Labor Planned welfare reform A two-level profit can create a system, which will run for “decades”, the Institute for Fiscal Studies (IFS) has warned.
Big changes Universal credit (UC) From April 2026, all new contenders will see cuts from £ 423.27 to about half from £ 217.26 and are frozen to 2029.
Anyone who applies for profit after April 6 next year will be entitled to a low rate, which means that they will be paid £ 2,500 less compared to the claimant applying before this date, which will continue to get a higher rate.
It threatens to create a two-level system that lives up to 2040 and beyond, analysis from IFS.
The influential think tank said that currently about 500,000 people are claiming an inefficient profit, such as UC Health, It has been attained for 15 years or more. Depending on this trend, two levels of entitlement will still not be phased up until 2040.
IFS research economist Matthew Oulton said: “Reduce a house benefits It will always be difficult for the affected people. In addition, however, it can be difficult for some people to adjust large falls quickly in income, so there is a case for this. Government To provide transitional assistance to existing contenders affected by profit cuts.
“However, it is difficult that they are difficult to justify the claimants permanently to behave separately on the basis of the exact date to start their claim. Universal loan Health proposals mean that a person can get lower support than each other in the 2040s, as he launched his claim in 2026. ,
IFS Analysis, Shadow Work and Pension Secretary Helen said that replying: “LaborWelfare improvement is a pretense. The IFS has shown their so-called reforms for universal credit health payments that they have been ring-fired by provisions, so they will last decades, the cost of taxpayers and locking people in the system. ,
“It embedded permanent security inequality, discourages work, and very savings destroys labor. The result is a welfare system that increases dependence and deepens black holes in public finance.”
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James Taylor, Director of Strategy Disability Equality Charity Scope, a system said that in the same situation there are two disabled people, who are achieving various levels of support “simply do not understand”.
He said: “Health elements of universal credit exist as people with disabilities often face a double hit on costs. If you are disabled, day-to-day life costs are high, and it is at the top of the costs related to low income and high disability related obstacles and high disability.
“We want to stop the move to the government, and start with the actual review of the universal credit that includes disabled people, assessing an impact and co-building any improvement with people with disabilities.
By 2029, with an increase in the standard rate of UC, the uplift upward change begins with an increase of 2.3 percent in April.
While in 2029/30, £ 1.7bn is expected to be saved to improve the health related elements, increase in savings will be almost completely offset.
Labor states that the purpose of change in rate was “to reduce the deformed incentives that disabled people out of work”, while helping people with disabled people and people with long -term health conditions help in good, safe work.
The government had originally planned to ban eligibility for personal independent payments (PIPs) for health benefits claimed by 3.7 million people.
This was scheduled to distribute the bulk of savings on £ 4.8bn, but ministers changed the syllabus after more than 100 labor MPs threatened to vote against the government on measures.
Steve Darling, spokesperson of Liberal Democrat Work and Pension, said: “The government’s name-fisted approach for welfare improvement has seen money for people with disabilities and has been killed and taken care of their care and has taken away significant support for hard working families.
“The new two-level system for the Universal Credit Health Elements uses an original approach, where some people who are ill or disabled are more similar than others, and it is distorted in the peak. It punishes the current disabled children and anyone who will be disabled in the future.
“In addition, as IFS has warned, people will disintegrate from trying to return to profit and work for a lower rate. This is contrary to advancing the government.
Department for work and pension (WPP) The comment was contacted.