Disability benefits slashed in Welfare Reform Bill

Disabled people will be the big losers in the government’s overhaul of the benefits system unveiled today in the Welfare Reform Bill.

Of £3.9bn of cuts earmarked through the bill for 2014-15, £2.5bn will come in cuts to disability living allowance and employment and support allowance, the replacement payment for incapacity benefit.

DLA will be replaced by a new benefit, personal independence payment, which will be more targeted on those with the most severe conditions, while ESA will be limited to a year for claimants who are neither so disabled that they have no prospect of work nor poor enough to pass a means-test for the benefit.

However, ministers have dropped a plan to cut housing benefit by 10% for claimants who have been out of work for over a year, after it faced widespread criticism for being too punitive.

At the heart of the bill is the universal credit, a proposed unified benefit for people of working-age, which would replace a host of existing payments, including income support, council tax benefit, housing benefit, income-related ESA, income-related jobseeker’s allowance, working tax credit and child tax credit.

It is designed to improve work incentives by enabling people to keep more of their benefits when they move into work than is currently the case.

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