How health-related benefit cuts add up

What are the proposed cuts?

On 18 March 2025 the DWP Secretary of State, Liz Kendall, announced a series of proposed changes to the social security system, in the ‘Pathways to Work: Reforming Benefits and Support to Get Britain Working’ Green Paper. These included:

• Tightening eligibility for Personal Independence Payments (PIP): someone must ‘score’ 8 points in an assessment of functional capabilities to receive the standard daily living component of PIP, and 12 for the enhanced rate. Under proposed changes, 4 of the points must be ‘scored’ on 1 daily living activity to receive this element of the benefit. Currently scores can be totalled across any scored activities. This reform will affect new claimants and those undergoing a reassessment from November 2026.
• Scrapping the Work Capability Assessment (WCA): the PIP assessment will be used to assess the entitlement for the health element of Universal Credit (UC) from 2028/29 onwards. Eligibility for this will be based on the impact of disability on daily living, not on the capacity to work. This interacts with the tightening eligibility for PIP, meaning someone who loses the daily living component of PIP would also lose the health element in Universal Credit - a payment for people with Limited Capability for Work-Related Activity (LCWRA). If someone is caring for this person, they may also lose Carer’s Allowance and/or the carer element of Universal Credit.
• Reducing the rate of the Universal Credit health element: this will be cut by £47 per week, from £97 per week in 2025/26 to £50 per week in 2026/27 for new claimants, with it frozen at the current level for existing recipients.
• Slightly increasing the Universal Credit standard allowance: a single person aged 25 or over will get around an extra £3 a week by 2029/30 compared to the usual uprating.
• Raising the age someone can receive the health element of Universal Credit to 22: this particular proposal is being consulted on and would not come in until 2027/28.

There are some welcome changes with people in receipt of benefits having a ‘right to try’ work without risk of losing benefits, and investment in additional employment support. There will also be a reduction in the number of reassessments needed for people with the most severe disability as the number of assessments for others rise. A new premium in Universal Credit will be available for people with severe, lifelong conditions that mean that they will never work, however, the details in the Green Paper remain vague and do not suggest this premium will bring support above the existing LCWRA rate.

The overall impact of these changes is a £5 billion cut in overall benefit expenditure. Without further details of the costing, it is not possible to accurately look at the distributional impact of the changes. However, we are able to look at the scale of changes for a series of example families, showing how these cuts stack up by 2029/30 for people in different situations. These examples are all for new claimants, but existing claimants will also be hit by the freeze to the health element of Universal Credit, and could lose entitlement to PIP when they are reassessed. The Green Paper suggests that, once the WCA is scrapped, losing PIP through reassessment will impact LCWRA eligibility, although further clarification is required.

Example families

Example 1:

Someone out of work losing the PIP daily living element, who also therefore loses the health-related element of Universal Credit

Harpreet is aged over 25 and lives on her own in private rented accommodation. She is not in work due to a long-standing health condition that restricts her mobility and daily living. She has scored 10 points in the daily living assessment of PIP, but without a 4 in any of the categories, and has also been awarded the standard mobility rate. She would also have received the health-related Universal Credit element under the current Work Capability Assessment. Under the new proposed rules, she would not receive the standard daily living element of the Personal Independence Payment, because she hasn’t scored a 4 in any category, and would also therefore not receive the health-related element of Universal Credit, as it will use the same assessment. Her monthly income after the changes is £818 a-month lower than it would be under the current system, a reduction of 58%, equating to almost £10,000 a year.

Example 2:

A newly out of work recipient of PIP and the health-related element of Universal Credit

Richard is aged over 25 and lives on his own in private rented accommodation. He is not in work due to a long-standing health condition that restricts his mobility and daily living. Unlike Harpreet, under both the existing and proposed rules he is eligible for the PIP standard daily living and standard mobility rate, as well as the UC health-related element, but because it is a new claim he only gets the reduced health-related element of Universal Credit. His monthly income after the changes is £227 a month lower than it would be under the current system, a reduction of 16%, equating to around £2,700 a year.

Example 3:

Someone in work losing the PIP daily living element

Gillian is aged over 25 and lives on her own in private rented accommodation. She is in part-time work, working 16 hours at the National Living Wage. She has a long-standing health condition that restricts her daily living, but not her mobility. She has scored 10 points in the daily living assessment, but without a 4 in any of the categories. Under the new proposed rules, she would not receive the standard daily living element of the Personal Independence Payment, because she hasn’t scored a 4 in any category. Her monthly income after the changes is £346 a-month lower than it would be under the current system, a reduction of 29%, equating to over £4,000 a year.

Example 4:

A couple where 1 member is in work and the other loses the PIP daily living element who also therefore loses the health-related element of Universal Credit

Wei and Jia are a couple with 1 child, who are both aged over 25, living in private rented accommodation. Jia is in full-time work, working 35 hours at the National Living Wage, but Wei is unable to work due to a long-standing health condition that restricts his daily living and his mobility. He has scored 13 points in the daily living assessment, but without a 4 in any of the categories. Under the current rules, he would have received the enhanced daily living element of PIP, but under the proposed rules, he doesn’t receive any daily living element at all, because he hasn’t scored a 4 in any category, and would also therefore not receive the health-related element of Universal Credit, as it will use the same assessment. The family monthly income after the changes is almost £1,000 a-month lower than it would be under the current system, a reduction of 30%, equating to almost £12,000 a year.

Example 5:

A couple where 1 member is a full-time carer for their partner, who lose the PIP daily living element and also therefore lose the health-related and carer elements of Universal Credit

James and Keith are a couple, both aged over 25, living in private rented accommodation. James left work to care for Keith, who has a long-standing health condition that restricts his daily living and his mobility. Keith has scored 10 points in the daily living assessment, but without a 4 in any of the categories. Under the current rules, he would therefore have received the standard daily living element of PIP, but under the new proposed rules, he loses this, because he hasn’t scored a 4 in any category, and would also therefore not receive the health-related element nor the carer element of Universal Credit, as it will use the same assessment. The family monthly income after the changes is over £1,000 a-month lower than it would be under the current system, a reduction of 55%, equating to over £12,000 a year.