Rising Personal Independence Payments (PIP) Claims in England and Wales
The number of individuals claiming Personal Independence Payments (PIP) across England and Wales has surged to an alarming 3.6 million as of October last year. This statistic highlights the substantial increase in the benefits expenditure that has occurred since the onset of the Covid pandemic.
According to data from the Department for Work and Pensions, in February 2020—right before the pandemic began—there were 3,875,758 claimants receiving either Disability Living Allowance (DLA) or PIP. Fast forward just four and a half years later, by August 2024, this figure has escalated to 4,990,463 individuals.
PIP is a crucial financial aid designed to assist those who face additional living expenses due to long-term physical or mental health conditions or disabilities that hinder their ability to perform everyday tasks or move around independently. Since its introduction in 2013, PIP has been systematically replacing DLA.
The growing number of claimants underscores the urgent concerns politicians have voiced regarding the sustainability of the current benefits system. The magnitude of this issue is vividly illustrated in the accompanying chart, which tracks the uptake of PIP and DLA from 2019 to 2024.
Future Policy Directions and Budget Considerations
The i Paper has reported that the Chancellor has opted against introducing significant tax increases during her upcoming Spring Statement on March 26, despite the budget watchdog projecting she may breach her self-imposed borrowing limits. Instead, she has proposed a series of strategies aimed at reducing welfare expenditure and curtailing budgets within Whitehall departments. These proposals have been submitted to the Office for Budget Responsibility (OBR) in anticipation of its updated economic and public finance forecasts coinciding with the Spring Statement.
Previously, the Chancellor had committed to conducting only one “fiscal event” annually. However, she is now willing to break this promise to maintain market confidence by adhering to her fiscal regulations.
In January, Work and Pensions Secretary Liz Kendall emphasized the necessity for the UK welfare budget to be placed on a “more sustainable path.” She stated, “We must steer the benefits bill towards sustainability; we cannot continue to bear the costs of failure—failure that impacts individuals, businesses, and the economy.” She further remarked that enhancing employment opportunities through reforms in Jobcentres and revamping the benefits system is essential, with plans to release a green paper on reforming sickness and disability benefits in the spring.
Kendall is anticipated to deliver a significant address on the subject in the upcoming weeks, prior to unveiling a comprehensive document detailing her proposals. The suggested measures from the Treasury indicate deeper cuts than previously anticipated, with a government source indicating, “We must preserve our fiscal credibility, and reducing the welfare bill is an integral part of that.”
The previous government also recognized the need for substantial changes to the welfare system in order to decrease costs. Last year, former Work and Pensions Secretary Mel Stride acknowledged that the sustainability of Britain’s benefits system hinges on serious reform.
Individuals claiming PIP present a diverse array of conditions, ranging from skin diseases to mobility impairments. Notably, the incidence of claimants with psychiatric conditions has increased significantly since the Covid pandemic. The daily living component of PIP can reach up to £108.55, while the mobility component can provide up to £75.75. Importantly, PIP can be claimed concurrently with other benefits such as Jobseeker’s Allowance (JSA).
