An estimated million disabled people will lose their benefits as Labour took an axe to the UK’s ballooning welfare bill.
Work and pensions secretary Liz Kendall said the bulk of the changes, aimed at saving £5bn by 2030, would fall on personal independence payment (PIP) by raising the threshold that people can qualify for it.
According to the respected think tank the Institute of Fiscal Studies (IFS), it means that new claimants to the health element of universal credit will receive £2,500 less a year than they would have without these changes.
Announcing the cuts, Ms Kendall told parliament the current social security system is “failing the very people it is supposed to help and holding our country back”. And later on Sky News, she suggested there could still be more cuts to come.
The changes come after concerns that the bill for those on disability and long-term sickness benefits will hit £70bn by 2030, with the number of claimants rising from the current 2.8 million to 4 million.
Charities, trade unions and left-wing Labour MPs united to brand the changes “immoral” but there was some welcome for other measures, including not freezing the level of PIPs and ending regular assessments for those with severe disabilities.
Charles Gillies, senior policy officer at the MS Society, said: “These immoral and devastating benefits cuts will push more disabled people into poverty, and worsen people’s health.”
And PCS union general secretary Fran Heathcote said: “Targeting the most vulnerable with benefit cuts to meet arbitrary fiscal rules is an immoral choice at any time, but at a time of rising poverty, long NHS waiting lists and when the cost of living crisis continues to bite is abhorrent.”
However, Ms Kendall said the reform was expected to save over £5bn in 2029-30 and pointed out that there were 1,000 new PIP claimants every week, which she described as “unsustainable”.
Amid a barrage of criticism, the prime minister Sir Keir Starmer later tweeted in support: “This government will always protect the most severely disabled people to live with dignity. But we’re not prepared to stand back and do nothing while millions of people – especially young people – who have potential to work and live independent lives, instead become trapped out of work and abandoned by the system. It would be morally bankrupt to let their life chances waste away.”
Under the current system, PIP claimants can qualify for standard support by accumulating eight points and enhanced support by accumulating 12 points.
Points are awarded for different levels of disability in 14 categories ranging from 0 to 8 points based on severity. But from next year, anyone claiming PIP will need to have a score of at least 4 points in one or more categories.
This would include being unable to cook, wash or go to the toilet without help, or needing more than 3.5 hours of therapy a week.
But there was anger from charities and trade unions.
Dr Sarah Hughes, chief executive of Mind, said: “Mental health problems are not a choice – but it is a political choice to make it harder for people to access the support they need to live with dignity and independence. These reforms will only serve to deepen the nation’s mental health crisis.”
National Education Union (NEU) general secretary Daniel Kebede said: “It is hard to conceive of a Labour government treating the most vulnerable members of society any worse. For pensioners who have lost the winter fuel allowance, parents coping with the two-child benefit, and now the targeting of disabled adults, cruelty is becoming a hallmark of this government. It is simply indefensible.”
The Scottish TUC said: “These welfare reforms from the Labour UK government could well have been delivered wearing a [Tory] blue rosette. It’s a short-sighted, reactionary decision that does nothing more than risk throwing people into avoidable destitution.”
In parliament, MPs gave a mixed reaction.
Debbie Abrahams, Labour MP for Oldham East and Saddleworth, warned the government against “balancing the books on the backs of sick and disabled people”.
Labour Norwich South MP Clive Lewis added: “I would like [Ms Kendall’s] department to be able to look my constituents in the eye to tell them this is going to work for them. My constituents, my friends, my family are very angry about this and they do not think this is the kind of action a Labour government takes.”
Lib Dem MP Steve Darling accused Ms Kendall of just “tinkering”.
There was scepticism that the reforms announced would achieve the necessary far-reaching changes required to fix the system.
Professor Len Shackleton, research fellow at the Institute of Economic Affairs, said the announcement would “upset” disability campaigners and Labour’s backbenchers, but “will do nothing much to reform benefits or save significant amounts of money”.
“Eligibility for PIP certainly needs to be narrowed but it remains to be seen just how this will be accomplished. It certainly makes sense to have a common fitness to work test for PIP and universal credit, but this test needs to be much tougher – and assessed in person – than either of the existing measures,” he said.
The IFS questioned whether the government’s planned changes would achieve the £5bn savings hoped for because removing regular assessments for PIP would increase incentives for people to get the benefit.
It also noted that many families on universal credit would receive £150 a year more, although those currently relying on health elements would lose £280 and new claimants of the health element would be £2,500 worse off.
Tom Waters, an associate director at the IFS, said: “The hope is more employment and fewer people in the disability and incapacity benefit system. The risk is that it’s precisely the individuals receiving health-related benefits that are least responsive to financial incentives to work, and perhaps most in need of extra financial support.”
The government also caused anger by saying that it would not publish the equality impact assessment and the poverty analysis detailing the impact of benefit cuts.
Addressing parliament, Ms Kendall announced the “work capability assessment” for universal credit – which is used to determine eligibility for incapacity benefit payments based on someone’s fitness for work – would be scrapped in 2028.
Instead, extra financial support for health conditions will in future be based on a person’s health or disability, rather than their capacity to work.
She also said the government will bring in a “permanent, above-inflation rise” to the standard allowance of universal credit as well as legislation to “rebalance” payments for the benefit. Ms Kendall said this would equate to a £775 annual increase in cash terms by 2029.
The Conservatives branded the government’s welfare reforms as “too little, too late”, and urged Ms Kendall to be “tougher”.
Shadow work and pensions secretary Helen Whately told the Commons: “This is a now or never chance to seize the moment, a now or never for millions of people who will otherwise be signed off for what could end up being a lifetime on benefits, but this announcement today leaves me with more questions than answers.”
SNP Westminster leader Stephen Flynn MP said: “The Labour Party’s devastating cuts to disabled people are a total betrayal of the promises they made to voters at the election.”
