A new report from the Work and Pensions Committee has raised concerns that planned cuts to the health component of Universal Credit (UC health) will push disabled people into poverty despite the above inflation rise in the UC standard allowance.
In its Pathways to Work report, the Committee repeated calls to delay planned cuts in UC health reform until the full impact of the changes are better understood.
The Committee wrote to the Secretary of State in May calling for a pause of the planned reforms to UC health and Personal Independence Payments (PIP) and called for PIP policy to be co-produced with disabled people.
The Government subsequently dropped all the PIP proposals and agreed to co-produce a new PIP assessment process with disabled people and their organisations in a review led by Sir Stephen Timms.
However, under the planned reforms to UC health, from April 2026 although all existing claimants and new claimants with severe or terminal conditions will be protected, other claimants assessed as having limited capability for work and work-related activity will see their awards halved from £423.27 to £217.26.
This is part of the Government’s drive to get more people off welfare and into work, as described in their Pathways to Work Green Paper.
Although the intent to safeguard these people was welcomed, MPs on the Committee raised concerns that some conditions, particularly serious mental health conditions, might not be included under the severe condition criteria; this also applies to people with fluctuating conditions.
The Committee also asked the Secretary of State why an assessment of safeguarding risks had not been conducted before the Green Paper was published.
Committee Chair Debbie Abrahams said: “We welcome the concessions that the Government made to the UC and PIP Bill (now the UC Bill); but there are still issues with these welfare reforms not least with the cut in financial support that newly sick and disabled people will receive.
“The Government’s own analysis published in March indicates that from next April approximately 50,000 people who develop a health condition or become disabled – and those who live with them – will enter poverty by 2030 as a result of the reduction in support of the UC health premium.
“We recommend delaying the cuts to the UC-health premium, especially given that other policies that such as additional NHS capacity, or employment support, or changes in the labour market to support people to stay in work, have yet to materialise.
“We agree in a reformed and sustainable welfare system, but we must ensure that the wellbeing of those who come into contact with it is protected.
“The lesson learned from last month should be that the impact of policy changes to health-related benefits must be assessed prior to policy changes being implemented to avoid potential risks to claimants.”