The government is also expected to make it harder for people to qualify for the benefit in a move to cut billions of pounds from the welfare budget
Plans to freeze some disability benefits could be dropped following a major backlash from MPs.
Work and Pensions Secretary Liz Kendall is under pressure to slash size of the welfare bill, with leaked proposals suggesting she was considering a real-terms cut to Personal Independence Payments (PIP) by cancelling an inflation-linked rise next Spring. Reports of changes to the benefit – which helps people living with a long term disability or mental health condition with extra living costs – triggered fury from Labour MPs.
Ministers are now considering dropping the plan, according to the BBC. Ms Kendall is poised to unveil welfare reform proposals in a green paper next week, which will include a “right to try” promise, giving disabled individuals the chance to work without fear of losing benefits if things go south.
Chancellor Rachel Reeves will outline the extent of welfare cuts – anticipated to between £5bn and £6bn – in her Spring Statement on 26 March. On Friday, she insisted the government must “get a grip” on the welfare bill, criticising the system as failing both taxpayers and beneficiaries.
Health and disability benefit spending is projected to balloon from £64.7bn in 2023-24 to £100.7bn by 2029-30, with the Office for Budget Responsibility citing welfare for working-age adults as the primary driver of this surge.
PIP, a key element of the working-age welfare bill, totalled £18bn in 2023-24. This figure is expected to nearly double to £34bn by 2029-30, meaning the number of claimants would increase from 2.7 million to 4.2 million.
PIP is designed to assist with additional living costs for individuals with long-term physical or mental health conditions. Some recipients are employed and argue that it provides crucial support that allows them to stay in work.
However, it also benefits those who are heavily disabled and unable to work. PIPs have been described as helping the disabled to live, rather than being a benefit for the unemployed. Commentator Paul Lewis said on X: “Disabled people to lose thousands of pounds each in bid to keep promise not to raise taxes again 1p on income tax would raise a little more than this but Labour chooses to take a ‘moral’ axe to social security.”
In reply shadowspinner said: “Encouraging people to work is great. Pushing people who can’t work further into poverty doesn’t do that. It just hurts them. It means they can’t afford food, heating, care. These cuts do the latter, they don’t encourage anything.
“In addition, PIP, which has a 0.0% fraud rate, is the benefit most vital for helping disabled people work after Access To Work (which has months-long waiting time – how many employers wait months?). PIP pays for transport costs, for adapted cars. Cuts will lose people their jobs.
“PIP isn’t means-tested. It isn’t just for people who don’t and can’t work. It’s for all disabled people, to offset the costs of disability – on average 900+ a month – and to allow access to things like blue badges and Motability. It helps some disabled people to work.”
With Labour commanding a significant majority in the Commons, a freeze on PIP would likely pass a vote, but it would expose internal divisions. BBC sources revealed that the measures to be announced would still be challenging and limiting who qualifies for PIP could worry some Labour MPs. Despite the planned stricter eligibility measures, sources said PIP spending would continue to rise, albeit not as rapidly as previously predicted.
Several MPs who generally support welfare reform told the BBC they have been assured that severely disabled people would not be expected to work and would not lose their benefit entitlements. These anticipated changes to the benefits system follow the government’s announcement that it will abolish NHS England, the semi-independent body currently managing England’s health service.
Health Secretary Wes Streeting has hinted at further cuts aimed at enhancing the efficiency of the health service. In an interview published in the Sunday Telegraph, a bold claim was made that there is “far more change to come”. The statement outlined that “hundreds” of redundant official bodies are simply “cluttering the patient safety and regulatory landscape”.
Further comments noted the awareness of inefficiencies: “Patients and staff alike can see the inefficiency and waste in the health service. My team and I are going through budgets line by line, with a relentless focus on slashing bloated bureaucracy,” he declared. Moreover, Streeting is set to feature on the BBC’s Sunday with Laura Kuenssberg programme.
Additionally, a Department for Work and Pensions spokesperson has openly stated: “We have been clear that the current welfare system is broken and needs reform, so that it helps long-term sick and disabled people who can work to find employment, ensuring people receive the support they need, while being fair to the taxpayer. Without reform more people will be locked out of jobs, despite many wanting to work. That is not just bad for the economy, it’s bad for people too.”
