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What will PM target - and why?

The Guardian

|

March 18, 2025

The government is under increasing pressure over its plan to save billions of pounds on the welfare bill by cutting spending on incapacity and disability benefits.

- Patrick Butler

What will PM target - and why?

Here we look at the changes proposed, and why.

Which benefits face cuts?

Labour is sticking to Conservative plans to cut spending on UK incapacity benefits by £3bn by the end of the parliament. There are reports ministers will seek further billions by reducing eligibility for personal independence payments (Pip). If the mooted level of cuts is correct, this would be the biggest reduction to benefits since 2015, when the then Tory chancellor, George Osborne, was in his austerity-era pomp.

What is the difference between incapacity benefits and disability benefits?

Incapacity benefits - sometimes known as sickness benefits - are means-tested payments made mainly through universal credit. Claimants assessed as having "limited capability for work-related activity" receive £5,000 a year on top of the standard universal credit award and are exempted from having to find work. Disability benefits are not means tested, and are intended to help meet the additional living costs of disability. Pip is the main disability benefit. Depending on the assessed level of disability, a claimant can receive between £1,500 and £9,610 a year.

Why does Labour want to cut the cost of incapacity and disability benefits?

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