Latest news with #HelenUndy
The Sun
5 days ago
- Business
- The Sun
PIP warning as people with mental health problems ‘could lose up to £5,750 a year' under government plans
HUNDREDS of thousands of Brits could lose up to £5,750 in PIP due to a major overhaul, a new report warns. The Money and Mental Health Policy Institute (MMHPI), founded by money guru Martin Lewis, says the proposed changes to PIP are a "catastrophic" mistake. 2 The government needs to reduce the welfare bill and encourage more Brits back to work, to balance the nation's finances so it announced major cuts to PIP in March, aiming to save £5billion a year by 2030. Currently, you qualify for PIP by earning enough points across different tasks, like cooking, cleaning, or managing money. Under the new rules, you'll need to score at least four points on one specific daily task to qualify. This change could mean around 800,000 people losing their PIP payments, according to estimates from the Office for Budget Responsibility (OBR). Research by MMHPI shows that a quarter of people likely to be affected by the changes have mental health problems. At the same time, a third of people surveyed by the charity currently receive the higher 'enhanced' rate of PIP because they need a lot of support. If they lose this, they could see their income drop by over £5,750 a year. Others, who get the lower 'standard' rate, could still lose more than £3,850 a year. Helen Undy, chief executive of the Money and Mental Health Policy Institute, said: "The message to the government from this research is clear - its proposed changes to PIP will have a catastrophic impact on people with mental health problems' wellbeing, finances, and working lives." Rachel Reeves delivers the Spring Budget in full "Balancing the books should not come at the price of causing misery and hardship for some of the most vulnerable people in society." The government says it wants to help more people get into work, but the charity argues that taking away this vital support will have the opposite effect. In response, a spokesperson for the Department for Work and Pensions (DWP) said that most people currently claiming PIP will continue to get it. They added: "Our reforms will help sick or disabled people move out of poverty and into good, secure jobs, while ensuring the social security system will always be there for those who will never be able to work. "We are consulting on how best to support those impacted by the new eligibility changes, and have also announced a review of the PIP assessment, working with disabled people and key organisations representing them to consider how best to do this." WELFARE SHAKE-UP IN March, Chancellor Rachel Reeves announced major welfare cuts to balance the nation's finances and boost employment. Key welfare changes include: Raising the eligibility threshold for PIP, achieving £3.4billion in annual savings. Temporarily introducing an above-inflation rise to Universal Credit's standard allowance (until 2029), while reducing the highest incapacity payment. Banning under-22s from claiming incapacity benefits under Universal Credit entirely. Slashing Universal Credit incapacity benefits for new claimants Abolishing the Work Capability Assessment (WCA) by 2028, with all health-related payments to be transitioned to PIP in the future. Launching a "Right to Work Guarantee", allowing unemployed individuals to attempt returning to work without losing benefits if they find it unsustainable. Merging jobseeker's allowance and employment support allowance, with a system that awards higher payments to those who have a work history compared to those who have not. More benefit cuts on the way It's not just PIP facing cuts. The government is also consulting on making major changes to Universal Credit, including reducing incapacity benefits and replacing work capability assessments. People already receiving incapacity payments will continue to get £416.19 per month, but this amount will stay the same until 2030. For new claims from April 2026, the payment will be reduced to £208.10 per month (£50 per week) and will also stay at this lower rate until 2030. The DWP has stated that a new premium will be introduced for those with the most severe, lifelong conditions who are unable to work, though the specifics of this proposal have yet to be disclosed. The Work Capability Assessment, which determines whether someone is deemed fit for work or has limited capability for work (LCW) or limited capability for work-related activity (LCWRA), will be scrapped by 2028. Instead the DWP will use the PIP assessment to assess entitlement for any Universal Credit health supplements. Claimants under the age of 22 will no longer be eligible for the health element of Universal Credit. The government is also introducing legislation to remove barriers to employment for benefit claimants by ensuring that attempting work will no longer automatically trigger a reassessment or review of their award. The intention is to give people the confidence to try work without fear of immediately losing their benefits if it doesn't work out. The government has promised to increase the Universal Credit standard allowance from April 2026, despite these changes. What are Work Capability Assessments? The DWP uses the Work Capability Assessment (WCA) to evaluate a claimant's ability to work when applying for Universal Credit due to a health condition or disability. The WCA focuses on assessing functional limitations rather than specific medical diagnoses. It considers both physical and mental health, awarding points based on how an individual's condition impacts their ability to carry out daily activities. After the assessment, claimants may be placed into one of two groups - Limited Capability for Work (LCW) or Limited Capability for Work and Work-Related Activity (LCWRA). Claimants assigned to the LCW group are recognised as currently unfit for work but may be capable of returning to employment in the future with the right support and assistance. Those in this group are required to engage in work-related activities, such as attending Jobcentre appointments or training courses. Failure to comply with these requirements may result in sanctions, including a reduction or suspension of benefits. Claimants are placed in the LCWRA group if their health condition or disability is considered so severe that they are not expected to be able to work or participate in any work-related activities in the foreseeable future. Those in the LCWRA group receive an additional amount on top of their standard Universal Credit allowance currently worth £423.27 a month. What's happening to the Universal Credit standard allowance? As part of the changes announced in March, the government will increase the standard allowance for Universal Credit. This basic payment will temporarily rise at a rate higher than inflation, with an increase based on the Consumer Prices Index (CPI) plus an additional 5%. For a single individual aged 25 or over, this means their weekly payment will rise by £7 from April 2026, increasing from the current £92 per week to £106 per week by 2029. The Department for Work and Pensions (DWP) previously estimated that these above-inflation increases will provide the average claimant with an additional £775 in cash terms by 2029, compared to inflation-only adjustments.
New Statesman
5 days ago
- Health
- New Statesman
Revealed: Labour's welfare cuts will take people out of work
Photo byThe government's disability benefit cuts would force people out of work or to reduce their working hours, according to new research by the Money and Mental Health Policy Institute – the charity led by Martin Lewis, the consumer champion. Labour's plans to tighten assessments for the personal independence payment (PIP) will affect around 800,000 claimants. The benefit, designed to help people with disabilities and chronic mental and physical conditions live an independent life, is currently paid to more than 3.6 million people. Ministers insist their welfare reforms will bring more people 'back into work'. But nearly two thirds of working people receiving PIP surveyed by the charity said they would need to reduce or give up work without the payments. Reasons cited include the impact losing the benefit would have on their mental health, and practical considerations such as covering the transport costs of travelling to work. 'PIP pays for [my] private therapy… which keeps my mental health at a functioning level,' one respondent told the researchers. 'Without these I doubt I could even manage the permitted work hours (14 hours per week) that I do.' 'PIP has allowed me to get a job where I work 12 hours a week,' another claimant said. 'This has helped with getting me out of my house and helped with my depression… PIP allows me to go to my job, get to appointments, get out to see family and friends.' People losing their PIP who were surveyed said they expect to significantly reduce their spending – including 77 per cent saying they would have to limit their spending on public transport, 87 per cent on private transport (such as taxis), 82 per cent on clothing and other essentials, 81 per cent on personal care, and 70 per cent on child-related costs – all essential parts of a functioning work life. The income shock of losing PIP under the proposed reforms would cause a 'terrifying triple whammy' of financial hardship, worsening mental health and reduced capacity to work for many people with mental health problems, according to the researchers. Claimants surveyed stand to lose £3,850-£5,750 a year if the cut goes ahead. Nearly all – 97 per cent – of respondents said the PIP changes would have a 'significant negative impact' on their mental health. Subscribe to The New Statesman today from only £8.99 per month Subscribe 'The government says its welfare reforms will help more people move into work. But you don't do that by depriving people of a critical financial lifeline that helps them stay well,' said Helen Undy, chief executive of the Money and Mental Health Policy Institute. 'Our analysis shows that these changes would actually result in many people with mental-health problems who have a job cutting their hours or leaving the workplace altogether. We urge the government to ditch these plans.' Adding ever-more restrictions to the welfare system to boost employment sounds logical, but it doesn't play out this way in the real world. As I have written before, the Department for Work and Pensions' fixation with cranking up 'conditionality' (the requirement to meet certain demands to avoid having your benefits docked) over successive governments has had little effect on working hours. While the number of claimants subject to conditionality has more than doubled since 2013, the evidence for its effect on working hours is 'inconclusive', according to the Resolution Foundation, a living standards think tank. Instead, with each harsher measure, working and non-working people are losing the support they need to live full and functional lives. A former DWP adviser once told me that, at best, 'harsh and prescriptive conditionality… pushes people into low-paid and insecure work, which is a poor outcome for them but also means they're likely to continue to need support to top up their incomes'. Martin Lewis, known as the Money Saving Expert, has spent his career pursuing value for money. He knows a false economy when he sees one. A government spokesperson said: 'The majority of people who are currently getting PIP will continue to receive it. Our reforms will help sick or disabled people move out of poverty and into good, secure jobs, while ensuring the social security system will always be there for those who will never be able to work. 'We are consulting on how best to support those impacted by the new eligibility changes, and have also announced a review of the PIP assessment, working with disabled people and key organisations representing them to consider how best to do this.' [See also: How the weather changed on the 'cruel' two-child benefit cap] Related
Reuters
5 days ago
- Health
- Reuters
Quarter of UK mental ill health benefit claimants expect to lose out from planned reforms, charity says
LONDON, June 5 (Reuters) - Around one in four British people with poor mental health who claim welfare benefits expect to lose their entitlement under proposed government reforms, according to research published by a charity on Thursday. Britain's government aims to save 4 billion pounds ($5.4 billion) a year by 2029-30 through tightening the rules for claiming a benefit known as personal independence payment (PIP) designed to cover disability-related costs, whether a claimant is in work or not. The Money and Mental Health Policy Institute said it interviewed 227 people with mental health conditions who receive PIP, which can be worth nearly 6,000 pounds a year. Some 24% of those surveyed said they expected to lose the benefit, while 39% were unsure if they would be affected. About one in five of those surveyed were in work, and nearly two thirds of them said reducing the benefit would make them work less, rather than more, due to difficulty affording transport costs or private mental health support. "Our analysis shows that these changes would actually result in many people with mental health problems who have a job cutting their hours or leaving the workplace altogether," the charity's chief executive, Helen Undy, said. PIP is paid to 3.7 million people in England and Wales, 6% of the population, and new claims have risen by two thirds in recent years. The government hopes that tighter eligibility rules will encourage more claimants to seek work. Under the government plans, claimants would need to have a severe difficulty in at least one area of daily life to qualify for the benefit, rather than a range of less severe problems. Britain's budget watchdog in March estimated that a third of claimants would be affected by the change, of whom around half would lose benefits after being reassessed. The new plans are subject to consultation until the end of the month. Finance minister Rachel Reeves has been under pressure from campaigners to reconsider, following a U-turn over a decision to scrap heating subsidies for most pensioners. ($1 = 0.7372 pounds)
