PIP Disability benefits reform increased costs to government

UK fiscal watchdog says changes designed to cut expenditure resulted in 15% rise

"A report from the Office for Budget Responsibility said that the introduction of the Personal Independence Payment had cost the exchequer around 15-20 per cent more than keeping the old system in place. Originally the government had estimated it would reduce costs by 20 per cent.

According to the OBR, costs were higher because more people were judged eligible for help than expected; a growing proportion of claimants were young and tended to need more support; and the rollout of the new system was far more difficult than expected."


"Personal Independence Payments were introduced in 2013 and were intended to reduce the number of people claiming disability benefits through regular assessments. However, existing claimants were far more likely to be judged as entitled to the benefits than the government had initially expected.

Success rates in reassessments for non-terminally ill patients were initially around 50 to 60 per cent before falling to 45 per cent, the OBR wrote. “That was substantially higher than the 35 per cent assumed in the December 2012 forecasts.”

So, sicker than expected!

FT read more:

Full Report :

And they have just announced 10 years between new and existing claims wonder how they will back pedal on that one ?

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Lessons learnt

PIP assessments are not "“objective medical assessment” … "in reality that is not feasible"

"To draw on the expertise of DWP’s medical advisers involved in the testing and the development of the new assessment criteria, rather than being solely reliant on analysts. This could have highlighted the necessarily subjective nature of the assessment, which was billed in the June 2010 Budget as the introduction of an “objective medical assessment” when in reality that is not feasible." (p.121)

See Welfare Trends Report 2019