What’s in the Pathways to Work disability reform Green Paper?

5 mins read

Tuesday 18 March 2025

Earlier today, the government launched its Green Paper on disability reform “Pathways to Work”, setting out plans to cut spending on disability benefits by around £5 billion.

What plans does the Green Paper set out?

The Green Paper is wide-ranging. It includes plans to:

  • Scrap the work capability assessment. Any extra financial support for health conditions in Universal Credit will instead be solely based on whether that disabled person qualifies for Personal Independence Payment (PIP).
  • Change the PIP rules to make it harder for some groups of disabled people to qualify for the daily living component. In addition to scoring sufficient points (i.e. eight points), claimants will need to meet an additional test of scoring at least four points in any one daily living activity.
  • Increase the standard personal allowance paid under Universal Credit by £7 per week by 2026/27. (Update: The Chancellor announced in her Spring Statement on 26 March 2025 a below-inflation rise in April 2029 to £106 per week.)
  • Cut the health payment (i.e. the current limited capability for work related activity component) by £47 per week for new claimants from £97 to £50. (Update: The Chancellor announced in her Spring Statement on 26 March 2025 that this rate will be frozen until 2029-30. It has already been announced that the LCWRA element will be frozen for existing claimants until 2029-30).
  • Introduce a new disability payment into Universal Credit from 2026 for those on the new lower rate of the health payment, but only where they are someone who has “the most severe, life-long health conditions, who have no prospect of improvement and will never be able to work”.
  • Freeze the rate at which the limited capability for work related activity element is paid for existing claimants until 2029/30.
  • Introduce a work trial guarantee. This will mean that no one’s disability benefits will be reassessed as a direct result of them moving into work.
  • Increase the number of face-to-face rather than telephone PIP assessments.
  • Provide significant additional support to help disabled people move into work.

Implications for Carer’s Allowance claimants

The proposed changes will make it harder to qualify for the PIP daily living component. So inevitably it will lead to fewer carers qualifying for Carer’s Allowance.

This is because to get Carer’s Allowance, you must be looking after someone who is on a “qualifying disability benefit”. If you are looking after a disabled person aged 16-state pension age in England, then the relevant “qualifying disability benefit” is PIP daily living component. If a carer cannot get Carer’s Allowance or the carer element of Universal Credit, they will then potentially lose entitlement to Universal Credit altogether or be expected to claim as a jobseeker.

Extending DLA to 18 could delay this for a bit for some families. Given PIP is sometimes harder to qualify for, it would be in a lot of families’ interests if their child can stay on DLA for longer.

Green Paper announces further consultations

The Green Paper also consults on proposals to :

  • Prevent young people from being able to access an additional health element within their Universal Credit until they reach the age of 22.
  • Allow Disability Living Allowance (DLA) to continue to the age of 18 rather than 16. We welcome this consultation, which is something Contact has campaigned on and families want.
  • Scrap contributory Employment and Support Allowance (and contribution-based Job Seeker’s Allowance). Replace it with a new time-limited Unemployment Insurance contributory benefit.

Who do these changes affect?

The focus on the Green Paper is mainly on benefits for disabled adults. DLA is unaffected other than proposals to increase the upper age limit to 18.

However, families with young disabled adults getting PIP or Universal Credit will be very concerned about how the Green Paper will impact on their disabled son or daughter.

What is Contact’s view?

Responding to the Green Paper, Anna Bird, Contact CEO, says:

“The cuts to disability benefits announced by the government today are worse than we feared. These significant changes will undoubtedly have a devastating impact on many of the families we support who are already experiencing poverty and struggling to pay for the basics – heating, housing, disability aids and therapies.

“The safety net for families with disabled young adults was already seriously strained and now feels like it has been ripped away.”

Derek Sinclair from Contact’s Family Finance Team says:

“The proposed changes to PIP criteria will undoubtedly see many vulnerable young disabled people lose entitlement to this crucial benefit. Added to this, swingeing cuts to the limited capability for work related activity component for new claimants will see many more families with a disabled young person forced into poverty in the future.

“We are also particularly worried about proposals to limit this extra health-related Universal Credit payment to young people aged 22 and above.”