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Work and Pensions Secretary Pat McFadden has stated in an interview with the BBC that reform of the welfare system “must happen.”
Speaking just two weeks after assuming the welfare portfolio, McFadden pledged to move forward with adjustments aimed at ensuring individuals receive necessary support while also addressing the escalating costs of benefits.
In June, the government abandoned a key policy initiative designed to reduce disability and health-related benefits expenditure by nearly £5 billion, a decision made to avert a potentially damaging defeat at the hands of Labour MPs.
The government has announced plans to offer skills and employment support to tens of thousands of individuals currently receiving sickness benefits, who are not presently required to seek employment, with the goal of facilitating their return to the workforce.
McFadden’s commitment follows the government’s reversal of proposed modifications to Personal Independence Payments (Pip) and the health component of Universal Credit.
These reforms were projected to yield approximately £5 billion annually by 2029-30. However, their cancellation has intensified pressure on the Chancellor ahead of the November Budget. Analysts estimate that the Chancellor will need to secure £20 billion to £30 billion through either tax increases or spending reductions to adhere to self-imposed borrowing regulations.
Following the abandonment of plans to tighten Pip eligibility criteria, the government initiated a review of the payments, led by disability minister Sir Stephen Timms.
While Timms’ report is not expected for another year, McFadden refuted the notion that reform efforts would be suspended until its completion.
“Absolutely not. Welfare reform is an ongoing process. An objective assessment of the current system would not lead to the conclusion that a defensive posture is the appropriate course of action,” he asserted.
He also did not dismiss the possibility of tightening eligibility for Universal Credit or eliminating entitlement to health-related Universal Credit payments for individuals under the age of 22.
“I’m not ruling anything out. Welfare reform is of paramount importance. The current system is detrimental to individuals and, in the long term, contributes to an increased benefits bill because we are not effectively supporting those who are capable of working,” he stated.
The scale of the challenge is significant. Approximately 3.7 million working-age individuals receive health-related benefits. The independent Office for Budget Responsibility forecasts that expenditure on health and disability benefits will reach £100 billion by 2030.
McFadden’s interview with the BBC took place at a Job Centre Plus in Barking, East London. He met with four women who shared poignant accounts of how traumatic life events had resulted in ill health and extended periods on sickness benefits. Each woman had been assigned a specialist work coach, whom they credited with helping to restore their confidence.
Faiza described how domestic violence had led to depression, anxiety, and a sense of being “finished.” Hana, visibly trembling, explained that her body had “shutdown” following the breakdown of her marriage and multiple surgeries.
The women’s names have been altered to protect their privacy.
All expressed a desire to work, but under the existing system, they are not obligated to engage with a job center.
McFadden stated that the system had created an “unhealthy” and “binary divide” by categorizing individuals as either fit or unfit for work.
He announced that 1,000 specially trained job center staff would offer voluntary support to those receiving sickness benefits.
The government states that work coaches, also known as Pathways to Work advisers, are now stationed in every job center across England, Wales, and Scotland.
“We’ve redirected support to individuals who have been absent from the labor market for an extended period, who have been, frankly, signed off, paid benefits, and left untouched for years. This is unacceptable,” he concluded.
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