Many followers of this blog will recall that there was quite a lot of coverage here (and indeed on other media) regarding the proposed introduction of tax-breaks for certain, medical related, employee benefits as mooted in both the Sickness Absence Review, and George Osborne’s Budget speech earlier this year.

In the Budget a formal consultation on this subject was promised. Since then I have been keeping an active eye on both the DWP and Department of Health websites awaiting this important consultation, but to no avail. And it’s only now, almost at the 11th hour, that I find I was looking in the wrong place all along (and I suspect many others would have been also). It turns out that the consultation was posted on the Treasury website, and it runs for only a few more days, with the closure date listed as the 16th August.

So why is this important?

My concern around this much-needed (and long-awaited) proposed tax relief is that it may be targeted at the wrong place and/or employee benefit. Now it’s a good thing that the Government recognise the need to provide employers with a tax incentive to help provide medical related benefits, but it would be an even better thing if that relief were targeted at the places that employers themselves believe will best help them control sickness absence. And according to our research from earlier this year, that area is either employer funded healthcare, or occupational health.

Yet I suspect that may not be the beneficiary of this relief. The title of the consultation, although less than snappy, says it all really:

“Implementation of a tax exemption for employer expenditure on health-related interventions recommended by the new health and work assessment and advisory service”

So it’s clear that the intention is only to support treatment recommended by the new Independent Assessment Service (IAS), which will mainly only kick-in when an employee has already been absent from work for 4 weeks or more. Or to put it another way, the relief is intended to only support funding for treating the symptoms of an illness or condition that has already caused an absence, rather than funding benefits that may prevent the cause of the problem in the first place.

This is surely short-sighted, and whilst I don’t expect the direction of the consultation to be overturned by any employer’s response at this stage, it would be a good thing for employer’s to register their views at this time, as it may well influence future Government decisions in this area. For my part, I will undertake to share our recent research with the consultation on my return from leave as well.

For those interested in the consultation details, it can be viewed via the following link:

https://www.gov.uk/government/consultations/implementation-of-a-tax-exemption-for-employer-expenditure-on-health-related-interventions-recommended-by-the-new-health-and-work-assessment-and-advis

I will keep you posted on the outcomes.

Best regards

Steve