Government’s £6billion benefits crackdown: Sick and disabled face huge cuts as Rachel Reeves scrambles to curb soaring welfare bill_Nhy
The sick and disabled are facing a £6billion benefits cut as Rachel Reeves scrambles to curb the soaring welfare bill.
The Chancellor is expected to announce the crackdown in her Spring statement later this month as she battles to avoid the need for tax rises.
Some £5billion of the savings will come from making it harder for people to qualify for Personal Independence Payments – a benefit designed to help with the extra costs caused by disabilities.
The payments, which can be worth up to £9,600-a-year, will also be frozen next year and not rise in line with inflation.
Moreover, those actively applying for jobs will have their benefits increased, while the rate of Universal Credit will be cut for those deemed unfit for work, ITV News has reported.
Labour is planning to invest £1billion of the savings into employment support for people hunting for a job.
It is understood the aim of the reforms is to increase the incentives for people to stay employed, even if they suffer from a disability or health condition.
Rachel Reeves is expected to announce the crackdown in her Spring Statement later this month as she battles to avoid the need for tax rises
Ms Reeves is said to be looking for £5billion of savings from benefits, with suggestions that conditions for claiming sickness payments will be targeted
Work and Pensions Secretary Liz Kendall is thought to be arguing that any money freed up should be invested in helping people back into the labour market
It comes as Ms Reeves said earlier this week that reducing the welfare bill was the ‘right thing to do’ as she frantically tries to find ways to balance the books.
Spending on health-related benefits currently stands at a whopping £65 billion.
The Chancellor also hinted that so-called ‘NEETs’ are in her sights, saying that the ‘majority’ of the million unemployed young people should be working.
On Wednesday Justice Secretary Shabana Mahmood defended efforts to reduce the amount spent on welfare.
She told BBC Radio 4’s Today programme: ‘There is a moral case here for making sure that people who can work are able to work and there’s a practical point here as well, because our current situation is unsustainable.’
Work and Pensions Secretary Liz Kendall is thought to be arguing that any money freed up should be invested in helping people back into the labour market.
Ms Kendall announced limited plans on Thursday to deploy 1,000 existing Work Coaches to deliver ‘intensive voluntary support’ to around 65,000 sick and disabled people.
She said: ‘For too long, sick and disabled people have been told they can’t work, denied support and locked out of jobs, with all the benefits that good work brings.
‘But many sick and disabled people want and can work, with the right support.
Graph shows the number of young people aged 16 to 24 not in education, employment or training
UK Prime Minister Keir Starmer talks during a Q&A session at a company on March 6
‘We’re determined to fix the broken benefits system as part of our Plan for Change by reforming the welfare system and delivering proper support to help people get into work and get on at work, so we can get Britain working and deliver our ambition of an 80 per cent employment rate.’
Personal Independence Payments were introduced back in 2013 but the number of people using them has increased.
There has also been a rise in benefit claimants citing mental health and anxiety as reasons to receive the benefit.
Figures show awards for a ‘psychiatric condition’, including anxiety and depressive disorders, grew from an average of 2,600 per month in 2019 to 5,700 by January 2024.
It comes as a new report was released on Friday calling for young adults claiming disability benefits to be made to look for work in exchange for their money.
Former Labour minister Lord David Blunkett has endorsed a call for Personal Independence Payments to be made ‘conditional’ for those aged 18-30 to combat spiraling joblessness.
The centre-right Policy Exchange think tank argues that the current system will cost every taxpayer up to £1,500 by 2028/29 and does not incentivise claimants to seek work.
They argue that it has become a ‘front-stop rather than a backstop’ as PIP claimants do not have to offer any medical evidence of illness to claim.
Former Labour minister Lord David Blunkett is endorsing a call for the Personal Independence Payment (PIP) to be made ‘conditional’ for those aged 18-30 to combat spiraling joblessness
The centre-right Policy Exchange think tank argues that the current system will cost every taxpayer up to £1,500 by 2028/29 and does not incentivise claimants to seek work (file photo)
Lord Blunkett, a former work and pensions secretary, said: ‘What is absolutely certain is that for the sake of individuals, our economy and the affordability of the system, radical and positive change is necessary.
‘Reflecting the experience of implementing the New Deal for the Young Unemployed from 1998, the recommendation that for the under 30s there should be some form of conditionality is well worth exploring.
‘Not least with the staggering figure of around 70 per cent of those under 25 claiming sickness or disability benefit presenting with some form of mental ill health.
‘The change over time and the variation with older people of working age cannot be ignored.
‘So a combination of focused and improved support together with much clearer requirements on the individuals seeking help makes absolute common sense.’
