18 Mar
Lords Chamber
Welfare Reform

The session in the House of Lords focused on discussing the UK government's latest welfare reforms, aimed at addressing the growing welfare bill and reducing the number of people claiming incapacity and disability benefits by encouraging more individuals into the workforce. Key themes included the sustainability of the current benefits system, with discussions highlighting the unsustainable rise in spending on sickness and disability benefits. The government outlined several reforms, including: merging contributory benefits, revamping the assessment process by scrapping the Work Capability Assessment by 2028, enabling more work opportunities through increased employment support, and adjusting the payment structures within Universal Credit.

30 billion -> 70 billion

Projected increase in spending on working-age benefits from before the pandemic to the end of this decade.

Significant emphasis was placed on integrating early intervention and prevention strategies to help people remain in or return to work quickly, such as providing employment advisers through the NHS and adjusting statutory sick pay. The government's Green Paper proposed legislative measures to allow people to try work without risking benefit reassessment if it does not work out, addressing the fear of losing benefits that restricts many from attempting employment.

£26 billion

Amount funded into NHS for addressing backlog and improving health services to support the reform agenda.

Although the proposals aimed to address long-term challenges and secure the sustainability of the welfare system, speakers across different parties expressed concerns about the implications of these reforms on vulnerable groups and their practicality without comprehensive cooperation across departments.

1 billion

Additional funding allocated for employment support as part of the "Get Britain Working" plan.

4.3 million

Projected number of claimants for Personal Independence Payment by the end of the decade.

Outcome

The proposed reforms are set to save £5 billion by 2029-2030 with a focus on sustainable adjustment to the welfare system. However, the proposals require significant legislative backing and are subject to further consultation processes about their impacts. This development underlines a cross-party recognition of the pressing need to reform social security, with discussions paving the way for further detailed legislative and policy responses in coming sessions.

Key Contributions

Viscount Younger of LeckieSpeaker
Conservative

Questioned the measurement of success for the £1 billion employment support fund and queried the real savings expected from the reform package. Emphasized on more rigorous medical assessments for claimants and the implications of scrapping sick notes on healthcare professionals.

Lord Palmer of Childs HillSpeaker
Liberal Democrats

Expressed concern about potential negative impacts on vulnerable individuals and queried the freeze on the health top-up for new claimants in Universal Credit. Advocated for deeper collaboration across departments to address intertwined issues of health and social security.

Baroness SherlockSpeaker
Labour

Clarified that increased disability benefits are unsustainable due to rising costs and emphasized a shift towards empowering those who can work. Reaffirmed a commitment to protect individuals unable to work and stressed the importance of trust and safeguarding in the benefits system.

Lord Vaux of HarrowdenSpeaker
Crossbench

Highlighted concerns about potential conflict between employment legislation protecting workers and hiring of those needing support. Suggested a need to ensure reform efforts align with employment realities to successfully reintegrate individuals into the workforce.

Baroness BrowningSpeaker
Conservative

Focused on historically low employment rates among autistic individuals, advocating a serious rethink of existing support systems to effectively integrate them into the workforce.

Baroness Lister of BurtersettSpeaker
Labour

Welcomed certain reforms but voiced concern over the impact on poverty and food insecurity. Questioned about future assessment processes and impact on carers' allowance as factors of poverty.

Baroness Fraser of CraigmaddieSpeaker
Conservative

Raised concerns about the intersection of devolved social security and ongoing UK benefit reforms, particularly in Scotland. Advocated for clear communication between governments to avoid leaving claimants behind.

Original Transcript
Lord Vaux of Harrowden
CB

My Lords, I think we all applaud the desire to get people off benefits and into work, but to do that we need jobs and we need employers who are willing to take those people.

I hope the noble Baroness will not mind my quoting from the impact assessment that accompanies the Employment Rights Bill in relation to day 1 unfair dismissal rights. It states that “there is evidence that the policy could negatively impact on hiring rates.

For example, employers may be slower to take on workers due to the liability and increased protections”— and I stress this last bit— “particularly for those that are seen as riskier hires”.

Does the noble Baroness agree that that seems to be in direct conflict with the desire to bring people into work, and does she think it is a good idea?

Baroness Browning
Con

My Lords, I refer to my interest in the register. When we talk about getting people back into work, perhaps the Minister could reflect on that group of people who have never been in work.

I am thinking not just of school or college leavers but people who are now in their 40s and 50s and have never been in work, but actually still want to. She will not be surprised to know that I am referring particularly to the autism community.

In the 32 years that I have worked in this building, the employment rate for the autism community has gone up from 17% to just 23%. These people have lived through many Conservative and Labour Governments, not forgetting a coalition Government.

To get them into work will require something really different from what has been applied before. They are a discrete but important group. Given the Green Paper and the Statement that we have heard today, is the Minister going to get autistic people into work?

Baroness Sherlock
Lab

My Lords, I am really grateful to the noble Baroness for raising that question and, as she so often does, reminding us of the challenges in this area. Let me say a couple of things.

To reassure those who may be worried, as I have said before, anyone currently receiving benefits will carry on getting them unless there is a reassessment and their eligibility changes. However, that is not the limit of our ambition.

One of the reasons we want at least to have a supportive conversation, rather than abandon people who are simply getting those benefits, is to begin to understand what more we could do to support them.

There are some people who will find it very difficult to get into work but maybe they could, with the right support, begin to do some voluntary work. Perhaps they could begin to reach out and get some fresh kinds of support or connect with the local community.

The biggest challenge for us, as in the noble Baroness’s words to us today, is how we challenge employers to take this on.

We are planning, as part of the consultation on the Green Paper, to not only invite people—I expect very many responses—but to hold events for the public and round tables, to hold discussions both in person and elsewhere.

I would be really grateful if she would be willing to talk to us about addressing this as part of that consultation.

Baroness Sherlock
Lab

My Lords, my noble friend raises some interesting points and I am grateful for the welcome she has given to some elements of our reforms.

On the question of adequacy, it may be—in her words—modest but this is actually a significant above-inflation cash increase in the standard allowance of universal credit. It means that by the end of this Parliament, people will be £14 a week, or £775 a year, better off.

That might be modest proportionally; it is significant and will make a difference to people’s lives. But the real way that we will make a difference to people’s lives, in so many cases, is by helping them to move into work. There is only so much that the benefit system can do.

There are those who cannot work and have severe needs, and the benefit system must always be there to support them. But for those who can, there is so much more out there that we could be doing and we simply have not been doing it. That is really one of my hopes.

We will deal with poverty in other ways. Just so my noble friend knows, the impact and equality assessments will be published next week alongside the Spring Statement. In the long run, this is not about simply tinkering around the sides of a system. We are not just doing blanket cuts.

We are doing two things: trying to put this system on a sustainable basis, so it will still be there for the future, but, much more than that, trying to reform it so that people genuinely can get into work who previously have been given no help and been abandoned.

That way, we can really make a difference to people’s lives.

The Lord Bishop of London

My Lords, I welcome the Government’s focus on and increased investment in supporting people back into good work, and the proposed safeguards through the right to try guarantee.

However, I am intrinsically wary of attempts to address the drivers of ill health through the social security system, rather than tackling root causes. We do not know yet the content of the NHS plan.

Supporting people who are currently claiming incapacity benefits into work will put considerable pressure on an already stressed health system.

What steps is the Minister’s department taking to work with the Department of Health and Social Care to ensure that the right support is available for people with physical and mental health needs?

Baroness Sherlock
Lab

I thank the right reverend Prelate the Bishop of London for that important question. I mentioned earlier that the prevalence of disability has increased. I have to correct that: the rate of prevalence has increased. Again, the rate of the increase of disability benefits has gone up by twice as much.

If I have got that wrong, they will correct me again and I will read it out next time I get up. On the question of health, crucially, we have invested almost £26 billion extra in the NHS, but change will take time.

We intend to implement our reforms to PIP in November 2026, subject to parliamentary approval. To reassure the right reverend Prelate and anyone listening, everyone claiming PIP will continue to receive it until they are reassessed and their eligibility changes.

We will always seek to protect the most severely disabled. In the meantime, we are looking to do a couple of different things.

We are trying to get early intervention to stop people falling out of work, and we are about to launch our health accelerators, which will support efforts to tackle economic inactivity through getting the NHS to shift to prevention.

We are trialling in some of our pilot areas how exactly we can bring together the NHS and employment support to address that. The right reverend Prelate raises an important point. One of the challenges for us is that there are things that will need the NHS to be sorted out.

There are other areas where a range of different types of support could enable people, even now, to get into work. We are determined to do both.

Baroness Fraser of Craigmaddie
Con

My Lords, I declare my interests in the register. There is much in this Statement to be welcomed, apart from the bit that says it is all the Conservatives’ fault. I particularly welcome the emphasis on getting disabled people back into work.

At Cerebral Palsy Scotland, where I work, we are dealing with a devolved social security system. Adult disability payment, ADP, is replacing PIP and DLA in Scotland. It is similar, but it has a different application and renewal process.

We are finding that there are people caught between DWP and Social Security Scotland. Apparently, there are about 80,000 people in Scotland still on PIP.

Can the Minister assure me that, in the process of all these reviews and all this change, those on the devolved benefits systems will not get left behind or be negatively affected?

Baroness Primarolo
Lab

My Lords, I would like to ask the Minister a question on the right to try, which I am sure we would all agree is a principle that is crucially important.

How can we make sure that people can take the risk to try paid employment, without the fear that is currently in the system that their benefits will be put at risk?

Baroness Sherlock
Lab

I thank my noble friend for the question. Of course, she has a great deal of experience in this area; she knows only too well how the system works and how it has worked in the past. This is one of the real problems with the current system.

When people have been put through that binary judgment that they either can or cannot work, if they get into the “can’t work” category, the risks are so great that, if they try to work and fail, we will then come and say, “Ha, so you can work after all”, and then it will be taken away.

We are going to do a couple of things. First, there is a linking rule already there, which we will make sure that everybody is aware of, so that if you try a job and come back on to benefits within six months, you will be able to go back to your old benefits.

That touches on a point raised by the noble Viscount as well. But we are going to go further: we are going to legislate to make it very clear that work in and of its own right will never be a reason for triggering a reassessment. It is really important that people know that.

In the long run, we will break the connection between can and cannot work and support, because in the long run it is the PIP assessment and your abilities and needs that will determine how much support you get, not whether you can or cannot work.

I hope that reassures my noble friend that we are determined to tackle this.

Baroness Neville-Rolfe
Con

My Lords, I am speaking from the Back Benches today because I am very concerned about the sustainability of the benefits system, with an ageing population and the ranks of the inactive and people on disability benefits, as the Minister described.

I am sure that it is right to focus on getting people back into work—and I am absolutely delighted that Charlie Mayfield is helping the Government. He comes from retail, as I do, and retail is detail. That sort of person is very helpful in trying to make things work.

I have a couple of questions. First, I have done some work on fraud in the past, including trying to use AI to reduce the cost of fraud. I was very concerned to hear that only one in 10 assessments is face to face. What does the Minister feel the opportunity is in tackling fraud?

Secondly, on timing, the Minister mentioned that there would be a change in PIP in November 2026 and in the work capacity assessment in 2028. Given the scale of the problem, can she give me any reassurance about timing and getting on with those changes?

Baroness Sherlock
Lab

Those are two great questions, and I thank the noble Baroness for them—and also for the phrase “retail is detail”, which I shall now deploy as though it were my own whenever the opportunity presents itself.

I am sorry for not picking up the question of fraud, because the noble Viscount asked about that as well.

We have a fraud Bill coming to this House, which is making its way through the other place at the moment, so we are absolutely determined to crack down on fraud and will use a whole range of means for doing that. We will have an opportunity to discuss that in detail when the Bill arrives here.

We are thrilled that Charlie Mayfield is leading this review for us. We know that if we cannot get the relationship with employers right and create a system that works for employers and employees, we will not be able to get the jobs we need, especially for people who find it difficult.

To reassure the noble Baroness, if she looks at annexe A of the Green Paper, there is a table on Green Paper measures that gives timings on everything coming in. However, the real reassurance is that we have already started.

For example, the changes to universal credit, assuming they get parliamentary approval, will start to come in from next April. But the work has already begun on supporting people into work.

The Secretary of State has already announced an extra 1,000 work coaches to work with people who are sick or disabled to help them get into work.

We know from past evidence that sometimes somebody simply spending a bit of time with somebody and encouraging them in can make all the difference straightaway. So we are starting on that already—we are not waiting for it to happen.

We are already piloting around the country, as I said to the right reverend Prelate, trailblazers for young people and for the wider population on how we work with local councils.

Sometimes, whether someone can get into work is not just about what we do; whether someone can get a job in Manchester might be about what the childcare is like, how the buses run between where the jobs are and where the homes are, and what the local labour market is like.

We are working with metropolitan authorities and engaging locally to try to turn the system around and get everybody pointing in the same direction.

Finally, I really share the noble Baroness’s concern about the sustainability of the system, but I want to make sure that we are doing it to keep the system there for the future—because I believe passionately that we need a safety net there for those who struggle and who cannot work.

We have to make sure that it works, and we are committed to making sure that everybody who has the most severe needs or will never be able to work will always get the support they need under this Government.

Baroness Sherlock
Lab

My Lords, I am grateful to my noble friend for raising that question and I apologise to my noble friend Lady Lister for having forgotten to deal with it in my response to her. I commend my noble friend Lady Pitkeathley for all that she does in this space.

First, she knows more than anyone that we are investing in carers: we have just significantly raised the amount of money that somebody can earn before they will lose their carer’s allowance. We have also launched an independent review of carer’s allowance to make sure that the system works.

The eligibility change will benefit 60,000 carers-plus by 2029-30. My noble friend makes the excellent point that the overlap between caring and disability is sometimes more intertwined than we realise.

Again, I reassure her that if somebody is on PIP, neither the carer nor the person being cared for will lose that money unless and until there is a reassessment and their eligibility is found to have changed.

More than that, we made a specific commitment in the Green Paper to look carefully when considering the consultation responses at how we can support any unpaid carers who find they are affected by the changes that we are proposing.

In light of that, I strongly encourage anyone such as her or people she may know to respond to the consultation, to engage with us and to make sure that we understand any unforeseen consequences and can think about how we deal with them.

Lord Young of Cookham
Con

The noble Baroness has announced a wide range of reforms. Can she say which require primary legislation and which can be done by secondary legislation? Can she outline the implications for those who work in her department of the reforms she has just touched on?

All content derived from official parliamentary records