Commons Sense

House of Commons · Written Ministerial Statement

Response to Welfare Cap Breach

29 January 2025 · Department for Work and Pensions

Proposed by Liz Kendall Lab Leicester West

Benefits & Welfare

Summarised by AI from the official record, so it can contain mistakes.

View on Parliament.uk

At a glance

Key points

  • The current government will publish a Green Paper to reform the health and disability benefits system.
  • The government plans to bring forward radical reforms to increase employment rates.
  • The government is committed to working across departments to ensure sustainable welfare spending.

Issue summary

The statement addresses the breach of the previous government's welfare cap by £8.6 billion due to higher expenditure on Universal Credit and disability benefits.

Action requested

The current government will publish a Green Paper to reform the health and disability benefits system, bring forward radical reforms to increase employment rates, and work across departments to ensure sustainable welfare spending. They are also committed to combating welfare fraud and improving interdepartmental collaboration.

Key facts

  • The previous government's welfare cap is on course to be exceeded by £8.6 billion in 2024/25.
  • Higher expenditure on Universal Credit and disability benefits due to low growth, high inflation, and higher than forecast rise in benefit spending.
  • 420,000 more households are predicted to claim Universal Credit health benefits by the end of the decade.
  • The new Charter for Budget Responsibility establishes a new welfare cap for this Parliament.
  • A new annual report on welfare spending will be published later this year.
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