News
  • Login
  • Home
  • News
  • Sport
  • Worklife
  • Travel
  • Reel
  • Future
  • More
Friday, September 12, 2025
No Result
View All Result

NEWS

3 °c
London
8 ° Wed
9 ° Thu
11 ° Fri
13 ° Sat
  • Home
  • Video
  • World
    • All
    • Africa
    • Asia
    • Australia
    • Europe
    • Latin America
    • Middle East
    • US & Canada

    Australia approves vaccine to curb killer epidemic

    France suspects foreign intelligence over pigs heads left outside mosques

    South Africa’s Constitutional Court rules that men can take wife’s surname

    Nasa bans Chinese nationals from working on its space programmes

    Ireland threatens to withdraw from Eurovision if Israel participates

    Luis Suarez gets extra three-match ban for spitting

    Israeli strikes in Yemen kill 35 people, Houthis say

    Suspect accused of killing elderly couple in New York City, taken into custody

    US influencer Mike Holston investigated over wild croc wrestling

  • UK
    • All
    • England
    • N. Ireland
    • Politics
    • Scotland
    • Wales

    Shock in Seaford after boy stabbed to death at railway station

    Smugglers who brought drugs on an industrial scale into Wales jailed

    Council sends letter to locals about removing flags

    Anti-Senedd Conservative selected in Cardiff for 2026 election

    Ministers lobby Treasury over bill for PSNI data breach

    Nigel Farage faces questions over who funded £885,000 Clacton constituency home

    Female referees on the rise, says 19-year-old Coventry ref

    Pulp, CMAT and Wolf Alice among nominees

    Four guilty of murdering man by stab wound to heart

  • Business
    • All
    • Companies
    • Connected World
    • Economy
    • Entrepreneurship
    • Global Trade
    • Technology of Business

    John Lewis losses nearly triple to £88m

    When is the Budget and what might be in it?

    US inflation rises ahead of key interest rate decision

    Oracle’s Larry Ellison surpasses Elon Musk as world’s richest man

    Contactless card payments could become unlimited under new plans

    Samantha Cameron’s fashion label Cefinn to close as costs rise

    Mitchum apologises after deodorant left users with itchy, burning armpits

    US job growth revisions signal economic weakness

    Badenoch ‘worried’ UK may need IMF bailout

  • Tech
  • Entertainment & Arts

    Dancers say Lizzo ‘needs to be held accountable’ over harassment claims

    Freddie Mercury: Contents of former home being sold at auction

    Harry Potter and the Cursed Child marks seven years in West End

    Sinéad O’Connor: In her own words

    Tom Jones: Neighbour surprised to find singer in flat below

    BBC presenter: What is the evidence?

    Watch: The latest on BBC presenter story… in under a minute

    Watch: George Alagiah’s extraordinary career

    BBC News presenter pays tribute to ‘much loved’ colleague George Alagiah

    Excited filmgoers: 'Barbie is everything'

  • Science
  • Health
  • In Pictures
  • Reality Check
  • Have your say
  • More
    • Newsbeat
    • Long Reads

NEWS

No Result
View All Result
Home Reality Check

How big is the welfare budget and where might cuts fall?

March 6, 2025
in Reality Check
9 min read
245 8
0
491
SHARES
1.4k
VIEWS
Share on FacebookShare on Twitter


PA Chancellor Rachel Reeves gesturing with her right hand while speaking at the National Manufacturing Conference. The BBC Verify logo appears in the top left corner of the image.PA

Chancellor Rachel Reeves has earmarked “several billion pounds” in draft spending cuts to welfare ahead of her Spring Statement, according to the BBC.

When asked about the welfare budget, the Justice Secretary, Shabana Mahmood said: “Our current situation is unsustainable… we’ve seen a huge rise in that welfare budget.”

BBC Verify has examined this budget and where the cuts might fall.

How big is the welfare budget?

Before looking at where the welfare budget might be cut, it is necessary to understand the size of the budget and how it has grown.

At the time of the October 2024 Budget, the Office for Budget Responsibility (OBR) forecast that total spending on health and disability benefits would rise from £64.7bn in 2023-24 to £100.7bn in 2029-30.

And the OBR projected that the biggest contributor to this increase would be from welfare spending on working-age adults, defined as those aged between 16 and 64.

The OBR projected spending on this sector would rise from £48.5bn in 2023-24 to £75.7bn in 2029-30.

Why is the welfare bill growing?

The OBR cited rising numbers of people coming on to incapacity and disability benefits as driving its latest forecasts.

The forecaster is essentially assuming the trend of rising benefits claims in recent years will continue.

In the five years after 2009-2010, more people were coming off incapacity benefits than on.

A bar chart showing the yearly change in the number of people (in thousands) applying for incapacity benefits. Between 2010 and 2014 the net change was negative, meaning more people were coming off benefits than applying, but between 2018 and 2024 the trend has been steadily rising to about a 200,000 net increase.

But in recent years – and especially since the 2020-21 Covid pandemic – more people have been coming on to benefits than off them.

And the OBR forecast the share of the working-age population in receipt of an incapacity benefit would rise from 7% in 2024 to a record high of 7.9% in 2029.

The reasons for this are not totally clear.

Some experts point to the damaging and lasting impact of the pandemic on physical health.

Others reference the rise in mental ill health, especially among younger people.

The Office for National Statistics (ONS) has reported that the number of people aged 18 to 24 who are not in education, employment or training (Neet) rose to 907,000 at the end of last year, a 30% increase on the level before the pandemic in 2020 (although the ONS also cautioned the survey used to collect the data was potentially unreliable).

Other experts place the emphasis on financial incentives in the welfare system – where people can get higher payments for being on sickness benefits than from being unemployed or in low-paid, part-time work.

The standard allowance for a single person on Universal Credit is £311.68 per month. If someone is deemed to have “limited capacity for work-related activity”, the criteria to receive incapacity benefits, they are eligible for an extra £416.19 per month on top.

But there is no consensus on what’s causing the trend.

“It is not yet known what factors are driving this increase,” says Eduin Latimer of the Institute for Fiscal Studies.

“Figuring out what is behind the recent rise must surely be a top priority for the government if it is going to be able to respond appropriately.”

Which elements of the welfare bill might be cut?

Ministers have not said where they will seek cuts, but the largest element of the working-age welfare bill is incapacity or long-term sickness benefits – paid via Universal Credit or the legacy system of Employment and Support Allowance.

If the government wants to make significant savings from the working-age welfare bill it will probably need to find some savings here.

But the second largest single element of the working-age welfare bill is Personal Independence Payments (PIP) – a benefit for people under state pension age who need help with daily activities because of a long-term illness or disability. PIP claimants can be in work.

In 2023-24, PIP totalled £18bn and that’s projected to almost double to £34bn by 2029-30. That would mean the number of claimants rising from 2.7 million to 4.2 million.

As with the rise in the overall welfare bill, there’s no consensus among experts on what’s driving rising PIP claims, but this is also somewhere the government might well look to make some savings.

The previous Conservative government had explored making it harder for younger people with mental health conditions to claim PIP.

Can significant savings be made?

Many experts, such as the Resolution Foundation think tank and the Institute for Employment Studies, agree that more working-age people should be helped and encouraged into work, and that there is a case for reform of the working-age welfare system.

But some argue that making sustainable, long-term savings requires upfront government investment in employment support programmes – schemes which aim to help people overcome barriers to getting into work.

Analysts also warn that reducing spending on the welfare bill has been historically difficult.

At the 2015 general election, the Conservative manifesto promised to cut £12bn from the annual welfare budget.

While some significant savings were initially found, ministers were forced to change policy after a political backlash over some of the cuts.

The OBR later concluded £4bn of the £12bn a year promised cuts had not been achieved.

Additional reporting by Rob England

BBC Verify logo
Thin, red banner promoting the Politics Essential newsletter with text saying, “Get the latest political analysis and big moments, delivered straight to your inbox every weekday”. There is also an image of the Houses of Parliament.



Source link

Tags: BigBudgetcutsfallwelfare

Related Posts

South Korean worker tells BBC of panic and confusion during Hyundai raid

September 8, 2025
0

Nick BeakeUS Verify Correspondent in Ellabell, Georgia EPASome 400 state and federal agents gathered outside the factory complex before...

Can Trump send National Guard troops to Chicago?

September 7, 2025
0

US President Donald Trump has suggested he will send National Guard troops to Chicago, saying "we're going in", when...

Do Reform’s economic plans add up?

September 6, 2025
0

Ben ChuBBC Verify policy and analysis correspondentPA MediaAs conference season begins for the UK's political parties, Reform UK will...

  • Ballyjamesduff: Man dies after hit-and-run in County Cavan

    510 shares
    Share 204 Tweet 128
  • Somalia: Rare access to its US-funded 'lightning commando brigade

    508 shares
    Share 203 Tweet 127
  • Google faces new multi-billion advertising lawsuit

    508 shares
    Share 203 Tweet 127
  • Uganda arrest over deadly New Year Freedom City mall crush

    507 shares
    Share 203 Tweet 127
  • George Weah: Hopes for Liberian football revival with legend as President

    506 shares
    Share 202 Tweet 127
  • Trending
  • Comments
  • Latest

Ballyjamesduff: Man dies after hit-and-run in County Cavan

August 19, 2022

Somalia: Rare access to its US-funded 'lightning commando brigade

November 23, 2022

Google faces new multi-billion advertising lawsuit

March 31, 2023

Stranger Things actor Jamie Campbell Bower praised for addiction post

0

NHS to close Tavistock child gender identity clinic

0

Cold sores traced back to kissing in Bronze Age by Cambridge research

0

Shock in Seaford after boy stabbed to death at railway station

September 11, 2025

John Lewis losses nearly triple to £88m

September 11, 2025

When is the Budget and what might be in it?

September 11, 2025

Categories

England

Shock in Seaford after boy stabbed to death at railway station

September 11, 2025
0

Stuart MaisnerSouth East andSam Harrisonin SeafordEddie MitchellThe teenager was pronounced dead at the sceneThe mayor of a seaside town...

Read more

John Lewis losses nearly triple to £88m

September 11, 2025
News

Copyright © 2020 JBC News Powered by JOOJ.us

Explore the JBC

  • Home
  • News
  • Sport
  • Worklife
  • Travel
  • Reel
  • Future
  • More

Follow Us

  • Home Main
  • Video
  • World
  • Top News
  • Business
  • Sport
  • Tech
  • UK
  • In Pictures
  • Health
  • Reality Check
  • Science
  • Entertainment & Arts
  • Login

Copyright © 2020 JBC News Powered by JOOJ.us

Welcome Back!

Login to your account below

Forgotten Password?

Create New Account!

Fill the forms bellow to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.
News
More Sites

    MORE

  • Home
  • News
  • Sport
  • Worklife
  • Travel
  • Reel
  • Future
  • More
  • News

    JBC News