DWP PIP and Universal Credit claimants could face new back-to-work push

David Bentley
·5-min read

People claiming Personal Independence Payment and Universal Credit are set to face a new 'back to work' push under plans by Labour to drive down relentless levels of economic inactivity. If it gets into power, the party would forge ahead with new measures for the Department for Work and Pensions to get more claimants into employment.

Labour's stark message in its General Election manifesto says: "Too many people are out of work or not earning enough." While it does not make any mention of the current plans to cut PIP benefit spending, which could include replacing cash payments with vouchers, Labour has previously indicated it will study the results of the consultation into the proposals which ends on July 22, three weeks after the election.

PIP can be claimed by people who are working, as it is not means-tested so income and savings are not taken into account. But only around 14 per cent of PIP recipients are in work, according to Government statistics.

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There are currently 3.5 million people claiming PIP for disabilities and long-term health conditions. Mims Davies, Minister for Disabled People, Health and Work, had earlier clarified that, in March 2023, 475,000 people in receipt of PIP in England and Wales were in employment in the UK, including self-employment. The total number of PIP recipients was around 3.3 million at that time, meaning 14 per cent were working.

She further stated: "Personal Independence Payment (PIP) is designed to help with the extra costs arising from long-term ill health and disability, and is paid regardless of income and irrespective of whether someone is in work."

In addition, more than two million people on Universal Credit - just under a third of the total number of claimants - have been ruled medically unfit for work. This includes 1.4 million in the highest incapacity group of 'limited capability for work and work-related activity' (LCWRA). This means they don't have to work or prepare for employment in future and receive an extra £416 a month on top of their benefit payment.

Locally, there are 183,973 Universal Credit claimants in Birmingham, the highest number of any local authority area in Britain, of whom 52,778 (29 per cent) are working. The remaining 131,191 (71 per cent) are either looking for work or unable to work.

Other figures show that almost three-quarters of the 1.4 million claimants on the Universal Credit LCWRA payment also receive PIP.

The Labour manifesto says: "Too many people are out of work or not earning enough. Long waits for treatment of health conditions, particularly mental health, are contributing to the rise in economic inactivity. Labour will reform employment support so it drives growth and opportunity. Our system will be underpinned by rights and responsibilities – people who can work, should work – and there will be consequences for those who do not fulfil their obligations.

"We will bring Jobcentre Plus and the National Careers Service together to provide a national jobs and careers service, focused on getting people into work and helping them get on at work. We will ensure the service is responsive to local employers, inclusive for all users, and works in partnership with other local services."

It goes on to say that the current work capability assessments that decide if someone will get the Universal Credit LCWRA payment will be either overhauled or axed entirely and replaced by a new system.

The manifesto states: "Labour will work with local areas to create plans to support more disabled people and those with health conditions into work. We will devolve funding so local areas can shape a joined-up work, health, and skills offer for local people. We will tackle the backlog of Access to Work claims and give disabled people the confidence to start working without the fear of an immediate benefit reassessment if it does not work out. We believe the Work Capability Assessment is not working and needs to be reformed or replaced, alongside a proper plan to support disabled people to work."

And it adds that there will be a focus on helping the younger generation, aged 18 to 21, into employment: "One in eight young people are not in education, employment, or training, with those lacking good qualifications and with poor mental health facing particular disadvantages. Drawing together existing funding and entitlements, Labour will establish a youth guarantee of access to training, an apprenticeship, or support to find work for all 18 to 21-year-olds, to bring down the number of young people who are not learning or earning. We will also guarantee two weeks' worth of work experience for every young person, and improve careers advice in schools and colleges."

The new measures would also be rolled out to people in Scotland and Wales, with Labour pledging: "We will work with the Scottish and Welsh Governments, and Mayors and Combined Authorities in England, to ensure all aspects of our new approach to Jobcentre Plus and employment support partner effectively with devolved provision, to offer the best opportunities for people right across the country."

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