AI Growth Labs will unlock new ways to accelerate innovation and cut bureaucracy in a safe environment
More new homes, better outcomes for patients, and world-leading innovations for professional services among potential wins for the public
This new approach to regulation will help drive forward growth and national renewal under the government’s Plan for Change
More new homes, better outcomes for patients, and world-leading innovations are among the benefits people can expect to see from a new blueprint for AI regulation being announced today, as the government slashes bureaucracy and ramps up the safe adoption of AI to unlock its full potential.
At the Times Sech Summit today (21st October), the Technology Secretary will announce plans to look at how companies and innovators can test new AI products in real-world conditions, with some rules and regulations temporarily relaxed under strict supervision.
Known as sandboxes, individual regulations are temporarily switched off or tweaked for a limited period of time in safe, controlled testing environments. They would initially be set up for key sectors of the economy like healthcare, professional services, transport, and the use of robotics in advanced manufacturing, to accelerate the responsible development and deployment of AI products.
The announcement comes as the Chancellor also details progress made towards delivering on the government’s vision for a regulatory system that better supports growth and innovation.
At today’s Regional Investment Summit, the Chancellor will announce a range of pro-growth reforms that will help deliver that vision set out March’s Regulation Action Plan, including a plan to save businesses across the country nearly £6 billion a year by 2029 by cracking down on pointless admin tasks.
AI applications hold the potential to make the lives of citizens better, faster. The AI Growth Lab will pilot responsible AI which can otherwise be held back by certain regulation, and generate real-world evidence for the impact they can deliver. This will ramp up adoption of AI and deliver opportunities for people across the country, cutting bureaucracy that can choke innovation and supporting businesses to flourish to deliver tangible national renewal.
For example, a testing ground focused on building AI tools could support health workers deliver better patient care on an accelerated timeline. This would also help reduce NHS waiting lists and time demands on frontline NHS staff, as well as ensure that public services are working around the lives of the British public.
Currently, a typical housing development application racks up 4,000 pages of documentation and takes as long as 18 months from submission to approval. By reviewing regulations to explore how AI could support officials, those times could be slashed – speeding up decision making and putting the government’s plans to build 1.5 million new homes by the end of the current Parliament in the fast lane.
Close working between businesses and regulators are already delivering transformations for the public. A sandbox led by the Information Commissioner’s Office has supported age verification company Yoti to fine tune their age estimation technology to help keep young people safe online, while another trial has helped FlyingBinary to develop online services which support mental health patients.
Technology Secretary Liz Kendall said: “To deliver national renewal, we need to overhaul the old approaches which have stifled enterprise and held back our innovators.
“We want to remove the needless red tape that slows progress so we can drive growth and modernise the public services people rely on every day.
“This isn’t about cutting corners – it’s about fast-tracking responsible innovations that will improve lives and deliver real benefits.”
In a further push to unlock benefits for the wider public through AI, a pot of £1 million is being set aside to support the Medicines and Healthcare products Regulatory Agency (MHRA) to pilot AI-assisted tools.
These would support scientific expertise, speed up drug discovery and clinical trial assessments, and licensing to improve efficiency and consistency – while keeping all decisions firmly in human hands.
The continued safe and responsible development of AI would be central to the government’s plans for its proposed AI Growth Lab. It would not be a testing ground where regulations could be switched on or switched off at will, but would see strict, time limited restrictions being put in place to set out which specific regulatory hurdles could be avoided or modified under close supervision.
It will be overseen by tech and regulatory experts and backed up by a strict licensing scheme with strong safeguards, meaning any breaches of individual agreements, or the emergence of unacceptable risks would stop testing in its tracks and open users who have breached their terms up to potential fines.
While this would mark new ground in terms of AI, other regulatory testing grounds have already been put to effective use across the economy.
The Digital Securities Sandbox for example is helping finance firms and innovators by giving them the ability to test innovative tech solutions for some of the most urgent challenges in the financial sector. It is helping to deliver a more secure and efficient financial system by focusing on Distributed Ledger Technology, which creates a single bank of data on financial transactions to speed up efficiencies and help tackle fraud.
Internationally, countries are already using sandboxes to speed safe deployment. Jurisdictions such as the EU, USA, Japan, Estonia and Singapore have announced or implemented some form of regulatory sandbox for AI.
The UK pioneered the global sandbox model with the launch of the FCA’s 2016 fintech sandbox – with transformative AI approaching, the UK must stay at the vanguard of international best practice in regulatory innovation – and the benefits this brings for UK innovation and jobs.
The government will now move ahead with a public call for views on its AI Growth Lab proposals. At the heart of that process will be considerations over whether the programme should be run in-house by the government, or overseen by regulators themselves.
The adoption of AI is the defining economic opportunity of the coming decade, but currently only 21% of UK firms are using the technology. The OECD currently estimates that AI could improve UK productivity by as much as 1.3 percentage points every year – worth the equivalent of £140 billion.
The AI Growth Lab will provide a route to test and pilot responsible AI innovations hindered by regulation – driving AI adoption and economic growth.
Thousands of sick or disabled people will be helped into ‘good, secure jobs’ following a major expansion of tailored employment support announced by the Department for Work and Pensions today
Hundreds of thousands of sick and disabled people will now get the personalised support they need to find good, secure jobs thanks to a major expansion of specialist employment support.
New funding will be delivered to fifteen areas across England as part of the Connect to Work programme which helps to break down barriers to opportunity.
Comes as part of £3.8 billion employment support package for sick or disabled people, unlocking work and boosting living standards as part of the Plan for Change.
A new £338 million investment into the Connect to Work programme will deliver localised, tailored support to over 85,000 people who are sick, disabled or face complex barriers to work in 15 areas across England.
The scheme provides intensive, personalised help including individual coaching from employment specialists, job matching services, and ongoing support for both participants and employers to ensure sustainable employment outcomes.
In all around 300,000 people across all of England and Wales are set to benefit over the next five years. To access support, sick and disabled people and those facing complex barriers to work can self-refer or they can be referred through various routes including healthcare professionals, local authorities, and voluntary sector partners.
"If anything comes up, just take it. It'll be the best thing that you've ever done"
Julie found good, secure work because of tailored support.
With 2.8 million people out of work due to ill-health – one of the highest rates in the G7 – it’s part of the Government’s plan to get Britain working again and deliver an 80% employment rate by overhauling jobcentres, tackling economic inactivity through local plans, and delivering a Youth Guarantee so every young person is either earning or learning.
Among those out of work, over one in four cite sickness as a barrier – more than double the 2012 figure of one in ten – highlighting the urgent need for tailored employment support that removes barriers faced by disabled people and those with health conditions.
Work and Pensions Secretary Liz Kendall said: “For too long, millions of people have been denied the support they need to get back to health and back to work.It’s bad for their living standards, it’s bad for their families, and it’s bad for the economy.
“That’s why we’re taking decisive action by investing millions of pounds so sick or disabled people can overcome the barriers they face and move out of poverty and into good, secure jobs as part of our Plan for Change.”
The expansion is backed by a £338 million cash injection with the largest interventions announced today including:
Up to £71.9 million for Central London Forward – supporting 16,800 people across the City of London.
Up to £47.1 million for the Local London Sub-Regional partnership – providing tailored support to 12,350 people across nine boroughs in east and outer London.
Up to £35.3 million for South Yorkshire – helping 9,950 participants across Sheffield, Rotherham, Barnsley, and Doncaster into work.
Up to £30.7 million for Greater Essex – supporting 7,800 people across Southend-on-Sea, Thurrock, and Essex into good jobs.
South Yourkshire’s mayor Oliver Coppard said: “I want South Yorkshire to be a place where we all thrive. Where poor health doesn’t hold us back. And work plays a huge part. It’s not just about wages – it’s about dignity, pride, and the security that comes from knowing you can support yourself and your family.
“Right now, more than 140,000 people across South Yorkshire aren’t in work. But many of those people desperately want to have a job, want to provide for their families, and contribute to the future of our communities. Which is why I’m proud that South Yorkshire is one of the areas across England and Wales delivering Connect to Work.
“It’s a programme designed to help those with disabilities, long-term health conditions, or from disadvantaged backgrounds, into good, secure jobs. And I’m even prouder that Connect to Work is part of the national Pathways to Work project, which we pioneered right here in South Yorkshire.
“South Yorkshire’s at the forefront of tackling these challenges nationally, and we’re increasingly a model for other places across the country.”
Connect to Work is already transforming lives across England, with early delivery areas demonstrating the real difference targeted employment support can make.
In West London, where £42.8 million was allocated earlier this year to support 10,800 people, participants are already finding work with the help of specialist coaches who understand the complex barriers they face.
Awais Ashraf, a Connect to Work participant in West London, said: “My health suffered with the loss of a family member, which led me into a period of depression and anxiety, and meant I lost my employment just under two years ago.“
My JCP Workcoach referred me to Connect to Work. I received a blend of support – from advice and tools in self-managing my health condition to identifying what skills I already had and could be transferred to another role.
“I am now working as a Teaching Assistant & knowing I have my Employment Specialist supporting me while I am in work is also a great reassurance.”
Cllr Tom Hunt, Chair of the LGA’s Inclusive Growth Committee, said: “The Government’s decision to provide grant funding to councils and mayoral areas to deliver Connect to Work is a positive step.
“Evidence shows that councils are best placed to understand and respond to the needs of their communities, and the LGA has long called for a more local approach to helping people back into employment.”
Connect to Work will enable councils and mayors, working with partners, to design tailored support for people who are currently out of the labour market due to health conditions, disability, or complex needs.
This not only facilitates supporting people move closer to work but also helps reduce wider social and financial pressures on communities and services, which helps reduce long-term welfare dependency, and creates stronger and more productive, resilient local economies.
Today’s announcement comes less than 24 hours after the Universal Credit Bill received Royal Assent.
Coming into force in April next year, it will make the welfare system fairer by rebalancing Universal Credit to reduce the incentives that discourage work and fuel inactivity. It will also increase the rate of the standard allowance of Universal Credit, for around four million households, putting an extra £725 in their pockets by 2030.
The new funding also builds on WorkWell, a joint programme by DWP and DHSC, which went live in October last year, backed by £64m funding.
It is transforming how people with health conditions are supported back into work through better integration between health services and employment support and will reach 56,000 people across the 15 pilot sites by Spring 2026.
This approach prevents people from falling out of work, transforming employment services, and providing specialist support to help the most disadvantaged back into good jobs, the UK Labour government says.
New details on the Government’s welfare reforms will be published today ahead of Second Reading of the Universal Credit and Personal Independence Payment Bill on Tuesday.
Terms of reference for the first comprehensive review of the Personal Independence Payment (PIP) assessment in a decade to be published today.
Comes alongside draft regulations for the new Right to Try Guarantee – enshrining protections in law for disabled people and people with health conditions who want to try work.
Reforms to deliver greater certainty, independence, and dignity for disabled people, while ensuring the system is fair, sustainable, and fit for the future as part of the Plan for Change.
New details on the government’s welfare reforms will be published today (Monday 30 June 2025) ahead of Second Reading of the Universal Credit (UC) and PIP Bill on Tuesday.
The terms of reference for the first ever comprehensive review of the PIP assessment in over a decade will be published today. The review – led by Minister for Social Security and Disability Sir Stephen Timms – will ensure the system is fair, supportive and reflects the realities of modern life.
It will be co-produced with disabled people, the organisations that represent them, and MPs with the core objective of delivering better experiences and better outcomes for disabled people and people with health conditions.
The review aims to respond to the changing picture of population health over the last decade including the rising prevalence of long-term health conditions and disability in the working-age population.
Monthly PIP awards have more than doubled since the pandemic, rising from 13,000 to 34,000 – a rate of around 1,000 new claims per day, or the population of Leicester every year. Much of this increase is driven by mental health conditions with awards for anxiety and depression having tripled from 2,500 per month in 2019 to 8,200 in 2023.
To better help those with mental ill health, the government has recruited more than 6,700 extra mental health workers since July while rolling out more access to occupational health services and developing digital resources, so employers better support their staff’s mental wellbeing.
Many people have also reported poor experiences with the assessment process. The current system often fails to reflect the real-world impact of disability on daily life and is no longer fit for purpose – making reform urgent and essential.
Alongside the review, draft regulations for the new Right to Try Guarantee will be laid in Parliament. This will, for the first time, enshrine in law the right for people receiving health and disability benefits to try work without fear of reassessment. This includes disabled people and people with health conditions – such as those recovering from illness – who want to return to work now their health has improved.
This responds directly to concerns raised by disabled people and people with health conditions – 37% of whom say they want to work but are held back by fear of losing their benefits according to a DWP survey.
Fixing the broken welfare system this government inherited is central to breaking down barriers to opportunity and driving up living standards – delivering on the government’s Plan for Change.
The government says reforms will ensure disabled people have the support they need to live independently, with dignity, and will unlock opportunities to get into work without facing the prospect of losing the help they need.
Work and Pensions Secretary Liz Kendall said: “We must build a welfare system that provides security for those who cannot work and the right support for those who can. Too often, disabled people feel trapped – worried that if they try to work, they could lose the support they depend on.
“That is why we are taking action to remove those barriers, support disabled people to live with dignity and independence, and open routes into employment for those who want to pursue it.
“This is about delivering a fairer, more compassionate system as part of our Plan for Change which supports people to thrive, whatever their circumstances.”
The Government will also set out details today of the changes they intend to make to the Bill as part of the government’s welfare reforms.
The Government says it has has listened to MPs who support the principle of reform but are worried about the pace of change for those already supported by the social security system.
That’s why ministers have confirmed that as part of the Bill:
All existing PIP recipients will remain on the current system and the proposed changes to eligibility as part of the bill will only apply to new claims from November 2026.
200,000 individuals in the Severe Conditions Criteria group – individuals with the most severe, lifelong conditions who are unlikely to recover – will not be called for a UC reassessment.
All existing recipients of the UC health element and new customers with 12 months or less to live or who meet the Severe Conditions Criteria will see their standard allowance combined with their Limited Capability for Work Related Activity (LCWRA) rise at least in line with inflation every year from 2026/27 to 2029/30.
Nearly 4 million households will receive an income boost with the main rate of UC set to increase above inflation every year for the next four years – estimated to be worth £725 by 2029/30 for a single household aged 25 or over. This is around £250 higher than an inflation only increases.
The Bill will also rebalance UC rates by reducing the health element for new UC claims to the equivalent of £50 per week from April 2026, fixing a system which incentivises people to define themselves as incapable of work by paying health element recipients more than double the standard amount.
These reforms will be also underpinned by a significant investment in employment support. Funding will be brought forward to accelerate tailored employment, health and skills support to help disabled people and those with health conditions get into work as part of our Pathways to Work guarantee.
£300 million will be brought forward over the next three years, increasing total employment support by £2.2 billion over four years – upholding our commitment to spend £1 billion per year by the end of the decade.
This investment will accelerate the pace of new planned investment in employment support programmes, building on and learning from successes such as the Connect to Work programme, which already provides disabled people and people with health conditions with one-to-one support at the point when they feel ready to work.
And for people whose health challenges make it difficult to find or stay in work, our initiative in partnership with the NHS, WorkWell, will offer personalised support to help individuals manage their health while preparing for or returning to employment. This will build on progress already made to get 384,000 people into work since this government entered office and will come alongside fundamental reforms to patient support as part of the landmark 10 Year Health Plan.
Health professionals will be on hand to connect people with services like physiotherapy, mental health support, and more. They will also be supported by a dedicated employment adviser who understands their specific health needs and guide them every step of the way.
For too long, meaningful reform to our welfare system has been ducked and delayed – stunting productivity, slowing down growth and ultimately holding British people and our country back. The government is taking decisive action and the difficult decisions needed to restore trust and faith in the system, providing opportunities for those who can work, and security for those who cannot.
Further information
The UC and PIP Bill is scheduled for Second Reading in the House of Commons Parliament on Tuesday 1 July 2025.
The UC and PIP Bill legislates for:
A new additional eligibility requirement for the daily living component of PIP so that from November 2026 new claimants must score a minimum of 4 points must be scored on at least one daily living activity to be eligible for the daily living component.
Rebalancing of UC health and standard elementsincluding reducing the health top-up for new claims to £50 per week from April 2026.
Ensure that all existing recipients of the UC health element – and any new claimant meeting the Severe Conditions Criteria and/or that has their claims considered under the Special Rules for End of Life (SREL) – will receive the higher UC health payment after April 2026.
Increasing the UC standard allowance above inflation for the next four years – worth an estimated £725 by 2029/30 for a single adult aged 25 or over.
Exemptions from reassessment for those with the most severe, lifelong conditions.
The Government has also confirmed that it will amend the Bill at Commons Committee stage to:
Provide protection for existing PIP claimants—ensuring they remain on the current system and are unaffected by new eligibility rules.
For all existing recipients of the UC health element – and any new claimant meeting the Severe Conditions Criteria and/or that has their claims considered under the Special Rules for End of Life (SREL) – the LCWRA rate for this group will now be uprated each year this Parliament to ensure their combined rate of the Universal Credit standard allowance and LCWRA is protected in real terms.
The Bill currently includes a 13-week transitional period for the PIP changes, but this will be superseded by long-term protections for existing claimants.
The Terms of reference for the PIP review, draft regulations for the Right to Try Guarantee, the draft amendment to the Bill which will enact the change to PIP, and analysis of poverty impacts will be published later today.
Latest data published last week shows almost one-in-four adults in England have common mental health conditions – and that adults with problem debt and those out of work are far more likely to experience mental health conditions.
To better help those with mental ill health, the government is boosting access to support, with more than 6,700 extra mental health workers since July, marking a significant milestone towards its goal of 8,500 by the end of this Parliament.
It has also started rolling out more access to occupational health services and developing digital resources so employers can better support their staff’s mental wellbeing as part of its drive to get people back to health and back to work.
More than 100 charities unite to say Scottish MPs must stand against social security cuts
More than 100 charities and civil society organisations have urged Scottish MPs to stand against social security cuts, uniting to tell Scottish MPs that it’s not too late to change course on controversial cuts.
They have written a joint letter to Scottish Secretary Ian Murray and copied it to all of Scotland’s MPs at Westminster.
They warned that will mean destitution and misery for many sick and disabled people, as well as others in their households – including children and unpaid carers
Peter Kelly, chief executive of The Poverty Alliance said: “People are desperate for the UK Government to deliver a just and compassionate society – but these proposals will deliver the opposite.
“If enacted, these cuts will mean more disabled people living in poverty, relying on foodbanks, and pushed into destitution. That’s not the change people voted for at the last general election.”
In the letter they say: “This is a question of about the kind of society we want to be. Scotland is a country that believes in justice and compassion and people want our governments to make decisions which align with those values.
“We urge Ministers to drop these proposals. We urge Scottish MPs to vote against these cuts, sending a strong, positive message to disabled people and carers in Scotland that this Government will build a country free from poverty, not one that forces people into deeper poverty and destitution.”
MPs are expected to get their first chance to vote on the cuts in the Commons on 1 July. The Government is facing defeat after dozens of Labour MPs signalled their opposition.
Fiona Collie of Carers Scotland said: “We need a government that will reduce the poverty that unpaid carers face. If these cuts go ahead, even more of them will be pushed into crisis – leaving people struggling to afford food, heating, and other essentials.
“We estimate that around 150,000 unpaid carers across the UK stands to lose carers’ benefits as a direct result of these changes. That’s completely wrong – and any MP who votes to inflict that kind of deliberate harm on people in their constituency will have to justify themselves to electors.”
Tressa Burke of the Glasgow Disability Alliance said: “It is shameful to try to balance the nation’s books on the backs of disabled people. We have around 6,000 members who have already suffered the worst impacts of the cost-of-living crisis, and more than a decade of austerity and social security cuts.
“These plans will cause untold harm to many disabled people and push them into destitution. It will undermine their human rights and leave them facing even greater inequality and discrimination. If MPs in Scotland support these heartless cuts, it will be a bleak day indeed. They will absolutely not get people into work, and will act as a reason to fall out of work too, where PIP has been topping up low-paid work.’
In a survey last year, 71% of Glasgow Disability Alliance members said they didn’t have enough money to manage the cost of their needs, 68% couldn’t afford utilities, and 58% couldn’t manage the costs of food and essential groceries.
A substantial number of Labour backbenchers remain resolute and refuse to back the watered-down Bill.
RACHAEL Maskell MP said: “I have spent my life standing up for sick and disabled people, professionally and personally, and while progress is welcome, to introduce a system which leaves sick and disabled people in the future in poverty, those with fluctuating conditions, in uncertainty, including those with MS or a cancer relapse, no security, is unacceptable.
“Taking someone’s independence, does not make them better, more able to work or keep people in work. It creates poverty, dependency and places more pressure on social care and the NHS.
“Most chilling, according to Refuge, 29% of domestic violence survivors are disabled people and are far less likely to flee their home if they lose this crucial support.
“Work by the Women’s Budget Group demonstrates that this policy is highly gendered, impacting women significantly.
“Disabled people have not battled all their lives to then pull the ladder up behind them.
“I cannot support the ableist perception of sick and disabled people, where they have been given no agency in these proposals.
“Instead I draw on the substantial evidence, the voices of those impacted and my conscience which determines that I cannot cross by on the other side and have no choice but to vote against the UC & PIP Bill.”
More than 75,000 people have signed Richard Burgon MPs petition on Change:
TRUSSELL: The new Universal Credit and PIP bill will push nearly HALF A MILLION more people into severe hardship and towards the doors of food banks
Additional protections for millions of vulnerable people on benefits are set to be written into law, under new measures being introduced to Parliament yesterday [18 June 2025].
New welfare legislation to ensure there are robust protections in place to support the most vulnerable and severely disabled.
Nearly 4 million households to benefit from uprating of Universal Credit standard rate, the largest, permanent real-terms increase to basic out of work support since 1980, according to the IFS.
More than 200,000 people with most severe, lifelong conditions to be protected from future reassessment for Universal Credit entitlement.
13-week period of financial support for those affected by PIP changes as part of upcoming welfare reforms.
Comes alongside £1 billion employment support package that will unlock opportunity and grow the economy as part of the Plan for Change.
The Universal Credit and Personal Independence Payment Bill will provide 13-weeks of additional financial security to existing claimants affected by changes to the PIP daily living component, including those who their lose eligibility to Carers Allowance and the carer’s element of Universal Credit, according to the UK government – but charity Trussell says the bill will push nearly HALF A MILLION more people into severe hardship.
The 13-week additional protection will give people who will be affected by the changes time to adapt, access new, tailored employment support, and plan for their future once they are reassessed and their entitlement ends.
This transitional cover is one of the most generous ever and more than three times the length of protection provided for the transition from DLA to PIP.
The Labour government says it inherited a broken social security system, with costs spiralling at an unsustainable rate and millions of people trapped out of work. The case for change is stark:
Since the pandemic, the number of PIP awards has more than doubled – up from 13,000 a month to 34,000 a month. That is around 1,000 people signing on to PIP every day – that is roughly the size of Leicester signing up every year.
The surge has been largely by driven by a substantial increase in the number of people who report anxiety and depression as their main condition. Before the pandemic (in 2019), 2,500 people a month were awarded PIP for these conditions, this has more than tripled to 8,200 a month in 2023.
Almost 1 million young people – 1 in 8 – are not in education, employment or training.
1-in-10 people of working age are now claiming a sickness or disability benefit.
Without reform, the number of working age people on disability benefits is set to more than double this decade to 4.3 million.
Spending on working age disability and incapacity benefits is up £20 billion since the pandemic and is set to increase by almost that much again by the end of this Parliament, to a staggering £70 billion a year.
Labour says that’s why, through the introduction of this Bill; the government is fixing our broken social security system so it supports those who can work to do so while protecting those who cannot – putting welfare spending on a more sustainable path to unlock growth as part of our Plan for Change.
Work and Pensions Secretary Liz Kendall said: “Our social security system is at a crossroads. Unless we reform it, more people will be denied opportunities, and it may not be there for those who need it.
“This legislation represents a new social contract and marks the moment we take the road of compassion, opportunity and dignity.
“This will give people peace of mind, while also fixing our broken social security system so it supports those who can work to do so while protecting those who cannot – putting welfare spending on a more sustainable path to unlock growth as part of our Plan for Change.”
As part of our (i.e. the Westminster govertnment’s) commitment to protect the most vulnerable and severely disabled, peace of mind will also be given to 200,000 individuals in the Severe Conditions Criteria group – individuals with the most severe and permanently disabling conditions who will never be able to work – as they will not be called for reassessed for Universal Credit (UC) under new legislation.
Those protected from reassessment will also be paid the higher rate of UC health top up of £97 per week, so they can live with dignity and security, knowing the reforms to the welfare system mean it will always be there to support them.
In the coming weeks, legislation will also be drafted for a Right to Try Guarantee. This will ensure that trying work will not, in and of itself, lead to a reassessment or award review, breaking down barriers to employment.
Reforms being delivered by the legislation introduced today go hand in hand with a £1 billion employment support package to support more people with health conditions back into work, unlocking opportunity and growing the economy as part of the Plan for Change.
Funding will offer personalised employment and health support for individuals on out of work benefits, with 500,000 people having already been supported into employment. This is a quadrupling the level of annual spend on supporting sick and disabled people into work, from the £275m in 2024/25 we inherited, to over £1bn in 2029/30.
Nearly 4 million households will also receive an income boost with the main rate of Universal Credit set to increase above inflation every year for the next four years – estimated to be worth £725 by 2029/30 for a single household 25 or over. This is around £250 higher than an inflation only increases.
The Bill will also rebalance Universal Credit rates by reducing the health element for new UC claims to £50 from April 2026, fixing a system which encourages sickness by paying health element recipients more than double the standard amount.
To open up opportunities to work, everyone affected by changes to the UC health element from April 2026 will be offered support from a dedicated Pathways to Work adviser, with 1,000 advisers in place across Britain.
All of those affected by reforms will be actively contacted and given the offer of a conversation about their support needs, goals and aspirations; offered one-to-one follow-on support, and given help to access additional work, health and skills support that can meet their needs.
The reforms build on the Get Britain Working White Paper that will overhaul Jobcentres, empower Mayors and local leaders to tackle inactivity, and deliver a Youth Guarantee so every young person is either earning or learning, as part of the Government’s ambition to deliver an 80% employment rate.
Additional information
The Bill will introduce a new additional eligibility requirement for the daily living component of PIP so that a minimum of 4 points must be scored on at least one daily living activity to be eligible for the daily living component. It will also rebalance Universal Credit.
Based on current forecasts, the rebalancing mean single households 25 or over, will see their standard allowance rise to around £106pw by the end of this parliament.
Current UC health top up is more than double the UC standard allowance for a single claimant.
There are 4 criteria for the healthcare professional to consider, all of which must apply for the claimant to meet the SCC, namely whether:
The individual’s level of function will always meet LCWRA
The individual’s condition will last for the rest of their life
There is no realistic prospect of recovery of function, and
The condition has been diagnosed by an appropriately qualified healthcare professional in the course of the provision of NHS services.
Scotland’s Social Justice Secretary: “Scrap damaging welfare reforms”
Social Justice Secretary Shirley-Anne Somerville has urged the UK Government to protect and enhance social security rather than making cuts.
The UK Government’s Universal Credit and Personal Independence Payment Bill has been published today, which includes the details of the first set of changes to ill-health and disability benefits. The Scottish Government will not mirror the Personal Independence Payment (PIP) changes in Adult Disability Payment in Scotland.
Social Justice Secretary Shirley-Anne Somerville said: “The UK Government’s proposed reforms will be hugely damaging to those who rely on social security support, particularly during the ongoing cost of living crisis.
“These plans have yet to be passed at Westminster, so there is still time for the UK Government to step back from this damaging policy and I strongly urge them to scrap their harmful proposals.
“The UK Government’s own analysis highlights how the proposals will push 250,000 more people across the UK into poverty – including 50,000 children. With around half of all children in poverty in Scotland living in a household with a disabled person, the changes threaten to undermine the progress that we are making to reduce child poverty, and the work of the UK Government’s Child Poverty Taskforce.
“That the UK Government is prioritising deep cuts to disabled people’s support is made even worse by their failure to abolish the two-child limit, which is estimated to have pushed more than 35,000 children into poverty since July last year.
“The reforms do not reflect the Scottish Government’s values. We will not let disabled people down or cast them aside as the UK Government has done. We will not cut Scotland’s Adult Disability Payment.
“The UK Government should follow our lead and protect the social security safety system, rather than dismantling it. If they do not, then disabled people can draw no other conclusion than the UK Government remain content to balance the books on the backs of the most vulnerable.”
Responding to the publication of the bill, Helen Barnard, Director of policy at Trussell said: “The UK government’s new Universal Credit and PIP bill, put before Parliament today, does almost nothing to ease the concerns of hundreds of the thousands of disabled people who fear that their social security support will be ripped from them.
“In fact, this bill will push nearly half a million more people into severe hardship and towards the doors of food banks.
“It is easy to see why so many MPs have voiced concerns about the damage this bill will do. What has been published today offers little for MPs deeply concerned about the impact of these cuts on their constituents.
“The last minute details on protections offer something for a small proportion of people, but even they will still see a real-terms cut. The reality of this bill is still record cuts in support for disabled people, and the biggest cuts to social security since 2015.
“It is shocking that MPs are being asked to vote through cuts without a full assessment of their impact, and especially worrying as we know that already three in four people referred to the Trussell community are disabled or live with someone who is.
“We know hunger and hardship already pushes up public service costs alone by £13.7 billion. MPs are being asked to vote for a Bill that will drive up hunger and hardship and undermine the UK government’s promises on economic growth and ending the need for emergency food.”
Today, the UK government published a bill, aimed at reforming the benefits system. Unfortunately, as it stands, this will be a disaster for disabled people – and is likely to worsen people’s living conditions, undermine their mental health, and increase the risk of suicide, says Mental Health Foundation.
These plans will not help reduce the number of disabled people out of work. Instead, they are counterproductive and cruel.
A more effective alternative for the government would be to move forward with its progressive policies that encourage people to return to work, such as the Right to Try scheme and improvements to support in job centres, and look at how well those work, without cutting support for disabled people.
Work will be unlocked for thousands of sick and disabled people through new measures that will bolster the support offered in Jobcentres and make the welfare system more sustainable, the Department for Work and Pensions has announced today
New plans to improve employment support brought forward ahead of wider reform package to fix broken welfare system.
1,000 work coaches deployed to deliver intensive employment support to sick and disabled people as part of the government’s Plan for Change which will break down barriers to opportunity.
It comes as a new survey reveals scale of the broken system with nearly half of disabled people and those with a health condition saying they don’t trust DWP to support them.
The plans will see 1,000 existing Work Coaches deployed in 2025/26 to deliver intensive voluntary support to around 65,000 sick and disabled people – helping them to break down barriers to opportunity, drive growth and unlock the benefits of work.
This intensive support for people on health-related benefits – including those furthest away from work – will see Work Coaches providing tailored and personalised employment support, and help claimants access other support such as writing CVs and interview techniques. They will also access a range of DWP employment programmes to help claimants unlock work based on conversations with their Work Coaches.
The additional help will be delivered by reprioritising work coach time so they can focus on tackling economic inactivity in order to make the welfare system more sustainable. The 1,000 redeployed Work Coaches are a “downpayment” on wide-ranging plans to overhaul employment support, which are set to be unveiled in just a few weeks’ time.
It is part of the Government’s Plan for Change – which will boost living standards and grow the economy by unlocking work for the 2.8 million people who are economically inactive due to long-term sickness – the highest in the G7 – and bring down spending on incapacity benefits which is expected to reach £70 billion by the end of this parliament.
It comes as new survey results show the current system isn’t just failing the taxpayer, it’s also failing the people it’s meant to help, with 44% of disabled people and people with a health condition believing DWP does not provide enough support to people who are out of work due to disability, ill health, or a long-term health condition.
Work and Pensions Secretary, Rt Hon Liz Kendall MP said: “We inherited a broken welfare system that is failing sick and disabled people, is bad for the taxpayer, and holding the economy back.
“For too long, sick and disabled people have been told they can’t work, denied support, and locked out of jobs, with all the benefits that good work brings.
“But many sick and disabled people want and can work, with the right support. And we know that good work is good for people – for their living standards, for their mental and physical health, and for their ability to live independently.
“We’re determined to fix the broken benefits system as part of our Plan for Change by reforming the welfare system and delivering proper support to help people get into work and get on at work, so we can get Britain working and deliver our ambition of an 80% employment rate.”
The data from the DWP Perceptions Survey – soon to be published in full – also shows:
35% of disabled people and people with a health condition believe DWP does not provide enough support to people of working age who are out of work, to help them get back into work.
44% of disabled people and people with a health condition don’t trust the DWP to help people reach their full career potential.
Nearly 2 in 5 (39%) disabled people and people with a health condition do not trust DWP to take its customers’ needs into account in how it provides services.
These figures follow recently released data which shows that there are over three million people on Universal Credit with no obligation to engage in work-related activity, despite over a quarter (27%) of health and disability benefit claimants believing that work could be possible in the future if their health improves and 200,000 saying they would be ready to work now.
Data also shows the number of working-age people on the health element of Universal Credit or claiming Employment Support Allowance (ESA) has risen to 3.1 million, a staggering 319% increase since the pandemic, reflecting the alarming rate at which young and working aged people are increasingly falling out of work and claiming incapacity benefits.
Behind each of these statistics is a person with hopes and ambitions, who can provide businesses with much-needed skills and experience, helping to grow our economy.
To give people the support they deserve, and restore trust and fairness to our welfare system, reforms to the welfare system are expected to be announced in just a few weeks.
These reforms will recognise that some people will be unable to work at points in their life and ensure they are provided with support while transforming the broken benefits system that:
Asks people to demonstrate their incapacity to work to access higher benefits, which also then means they fear taking steps to get into work.
Is built around a fixed “can versus can’t work” divide that does not reflect the variety of jobs, the reality of fluctuating health conditions, or the potential for people to expand what they can do, with the right support.
Directs disabled people or those with a work-limiting health condition to a queue for an assessment, followed by no contact, no expectations, and no support if the state labels them as “unable” to work.
Fails to intervene early to prevent people falling out of work and misses opportunities to support a return to work.
Pushes people towards economic inactivity due to the stark and binary divide between benefits rates and conditionality rules for jobseekers compared to those left behind on the health element of Universal Credit.
Has become defined by poor experiences and low trust among many people who use it, particularly on the assessment process.
The government’s plans to fix the broken benefit system will build on the biggest employment reforms in a generation announced in the Get Britain Working White Paper, which will empower mayors to drive down economic inactivity, deliver a Youth Guarantee so every young person is either earning or learning, and overhaul jobcentres across the country.
Former John Lewis boss Sir Charlie Mayfield is leading an independent review investigating how government and employers can work together to help disabled people and those with ill health who may be at risk of falling out work stay on in employment, with the findings of the discovery phase expected in the spring.
The government is also investing an additional £26 billion to cut NHS waiting lists and get Britain back to health and back to work.
The government has already delivered on its pledge, providing two million extra appointments in five months and as a result, around 160,000 fewer patients on waiting lists today than in July.
Teams of clinicians will also introduce new ways of working at 20 hospital sites in areas with the highest levels of economic inactivity to help patients return to the workforce faster.
This is alongside the recruitment of an additional 8,500 mental health workers to ensure mental health is given the same attention as physical health.
Many sick and disabled people say they want to work to help boost their living standards – but aren’t given the right support, according to new data published on Time to Talk day [6 February].
New survey suggests 200k people claiming health and disability benefits are ready for work now if the right job or support were available.
Comes as number of young people with a mental health condition who are economically inactive due to long-term sickness reaches over a quarter of a million (270,000).
Overhaul of health and disability benefit system set to be unveiled in Spring to ensure it provides meaningful support to help long term sick back into work.
New research published by the Department for Work and Pensions shows that nearly half (44%) of people with a mental health condition expect to be able to work in future if their health improves.
This comes as the number of young people (aged 16 to 34) who are economically inactive due to long-term sickness and have a mental condition reaches 270,000. This number has been rising consistently over the past decade and has increased by 60,000 (26%) in the last year alone. The equivalent figure for all people of working-age (16 to 64) is 790,000 – an increase of 140,000 (22%) over the last year.
The Work Aspirations of Health and Disability Claimants survey also finds that a third (32%) of those claiming health and disability benefits believe they can work now or in future. (5%) say that they would be ready now if the right job or support were available. This equates to around 200,000 individuals.
The survey also finds that those out of jobs overwhelmingly see work as a key part of their identity and a route to higher self-esteem, happiness and security.
In further evidence that the current system pushes people away from work, the survey revealed that 50% of people who are on health and disability benefits and are not currently in work said they were worried they would not get their benefits back if they tried paid employment and it did not work out.
It comes as the Work and Pensions Secretary Liz Kendall visited Workbridge charity which offers support to people who are unable to work due to mental ill health, to hear how they’re supporting people with mental health conditions into work.
Responding to the stark survey results, the Work and Pensions Secretary has said the report demonstrates the need to reform the current welfare system, so that it offers better, meaningful support to give disabled people and people with long-term health conditions a real opportunity to find work.
The upcoming reforms will be a key part of the government’s Plan for Change to boost employment by breaking down barriers to opportunity – creating a welfare system that promotes tailored pathways into work and accommodates the complex nature of disabilities and health conditions – and consequently, improving people’s living standards.
Work and Pensions Secretary, Rt Hon Liz Kendall MP said: “Today’s report shows that the broken benefits system is letting down people with mental health conditions who want to work.
“People claiming Health and Disability benefits have been classed by the system as “can’t work” and shut out of jobs and have been ignored – when they’ve been crying out for support.
“That is a serious failure. It’s bad for people, bad for businesses, which miss out on considerable talent, and bad for the economy.
“For young people in particular, being out of work can have a scarring effect that lasts a lifetime.
“On Time to Talk day, it’s time to change how we support people with long-term health conditions, such as a mental health condition, so that they have a fair chance and choice to work.”
On her visit to Workbridge, Kendall spoke to experts to hear their insights on how government and employers can better accommodate the fluctuating nature of people’s mental health – ensuring that people’s views and voices are at the heart of changes that affect them.
Being in work has a positive effect on people’s mental and physical health – providing people with confidence and independence, as well as financial benefits.
The UK remains the only G7 country that has higher levels of economic inactivity now than before the pandemic, with the benefits bill spiralling – largely driven by the increase in people claiming incapacity benefits for mental health conditions, who had not received the care and treatment they deserve.
The reforms to the health & disability benefit system due to be unveiled in a Green Paper in Spring will consider these issues and how the government can tackle these barriers to employment, and the government will work closely alongside charities, organisations and disabled people to ensure their voices help shape any proposals for reform.
The Green Paper will set key ambitions for creating a system that is fairer on disabled people – offering support into work which takes into consideration the realities of their health condition and life circumstances, and fairness for the taxpayer by bringing down the benefits bill.
The reforms are expected to build on the Get Britain Working White Paper, which set out the first steps to achieving the government’s target 80% employment rate, driving up growth and driving down poverty in every corner of our country.
Successful steps have already been taken to offer work and life-changing support, with a record number of people with mental health conditions receiving employment advice through the NHS Talking Therapies programme.
Alongside this support, the Laobur Government has settled record funding for the NHS – so that all people can get the care they need – and have pledged:
Welfare fraudsters who cheated the taxpayer out of £7 billion last year could be banned from driving if they fail to reimburse the public and repay their debt
Benefit cheats to be stripped of driving licences under new plans in government’s biggest fraud crackdown in a generation
New Public Authorities (Fraud, Error & Recovery) Bill introduces measures to be tough on criminals and fairer to taxpayers.
The Bill alone is expected to save the Department £1.5 billion over the next five years, and forms part of wider government plans to save a total of £8.6 billion over 5 years in the biggest welfare fraud and error budget package in recent history, as part of Plan for Change
As part of new legislation set to be introduced in Parliament today to deliver the biggest fraud crackdown in a generation, benefit cheats could be disqualified from driving for periods of up to two years if they refuse all opportunities to repay the money they owe.
The Department or Work and Pensions (DWP) will be able to apply to the court with the justification to suspend fraudsters from driving, provided the debts is £1,000 or over and frequent requests to repay the debt have been ignored.
DWP’s serious organised crime authorised investigators are also expected to be handed powers to apply to a court for search warrants. It means that for the first time, they will be able to support Police and search premises and seize items such as computers and smartphones as evidence against fraudsters.
The Bill alone is expected to save the Department £1.5 billion over the next five years, and forms part of wider government plans to save a total of £4.3 billion in 2029/30 in the biggest welfare fraud and error budget package in recent history.
The new legislation is being brought forward after the government inherited a broken welfare system, with fraud and error in the social security system currently costing the taxpayer almost £10 billion a year and, since the pandemic, a total of £35 billion of taxpayers’ money has been incorrectly paid to those not entitled to the money.
This Bill comes as the government seeks to bring forward measures to overhaul the health and disability welfare system as part of its Plan for Change, so it better supports people to enter and remain in work and to tackle the spiralling welfare bill – with new proposals for reforming the health and disability benefits system expected in the Spring.
This legislation also delivers on the government’s manifesto commitment to safeguard taxpayers’ money and demonstrates the government’s commitment to not tolerate fraud, error or waste anywhere in public services, including the social security system.
The measures in the Bill will be underpinned by a principle of fairness and proportionality – the priority is always to negotiate affordable and sustainable repayment plans, with these powers to be used as a last resort.
Secretary of State for Work and Pensions, Liz Kendall, said: “We are turning off the tap to criminals who cheat the system and steal law-abiding taxpayers’ money.
“This means greater consequences for fraudsters who cheat and evade the system, including as a last resort in the most serious cases removing their driving licence. Backed up by new and important safeguards including reporting mechanisms and independent oversight to ensure the powers are used proportionately and safely.
“People need to have confidence the Government is opening all available doors to tackle fraud and eliminate waste, as we continue the most ambitious programme for government in a generation – with a laser-like focus on outcomes which will make the biggest difference to their lives as part of our Plan for Change.”
DWP will also have the power to recover money directly from bank accounts of those not on benefits or in PAYE employment who owe the Department and refuse to pay up, despite having the means to do so. The Bill will allow DWP to request bank statements to prove these debtors have sufficient funds to fairly repay what they owe. However, DWP will not have direct access to people’s bank accounts.
Modernising the approach to catching fraudsters, preventing overpayments and introducing new safeguards to further protect vulnerable customers means the DWP can keep pace with the sophisticated nature of fraud, while also ensuring law-abiding customers get the right benefits – preventing them from falling further into debt.
The Bill will also include safeguarding measures to protect vulnerable customers. Staff will be trained to the highest standards on the appropriate use of any new powers, and we will introduce new oversight and reporting mechanisms, to monitor these new powers.
The government will also bring forward Codes of Practice which will be consulted on during the passage of the Bill to provide further assurance on the safe use of the powers, and we have a clearly defined scope and clear limitations for the use of all the powers including the right to appeal the decision.
The Cabinet Office’s Public Sector Fraud Authority will also be given more powers under the legislation being introduced in Parliament today.
A brand-new measure will see the time limit for civil claims against Covid fraud doubled from six to twelve years. This step change in the ability to fight fraud committed during the pandemic will give the Covid Corruption Commissioner and the Public Sector Fraud Authority more time to investigate complex cases and apply their new powers retrospectively – including the ability to raid properties and retrieve money from Covid fraudsters’ bank accounts.
Georgia Gould, Minister in the Cabinet Office, said: “During the pandemic, when people and businesses needed government support the most, some people stole public money for their own personal gain.
“This legislation gives the government tough new powers that can be used to investigate and recover money stolen from the public during covid and doubles the time we have to bring fraudsters to justice.”
Taken together, these measures show the government’s commitment to taking a responsible approach to public finances which is required for long-term economic growth, in order to deliver for working people up and down the country.
Additional Information
The new law will deliver on this government’s manifesto commitment to safeguard taxpayers’ money – ensuring every pound is spent wisely and effectively:
New powers of search and seizure – so DWP can control investigations into criminal gangs defrauding the taxpayer
Allowing DWP to recover debts from individuals no longer on benefits and not in PAYE employment who can pay money back but have avoided doing so.
New requirements for banks and building societies to flag where there is an indication that there may be a breach of eligibility rules for benefits – preventing debts accruing
All the powers will include strong safeguards to ensure they are only used appropriately and proportionately – including new inspection and reporting mechanisms.
We have a clearly defined scope and clear limitations for the use of all the powers we are introducing, and our staff will be trained to the highest possible standards.
The measures in this Bill will enable the PSFA to:
reduce fraud against the public sector by using its expertise to take action on behalf of other departments, against those who attack the public sector.
better detect and prevent incorrect payments across the public sector through new information gathering and sharing powers.
Use strong non-criminal sanctions and civil penalties to provide an alternative to criminal prosecution and to deter fraud
improve the government’s ability to recover public money, through new debt recovery and enforcement powers.
Use new powers of entry, search and seizure to reduce the burdens on the police in the most serious criminal investigations.
improve fraud management in future emergencies by creating specialist time limited powers to be used in crisis management situations – building on lessons learned during COVID-19.
The PSFA will implement a ‘test and learn’ approach when utilising these powers, piloting different approaches and expertise to find the best way to tackle public sector fraud.
