Millions claim DWP benefits without work requirement, sparking calls for reform
Official figures from the Department for Work and Pensions (DWP) reveal a significant rise in long-term sickness claims, prompting urgent calls for reform. More than three million people are currently claiming Universal Credit without any obligation to look for work—double the number of those actively seeking employment while on benefits.
Sharp rise in long-term benefit claims
The latest statistics indicate that the number of Universal Credit claimants exempt from job-search requirements has surged from 1.5 million in January 2022 to 3.1 million today. In contrast, the number of claimants actively seeking employment has remained steady at 1.6 million.
This sharp increase has sparked concerns over the sustainability of the welfare system and its impact on both the economy and individuals. Many believe the current system discourages employment, leaving businesses struggling to find workers and placing an excessive financial burden on the state.
Welfare reforms in the pipeline
Work and Pensions Secretary Liz Kendall has warned that the growing number of long-term claimants is detrimental to both the economy and individuals themselves.
“This is bad for people’s incomes and health,” she stated. “Potential is being wasted, businesses are missing out on untapped talent, and our economy is suffering.”
Ministers are now considering removing financial and practical incentives that allow people to remain on long-term benefits. One proposal includes abolishing the highest category of Universal Credit health claims, known as Limited Capability for Work or Work-Related Activity, which grants claimants an additional £5,000 per year and exempts them from job-search requirements.
The government is expected to announce an overhaul of the benefits system before Chancellor Rachel Reeves’s Spring Statement on 26 March. The reforms are likely to focus on encouraging more people back into employment while reducing dependency on benefits.
Labour faces pressure amid economic concerns
With welfare costs projected to exceed £100 billion by the end of the decade, Labour is under increasing pressure to act swiftly. Kendall has pledged reforms that will “genuinely support disabled people and those with long-term health conditions into work, bring down the benefits bill, and grow the economy.”
However, Labour’s plans come amid economic uncertainty, with job vacancies falling and borrowing costs rising. Shadow Business Secretary Andrew Griffith criticised Labour’s approach, arguing that restrictive employment policies could hinder job creation.
“Businesses welcome anything that helps get people off benefits and back into work,” he said. “But for vacancies to be available in the first place, Labour needs to ditch their job-killing red tape Employment Bill and the chancellor’s job tax. Without that, this is just the latest in a growing line of inconsistent announcements.”
Challenges in moving claimants back to work
The Office for Budget Responsibility (OBR) estimates that within the first year of leaving work due to health issues, one in six people return to employment each quarter. However, after a year or more on benefits, only one in 20 go back to work.
Critics warn that making benefits harder to claim could push disabled people further into poverty rather than back into jobs. James Taylor of the disability charity Scope argued that while many disabled people want to work, barriers such as fear of losing benefits and a lack of tailored support make it difficult.
“Our welfare system is not working,” he said. “The worst thing the government could do is cut benefits for disabled people or make the system more punitive.”
The road ahead
As Labour prepares to unveil its welfare reforms, the debate over the future of Britain’s benefits system is set to intensify. Striking a balance between controlling costs and ensuring adequate support for the long-term sick and disabled remains a key challenge for the government. The forthcoming Spring Statement will be closely watched, as both policymakers and the public await clarity on how the government intends to address the growing welfare crisis.