The health element of Universal Credit, currently supporting around 184,000 young people aged 16 to 24, may face removal as part of significant welfare reforms under consideration by the Labour Party government and the Department for Work and Pensions (DWP). Until April 2026, claimants under 25 received an additional £423 per month without the requirement to seek employment. This amount was halved to £217 for new claimants from April 2026 and frozen at that level.
Discussions are ongoing about extending the removal of the health element not only to new claimants but also to existing ones. In its place, the DWP plans to introduce a multibillion-pound package aimed at helping young people into work. Proposed measures include subsidised jobs, targeted “back to work” programmes, and enhanced mental health support.
A government source stated: “We will be bringing forward a comprehensive package of support and reform to tackle the scandal of a million young people not in education, employment or training. The details are yet to be decided, but we are committed to enabling work and opportunity, while always protecting those unable to work.”
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Lucy Schonegevel, director of impact at Action for Children, expressed concern about the reports, saying: “If confirmed, cutting disability benefits for under-25s would contradict the prime minister’s recent warning against ‘crude cuts’. Serious investment in tailored employment support is crucial, but employment initiatives alone cannot address the shortage of available jobs.”
The final decisions on these DWP changes are expected following the upcoming reports from the Milburn Review and Timms Review, which will provide recommendations on youth unemployment and disability benefits respectively.
Labour cabinet minister Pat McFadden recently emphasised the need to modernise the welfare system, originally established by the Clement Attlee government and updated by New Labour. He remarked that after the reviews are published this autumn, the party must consider how to shift focus from entitlement to opportunities that can transform lives, embracing the changes necessary for the system’s future.