Labour face DWP inquiry into controversial benefit reforms as millions could lose out

The Work and Pensions Committee has initiated a fresh inquiry into welfare reform proposals, as detailed in the Pathways to Work Green Paper. The cross-party group of MPs will scrutinise the (DWP) proposed alterations to disability and health-related benefits, which were unveiled by Work and Pensions Secretary Liz Kendall on March 18.

The proposals focus on modifications to the eligibility criteria and reduced benefit payment rates. They also include plans to scrap the Work Capability Assessment (WCA), meaning the new Personal Independence Payment (PIP) assessment would determine eligibility for PIP and the health element of .

The proposed eligibility changes for PIP are expected to impact between 800,000 and 1.2 million people currently receiving the . The DWP's impact assessment estimates that 370,000 claimants will lose entitlement and payments.

Under the revamped system, to qualify for Universal Credit health elements, an individual would need to be receiving the daily living component of PIP. However, eligibility for this PIP component is being tightened.

From November 2026, only those who score at least four points in at least one of the daily living activities, along with at least four points accumulated from any of the other health questionnaire responses contained in the PIP 2 evidence form, giving an overall total of eight points, will qualify for the standard rate of PIP.

For claimants to receive the enhanced rate, they need at least twelve points, reports the . According to the Work and Pensions Committee, the projected decrease in real terms support is anticipated to affect around 1.5 million current claimants.

The Green Paper presents strategies, which the Secretary of State has revealed, are projected to save £5 billion by the fiscal year 2029/30. The UK Government has also announced that these reforms, supported by a £1 billion investment in employment support by 2029, will aid a greater number of individuals with chronic long-term health conditions or disabilities to re-enter and remain in the workforce.

An inquiry has been slated to probe the consequences welfare changes may have on poverty and employment rates and to assess their potential effects on disabled individuals. This inquiry will further investigate the association between health and unemployment.

Debbie Abrahams, Chair of the Work and Pensions Committee, expressed her concerns: "While the Chancellor undoubtedly must respond to financial challenges, there are legitimate concerns regarding the proposed changes to our social security system which would lead to a cut in support for more than three million sick and disabled people and their families, especially if these cuts happen before employment opportunities emerge.

"It is therefore vital that there is full examination of the evidence of the likely impacts this will have on poverty and employment, as well as the health of sick and disabled people.

"Our social security system is meant to provide a safety net to support people, so that they are protected from poverty. But we know that there are already 14.3 million people living in poverty, and half of them are sick or disabled people who are not properly supported by our benefits system. We must ensure that the new social security policy addresses this."

Scope of Inquiry

The Committee is not putting out a call for evidence, but the terms of reference are:

• to explore the issues with the social security system the Green Paper is seeking to address
• to explore the evidence of the impacts of welfare changes on poverty and employment
• to explore the experience of sick and disabled people of the current welfare system and their views on the impacts the changes could have on them
• to explore the link between health status and worklessness, and the potential impacts of the welfare changes on health status

It's also worth noting that the former chair of the Work and Pensions Committee, Sir Stephen Timms, is now the Minister for Social Security and Disabilities.