Rising charges of incapacity colliding with higher monetary hardship are pushing extra individuals to hunt help
A part of the federal government’s justification for its cuts to incapacity and incapacity advantages is that the variety of disabled working-age individuals in England and Wales has risen by 17% for the reason that pandemic, however the variety of individuals receiving incapacity[i] or incapacity advantages[ii] has elevated by double this fee – 34%. The implication appears to be that these advantages are going to people who they weren’t meant to help.
Whereas this sounds, on paper, like a regarding pattern, in actuality it might merely point out that respectable demand for these advantages is just not solely decided by whether or not extra persons are disabled.
First, allow us to think about why the variety of disabled working-age individuals could have risen by 17%. We all know that the pandemic had enormous knock-on penalties for well being and well being inequalities. This has been compounded by a cost-of-living disaster that has additionally had profound impacts on our well being. Psychological well being has been notably affected, with 36% extra individuals involved with psychological well being providers in 2024 than in 2019. That is mirrored in a steep rise in claims for incapacity advantages the place psychological well being issues are cited as somebody’s ‘main situation’.
Nevertheless, this authorities argues that the variety of individuals receiving incapacity and incapacity advantages has grown twice as quick as the speed of development in disabilities. It might appear intuitive {that a} rise in claims for these advantages can be pushed primarily by an increase within the variety of disabled individuals, however in actuality many disabled individuals don’t declare related monetary help. This could possibly be as a result of they aren’t conscious of what’s out there, they’re delay by the often-strenuous strategy of proving eligibility, or they don’t really feel they want extra help.
The rise in incapacity and incapacity profit claims is subsequently depending on traits in each incapacity and the proportion of disabled people who find themselves eligible for and apply for help. By evaluating the full variety of disabled individuals – outlined utilizing the Equality Act – to the quantity claiming incapacity and/or incapacity advantages, we will see that the proportion of disabled individuals claiming these advantages stood at round 40% earlier than the pandemic however has since grown to 46%.
Whereas the federal government argues that the rise in charges of incapacity is out of step with the rise in these claiming incapacity and incapacity advantages, this might merely be right down to higher respectable take-up fee throughout the disabled inhabitants, quite than elevated claims from individuals for whom the profit was not meant.
The principle change that the federal government is proposing in response is to tighten eligibility for the private independence fee (PIP), resulting in 800,000 fewer individuals receiving the profit by 2029 – 30. PIP is the profit for which there was the largest post-pandemic improve in claims – 28% of disabled individuals obtained the profit in 2019, rising to 33% in 2023. As a result of it’s non-means examined and never primarily based on working standing, it additionally permits us to discover a wider vary of mediating elements that may clarify why claims have elevated.
The very first thing to contemplate is whether or not the evaluation success fee has modified for individuals making use of for PIP. A falling success fee would counsel extra persons are making use of who the profit was not meant for or that the evaluation is getting tougher to go. A rising success fee would counsel the evaluation is getting simpler to go or that extra persons are making use of with disabilities which have a higher impression on their lives.
Nevertheless, we discover a pretty static success fee, suggesting that the profit is constant to go to the individuals it was meant to help despite the fact that extra persons are making use of. This that not all disabled individuals who could also be eligible for PIP are claiming, which in flip means that different elements are mediating whether or not individuals apply past simply the severity and impression of their disabilities.
One other method to perceive these traits is to take a look at how ranges of PIP claims range throughout the nation. By doing this, we will study how a lot this distribution is accounted for by incapacity prevalence and – crucially – what else would possibly assist to elucidate any variation. We discover that the geographical unfold of the areas which have the best variety of disabled individuals (on the left of determine 3) is similar to the areas of the nation which have probably the most quantity of individuals claiming PIP (on the best).
Determine 3: The areas of the nation with the best incapacity prevalence have the best PIP claims
Variety of disabled individuals and PIP caseload by native authority
Notes: Figures taken from December 2024 for incapacity prevalence and January 2025 for PIP caseload
Supply: NEF Evaluation of the Labour Power Survey (LFS) Private Independence Fee: Circumstances with Entitlement from 2019 (DWP)
We are able to see this additional by putting all of the areas on the x axis of determine 4 primarily based on how many individuals declare PIP, and the variety of disabled individuals in that area on the y axis. This reveals that there’s a robust correlation between these two variables, which means that, as you’ll anticipate, areas with excessive numbers of disabled individuals additionally see excessive numbers of PIP claims.
Whereas this correlation is powerful, there may be nonetheless some unexplained variation, resembling Buckinghamshire which has a excessive proportion of incapacity prevalence however a decrease variety of individuals claiming PIP than we’d anticipate. However as Buckinghamshire is a extra prosperous area, it’s potential that fewer disabled individuals within the area really feel the necessity to declare incapacity advantages.
We are able to lengthen this evaluation with a sequence of regressions to check if regional social and financial drawback performs a job in explaining regional PIP caseload at a selected time limit. By itself, the variety of disabled individuals explains 71% of the PIP caseload in a selected area. However once we add every area’s relative deprivation utilizing the Index of A number of Deprivation (IMD) we will clarify 94% of the regional PIP caseload.
We all know that disabled individuals have struggled specifically through the cost-of-living disaster. 12% of disabled individuals report not to have the ability to pay their payments prior to now 12 months, in comparison with 5% of non-disabled individuals. The proportion of disabled individuals who can not reliably afford satisfactory wholesome meals rose from 11% in 2021 – 22 to 16% in 2023 – 24. For non-disabled individuals, these figures rose from 3% to six%.
Reasonably than indicating that PIP is being awarded to individuals much less in want or deserving of the help than prior to now, our evaluation means that the rise in claims is symptomatic of rising charges of incapacity mixed with worsening hardship. An increase in incapacity makes extra individuals eligible for PIP, whereas worsening hardship signifies that extra individuals who had been beforehand eligible for PIP, however didn’t apply for it, now really feel the necessity to apply for added monetary help.
On this foundation, it appears unlikely that the proposed tightening of eligibility for PIP as the federal government is planning will obtain a lot aside from inflicting additional hardship for a bunch struggling probably the most for the reason that pandemic. It’s additionally doubtless that the price financial savings from this are usually not as excessive as assumed, because it’s typically the case that profit cuts and/or tightened eligibility end in individuals transitioning from one advantages system to a different one (eg, council tax aid) as they seek for different monetary help.
As a substitute, the federal government must develop a plan for addressing the underlying elements which might be main extra individuals to grow to be disabled or expertise ill-health, in addition to an financial technique to cut back the variety of individuals expertise monetary insecurity.
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