How your PIP may be cut – and what could replace it

Young people on personal independence payment (PIP) who are able to work could have their payments reduced if they turn down help finding a job. Alan Milburn, the Government’s youth unemployment adviser, told The Times in September that he favours cutting or reducing benefits. His final report is due this month. His review, alongside a separate review of PIP led by disability minister Sir Stephen Timms, will shape how the benefits system supports people into work. Both come as ministers face pressure to curb a welfare bill forecast to reach £431bn by 2030-31. Timms has said PIP is “not fit for purpose”. Both reports are expected in the coming weeks, and will feed into a White Paper – a document setting out planned laws – ahead of legislation next year. How PIP works now PIP is a disability benefit that helps 4.1 million people with the extra costs of a long-term condition, whether or not they work. Claimants are assessed on how well they manage everyday tasks such as washing, dressing and preparing food. Eight points are needed for the basic rate and 12 for the higher rate. The benefit is worth up to £843 a month. It is not means-tested, so income and savings do not affect it. Jobseekers on universal credit can be sanctioned – have money docked – if they do not look for work. PIP claimants face no such requirement. Timms has acknowledged that PIP assessments can be “demeaning”. Claims rose 17 per cent in the past year, according to Department for Work and Pensions (DWP) figures, while spending is forecast to rise from £28.5bn this year to £41.5bn by 2030-31.What could change for young claimants? Young people who fail to take up intensive support to help them into work would face benefit sanctions under Milburn’s plans, The i Paper reported last month. In his Times interview, Milburn described the approach as “tough love” and argued that young people who can work should have a “duty to engage”. He told also a Politico panel at Labour’s conference in September that a sanction has “got to be a final thing, not the first thing”. However, whether the plans will also cover PIP is yet to be clarified. Adding work conditions to PIP “would effectively be quite a big cut”, Eduin Latimer, senior research economist at the Institute for Fiscal Studies, told this paper last month. He noted that only about one in five claimants work. Ministers are also considering stricter eligibility rules, either for all claimants or for those below an age such as 50 or 60, according to The Guardian. A DWP spokesperson said there would “always” be a safety net “for the most vulnerable and those who are unable to work”. What could replace the cash? Timms has said his review is looking at whether people could be directed to help “in addition to – or in some cases, perhaps instead of – a cash payment”. Alternatives could include quicker access to therapy, specialised equipment or help getting into work, this paper has revealed. Timms has stressed that any switch would be “completely voluntary”. Ministers have discussed how to encourage claimants to make it, though a mandatory rule now appears to have been ruled out. A review into ADHD, autism and mental health by Professor Peter Fonagy, published last month, called for cash benefits to be combined with “timely treatment, adjustment and employment support where participation is realistic”. Unlike Milburn’s review, the Timms panel – largely made up of disabled people – is not expected to identify cuts. It has also ruled out means-testing PIP, The Guardian reported. MPs are expected to debate the Timms proposals before the end of the year, when the Government is also due to respond to both reviews. A DWP spokesperson said the final report “will lay the foundation for sustainable reform”.