Employer healthcare initiatives could cut absence and save the UK £13bn a year

Back-to-work tax incentives could save the economy £13.2bn a year, economists claim.

A report by NERA Economic Consulting and funded by Norwich Union Healthcare found that tax incentives for employers intended to encourage workplace health initiatives that would reduce absence from work were not being widely taken up.

In the report, entitled Sharing the costs, Reaping the benefits – Incentivising return to work initiatives, match-funding or tax credits are presented as ways to reduce the £13.2bn cost of sick pay, the resultant overtime and labour replacement costs.

The health service also comes under fire for failing to prioritise getting patients of working age back to work over other patients’ needs.

About 85% of GPs said the provision for rehabilitation and return-to-work services was poor. The most significant requirements are for help with musculo-skeletal disorders and mental health problems, which cause  most long-term absences.

Tim Baker, commercial director of Norwich Union Healthcare, said: “The report seeks to stimulate the debate on the role of tax incentives in encouraging employers to engage with workplace health and rehabilitation services.

“It shows how the market is failing at the moment but how, with a change in relationship between the stakeholders, we could begin to tackle the problem of sickness and absence in the workplace.”

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