Fri, 27 Jun 2025

Fri, 27 Jun 2025 Faisal Islam: How much will U-turn on disability benefits cost?

The changes could cost up to £3bn which will have to come from higher taxes or cuts elsewhere, given the chancellor's self-imposed borrowing rules.

* The UK government has made a U-turn on its welfare reform plans, which were expected to save £5 billion by 2029-30.
* Instead, the reforms will now only save around £2 billion per year and changes have been delayed until November 2026.
* The planned cut to Disability Personal Independence Payment (PIP) eligibility has been reduced, sparing 370,000 current claimants from benefit cuts.
* A new assessment system for PIP applicants will require them to score at least four points in one activity, rather than qualifying across a broad range of tasks. However, the scoring system is still unclear and may not save as much money as expected.
* The changes will also have a knock-on impact on Carer's Allowance, which could cost around £2 billion.
* The government has promised to invest an extra £1 billion in employment, health and skills support to help people back into work, but this is likely to be offset by higher taxes or cuts elsewhere.
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