Milburn review to move under-25s off main sickness and disability benefits, cutting payments for some

Many young claimants would receive less financial support, and Milburn describes hundreds of thousands of young people as trapped in poverty under the current system.
Whether the priority is longer-term life chances or immediate finances
Milburn frames the trade-off at the heart of his plan to move under-25s off sickness benefits.
Mark

Start with the basic change. What actually happens to a 22-year-old on these benefits?

Mimi

They'd lose access to the health element of universal credit and to Pip. In its place they'd get an allowance at the universal credit basic rate. Some could get a new additional cost allowance for day-to-day costs linked to their condition, and those with severe disabilities who can't work would get a new higher-rate benefit.

Mark

Milburn himself says it won't be painless. That's unusual for the author of a government report.

Mimi

He told the Times some people will get less support at the start of a claim. His argument is that the current system puts immediate finances ahead of long-term life chances, and he thinks that's backwards.

Luke

But that's his argument, not a finding. The reporting doesn't tell us how much less anyone would receive, or how many would lose out.

Mimi

Right. We know many claimants would get less. The size of the cuts isn't given.

Mark

And the support side? He wants billions spent.

Mimi

Work placements, job subsidies and personal advisers. There's also a stick: young people who don't engage could lose some benefits.

Luke

Worth noting the report isn't published yet. All of this comes from the Times and Milburn's comments, so the final text may differ. The amount of investment is just 'billions', with no figure.

Mark

Why might Labour MPs resist?

Mimi

They opposed welfare reform under Keir Starmer, and this is described as a radical overhaul. Burnham is likely to back it, but the reporting says it could be controversial.

Luke

And savings could take almost a decade, so it isn't a quick fix for the government's budget pressures, defence included.

Mark

What should we watch for?

Mimi

The published detail, and legislation in the new year.

  • A government-commissioned review is set to recommend stripping under-25s of access to the health element of universal credit and Pip, a move that would leave many young claimants with less money.
  • Milburn concedes the plan is not pain-free, admitting that some people will receive less support at the start of a claim, even as a new additional cost allowance offers a partial cushion.
  • Billions of pounds of employment support, including work placements, job subsidies and personal advisers, are proposed alongside conditions that could strip benefits from young people who do not engage.
  • Labour MPs who opposed welfare reform under Keir Starmer are poised to push back, while the government presses on toward legislation in the new year despite heavy pressure to fund defence.
  • Any monetary savings could take almost a decade to materialise, so the immediate impact falls on claimants while the financial payoff remains distant and uncertain.

Britain is once again wrestling with a question that sits at the heart of any compassionate state: how to support people who cannot work without quietly trapping them in dependence. A review led by Alan Milburn, a former Labour health secretary, proposes moving under-25s off the main sickness and disability benefits and onto a lower, universal-credit-rate allowance, with many young claimants receiving less money at the start. Milburn himself admits this is not a painless choice, framing it as a trade between immediate income and a young person's longer-term life chances. Whether the country accepts that trade, and whether its promised rewards arrive in time, will be decided in the political arguments that follow publication.

A year-long review of Britain's welfare system, due to be published on Tuesday, is expected to recommend that people under 25 be moved off the main sickness and disability benefits. Many would end up with less money than they receive now. The Times broke the story ahead of publication, and the review's author, Alan Milburn, has openly acknowledged the cost to claimants.

Milburn, a former Labour health secretary and MP, was asked by the government to examine how to reduce the number of young people not in education, employment or training. Official figures suggest just under one million young people are in that position, and the review puts it at one in eight 18- to 24-year-olds. Under the proposals, under-25s would lose the health element of universal credit and Pip, receiving instead an allowance at the universal credit basic rate. Some could qualify for a new additional cost allowance for day-to-day costs linked to their conditions, and those with severe disabilities who cannot work would move to a higher-rate benefit. The changes would apply to existing claimants as well as new ones.

Milburn has framed the choice as one between young people's immediate finances and their long-term life chances, arguing the current system favours the first at the expense of the second. He described hundreds of thousands of young people trapped in a system that offers them poverty without prospects. The package also includes billions in investment for work placements, job subsidies and one-to-one advisers, along with conditionality: those who do not engage could lose some benefits. "A deal isn't a deal unless there are potential consequences," he said.

The savings would take almost a decade to arrive, and the timing lands amid heavy pressure on the government to fund defence. The prime minister is expected to back the plans, but Labour MPs who opposed welfare reform under Keir Starmer may resist. A government spokesperson insisted there would always be a safety net for those unable to work, and that the aim is to invest in young people's success rather than pay for failure. Legislation is expected in the new year, and the real argument is likely to begin once the report is published.

A year-long review of Britain's welfare system, due to be published on Tuesday, is set to recommend that people under 25 be moved off the main sickness and disability benefits. Many of them would end up receiving less money than they do now. The Times reported the plan ahead of publication, and the review's author, Alan Milburn, has acknowledged the cost to claimants himself.

Milburn is a former Labour health secretary who sat as a Labour MP from 1992 to 2010. The government asked him to look at how to reduce the number of young people who are not in education, employment or training, known as Neets. Office for National Statistics data for April to June suggests just under one million young people in the UK are in that position, a rise of 3% on the same period a year earlier. The review's own framing puts it at one in eight 18- to 24-year-olds.

Under the expected recommendations, under-25s would no longer be able to claim the health element of universal credit or personal independence payment, known as Pip. They would instead receive an allowance paid at the same basic rate as universal credit. Some could qualify for a new additional cost allowance, meant to cover day-to-day costs linked to their conditions. Young people with more severe disabilities who cannot work would be moved onto a new benefit paid at a higher rate. Milburn said the changes would apply to existing claimants as well as new ones.

He has been open that this is not a painless proposal. Speaking to the Times, he said some people would get less financial support at the start of a claim than they do now. He framed the question as a choice between young people's longer-term life chances and their immediate finances, and argued the present system favours the second at the expense of the first. In his view that is the wrong way round. He described hundreds of thousands of young people as stuck in a benefit system that traps them in poverty, with no prospect of prosperity or a job.

The other half of the package is spending. Milburn is expected to recommend billions of pounds of investment in employment support for young people, including work placements, job subsidies and one-to-one personal advisers. There is also an element of conditionality: young people who did not engage with the support on offer could lose some of their benefits. "A deal isn't a deal unless there are potential consequences," he said, adding that entitlements and responsibilities are two sides of the same coin.

The scale of the change is considerable. Milburn said the new system would need significant investment and amount to rebuilding the system from scratch. If the recommendations were approved, it could take almost a decade before the state saw any monetary savings. That arrives while there is heavy political pressure on the government to find money for defence.

The politics may be difficult. The recommendations are likely to be backed by Prime Minister Andy Burnham, but they could prove controversial among Labour MPs, who opposed welfare reform under his predecessor, Sir Keir Starmer. A government spokesperson said there would always be a safety net for the most vulnerable and those unable to work, but that the prime minister wants wholesale change in how young people are supported, investing in their success rather than paying for failure.

The government is set to take the proposals forward into legislation in the new year, so the argument among Labour MPs is likely to start once the report is published.

It could mean that some people will get less financial support at the beginning of their benefit claim than under the current system.
— Alan Milburn, to the Times
A deal isn't a deal unless there are potential consequences.
— Alan Milburn
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