𝓤𝓷𝓲𝓽𝓮𝓭 𝓝𝓮𝔀𝓼

Andy Burnham has been urged to overhaul disability benefits by means-testing Personal Independence Payments, with a new report suggesting the move could save billions of pounds a year. The Institute for Fiscal Studies (IFS) says linking PIP to the existing means-tested Universal Credit system could initially cut spending by £8.2billion.

The proposal would target support more closely at disabled people on lower incomes, while potentially reducing payments to some better-off claimants. The IFS says the change could reduce PIP spending by around a third, although it warned the eventual savings could be lower as people respond to the new rules. PIP is currently paid to people with long-term physical or mental health conditions who have difficulties with everyday activities or getting around.

The benefit has expanded sharply in recent years, with more than four million people now receiving PIP, according to new Department for Work and Pensions figures.

Spending has risen from £14billion in 2019-20 to £25billion in 2025-26.

Official forecasts indicate that figure could climb further to £34billion by 2030-31.

The scale of the increase has put disability benefits under renewed scrutiny as the Government considers further welfare reforms.

The Mail reported the IFS proposals, including a separate suggestion to change eligibility for younger claimants.

The think tank estimates that stopping all under-30s from receiving PIP could save £5.5billion a year.

However, it acknowledges that 689,000 people aged under 30 currently receive the benefit and that many have severe disabilities.

Instead, it suggests restricting PIP for under-30s to people with the most severe conditions, which it estimates could save up to £2.2billion annually.

Eduin Latimer, a senior research economist at the IFS, said any changes would produce both gains and losses for different groups.

He said: “There will be losers as well as winners,” and added that the Government needs to decide what PIP is intended to achieve.

Mr Latimer said: “If it is to help disabled people in the greatest need, there is a case for targeting support on those with the most severe disabilities or on the lowest incomes.”

The IFS also warned that the initial £8.2billion saving from means-testing PIP could diminish over time.

It said “behavioural responses” could lead to more people claiming Universal Credit in order to retain their PIP payments.

Despite that, the think tank said there would “still be a large saving”.

The proposals come ahead of the Government’s review of disability benefits by social security minister Sir Stephen Timms.

Labour abandoned plans last year to cut £5billion from the disability benefits bill after facing a major rebellion from its own backbench MPs.

The Government subsequently launched the Timms Review, which is due to report this autumn, ahead of October’s Budget.

Another report from the Re:State think tank has also highlighted the scale of Britain’s disability benefit spending compared with other countries.

It found 7.8 % of Britain’s working-age population claimed extra-cost benefits because of a medical condition in 2024, an increase of 50 % since 2016.

The report said the equivalent figures were 0.2 % in Denmark, 0.6 % in France and 2.5 % in Norway.

It also argued that Britain’s PIP payments are generous by international standards.

The maximum award is £10,120 a year, while the average claimant receives £7,420, according to the report.

Re:State chief executive Charlotte Pickles said Britain had “confused cash with compassion” and claimed the Government had “broken the welfare state”.