Largest welfare reforms for a generation to help sick and disabled people who can and have the potential to work into jobs – backed by a £1 billion investment, unveiled by the Work & Pensions Secretary today
- Work Capability Assessment to be scrapped and “right to try” work guarantee to be introduced in drive to tear down barriers to work
- Changes will unlock work, boost employment, and tackle the broken benefits system to unlock growth as part of the government’s Plan for Change
Record £1 billion employment support measures have been announced ‘to help disabled and long-term sick people back into work’.
The new measures are designed to ensure a welfare system that is fit for purpose and available for future generations – opening up employment opportunities, boosting economic growth and tackling the spiralling benefits bill, while also ensuring those who cannot work get the support they need as part of the government’s Plan for Change.
This will end years of inaction, which has led to one in eight young people not currently in work, education or training and 2.8 million people economically inactive due to long term sickness – one of the highest rates in the G7.
The number of people receiving one of the main types of health and disability benefit, Personal Independence Payments (PIP), has also risen rapidly and is becoming unsustainable.
Since the pandemic, the number of working-age people receiving PIP has more than doubled from 15,300 to 35,100 a month. The number of young people (16-24) receiving PIP per month has also skyrocketed from 2,967 to 7,857 a month. Over the next five years, if no action is taken, the number of working age people claiming PIP is expected to increase from 2 million in 2021 to 4.3 million, costing £34.1 billion annually.
All this has driven the spiralling health and disability benefits bill, forecast to reach £70 billion a year by the end of the decade, or more than £1 billion a week. This is equivalent to more than a third of the NHS budget, and more than three times as much as is spent on policing and keeping communities safe.
Speaking in Parliament today, Liz Kendall announced a sweeping package of reforms to overhaul the system, so it better supports those who need it while tearing down barriers to work including:
Ending reassessments for disabled people who will never be able to work and people with lifelong conditions to ensure they can live with dignity and security
Scrapping the controversial Work Capability Assessment to end the dysfunctional process that drives people into dependency – delivering on the government’s manifesto commitment to reform or replace it
Providing improved employment support backed by £1 billion – one of the biggest packages of employment support for sick and disabled people ever – including new tailored support conversations for people on health and disability benefits to break down barriers and unlock work
Legislating to protect those on health and disability benefits from reassessment or losing their payments if they take a chance on work.
To ensure the welfare system is available for those with the greatest needs now and long into the future, the government has made bold decisions to improve its sustainability and protect those who need it most, including:
- Reintroducing reassessments for people on incapacity benefits who have the capability to work to ensure they have the right support and aren’t indefinitely written off.
- Targeting Personal Independence Payments for those with higher needs by changing the eligibility requirement to a minimum score of four on at least one of the daily living activities to receive the daily living element of the benefit, in addition to the existing eligibility criteria.
- Rebalancing payment levels in Universal Credit to improve the Standard Allowance. Raising it above inflation by 2029/30, adding £775 annually in cash terms.
- Consulting on delaying access to the health element of Universal Credit until someone is aged 22 and reinvesting savings into work support and training opportunities through the Youth Guarantee.
Prime Minister Keir Starmer said: “We inherited a fundamentally broken welfare system from the previous government. It does not work for the people it is supposed to support, businesses who need workers or taxpayers who foot the bill.
“This government will always protect the most severely disabled people to live with dignity. But we’re not prepared to stand back and do nothing while millions of people – especially young people – who have potential to work and live independent lives, instead become trapped out of work and abandoned by the system. It would be morally bankrupt to let their life chances waste away.
“When I talk about opportunity for all, I mean it. That’s why we are bringing forward the biggest changes to the welfare system in a generation and improving support for those who need it. Ensuring those who can work do work is not only right, but it will also improve living standards and drive growth, the number one priority in our Plan for Change.”
Work and Pensions Secretary Liz Kendall said: “Our social security system must be there for all of us when we need it, now and into the future. That means helping people who can work to do so, protecting those most in need, and delivering respect and dignity for all.
“Millions of people have been locked out of work, and we can do better for them. Disabled people and those with health conditions who can work deserve the same choices and chances as everyone else.
“That’s why we’re introducing the most far-reaching reforms in a generation, with £1 billion a year being invested in tailored support that can be adapted to meet their changing circumstances – including their changing health – while also scrapping the failed Work Capability Assessment.
“This will mean fairness for disabled people and those with long term health conditions, but also for the taxpayers who fund it as these measures bring down the benefits bill.
“At the same time, we will ensure that our welfare system protects people. There will always be some people who cannot work because of their disability or health condition. Protecting people in need is a principle we will never compromise on.”
In her statement to Parliament, the Work and Pensions Secretary outlined the clear case for change to the welfare system and set out her commitment to ensuring that disabled people and those with a health condition have the same opportunities to work as anyone else.
In particular, she highlighted that the UK has one of the highest reported rates of working-age people out of work due to ill health in Western Europe and the UK is the only major economy whose employment rate hasn’t recovered since the pandemic – exacerbated by a broken NHS with millions of people on waiting lists.
The government has already made huge progress to fix the NHS, including by hitting the manifesto commitment to deliver over two million extra elective care appointments seven months early, and bringing forward a wider programme for NHS reform through the rollout of community diagnostic centres and 10-year plan. The Health Secretary has also sent crack teams spearheaded by top clinicians into areas of high economic inactivity, and the latest data shows waiting lists in these areas have reduced at almost double the rate of the rest of the country.
The reformed system will be built on a straightforward guarantee: any disabled person or person with a long-term health condition who is claiming out of work benefits will be able to access high quality, tailored help into a job. It will also mean that those who cannot work will always get the support they need. In Scotland and Wales, we will work closely with the devolved governments as we develop this package of support.
The reforms are based on five key principles:
Protecting disabled people who can’t and won’t ever be able to work and supporting them to live with dignity by:
- Income Protection: Those currently in receipt of UC health will benefit from the increased standard allowance and will not be affected by plans to reduce UC health in future.
- Extra Financial Support: For people who receive the new rate of UC health in the future system, we are proposing a new premium for individuals with severe, life-long health conditions who will never be able to work. The details, eligibility criteria and rate of this premium will be set out in due course.
- Ending Reassessments: Reassessments for disabled people and people with life-long conditions who will never be able to work will be scrapped.
- Improving Safeguarding Practices: The government will look at how safeguarding practices for the most vulnerable can be improved and improve experiences with the system, working with stakeholders to identify areas for improvement.
Delivering better and more tailored employment support to get more people off welfare and into work. This includes:
- £1 Billion employment package to deliver tailored support for disabled people and those with long-term conditions.
- New Support Conversations to provide earlier opportunities for people with health conditions to discuss work goals and available help.
- Investing in the Youth Guarantee by delaying access to UC health element until age 22 and reinvesting savings into work support and training for young people.
Stopping people from falling into long-term economic inactivity through early intervention and support by:
- Access to Work Scheme: We will consult on improvements to help people start and stay in work with reasonable adjustments including aids, appliances and assistive technology. These would be the first substantive changes to Access to Work since its introduction in 1994
- Unemployment Insurance: We will reform contributory benefits (ESA and JSA) into a single, non-means tested, time-limited benefit for those who have paid into the system to ensure people get the support they need to find a new job that makes the most of their skills, contributing to a dynamic and productive economy.
Restoring trust and fairness in the system by fixing the broken assessment process that drives people into dependency on welfare by:
- Scrapping the WCA to end the labelling of people as either ‘can or can’t work’ and consulting on a new single assessment. Under the new system, any extra financial support for health conditions (including PIP, ESA or UC health) will be assessed via a new single assessment which will be based on the PIP assessment – considering on the impact of disability on daily living, not on capacity to work.
- Increasing Face-to-Face Assessments for PIP and the WCA to improve the quality of assessment decision while ensuring we continue to meet the needs of those with who may require a different method of assessment.
- Longer term reform of the PIP Assessment – In the long term we will set out broader reforms to the PIP assessment, and intend first to carry out a review involving experts and stakeholders to adapt and improve it.
- Right to Try Guarantee: which will ensure someone trying work or on a pathway towards employment will never lead to an immediate reassessment or award review.
- Restarting Mandatory Reassessments: We will reintroduce reassessments for incapacity benefits, with exceptions for those who will never work and those under special rules for end-of-life care. Reassessments have largely been switched off since 2021, leaving people stuck on benefits when they could be helped into work and to improve their quality of life.
Ensuring the system is financially sustainable to keep providing for those who need it most by:
- Changing PIP Eligibility: PIP will be targeted more on those with higher needs by requiring a minimum of four points on one daily living activity, in addition to the existing eligibility criteria.. DWP will work with DHSC to ensure that existing people who claim PIP who may no longer be entitled to the benefit following an award review under new eligibility rules have their health and eligible care needs met. The government is consulting on how best to achieve this.
- Rebalancing Universal Credit: by improving the Standard Allowance to provide more adequate support. The government plans to raise the Standard Allowance above inflation by 2029/30, adding £775 in cash terms annually. This aims to avoid people having to choose between employment or adequate financial support. This change addresses the current issue where the health element rate is double that of the standard allowance, creating an incentive for people to prove they are unfit to work to claim the health element and access greater financial support.
Helen Barnard, director of policy at Trussell, said: “We’re deeply concerned by the cuts announced to disability payments today.
People at food banks have told us they are terrified of how they might survive. We welcome the positive proposals from the Department for Work and Pensions to boost the basic rate to Universal Credit and invest in employment support. However, we fear these steps will be undermined by a Treasury drive to make short-term savings.
“Huge cuts risk pushing more disabled people to the doors of food banks, and will have devastating consequences for us all. The UK government was elected on manifesto pledges to end the need for emergency food parcels. This isn’t what people voted for.
“Disabled people are already three times more likely to face hunger, and three quarters of people at food banks are disabled or live with someone who is. Our social security system should be rooted in justice and compassion, able to be there for us all, especially when we need it most.
“This isn’t a done deal. With at least a year before any cuts come into force, there’s still time for the Prime Minister and Chancellor to rethink and make good on today’s promise to restore trust and fairness in the social security system.”
Responding to today’s statement by Liz Kendall MP, Poverty Alliance policy & campaigns manager Ruth Boyle said: “People in the UK are desperate for a government that delivers a just and compassionate country.
“They want to see an end to deepening poverty, debt, destitution, and hunger in their communities. Many will be distressed, disappointed, scared, and angry at today’s announcements.
“The plans to cut the health element of Universal Credit are wrong and unjust. Cutting vital financial support to disabled people won’t help them into paid work – but it is likely to move them towards poverty.
“Equally unjust is the idea of making it virtually impossible for under-23s to get Universal Credit health support. The Government is punishing young people who aren’t fit for work simply because of their age.
“These changes are driven by a desire for financial cost savings, rather than helping people access the support they need. Positive proposals like personalised support to help people into work and a Right-to-Try will be undermined by cuts which force people into further and deeper poverty.
“Personal Independence Payments are a vital part of the social security system, and even though we have a replacement Adult Disability Payment in Scotland, there are still many people here who are on PIP.
“These social security benefits support people’s basic freedom – whether they are in work or not. They help cover some of the extra living costs that are forced on disabled people. The Government now plans to make it harder for them to get that vital support, denying them a full place in society, and undoubtedly pushing many towards debt and destitution.
“We urge the Scottish Government to maintain its commitment to justice and compassion, and to make sure the Adult Disability Payment still supports the freedom and rights of disabled people.
“It is shameful to try to balance the books on the backs of disabled people and households that are already struggling to keep their heads above water. Instead, the Government should do the responsible thing and use their tax powers to unlock our country’s wealth for investment in a strong social foundation.
“And they can scrap their self-imposed fiscal rules with a plan to help everyone build a better life for their households, and a better future for our country.”
OXFAM Scotland tweeted: ‘Just a reminder there’s no shortage of money in the UK, just a shortage of political will to go out & tax it.
‘While more people risk being locked into hardship/deeper poverty, the ballooning bank balances of the UK’s richest millionaires/billionaires get off virtually scot-free’
The Disability Policy Centre’s Interim Director of Research, Arun Veerappan, response to the Government’s release of the Green Paper this afternoon.
Green MSP slams Labour betrayal of disabled people and calls on MPs to fight back
Scottish Green’s co-leader and MSP for Lothian region Lorna Slater is calling on Labour MPs to fight back on the inhumane cuts that the UK government are proposing to hit their fiscal targets.
In the Westminster government’s latest controversial move, it has announced a package of changes expected to affect some of the UK’s most severely disabled people. The measures will deny benefits for thousands of people across the country.
Lorna Slater MSP for Lothian region said: “These cuts will make a cruel and dehumanising system even more brutal than it already is. They will spread pain and misery across every community.
“ This decision is immoral. You can’t cut £5 billion of support without causing real harm to disabled people.
“ None of this is inevitable. Labour could choose to bring in a wealth tax that collects a fair and justified share from the richest people to invest in the services we all rely on.
“Labour are doubling down on the Tory idea that you can work your way out of disability. They are sending a cruel and dangerous message that only people who can boost our economy are worth supporting. They promised an end to austerity, but this goes even further than anything that the Tories ever dared.”
“The fact that they are choosing to punish the people with the least tells us everything we need to know about Labour’s values. The millions of people who waited 14 long years to get rid of the Tories deserve so much better than this.”
‘Cuts to benefits announced today have clearly been motivated by a desire to make short-term savings to meet arbitrary fiscal rules, says New Economics Foundation’s Head of Social Polict Tom Pollard.
‘They’re not going to help ill and disabled people, they’re only going to create more problems.’
Former Labour Party leader and now Independent MP Jeremy Corbyn said: “This is a seminal moment: a Labour government cutting disability benefits. Not just continuing Tory levels. Cutting.
“This comes after a week of speculation, itself an act of cruelty by a government toying with people’s dignity. These cuts are disgraceful – and will cost lives.”
Scope charity commented: “These plans will be catastrophic for disabled people’s living standards. Nearly half of families living in poverty already include someone who is disabled. Now the government is choosing to penalise some of the poorest people in our society.
“We welcome the investment in tailored, non-compulsory employment support. But ripping £5 billion out of the benefits system by 2030 will completely undermine this positive step.
“Countless disabled people, charities, MPs, and experts are urging the government to think again. And we’re not backing down. The consultation is likely to receive an overwhelming response. We urge the government to listen to disabled people and think again.
“Over the coming days, we’ll analyse all the details in the government’s plans. We’ll then share more information about what these changes mean and who could be affected as soon as we can. We’ll also share ways you can have your say in the consultation.
‘This is an especially worrying time for many disabled people. If you’re concerned about these changes, you can contact our helpline for advice and support.
Call us free on 0808 800 3333, or visit our website for more ways to get in touch:
‘If you need to talk to someone about how you’re feeling, day or night, Samaritans are here to help. Call 116 123 for free, or visit their website https://samaritans.org “
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