much better than it was five years ago, but waiting lists are still too long in some parts of the country. Positive changes are also taking place to inform general practitioners about common mental disorders and return-to-work issues, but more systematic action in dealing with workplace matters is needed through a revised training curriculum.

The OECD recommends that the UK authorities:

  • Ensure that the new Health and Work Service, announced to start in 2014, is implemented quickly and universally, with a strong focus on mental health and those still in work and with much stronger involvement of employers.

  • Increase the attention to mental health and its impact on employability and work capacity in all parts of the welfare system.
  • Increase resources and refine financial incentives for employment service providers to ensure better employment outcomes for customers with mental health problems.
  • Build on recently improved integration of health and employment services to make sure that integrated health and employment interventions for those with mental health issues are widely available.
  • Further expand access to psychological therapies for those with a common mental disorder.

Mind comments:

‘Mental Health and Work’, the latest report from the Organisation for Economic Co-operation and Development (OECD), highlights the impact that mental health problems and sickness absence has on businesses in the UK, and makes recommendations on how to support people with mental health problems during employment, whilst on sick leave and out of work.

Paul Farmer, Chief Executive of Mind, commented:

“We welcome this report, which puts mental health and work on the agenda, and highlights some of the key challenges and solutions. Appropriate employment can be beneficial to wellbeing, so we agree that more specialist support is needed. This will help tackle the barriers to entering and retaining work faced by people with mental health problems. The report also identifies the need for better integration between employers, the health service and the benefits system, as well as initiatives like Improving Access to Psychological Therapies (IAPT). Too many people currently fall through the gaps because these services are not joined up.

“Early intervention is key to supporting good mental health, and the new Health and Work service is an opportunity to help individuals get the right support at the right time. For the service to be effective, however, we need to see case managers with expertise in mental health who are able to recognise the impact a complex, fluctuating condition can have on somebody’s ability to work. “The report appears to support the reforms to the welfare system, including compulsory reassessment of those claiming out-of-work and sickness benefits. However, we know that sanctions do not help people back into work, in fact they often make it harder for people to engage and result in individuals being pushed even further from the workplace.”


Organisation for Economic Co-operation and Development (OECD)