Between mid-2021 and mid-2024, the number of monthly new awards
for working-age disability benefits (personal independence
payment, PIP) in England and Wales, rose from near its
pre-pandemic level of 19,000 up to 42,000. This sharp increase in
the number of new awards is the main reason why the number of
people receiving working-age disability benefits rose from 2.1
million in 2019–20 to 3.4 million by the start of 2026. Today's
statistics show 27,000 new awards per month in the three months
to January 2026 – 8% lower than in the prior quarter and 37%
below the level seen during the post-pandemic peak. But this
level of new awards is still 38% higher than those seen before
the pandemic. Under the OBR's November 2025 forecast, which
assumes that PIP applications decline to below the levels in
today's data but remain above the pre-pandemic norm, real
spending on working-age disability benefits, which was £14
billion in 2019–20, is due to rise from £25 billion this year to
£32 billion in 2029–30. If that decline in PIP applications does
not materialise then spending will rise even more.
Sam Ray-Chaudhuri, a Research Economist at IFS and author
of this comment, says:
"Today's statistics show a further decline in the number of
people starting a disability benefit award each month. They will
make easy reading for the government, who have expressed concern
about the number of recipients of and spending on these benefits.
Only time will tell whether this recent pattern will persist. But
even if it does, the fiscal cost of the sharp rise in claimants
seen since the pandemic is likely to be long-lasting, as
recipients typically stay on these benefits for many years.
Indeed, on the latest forecasts, real spending on working-age
disability benefits is set to be £32 billion in 2029–30 – £18
billion more than before the pandemic."
ENDS
Notes to Editor
New disability benefit awards continue to fall but remain
well above pre-pandemic levels is an IFS briefing by Eduin
Latimer and Sam Ray-Chaudhuri.
The briefing is
available to read here on the IFS website
