PIP changes explained with fears it will hugely impact Wales

Wales Online

14 hours ago

PIP changes explained with fears it will hugely impact Wales
What the PIP changes could mean for benefits claimants in Wales ahead of crunch vote
Work and Pensions Secretary Liz Kendall arrives in Downing Street for today's cabinet meeting ahead of the crucial welfare reform vote
(Image: PA )
MPs will tonight vote on UK Government plans to reform welfare payments. It comes after a climbdown by the Labour administration after huge public outcry and facing a huge rebellion from its own MPs.
At its height more than 100 Labour MPs said they would vote against their own government, but that has reduced to 39 Labour backbenchers since changes were announced. Wales' four Plaid Cymru MPs have also backed the amendment, which will be voted on.
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The proposals were hugely controversial. While the UK Government say reform is needed, critics said they were being rushed through and had not consulted charities or disabled people who will be impacted. For our free daily briefing on the biggest issues facing the nation, sign up to the Wales Matters newsletter here .
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Work and pensions secretary Liz Kendall told the Commons: "Welfare reform, let's be honest, is never easy, perhaps especially for Labour governments. Our social security system directly touches the lives of millions of people and it is something we all care deeply about.
"We have listened to the concerns that have been raised to help us get these changes right. The Bill protects people already claiming PIP, it protects in real terms the incomes of people already receiving the UC (universal credit) health top-up from that benefit and their standard allowance, and it protects those with severe lifelong conditions who will never work, and those near the end of their life as we promised we would."
The Welsh Government had criticised the plans, with senior minister Jane Hutt writing to Ms Kendall saying there needed to be a review of the plans. Once the climbdown was announced, it was welcomed by First Minister Eluned Morgan. She said: "Around 200,000 people could have been in real trouble, and they've listened, they've learned and they've acted – and that is something I think we should welcome."
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What is PIP?
Personal Independence Payment (PIP) is a non-means-tested benefit intended to help with extra costs arising from long-term disability or ill-health which was introduced in 2013. It replaced Disability Living Allowance for people of working age.
PIP is made up of two components:
a mobility component, based on an individual's ability to get around; and
a 'daily living' component, based on ability to carry out other key activities necessary to be able to participate in daily life.
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Each component can be awarded at either standard, enhanced, or nil (where they receive nothing).
What was proposed?
The UK Government had proposed sweeping changes that were deeply unpopular there were two main elements:
Increasing the basic 'standard allowance' of Universal Credit that all claimants receive, while reducing the generosity of the additional amounts for claimants with disabilities and health conditions that affect their capability for work
In terms of PIP, changes to the way eligibility is calculated - claimants would need to score four or more points for at least one of the 'daily living' activities that determine entitlement to the daily living component
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Now what is happening?
The UK Government announced two major changes
the new Personal Independence Payment daily living 'four-point' requirement will only be implemented for new claimants from November 2026
existing recipients of the Universal Credit health element, and any new claimant meeting the criteria for the most severe and lifelong conditions, will "have their incomes fully protected in real terms"
Why is it so important in Wales?
There was a lack of official government data about exactly who would be impacted in Wales but it was widely commented that there would be a disproportionate impact in Wales because Wales has higher rates of disabled people of working age than the UK average.
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The Joseph Rowntree Foundation highlighted the constituencies where cuts to sickness and disability benefits will fall most heavily which showed of the top 20 constituencies in England and Wales with the highest proportion of the working age population in receipt of health-related social security, eight are in Wales (and 10 out of the top 30) which suggested changing PIP would have a disproportionate impact on disabled people in Wales.
In fact, Welsh Government minister Jane Hutt wrote to her UK Government counterpart and said that element needed to be reviewed. "The proposed changes to Personal Independence Payments should be reviewed before any changes are made," she wrote.
Policy in Practice estimated there will be substantial increases in poverty and financial hardship for working age households in Wales.
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The original plans would have impacted an estimated 190,000 people in Wales (6.1% of the population) and see £470m lost from the Welsh economy.
Victoria Winckler, director of The Bevan Foundation, said it would "increase social inequality, and exacerbating already entrenched poverty in Wales".
Are the changes better news?
There are still concerns that the row back is going to create a two-tier system and younger disabled people and those who become disabled in the future will be disadvantaged and denied access to work and education.
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The concessions by the UK Government have seen a number of the Welsh MPs who had signed an amendment which looked set to sink the government plans has decreased. While Plaid Cymru's four MPs have signed the amendment, only one of the five Labour MPs who had originally put their names to it have kept there, that's Steve Witherden, the MP for Montgomeryshire and Glyndwr.
However, a huge number of charity groups say the changes don't go far enough. Since the revisions, groups and charities including Citizens Advice, The Poverty Alliance and The Salvation Army have co-signed a letter saying they want the bill withdrawn. There has not, the groups say, been enough consultation.
That was echoed by Luke Young, head of policy at Citizens Advice who asked MPs to vote against the bill. "The UK government's own impact assessment says the cuts will plunge 150,000 people into poverty by the end of this Parliament. Even this is an underestimate of the potential impact. If this Bill is passed, then by 2030 it will have cut PIP for more than 400,000 disabled people and Universal Credit for more than 700,000 people who are disabled or have a long-term health condition.
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"We know Wales will be disproportionately affected, with communities such as Blaenau Gwent, Caerphilly and Neath Port Talbot being hardest hit. It will push more people toward already stretched public services and into to food banks, as they find even less support available under a new three tier system."