New research from the UK’s only disability think tank, The Disability Policy Centre, reveals the government’s welfare reforms are likely to deliver savings of £100m by 2030, a mere 2% of the £5bn claimed by the Government. 

The analysis projects any potential savings outlined in the ‘Pathways to Work’ green paper will be offset by a range of unintended costs elsewhere across the system, in particular resulting from the tightening of Personal Independence Payments criteria.

These include increased pressure on the NHS as some disabled people seek alternative support, a fall in spending from disabled households with less disposable income and additional legal costs from appeals against the cuts (See ‘Table 1’ in Notes for breakdown). 

Previous attempts at similar reforms to the welfare system failed to produce the savings they claimed they would. Plans to cut £18bn in disability benefits between 2016 and 2021, for example, actually resulted in savings of £0.8bn at most - only 8% of what was initially claimed (See ‘Table 2’ in Notes).  

The research examined previous government reforms since PIP’s introduction in 2013 and compared governments’ projected savings with actual savings using reports from The Office for Budget Responsibility (OBR) and House of Commons, as well as reviewing legal decisions and calculating tax impacts using recognised fiscal multipliers (See full methodology in Notes).

Arun Veerappan, Interim Research Director of the Disability Policy Centre, who conducted the new analysis said:  

“The government’s welfare reforms as set out yesterday risk making life much harder for disabled people whilst producing taxpayer savings equivalent to the price-tag of a Premier League striker - amounting to all pain and no gain scenario.

“Previous attempts to reform Personal Independence Payments, in particular, have failed to produce anywhere near the savings successive governments claimed they would - and the same pattern will play out here without further changes.

“Despite there being little net benefit to the taxpayer, many of these changes will be truly seismic for disabled people in this country, and as such should be accompanied with an impact assessment until waiting next week when it will be overshadowed by the Spring Statement. 

“The silver lining here is that the Government still has time: they are rightly consulting on elements of PIP and, as a green paper, many of these reforms can and must be consulted on further to make life easier for disabled people, not worse.”

Chloe Schendel-Wilson, Director and Co-Founder of The Disability Policy Centre, said:

“The ideological problem unpinning the failure here is the framing from policymakers on seeing disabled people as a drain on our economy. Through this lens there are only ‘bills’ in need of ‘axing’.

“When the reality is, if provided with the necessary support when required, disabled people are entrepreneurs, scientists, innovators, musicians and shop owners, they’re pub-going, high-street shopping consumers and they’re taxpayers providing critical input into our economy, our society and the success of our country. When faced with stalling productivity, the Treasury should be viewing disabled people as an untapped catalyst for much-needed growth, not the drag they’re made out to be.

“Despite these initial shortcomings, this Government has proven it is very capable of listening and engaging with the disability sector to get things right for disabled people and for the country - and we believe they could do so again here.

Notes to Editors 

Spokespeople available for interview on request, please contact louie@dispolcentre.org/ 07748 102192 or Chloe Schendel-Wilson, Co-Founder and Director of the Disability Policy Centre on chloe@dispolcentre.org  

Data  

Table 1: Breakdown of costs from PIP cuts 

Breakdown of £5bn “Saving” 

£bn (2025-2030) 

Planned Saving 

  £5.0bn 

Not Workable or Feasible

  - £2.8bn 

Additional NHS and Social Care Costs 

- -£1.2bn 

Loss of Disabled Household Spending 

  -£0.5bn 

Additional Admin and Tribunal Costs 

- -£0.4bn 

Net Saving

- £0.1bn  

Table 2: Planned savings compared with actuals from 2016-2021 (£bn) 

Proposal 

Planned Saving  

(2016-2021) £bn 

Issue 

Replacing DLA with PIP 

  £7.5bn  

  Hard to exclude complex conditions in practice 

Restricting Mental Health Conditions 

  £3.7bn 

  Ruled unlawful and discriminatory in 2017 

Lower Awards for Use of Aids 

  £6.5bn 

Abandoned as completely unfeasible in 2016 

Total Savings Promised 

  £17.7bn 

Actual Savings Delivered 

  £0.8bn (8%) 

Mainly due to reassessments