Dr. Karina Doorley:

That is a very complex question about a very complex topic. I suppose the Chairman is right. There is not the same body of research about the adequacy of disability payments compared to something like pension payments. That is because much of the research that looks at the level at which welfare is set does so in an attempt to establish what incentives to work are. It is very difficult to talk about incentives to work when we are studying a population with a disability because, obviously, many of them are self-declaring as unfit to work. It makes absolutely no sense, therefore, to be looking at incentives to work and what level of payment is the correct one to have this trade-off between a safety net but also keep incentives to work for those who can do so. I guess that is why there is probably a little bit less research in this area. It is also quite complex to study because the typical types of survey data we use do not have much information on disability.

From our perspective, with the SWITCH model and the data we use, we know if somebody is receiving a disability payment but we do not know anything else, so it is quite hard to establish their level of need in terms of payment without going to another data source, such as the household budget survey. With that we may be able to determine where their expenditure might exceed that of other households that do not contain a person with a disability and abstract from that what might be the correct level of payment. I do not have much more to say on that topic now.