The Department for Work and Pensions’ decision to halt planned welfare cuts is set to cost UK taxpayers who do not claim benefits an additional £580 each by 2030. This stark warning comes from the Centre for Social Justice (CSJ), following the Labour government’s move to abandon changes to Personal Independence Payments (PIP) and the health-related component of Universal Credit.
According to the CSJ, expenditure on disability-related benefits is projected to soar from the current £49.6 billion to £72.3 billion within the next six years. With 39.1 million income taxpayers footing the bill, this £22.7 billion increase translates into a significant financial strain on households nationwide.
The thinktank highlights that taxpayers will face hundreds of pounds more in costs annually by the end of the decade as a direct result of the welfare spending surge. The CSJ also notes that the government could use the same funds to reduce income tax by 3p, freeing up an extra £5 billion for other priorities.
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Joe Shalam, CSJ policy director and former adviser at the Department for Work and Pensions, emphasized the consequences: “The current welfare system is failing. Ignoring necessary reforms while costs skyrocket is a political choice with a hefty £27 billion price tag. Taxpayers bear this cost, and worse, many individuals risk becoming trapped on benefits with no clear path back to independence or employment. The upcoming Budget must address this urgently.”
Responding to the report, Conservative Shadow Chancellor Sir Mel Stride criticized the Labour government’s welfare approach, accusing them of “planning for failure” by not pursuing cost savings. He argued that rising taxes are a direct result of Labour’s increased welfare spending and called for swift reforms to reduce the swelling number of long-term benefit claimants.
“The Conservatives have proposed changes to cut the benefits bill by £23 billion, avoiding tax rises and encouraging more people back into work,” Stride stated.
A DWP spokesperson explained their strategy: “We aim to maintain a welfare system that supports those in need and promotes a transition into employment, while ensuring fairness for taxpayers. Our Timms Review will assess PIP to guarantee it remains fair and forward-looking. We are prioritizing work, skills, and opportunities to help lift people out of poverty into secure jobs as part of our broader plan for change.”