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Recent projections indicate that individuals with disabilities could face a reduction of nearly £10,000 annually in benefits due to Labour’s new disability benefits reform. This plan targets the living standards of low and middle-income households, raising concerns among experts.
Announced on Tuesday, the reforms will directly affect 1 million individuals who rely on personal independence payments (PIP), with expected losses ranging from £4,200 to £6,300. In addition, hundreds of thousands may see their incapacity benefits diminished, further exacerbating financial hardships.
The Resolution Foundation think tank pointed out that these cuts could lead to significant “income shocks” for those at the lower end of the income spectrum, with no assurance that the changes will facilitate returns to employment.
Furthermore, the changes will have additional ramifications. PIP serves as a critical “passport” for various benefits and services, including carer’s allowance and local tax reductions, impacting not just individuals with disabilities but also their unpaid caregivers.
Caregivers looking after disabled family members may face substantial financial losses if the individuals they care for are deemed ineligible for PIP, potentially pushing several households further into poverty, according to Carers UK.
Another critical aspect of PIP is its association with the Motability scheme, which enables eligible disabled individuals to exchange part of their benefits for a leased accessible vehicle. Although the current reforms do not target the mobility component of PIP, disability advocates from Scope have expressed concerns regarding the unclear future availability of vehicle access.
Additionally, approximately 3,500 young adults with disabilities leaving care may experience significant reductions in benefits, amounting to nearly £5,000 a year. Changes will prevent Americans under 22 from accessing the incapacity component of universal credit (UC).
The Resolution Foundation criticized the government for seemingly fast-tracking these changes without adequate consideration and cautioned against repeating past errors in welfare reform. Louise Murphy, a senior economist at the organization, highlighted the lack of clarity on whether the proposed reforms will effectively support individuals in seeking employment.
She remarked that while the green paper contains valuable suggestions for supporting individuals who recently lost jobs or are on the verge of re-entering the workforce, the rationale behind reducing disability support remains unclear and could potentially exacerbate poverty.
The think tank warns that tightening the eligibility criteria for PIP could impact incomes severely for some individuals with disabilities, effectively creating a double disadvantage as the government aims to streamline the benefit assessment process.
They estimate that individuals eligible for both PIP and incapacity benefits could see an annual income drop of £9,600 if they fail to meet the revised criteria during reassessment, with implications intensifying when the work capability assessment is eliminated in 2028.
There has been rising concern and frustration from advocacy groups and Labour MPs regarding the implications of these cuts. They argue that these changes could undermine the party’s commitments to alleviate child poverty and support vulnerable populations, such as care leavers and unpaid caregivers.
Helen Walker, CEO of Carers UK, emphasized that increasing the threshold for PIP eligibility would adversely affect many families, making it increasingly difficult for caregivers to meet essential needs like food and heating.
If the PIP of a cared-for person is revoked, the associated carer’s allowance—valued at approximately £4,250 annually—would also be lost, potentially stripping families of critical financial support amounting to £10,000.
About 1 million people claim carer’s allowance in the UK, with around half linked to PIP claims. An estimated 1.2 million unpaid caregivers live in poverty in the UK, with 400,000 experiencing extreme poverty.
The charity Become, which supports care leavers, has urged the government to exempt this vulnerable group from the reforms, arguing that it would be detrimental for those without familial support, pushing them further into societal isolation.
Katharine Sacks-Jones, CEO of Become, articulated concerns stating that without crucial financial support, many young care leavers could struggle to cover basic necessities, elevating their risks of homelessness, mental health issues, and long-term unemployment.
The government has asserted its responsibility as the “corporate parent” of care leavers and has committed to enhancing support mechanisms for them. A cabinet committee co-chaired by Education Secretary Bridget Phillipson and Deputy Prime Minister Angela Rayner is addressing the issue.
The Department for Work and Pensions has been contacted for further comments regarding the ongoing reforms.
Source
www.theguardian.com