Labour leader Keir Starmer has urged his MPs to support the government’s welfare reforms, emphasizing the necessity of their passage. The government contends that proposed changes to Personal Independence Payment (PIP) and Universal Credit (UC) will yield £5 billion in savings by 2030.
Government projections indicate 3.2 million families will experience financial losses, while 3.8 million will see improvements. These reforms impact PIP, a benefit supporting over 3.6 million individuals with long-term health conditions in England, Wales, and Northern Ireland.
PIP comprises daily living and mobility components. The proposed changes tighten daily living assessments, affecting approximately 800,000 individuals, according to the Office for Budget Responsibility (OBR).
Assessments involve scoring activities like eating and washing on a 0-12 scale. From November 2026, a minimum score of four points for a single activity will be required for eligibility, increasing the threshold for support.
For example, needing assistance washing below the waist will now require a four-point score, compared to the current two-point assessment. The government details payment amounts for the daily living component.
Payments for the mobility component remain unchanged.
PIP is paid every four weeks, tax-free, and unaffected by savings or income. It does not count towards income-based benefits or the benefit cap. Recipients may continue receiving PIP while employed.
Currently, PIP is awarded for one to ten years, with reviews available if circumstances change. The government plans more frequent reassessments, except for those with severe permanent conditions.
A similar benefit, the Adult Disability Payment, exists in Scotland. The government’s proposed Universal Credit changes impact 7.5 million recipients.
Over three million recipients are currently exempt from work requirements due to health conditions. The standard Universal Credit payment for a single person over 25 is £393.45 monthly. However, a significant health-related top-up more than doubles this amount.
Under the proposals, eligibility for the incapacity top-up is raised to age 22, and its value will be reduced to £50 a week from 2026-27.
Existing recipients’ top-ups will also be frozen. While the basic Universal Credit payment will increase, the projected increase has been slightly revised.
The Department for Work and Pensions (DWP) estimates 3.2 million families will face average annual losses of £1,720 due to these measures.
However, this doesn’t account for the £1 billion investment in job support for disabled individuals. The DWP expects this investment to offset some financial losses.
Conversely, 3.8 million families are projected to gain an average of £420 annually. Concerns have been raised by dozens of Labour MPs, particularly regarding the impact on disabled individuals.
Forty-two Labour MPs expressed strong opposition in a letter to *The Guardian*, citing significant anxiety among disabled people and their families.
Starmer maintains the current system is unsustainable, necessitating these reforms. The government aims to support those able to work while protecting the severely disabled.
A £1 billion investment in job support is planned. Further reforms aim to decouple work and benefit loss, including scrapping the work capability assessment by 2028.
Claimants will transition to PIP assessments focusing on daily life impact. A “right to try” system will prevent financial penalties for unsuccessful job attempts.
A potential merger of employment and support allowance and jobseeker’s allowance into a single, time-limited benefit is under consultation. Work and Pensions Secretary Liz Kendall emphasized stronger income protection for those contributing to the system.
Annual health and disability benefit spending is £65 billion, projected to reach £100 billion by 2029 before these reforms. PIP spending is expected to nearly double to £34 billion by 2029-30.
While initially intended to save £1.4 billion annually, PIP’s actual savings have been modest, and claimant numbers have risen. Mental health conditions account for 44% of working-age claimants.
The OBR predicts working-age adult welfare spending at £72.3 billion by 2029-30, with an additional £25.4 billion for pensioners and children.
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