Written statement on Welfare Reform - June 30

Secretary of State for Work and Pensions (Liz Kendall): The Government has committed to making two changes to strengthen the Universal Credit and Personal Independence Payment Bill: implementing the new eligibility requirements for PIP from November 2026 for new claims only, and adjusting Universal Credit rates to make sure all existing recipients of the Universal Credit health element – and any new claimant meeting the severe conditions criteria and those who qualify under Special Rules for End of Life – have the combined rate of their Universal Credit standard allowance and Universal Credit health element protected in real terms.

Today, we have circulated policy explainers for the amendments that the Government will table ahead of Committee Stage to enact the proposed change to PIP & UC, demonstrating our commitment to strengthening the Bill.

These explainers have been circulated alongside a full draft of the amendment to the PIP clauses. This letter has been deposited in the libraries of both houses for reference. We will formally table the amendments to both UC and PIP following the Bill's Second Reading.

We have also published the revised poverty impacts, ‘Spring statement social security changes – Updated impact on poverty levels in Great Britain' based on the two changes we are making to strengthen the Bill. No-one who is already receiving an award of Universal Credit or PIP will be pushed in to poverty as a result of the direct impact of the measures in this Bill.

As we continue our wider drive to tackle the scar of poverty – including by extending free school meals, expanding the Warm Home Discount to an extra 2.7 million households next winter, and supporting 700,000 of the poorest families through our Fair Repayment Rate on Universal Credit deductions.

We committed in the Green Paper to introduce the “right to try”, and I am pleased to announce that we have deposited in the House Library draft regulations alongside this Bill that establish in law the principle that work, in and of itself, will not lead to a reassessment. This will apply to all Universal Credit, New Style Employment and Support Allowance and PIP customers. This is just the first step. As set out in the Pathways to Work Green Paper, we will also work with disabled people and stakeholders to explore ways to further strengthen this Right to Try Guarantee.

Through measures within the Universal Credit and Personal Independence Payment Bill, we are giving people who are already on PIP the certainty they need, while increasingly targeting funding at those who need it most, to make sure the system is sustainable to support generations to come.

In addition to bringing forward amendments to the Bill we will also commit to spending an additional £300m in the next three years on our investment in Pathways to Work, health and skills support.

At the Spring Statement in March, we announced Pathways to Work funding of:

• £200m for 26/27
• £300m for 27/28
• £400m for 28/29
• £1bn in 29/30

This investment in Pathways to Work support towards employment will now increase to:

• £200m in 2026/27
• £400m in 2027/28 (up from £300m)
• £600m in 2028/29 (up from £400m)
• £1bn in 29/30

This is on top of funding and support we are now mobilising through Connect to Work, WorkWell, local inactivity Trailblazers and 1000 new Pathways to Work advisers to support disabled people. This already amounts to the biggest employment support package for disabled people and people with health conditions in more than a generation. The extra money we are announcing today means that we will be able to go further and faster on our new planned investment in work, health and skills support offers, building on and learning from successes such as the Connect to Work programme, which is being rolled out over 2025 to provide disabled people and people with health conditions with one-to-one support at the point when they feel ready to work.

Alongside taking action to get welfare spending on a sustainable footing, so that help can be there for people who need it now and into the future, we are committed to a holistic programme of reform to make sure that PIP is fair and fit for the future. The PIP assessment review, which the Minister for Social Security and Disability is leading, is a significant part of this work.

In the Green Paper, we set out our intention to review the PIP assessment and make it fit for the future. We committed to bring together a range of experts, stakeholders and people with lived experience to consider how best to do this and to start the process of preparing for the review. I announced to the House on Monday 21 May that this process had started and, since then, the Minister for Social Security and Disability, who will lead the review, has listened to a wide range of views, including holding roundtables with disability charities.

Today, I am pleased to announce we are publishing the Terms of Reference for the PIP assessment review and we will engage widely and at pace to design the process for its work. Because of our commitment to coproduce, the precise timeline for the review will be determined over the summer, based on the design work with stakeholders to ensure the review can fulfil its aims. I expect it to conclude by Autumn 2026.