UK plans to squeeze disability benefits in bid to cut soaring welfare bill

UK ministers on Monday set out plans for sweeping reforms of benefits claimed by millions of people with long-term disabilities and health conditions, as part of a drive to cut the government’s spiralling welfare bill.

Mel Stride, work and pensions secretary, said it was time for “an adult, grown-up conversation” to make the disability benefits system more sustainable, following a surge in claims linked to mental health that would otherwise send the total bill to £28bn by 2029 — double its pre-Covid level.

The nature and understanding of disability and ill health in Britain had “changed profoundly” since 2013, when the Conservative-led government introduced the system of “personal independence payments” to help people facing higher living costs as a result of their condition, he told the House of Commons later.

A consultation published on Monday included proposals to base eligibility for PIP on a formal medical diagnosis of someone’s condition rather than the current “functional” assessment of their ability to manage daily living. Some people, including those with severe or terminal conditions, might no longer need to go through an assessment process.

It also proposed moving away from fixed weekly payments — whose higher rate is now set at £108.55 for those struggling with daily living, and £75.75 for those with mobility constraints.

Instead, Stride said, the government wanted to explore “alternative forms of support”, including vouchers, reimbursement based on receipts, or better access to mental healthcare or local authority care packages.

About 2.6mn adults of working age at present claim either PIP or the Disability Living Allowance it replaced, according to official figures. A surge in claims for PIP, which is not means-tested or linked to people’s employment status, has been fuelled by a rise mental health conditions.

Prime Minister Rishi Sunak suggested last week that the system was being “misused” by people who were “over-medicalising” everyday stresses and described it as a “moral mission” to bring more people into work, reduce reliance on benefits and cut the costs of welfare for taxpayers.

He told ITV News on Monday that PIP assessments were “easily exploited, subject to unverifiable claims” and that he wanted “something that is more rigorous, more objective and potentially has more medical evidence”.

But Sarah Hughes, chief executive of the charity Mind, said removing “crucial” financial support from people with mental health problems “is not going to fix anything, it will make matters worse”.

Following “years of under-investment in mental health services . . . we will not allow people with mental health problems to carry the can for failures of the system”, she added.

Stride said on Monday that reforms could offer more support to those most in need but that some claimants “may have better outcomes through treatment, healthcare and support than through a cash payment”.

The current system was “very blunt”, he added, because support was fixed at a certain amount per month irrespective of people’s health condition — when some might need only small, one-off adjustments, such as the installation of a handrail in their bathroom.

The plans to pare back PIP are part of a broader package of reforms — most of which would be implemented only after the next election — intended to help people with long-term health conditions remain in jobs or move back into work.

Tom Pollard, head of social policy at the New Economics Foundation think-tank, said the government had not presented any evidence that people with mild depression or anxiety were receiving PIP and was “wilfully muddying the water” by talking about work in the context of PIP, which was paid regardless of employment status.

Last week, Sunak set out plans to shift responsibility for authorising short-term sickness absence away from GPs, with the aim of encouraging people to work as much as possible around a health condition.

The government is already bringing in changes to means-tested incapacity benefits, which will cut support to some people with mental health conditions or mobility problems.

At the same time, it aims to increase “talking therapy” for people with less severe mental health problems, and to pilot a new scheme to integrate health and job-hunting support.