Disability Benefits system to be overhauled as consultation launched on Personal Independence Payment

Plans to make the disability benefits system fit for the future and overhaul the “one size fits all” approach are set to be published today (Monday 29 April), following the Prime Minister's speech which set out the government's wide-ranging ambitions for welfare reform.   

The Modernising Support Green Paper will explore how our welfare system could be redesigned to ensure people with disabilities and long-term health conditions get the support they need to achieve the best outcomes, with an approach that focuses support on those with the greatest needs and extra costs.

The UK's health landscape has changed since Personal Independence Payment (PIP) was introduced in 2013 with the intention that it would be a more sustainable benefit that would support disabled people to live independently by helping with the extra costs they face. 

However, the caseload and costs are now spiralling. There are now 2.6 million people of working age claiming PIP and DLA – with 33,000 new awards for PIP each month which is more than double the rate before the pandemic. This is expected to cost the taxpayer £28 billion a year by 2028/29 – a 110% increase in spending since 2019.

This is in part fuelled by the rise in people receiving PIP for mental health conditions such as mixed anxiety and depressive disorders, with monthly awards doubling from 2,200 to 5,300 a month since 2019. 

Since 2015, the proportion of the caseload receiving the highest rate of PIPhas increased from 25% to 36%. And many more people being awarded PIPnow have mental health conditions than when it was first introduced.  

In line with the wider reforms to ensure the welfare system is fair and compassionate, the Modernising Support Green Paper proposals centre on targeting and improving the support for those who need it most.

These ideas include removing the PIP assessment altogether for people with certain long term health conditions or disabilities, including those with terminal illnesses to reduce bureaucracy and make life easier for those most in need of support.

By more accurately targeting support, we will ensure the large scale of government expenditure on PIP translates into better outcomes for disabled people and those with health conditions. 

Prime Minister Rishi Sunak said:

It's clear that our disability benefits system isn't working in the way it was intended, and we're determined to reform it to ensure it's sustainable for the future, so we can continue delivering support to those who genuinely need it most.

Today's Green Paper marks the next chapter of our welfare reforms and is part of our plan to make the benefits system fairer to the taxpayer, better targeted to individual needs and harder to exploit by those who are trying to game the system.

We're inviting views from across society to ensure everyone has a chance to make their voices heard and shape our welfare reforms.

Work and Pensions Secretary Mel Stride said:   

We're making the biggest welfare reforms in a generation – protecting those most in need while supporting thousands into work as we modernise our benefit system to reflect the changing health landscape.

A decade on from the introduction of PIP, this Green Paper opens the next chapter of reform, enhancing the support for people with health conditions and disabilities while ensuring the system is fair to the taxpayer.

The Green Paper sets out proposals across three key priorities to fundamentally reform the system:

Making changes to the eligibility criteria for PIP, so it is fairer and better targeted

Through previous consultations, we have been told that the criteria currently used in assessments do not always fully reflect how a disability or health condition impacts on a person's daily life. The criteria have changed over time and no longer capture these different impacts as originally intended.

We will consider whether the current thresholds for entitlement correctly reflect the need for ongoing financial support. This includes considering if current descriptors - such as the need for aids and appliances - are good indicators of extra costs.

We will also look at changing the qualifying period for PIP in order to ensure the impact that people's conditions will have on them over time is fully understood and consider whether we should change the test used to determine if a condition is likely to continue long-term.

Reforming the PIP assessment so that it is more closely linked to a person's condition and exploring removing assessment entirely for those most in need.

PIP is over a decade old and a lot has changed since the assessment was developed. We know some people continue to find PIP assessments difficult and repetitive, and view the assessment as too subjective.

We will consider whether some people could receive PIP without needing an assessment by basing entitlement on specific health conditions or disabilities supported by medical evidence.

This includes looking at whether evidence of a formal diagnosis by a medical expert should be a requirement to be assessed as eligible for PIP. This will make it easier and quicker for people with severe or terminal conditions to get the vital support they need.

We will explore alternative approaches to ensure people are given the right help to fulfil their potential and live independently. The UK has used a fixed cash transfer system since the 1970s but there are a number of international systems that look at the specific extra costs people have and provide more tailored support instead.

For example, in New Zealand, the amount of Disability Allowance is based on a person's extra costs which are verified by a health practitioner. Norway's Basic Benefit requires people to provide a letter from a GP outlining the nature of their condition and the associated extra costs. 

We are considering options including one-off grants to better help people with significant costs such as home adaptations or expensive equipment, as well as giving vouchers to contribute towards specific costs, or reimbursing claimants who provide receipts for purchases of aids, appliances or services.

This reflects the fact that some claimants will have significant extra costs related to their disability, and others will have minimal or specific costs.

While these alternative models help people with the extra costs of their disability or health condition, we know other forms of support including health care, social services care provision and respite are also important to help people to realise their full potential and live independently.

We are also considering whether some people receiving PIP who have lower, or no extra costs, may have better outcomes from improved access to treatment and support than from a cash payment.

Andy Cook, Chief Executive of the Centre for Social Justice, said:

Our landmark Two Nations report laid bare the lasting impact of the pandemic on our nation's most vulnerable communities.

With the welfare system now grappling with the combined challenges of economic inactivity, school absence and mental health, this consultation provides a meaningful opportunity to shape the future of Britain's welfare state.

We owe it to those most struggling to make sure the benefit system provides the best support to those who need it. And with costs skyrocketing, it is time to bring the welfare system into the post-lockdown age.

The Green Paper is the latest of the government's welfare reforms to ensure disabled people and people with long-term health conditions can live full and independent lives. It builds on last year's Health and Disability White Paper and the £2.5 billion Back to Work Plan which will break down barriers to work for over one million people.  

The Government is also delivering the largest expansion in mental health services in a generation, with almost £5 billion of extra funding over the past five years, and a near doubling of mental health training places.

Our reforms to the Work Capability Assessment are expected to reduce the number of people put onto the highest tier of incapacity benefits by 424,000, people who will now receive personalised support to prepare for work, while our Chance to Work Guarantee will mean people can try work without fear of losing their benefits. 

Further Information

• The consultation will be published in the afternoon alongside an expected Oral Statement.
• This consultation will be open for 12 weeks and we are inviting views from across society to ensure everyone has a chance to shape the modernisation of the welfare system. The findings of the consultation, which closes on Tuesday 23 July, will inform future reforms.
• The UK Government is committed to improving the lives of disabled people and people with long-term health conditions in all parts of the UK.
• In Wales, Personal Independence Payment (PIP) is the responsibility of the UK Government.
• In Northern Ireland, PIP is transferred and is the responsibility of the Department for Communities.
• In Scotland, Adult Disability Payment (ADP) has replaced PIP and is the responsibility of the Scottish Government. The transfer of existing Scottish PIP claimants from DWP to Social Security Scotland started in summer 2022 and will continue until 2025.
• We will continue to work with the Devolved Administrations to consider the implications of the proposals in this Green Paper in Scotland, Wales and Northern Ireland.