New proposals to cut PIP and disability benefits ahead of full review

Daily Mirror

12-07-2025

The Centre for Social Justice has called for emergency measures to be brought in to reduce the number of people currently on the benefit
New plans to slash Personal Independence Payment (PIP) have been put forward, aligning with a forthcoming Government review of the benefit. Currently, Labour has paused any steps regarding PIP within its welfare overhaul due to a backlash from MPs and activists for disability rights.
Originally, there was a move to impose a four-point rule to tighten PIP accessibility. This would've meant claimants needing at least one tally of four points in assessed daily living activities to qualify. However, modifications to PIP are now set to follow only after Sir Stephen Timms, Minister for Social Security and Disability, conducts a thorough examination.
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Slated for completion by Autumn 2026, the 'Timms Review' vows to be "co-produced with disabled people, along with the organisations that represent them, experts, MPs and other stakeholders, so a wide range of views and voices are heard."
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The Centre for Social Justice (CSJ), a centre-right think tank, is urging for an expedited review and argues for a significant reform of PIP to "redirect funding from long-term cash payments."
In the updated 'Change the Prescription' report, the CSJ outlines several proposals concerning eligibility for PIP and the health component of Universal Credit, reports Birmingham Live.
Amongst their suggestions is the ceasing of PIP and Universal Credit health benefits for individuals experiencing slighter forms of anxiety, depression, and ADHD - a change that could impact over a million beneficiaries, including those currently receiving standard-rate PIP for such conditions.
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For those who continue to be eligible due to receiving the enhanced rate of PIP, their payments would be cut by roughly £80 a week to match the standard rate.
The report estimates this would save £7.4 billion annually by 2029/2030 and suggests that £1 billion of this could be reinvested in frontline mental health services such as NHS Talking Therapies, local support groups, work coaches and community interventions.
The think tank suggests that limiting eligibility for PIP and the UC health element to the most severe cases of anxiety, depression and ADHD would save approximately £8.8 billion.
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Joe Shalam, policy director at the CSJ, said: "Liz Kendall deserves credit for tackling the perverse incentives that have crept into the welfare system since Covid.
"People who cannot work due to sickness or disability must always be protected, but as our research shows, too many people are trapped in a cycle of dependency and wasted potential.
"By tightening eligibility for mental health benefits and investing in therapy and employment support, ministers can save public money and transform lives. The Timms Review must be brought forward to Autumn, there is no time to lose."
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Labour's welfare reforms bill was supported by MPs only after a £5 billion reduction to PIP was dropped. However, the CSJ argues that the rising number of PIP claims are contributing to a significant gap between welfare and work that needs immediate attention.
The report suggests that a person who is economically inactive and on Universal Credit, including the average housing element to cover their rent, and also receiving PIP, would have a taxpayer-funded Government income of around £25,000 - this increases to £27,500 for those awarded the highest rate of PIP.
However, this amount drops to £22,550 once the welfare bill's cut to the Universal Credit health element for new claimants is considered.
In contrast, a full-time worker earning the National Living Wage (NLW) is projected to make £22,500 after paying income tax and National Insurance, creating a £2,500 disparity between work and welfare for existing claimants.
The CSJ argues that the gap widens even further when additional benefits are factored in.
For instance, an unemployed single parent, claiming PIP for anxiety and disability allowance for a child with additional needs such as ADHD, would receive £36,900, which is over £14,000 more than the net wages of a full-time worker on the National Living Wage.