Britain’s welfare bill is fast becoming the defining fiscal pressure of this parliament. In 2024–25, total spending on welfare benefits in Great Britain was £305 billion – more than the Department of Health & Social Care (£204.7 billion), the Department for Education (~£95 billion) or the Ministry of Defence (~£60 billion) that same year.

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Of that Department for Work & Pensions (DWP) spending, around three-fifths goes to pensioners (through benefits like the state pension) and two-fifths to people of working age and children.

Health and disability benefits for working-age people are a significant proportion of this – and of the £140 billion spent on children and working-age people in 2024–25, more than a third (£52.3 billion

) went on health and disability payments for working-age adults.

Health and disability payments comprise two main benefit types:

1. Incapacity benefits: This is primarily the health element of Universal Credit (UC health), a means-tested additional payment for welfare claimants assessed as having limited capability for work due to a health condition or disability. Incapacity benefits accounted for £29.7 billion of spending in 2024–25.

   [10]Link to footnote

2. Disability benefits: This is principally the Personal Independence Payment (PIP), intended to meet the extra costs associated with disability or long-term physical or mental-health conditions, regardless of whether a person is in work. Disability benefits for those of working age accounted for £22.6 billion of spending in 2024–25.

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As well as making up a significant portion of the UK’s benefit bill, spending on health and disability payments for working-age adults is also the fastest-rising category of welfare spending. Over the next three years, this category is expected to grow by an average of 4.2 per cent every year in real terms – eclipsing projected growth in health, education and defence spending – and is estimated to reach £73.4 billion by 2030–31, equivalent to 2 per cent of GDP.

It is important to note that this surge is not the result of a more generous system.

Benefit rates have not fundamentally changed; what has changed is caseload. Before the pandemic, 2.8 million working-age people were claiming benefits due to ill health or disability.

But by August 2025, this had climbed by more than 40 per cent to 4.5 million.

The increase has been too large and too rapid to be explained by overall population growth or ageing. Instead, there are three core drivers:

1. More claims linked to mental ill health: The number of disability benefit claims driven by psychiatric disorders has more than doubled since the pandemic.

   [16]Link to footnote
   More than half of the total growth in claims in this period can be attributed to mental-health or behavioural conditions.
   [17]Link to footnote
   The impact on incapacity benefits is harder to isolate – because claimants can list multiple conditions and are not required to specify a primary cause – but recent data from the DWP show that nearly 90 per cent of claimants found to have limited capability for work cited a mental or behavioural disorder.
   [18]Link to footnote
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   [19]Link to footnote
   This points to a profound shift in which mental-health conditions are now near universal among successful claimants.

2. Rapid growth in claims among young people: The number of young people on incapacity benefits has surged by more than 50 per cent since the pandemic, reaching 239,000.

   [20]Link to footnote
   Four in five of these young people with a recorded condition on UC health are claiming due to mental-health or neurodevelopmental conditions.
   [21]Link to footnote

3. Rising long-term benefit dependence: Only around 0.9 per cent of people on UC health now move into work each month, highlighting very low exit rates.

   [22]Link to footnote

Britain is not alone in facing this underlying challenge. Across most advanced economies, rates of anxiety, depression and neurodevelopmental conditions are rising – especially among young people. What sets Britain apart, however, is how this trend has translated into public spending. As Figure 2 shows, no comparable country has seen rising rates of illness feed so directly into a substantial increase in benefit expenditure, essentially funnelling people with illness away from work and into long-term welfare.

Research commissioned by the Tony Blair Institute for Global Change and carried out by YouGov shows the public broadly recognises these shifts in both disease burden and increased welfare spending. Many people also suspect – rightly – that spending on health-related welfare benefits is increasing faster in the UK than in comparable countries. This perception is strongest among those currently intending to vote for the Conservatives or Reform UK, but it is not confined to them.

The British welfare system is now a problem the government cannot afford to ignore. Reducing the number of incapacity and disability benefit claimants must be an explicit short-term objective of government within this parliament.

The impact of the UK’s growing benefit bill is profound and creates a compelling case for welfare reform – not just on economic and fiscal grounds, but on moral grounds too.

The fiscal case is clear. The more a government spends on health and disability payments, the less it is able to spend on other priorities without resorting to either more tax or more borrowing. Neither of these is an attractive option for the government at present – especially with pressure to increase expenditure elsewhere, including on the defence budget or in mitigating the cost-of-living crisis.

The economic case is just as clear. In total, ill health among working-age people is thought to reduce economic output in the UK by up to £188 billion each year

with knock-on costs to public services adding significantly to the overall bill. The impact of lower tax revenues, higher welfare spending and additional NHS costs are estimated to cost the government an extra £70 billion every year.

Then there’s the moral case. Despite record spending on health-related welfare payments, high rates of ill health persist and deprivation remains widespread; three-quarters of all adults receiving incapacity benefits are experiencing material hardship.

Young people are particularly hard hit. The government’s most recent report on the issue, Keep Britain Working, found that a young person signed off work early in their working life could lose up to £1 million in lifetime earnings if they never re-enter the world of work.

Without reform, too many people will remain on health-related benefits without consistent access to effective treatment, sustained engagement or a clear pathway back into work, increasing the risk of long-term dependency.

Signing people off work – almost indefinitely – with ill health ignores the growing body of evidence that work has an overwhelmingly positive impact on both mental and physical health, life satisfaction and economic prospects, especially in the long term.

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Studies show that routine, structure and social connection – qualities that often can be found through work – are protective against many common mental-health conditions including anxiety, depression and social isolation. In fact, moving from unemployment into paid work has been found to reduce the risk of mental-health problems by around 30 per cent, a level of improvement comparable to many established clinical treatments.

The same is also true for many physical conditions.

Sustained inactivity is associated with poorer cardiovascular health, higher rates of chronic illness and slower recovery, while appropriate work – particularly when combined with support and reasonable adjustments – is linked to improved mobility, better long-term health outcomes and greater independence.

By contrast, prolonged worklessness has well-documented negative effects. Extended detachment from the labour market is associated with worsening mental health, increased risk of chronic disease and sharply declining chances of re-entry into work. As Figure 4 illustrates, the probability of returning to employment falls steeply the longer someone remains out of work, with the sharpest drop occurring early on. Each additional month compounds the risk of long-term dependency, making early intervention critical.

Our polling shows that public opinion is in line with the evidence. There is widespread recognition, for instance, that a system perceived to be open to misuse will struggle to sustain long-term public consent. Similarly, many adults in Great Britain believe that leaving people on financial benefits without a defined path forward is not just inefficient, it is morally wrong.

When asked to weigh two competing statements of principle (statement A, that leaving people on financial benefits without a clear path forward is morally wrong, versus statement B, that forcing people back into work when they need financial benefits is morally wrong), the balance of opinion is clear. A majority of 57 per cent align more closely with the first position. Just 22 per cent align more closely with the second.

The public instinct, in other words, leans towards progression rather than permanent dependency. Figure 5 shows how this view breaks down across different voter groups.

Such a high and growing benefits bill, coupled with 4 million people signed off work with ill health, points to a welfare system no longer fit for purpose. At its inception, the welfare state was designed to support people with mainly physical disabilities, unable to work in mainly physical jobs.

In the decades since, both the world of work and illness have changed. Jobs are far less dependent on either physical strength or presence, and mental health has become the dominant category of presenting illness.

This creates a challenge for the modern welfare state. Whereas physical conditions are often observable, permanent and relatively rare, mental-health conditions are more often fluctuating, subjective and common. The result is a system perceived as open-ended, vulnerable to misuse, and insufficiently focused on recovery and pathways into rewarding work – one that entrenches welfare dependency, even where conditions are treatable or manageable.

In the longer term, there must be a wholesale review of the welfare system to address these trends. That will take work, time and likely a substantial amount of primary legislation to enact. In the short term, however, the UK cannot afford to wait. This paper focuses therefore on what the government can do now – within this current parliament – through only secondary legislation and the issuance of guidance.

Here, we consider the ways in which the current system is failing those with ill health before looking at what could be done to address these issues. Broadly, these fall into three main categories:

1. Misaligned incentives for claimants

2. A failure to consider non-work-limiting conditions

3. Structural weaknesses across the system

Misaligned Incentives for Claimants

Universal Credit was designed around the principle that work should always pay more than welfare. In practice, however, the combination of additional health-related support and disability benefits can narrow the financial gains from moving into work.

The inclusion of incapacity and disability benefits alongside standard Universal Credit, for example, can substantially increase the income available to those out of work. While on paper claimants remain financially better off in work, the difference is often modest, particularly for people entering lower-paid roles. This may help to explain some of the recent growth in claimant numbers, especially for young people who are more likely to start out in jobs paying closer to the minimum wage. The government has begun to address this disparity in the level of UC support, a welcome shift. But narrowing the payment gap alone does not remove the wider risks and structural disincentives attached to work.

While incapacity benefit claimants are permitted to work, doing so is widely perceived as risky. Survey evidence shows that almost three-quarters of recipients of incapacity benefits report fear of losing benefits as a significant or very significant barrier to work.

In a system where attempting work carries a high risk of losing benefits, even claimants who want to enter work may rationally choose not to.

This is because in the UK, incapacity is primarily met with a cash transfer. There is limited structured assistance to manage phased returns to work, coordinate with employers or adapt roles to fluctuating conditions. By contrast, systems such as those found in the Netherlands or Denmark feature income support that is more tightly integrated with active case management and employer engagement.

That approach is built around recovery and work retention; Britain’s is largely built around maintenance.

The system’s incentives tilt away from work. Modest financial gains, the perceived risk of losing benefits and limited support for returning to work all contribute to this. When someone moves into employment, there is a perception that their benefits may be withdrawn entirely, creating a cliff edge rather than a supported transition. Employment may be permitted, but it is not systematically rewarded, protected or promoted.

Over time, this has fundamentally reshaped the underlying assumption in the system. The category of people implicitly treated as unable to work has widened. In seeking to protect those with the most severe conditions, the system has extended that presumption too broadly. The result is not just higher caseloads, but a framework in which work is no longer clearly the expected outcome.

A Failure to Consider Non-Work-Limiting Conditions

Health-related unemployment benefits were designed to support people whose conditions prevent them from working. Over time, the boundary between those who cannot work and those who could, with support, remain in or return to work has blurred. Common, fluctuating and often treatable conditions are increasingly channelled into long-term support.

Public attitudes reflect concern: nearly half of respondents believe too many conditions are currently viewed as “work-limiting”, compared with fewer than one in ten who think too few are.

Illness does not automatically mean incapacity. For many common mental-health and musculoskeletal conditions, there is substantial evidence that good, supported work is compatible with recovery and may improve long-term outcomes. The system must reflect this reality.

Structural Weaknesses Across the System

There are structural weaknesses across the four key gateways in the system: GP certification, assessment, tribunal and reassessment. Taken together, these weaknesses are wearing away the system’s gateways, widening the path onto benefits.

At Gateway 1: GP Certification

In order to claim incapacity benefit, claimants must have a Fit Note. This note provides the DWP with evidence that the claimant has a medical condition and that the doctor (usually a GP) considers the claimant unable to work normally as a result. In theory, the note allows doctors to specify whether they consider the claimant wholly unable to work, or whether the individual could work with adjustments. In reality, 93 per cent of notes are currently designated “not fit for work”, with no adjustments suggested.

There are well-recognised issues with the Fit Note process. GPs have no formal training in occupational health (necessary to determine an individual’s fitness to work) and often lack critical information from the employer about the claimant’s current work duties (if the person is in work). In addition to this, GPs often report feeling pressured into signing Fit Notes because they are advocates for patients and do not feel in a place to challenge personal accounts of illness or function.

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As a result, the number of Fit Notes issued annually has more than doubled since 2015.

Even more strikingly, for PIP there is effectively no first gateway. There is no requirement for a formal diagnosis, and eligibility is determined primarily through functional assessment rather than medical certification.

At Gateway 2: Assessment

Claimants of both incapacity and disability benefits must undergo an assessment to determine their eligibility. These assessments are a combination of medical evidence, written submissions from the applicant and the impressions of the assessor (taken during either an in-person or online interview). The purpose is to provide a structured and consistent test of eligibility and to assess function rather than looking simply at conditions. Those with less function are entitled to higher rates of benefit.

However, there are also well-recognised issues with the DWP assessment process. For instance, claimants are not required to provide medical evidence as part of the assessment, meaning around 20 per cent of Work Capability Assessments (WCAs, the assessment for UC health) and around a third of PIP assessments are completed without any external clinical input.

GPs are not obligated to provide reports, and the modest fee associated if they do offer the service – around £40 per report – offers little incentive for them to do so.

Another problem lies in the growing use of a practice known as curtailment – a process by which an assessor can end an assessment early once full benefit eligibility is established. The effect is to reward assessors for speed over rigour, a point that is frequently referenced by so-called sickfluencers who create online content advising claimants on how best to maximise chances of a successful claim.

A switch to predominantly online assessments may also have had an effect on the rigour of the assessment process. During the pandemic, most assessments were shifted rapidly to remote consultations, and in-person assessments have not returned to pre-pandemic levels. Since then, it is worth noting that approval rates have risen, dropout rates (the share of claims withdrawn before reaching a decision) have fallen and a greater proportion of applicants have successfully moved through to entitlement.

Recent changes to guidance suggest the government has recognised this, with a target set for face-to-face assessments of 30 per cent for both PIP and the WCA – up from lows of 6 per cent for PIP in 2024 and 13 per cent for the WCA

– though the impact of these proposed changes is yet to be demonstrated.

At Gateway 3: Tribunals

Claimants who are unsuccessful in their original claim can appeal and will have their case considered by a tribunal. However, the evidence indicates that tribunals overturn a substantial share of decisions. Around 70 per cent of PIP appeals heard are decided in the claimant’s favour; incapacity benefit appeals relating to Employment and Support Allowance (ESA) and UC health are similarly high, with roughly half or more of decisions revised at tribunal.

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This persistent gap between assessment and tribunal outcome suggests the same judgement criteria are not being applied across the board. Whether because evidentiary thresholds shift or oral testimony carries greater weight, the message is evident: the credibility of the assessment gateway is fragile. When first decisions are routinely reversed, confidence in the entire assessment system is undermined.

At Gateway 4: Reassessment

Reassessment is the main formal mechanism for removing eligibility for health and disability benefits. It is not the only off-ramp – other reasons for leaving include moving into work voluntarily, transferring to another benefit, stopping claiming (for example, because of non-compliance, administrative reasons or personal choice) and death – but is the main means by which government can address the stock of claimants.

In recent years, however, the number of people exiting health and disability benefits as a result of reassessment has fallen. Prior to the pandemic, reassessments accounted for around a third of all exits from incapacity benefits. But, as Figure 9 demonstrates, by 2023, reassessments had fallen by around 80 per cent.

This collapse has extended durations on benefits and accelerated the growth of the overall caseload.

The government has pledged to increase the rate of WCA reassessments, but it will take time and money. To fund this, it is lengthening PIP reassessment intervals for most claimants aged 25 and over to a minimum of three years for new claims, extending to five years at subsequent review if eligibility persists.

Yet Office for Budget Responsibility (OBR) forecasts make clear that PIP is a principal driver of welfare spending growth, making it difficult to justify easing scrutiny in this area.

The debate around welfare reform in Westminster is often framed as a binary choice between compassion and cuts. But our polling suggests the public view the issue in more nuanced terms. Voters are not hostile to welfare itself. They are concerned that the system no longer draws clear and credible boundaries between those who cannot work and those who could, with the right support, remain engaged in or return to employment.

We worked with YouGov to conduct two polls to measure views on the welfare debate across Britain: an exploratory questionnaire to understand attitudes across the different dimensions of affordability, fairness and flexibility, followed by an MRP (multilevel regression and post-stratification) that mapped attitudes across every parliamentary constituency in England, Scotland and Wales.

This approach allowed us, for the first time, to examine views on welfare reform at a constituency-by-constituency level, explore the attitudes of those currently grappling with the system and analyse how these views interact with party politics – including analysis of the Labour Party’s 2024 electoral coalition, with a large enough sample to look at voters who have moved from Labour both to the right (Reform UK and Conservative) and to other progressive parties (such as the Greens and the Liberal Democrats) since July 2024.

The findings challenge some assumptions, but they also reveal something deeper: a system that has lost legitimacy across much of the electorate, and a significant political opening for welfare reform grounded in fairness, contribution and progression off benefits and into work.

The Public Thinks the Current System Is Unaffordable and Unsustainable

Voters across the political spectrum believe the current welfare system is failing. Excluding those who say they don’t know, the majority – 62 per cent – say the system is too easy to access and prone to misuse. Current Labour supporters (again, excluding those who say they don’t know) are nearly twice as likely to say the system is too easy to access than they are to say it is too strict.

Mapped geographically, this creates a striking picture. In only five of the 632 constituencies in Great Britain do more voters say the system is “too strict” than say it is “too easy to access”. The interactive map presented in Figure 12 shows how attitudes towards the principle of welfare reform break down across every constituency in England, Scotland and Wales.

Looking beyond this broad but varied consensus – with most constituencies showing majorities that think reform is overdue – there are some clear geographical patterns. In many rural and southern constituencies, around 60 per cent believe it is too easy to claim welfare. In many inner-city seats – particularly inner London, major cities and parts of Scotland – that figure falls towards 30 to 45 per cent, and the share saying it is too strict rises to around a quarter or more.

Analysing these findings through the lens of Labour’s 2024 electoral coalition reveals an emerging tension. Among those who still say they will vote Labour, and among those the party has since “lost” to other parties, attitudes are split between seeing the system as too easy to access, about right or too strict. There is no settled pro-status-quo majority within this group.

The picture looks markedly different among those who voted Labour in 2024 but now say they would back Reform UK or the Conservatives. According to the nationally and politically representative sample of 12,068 adults collected as part of the MRP process, 69 per cent of this group believe the system is too easy to access and too prone to misuse. The often-overlooked group of voters who supported Labour in 2024 but now say they would not vote or do not know who they would back are also more likely to describe the system as too permissive than too strict. By contrast, those who have shifted from Labour to the Greens or the Liberal Democrats are more evenly split, though slightly more likely to see the system as too strict than too easy to access.

The pattern is one of geographically and politically widespread concern over welfare’s permissiveness. This is not confined to traditionally Conservative areas and is visible across much of the electoral map.

The Public Supports the Moral Case for Reform and Thinks the Current System Is Unfair

At the heart of the case for reforming welfare are two moral considerations. The first is whether the system risks trapping people in long-term dependency, leaving them without a clear route back into work or independence. The second is whether it retains public legitimacy as a safety net, commanding confidence that support is directed fairly, responsibly and to those who genuinely need it.

As set out earlier, many British people view long-term dependency without progression as problematic. To test this directly, we asked respondents to weigh two competing statements of principle: that leaving people on financial benefits without a clear path forward is morally wrong (statement A), or that forcing people back into work when they need support is morally wrong (statement B). The balance of opinion is decisive. A majority of 57 per cent align with statement A, compared with 22 per cent with the latter; the remainder select neither option or are unsure. The public instinct therefore leans towards progression and recovery rather than permanent dependency.

The constituencies with the highest proportions aligning with statement A are concentrated mainly in the South East, including North East Hampshire, Mid Dorset and North Poole, Wokingham, Godalming and Ash, Mid Buckinghamshire and Beaconsfield. Many of these areas are affluent, Remain-voting southern seats that the Liberal Democrats won at the 2024 election. The moral case against long-term dependency, in other words, is not confined to traditionally Conservative or “left behind” areas. It is particularly strong in parts of the country often seen as socially liberal but fiscally cautious – underscoring the breadth of support for reform framed around progression and responsibility.

Voters also express deep concern about fairness. The idea that some people are “taking advantage of the system” remains a major driver of scepticism, particularly among 2024 Conservative voters, Reform UK voters, older respondents, and lower-middle and working-class respondents. For these groups, the issue is not simply the level of spending, but whether the system draws credible boundaries around eligibility.

These perceptions are often reinforced by lived experience: around a third of respondents say they personally know someone they believe is receiving health-related welfare benefits that, in the respondent’s view, are not genuinely needed.

What these findings reveal is not blanket hostility to welfare, but a sense that its rules are insufficiently clear and its safeguards insufficiently robust – a legitimacy problem rooted as much in perception as in policy. Voters are not rejecting the principle of a safety net; they are questioning whether it is administered in a way that feels firm, fair and oriented towards recovery and contribution.

Greater Flexibility and New Pathways of Support Could Rebuild Faith in the System

The question then is not whether reform is needed, but what kind of reform could command broad and lasting support. A crucial element of this is what principles would form the foundation of a system that could be seen as legitimate both by taxpayers and by welfare claimants.

To understand this, we asked a further question in our large MRP sample: whether respondents sat closer to the belief that being in work is beneficial for most people’s mental and physical health, or whether being in work often makes people’s mental or physical health worse.

A substantial majority align more closely with the view that work is, in general, beneficial. This principle holds across much of the electorate, including among many people who are themselves receiving benefits.

Support for this underlying principle was reinforced when respondents were asked about practical policy choices. When presented with a choice between expanding structured mental-health treatment and personalised support versus providing additional long-term cash benefits for those out of work with anxiety or depression, the public consistently favours the former. They express a preference for systems that help people recover, build confidence and return to employment where possible, rather than systems that default to long-term benefit reliance.

These concerns extend to the system’s impact on younger people. Around half of respondents believe the current welfare system pushes young people with mental-health problems out of work or education, rather than helping them remain engaged or return. The worry is not simply about cost, but about long-term detachment from work at the start of adult life and the consequences that may follow.

The belief that work supports mental health is shared by the wider public and by many welfare claimants themselves. Across much of the electorate, there is recognition that employment, where possible, provides structure, purpose and social connection. A system that strengthens pathways back to work, while flexibly assessing and managing different conditions, could therefore command broad support.

The UK welfare system has long-standing structural weaknesses that will require sustained government intervention well beyond our proposed emergency handbrake. The measures set out in this paper are intended as a short-term intervention to restore control over entry into long-term benefits, strengthen decision-making and rebuild confidence in the system, creating the conditions for more fundamental reform.

A welfare system that enables people to live more independent and fulfilling lives – while supporting a strong, thriving economy – must place work at its centre. Work remains the most reliable route to dignity, stability and prosperity, and this is a view widely shared by the public.

The polling shows there is no majority for the status quo. Across much of the country, including in Labour-held constituencies and among key parts of Labour’s 2024 coalition, voters see the current system as unsustainable and insufficiently robust. Reform that restores clarity to the system’s rules, strengthens its focus on recovery and contribution, and is delivered with credibility would align with a broad current of public opinion. It also presents a political opportunity to meet a widespread desire for a welfare state that is sustainable, credible and fair – and that works to help those in genuine need.

Facing the welfare challenge head on is not optional. It is central to the country’s economic strength and social renewal. Now is the time for government to act.