Andy Burnham has said his Government will show “the same boldness as we did on the triple lock” in responding to Alan Milburn’s review of youth unemployment.
Speaking on The Rest Is Politics podcast, the Prime Minister said reform should not be approached “as a traditional DWP reform”, but as “a whole government approach to the way we support young people”.
The comparison is important because, at his party’s annual conference in Liverpool, Burnham announced the triple lock would be “adjusted” from April 2030 – the first permanent change to the mechanism since it was introduced by the coalition government in 2011.
He did not set out what that same “boldness” would mean for benefits, but two reviews due this autumn – one by Milburn and one by Sir Stephen Timms – will shape what comes next for universal credit and personal independence payment (PIP) claimants.
What could Milburn recommend?
Milburn, a former health secretary, is examining why nearly one million 16- to 24-year-olds are not in education, employment or training – a group whose out-of-work and disability benefits reportedly cost the government around £8.1bn a year.
His review is expected to recommend wholesale changes to get young people into work and bring down the benefits bill, though Burnham told his conference that savings would come not from “crude cuts” but from “investing in people in their success”.
Milburn’s review will build on Professor Peter Fonagy’s review into ADHD, autism and mental health, published on Friday, which found that by 2024, 40 per cent of adults receiving out-of-work and disability benefits screened positive for ADHD traits.
The report warned that a system centred on getting a diagnosis is “not sustainable”, and that a diagnosis can be “limiting” because it defines people by what they “cannot do”.
Instead, it called for a “needs-led approach” focused on increasing people’s participation in society, rather than waiting for a diagnosis before they can access support.
Universal credit health element
One central option reportedly being considered by ministers as they try to bring down the welfare bill and get more young people into work is removing the universal credit health element for under-25s – including existing claimants – and replacing it with an intensive back-to-work scheme, according to The Guardian.
The proposal is expected to be among the reforms set out in Milburn’s report.
That payment, for people whose condition severely limits their ability to work, is already being halved for new claimants from next April, from £429.80 to £217.26 a month.
Young people who fail to take up intensive support to help them into work will face benefit sanctions, The i Paper understands, with Milburn telling a Politico panel during Labour’s conference that a sanction has “got to be a final thing, not the first thing”.
Personal independence payments
PIP helps with the extra living costs of a long-term condition or disability, whether or not you work, and is now claimed by four million people, with spending forecast to rise from £28.5bn this year to £41.5bn by 2030-31.
Fonagy’s review found that a growing number of people are incentivised to seek a diagnosis because support, including benefits such as PIP, can be difficult to access without one.
It said a diagnosis should not automatically be treated as evidence of fixed or permanent incapacity, and that cash benefits should be combined with “timely treatment, adjustment and employment support where participation is realistic”.
That closely matches the direction of the Timms Review, with Timms, a former work and pensions minister, telling Disability News that some claimants could ask for funding to go “into a service of some kind rather than them receiving the cash”.
He stressed this would be “completely voluntary”, and The i Paper has revealed that alternatives could include quicker access to therapy, specialised equipment or help getting into work.
Ministers have discussed how to encourage claimants to switch amid concerns that not enough would sign up voluntarily, The i Paper understands, though a mandatory rule now appears to have been ruled out.
Unlike Milburn’s review, the Timms panel – largely made up of disabled people and co-chaired by disability campaigner Sharon Brennan and Dr Clenton Farquharson – is not expected to identify cuts.
But The Guardian has reported that the Government is considering new eligibility criteria, either for all claimants or for those below an age such as 50 or 60, though people with the most severe conditions would not be affected.
What happens next?
Parliament is expected to debate the Timms proposals before the end of the year, with the Government responding soon after.
Milburn’s review is likely to be published shortly after the Budget on 28 October, with savings not expected until 2027, according to The i Paper.
While some changes could be made through secondary legislation, the wider response is likely to require primary legislation, which The i Paper has reported provides scope for a Labour rebellion.
Sir Keir Starmer was forced to abandon his own attempt to cut the welfare bill last year in the face of a backbench revolt.
Neil Duncan-Jordan, one of the MPs who rebelled then, told The i Paper he supports bringing the bill down, but warned Burnham must not “make the same mistake” as his predecessor.