Young people to no longer get main sickness benefit and PIP under Milburn’s welfare overhaul plan

Young people would no longer be entitled to the main sickness and disability benefits under a radical overhaul of the welfare system that would see a reduction in financial support for some.

Former health secretary Alan Milburn has proposed a “big rewriting” of the system as part of his Milburn review to be published on Tuesday - though admitted the road will not be “pain-free”, he told The Times.

The chair of the Social Mobility Foundation spent the last year reviewing the one million people aged 18-24 who are not in education, employment or training. He told The Times that reforming the system would be the best way to offer young people a chance of finding work.

His plan, reported the newspaper, would see young people no longer able to claim the two main sickness and disability benefits: the health element of universal credit and the personal independence payment (PIP).

Instead, they would move on to a new “youth allowance”, which would be paid at the same level as the standard rate of universal credit.

For those who received PIP which is intended for people with a disability, they will be moved on to a new “additional cost allowance” which would cover day-to-day costs relating to their conditions.

Those who are not capable of working at all due to their disability would be given a new benefit, paid at a higher rate.

In an interview with The Times, he said: “I’m not saying that any of this will be easy or that it will be pain-free because it won’t.

“Candidly, it could mean that some people will get less financial support at the beginning of their benefit claim than under the current system. But actually, for young people, there’s a different debate that we’ve got to resolve, which is whether the priority is their longer-term life chances or just their immediate shorter-term finances.”

He added that he was more focussed on what would give young people a better chance of creating a good life, rather than just be better off for a year or two.

The government plans to bring forward major welfare reforms in 2027 amid efforts to reduce the 45 per cent of young people who are not in education, employment or training (Neet) – around a million people.

Prime minister Andy Burnham has said an overhaul to the benefits system will require the government to “invest up front in young people”.

Under Mr Milburn’s plans, employment support would also be expanded.

“The menu of opportunities has got to increase,” he told The Times. “They’ll have a personal adviser, they’ll be coached all the way through. The adviser will stick with them until they have found a job or an apprenticeship or college place.”

Disability charity Sense said it supported efforts to give more young disabled people the opportunity to work while protecting those who cannot.

But director of influencing Harriet Edwards said: “We’re deeply concerned that, if these proposals are taken forward without proper funding for specialist employment support alongside welfare changes, some young disabled people could lose out.

“We need to understand who will qualify for the new support, who risks missing out, and what practical, accessible help young disabled people will actually receive to find work.

“We know many of the families we support are deeply anxious about what these changes could mean for them, and we urge the government to provide clarity as soon as possible.”