Is spending on disability benefits being cut or going up?

20 December 2012

"Across the UK, more than 1,000 people have died only months after being told to find work." Ian Lavery, PMQs, December 19, 2012

"What I would say to the hon. Gentleman is that the actual money that we are putting into disability benefits over the coming years is going up, not down." David Cameron, PMQs, December 19, 2012

Back in April this year, we factchecked the claim that over 1,000 people had died after being enrolled in the government's Work-Related Activity Group (WRAG). The claim advanced yesterday by Ian Lavery at the House of Commons first appeared on the Daily Mail as a result of a Freedom of Information (FoI) request sent by the Daily Mirror to the Department of Work and Pensions (DWP). The articles stated that between January and August 2011, 1,100 claimants died after they were placed in the WRAG following their assessment.

However, Full Fact concluded that being placed in the Work-Related Activity Group is not the same as being found "fit for work" given that the DWP makes clear that in the WRAG "the claimant's capability for work is limited by their physical or mental condition and it is not reasonable to require them to work."

In response to Ian Lavery raising this issue during PMQs, the Prime Minister said that "the actual money that we are putting into disability benefits over the coming years is going up, not down." 

Are disability benefits really increasing?

Let's find out. 

As there are a number of disability benefits - such as the Employment and Support Allowance, the Incapacity Benefit, and the Carer's allowance, to name but a few - we contacted the Prime Minister's office to find out which ones he was referring to during PMQs, and were told it was the Disability Living Allowance (DLA) and the Personal Independence Payments (PIP). 

The DLA is a non-means-tested, non-taxable cash payment that disabled people can claim whether they are in work or not. 

Back in May this year, the DWP announced its plans to reform the benefits system. Under the universal credit system, the DLA for working age (16 to 64) claimants will be replaced with a "Personal Independence Payment" (PIP). This change - which will be introduced in April 2013 - will only affect working age people, not children or those over 65 who claim the benefit. DWP is in fact expecting the amount of money spent on children and pensioners to go up in real terms over the next few years. 

The DWP published its current and expected expenditure for the next five years here. Here is what the government has spent overall in DLA since 2009/10 and what it has forecast to spend in real terms until 2016/17: 

Whilst we can see that the expenditure is due to go up in the next year, the rise is not consistent, and the budget is due to decrease after 2013/14.

To understand the reason behind the fluctuations, we have to dig deeper and look into what plans the government has set out for the next five years for both DLA and PIP claimants. 

We have charted the data below to find out how different age groups will be affected by the universal credit reform. 

What this data tells us is that Cameron would be correct to say that disability benefits are going up if by disability benefits he meant exclusively the Disability Living Allowance aimed at children and pensioners. However, because of the universal credit reform, payments to working-age people (PIP) will be reduced, over the coming years, from £7.5bn this year to just under £6.9bn in 2015/16. 

In nominal terms, the total spend on disability benefits - that is DLA and PIP - will go up to £14.7 billion in 2016/17. However, the best way to do comparisons over time is in real terms, i.e. adjusting for inflation, as the DWP figures do. This means that disability benefits are projected to go down by £222 million from £13.559 billion this year to £13.337 billion in 2016/17.


Flickr image courtesy of Leo Reynolds

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