This Commons Library briefing looks at controversial proposals put forward by the Government to change the eligibility criteria for Personal Independence Payment (PIP) from 16 March 2017, to reverse the effect of two recent Upper Tribunal judgments.Jump to full report >>
Personal Independence Payment (PIP) is replacing Disability Living Allowance (DLA) for people of working age. Like DLA, PIP is non-means-tested and is intended to help with the extra costs arising from ill health or disability. It has two components: a mobility component, based on an individual’s ability to get around; and a “daily living” component, based on ability to carry out other key activities necessary to be able to participate in daily life. Each component has two rates.
PIP was introduced for new claims from April 2013, and DWP expects that all existing working age DLA claimants will have been reassessed for PIP by 2019-20. The PIP assessment is intended to provide “a more holistic assessment of the impact of a health condition on an individual’s ability to participate in everyday life.” It covers sensory impairments, developmental needs, cognitive impairments and mental conditions, as well as physical disabilities. PIP is intended to target support more closely on those most in need, and significantly fewer people will qualify for PIP than would have qualified for DLA. The Office for Budget Responsibility estimates that savings from PIP will however be considerably less than the 20% savings originally expected.
On 23 February 2017, DWP laid before Parliament regulations to amend the PIP eligibility criteria from 16 March to “clarify the drafting and reverse the effect” of two recent Upper Tribunal judgments, which had interpreted the Schedule setting out the assessment criteria “in ways which the Government did not intend.” The first judgment relates to the PIP daily living activity 3 (“managing therapy or monitoring a health condition”); while the second judgment relates to mobility activity 1 (“planning and following journeys”), specifically the assessment scores for those unable to undertake journeys due to psychological distress. An Equality Analysis accompanying the regulations estimates that around 3,000 claimants could ultimately be affected by reversing the effect of the judgment relating to daily living activity 3, while reversing the effect of the mobility activity 1 judgment could affect 336,500 claimants (with 292,500 no longer entitled to any mobility component). The latter changes could affect people with a wide range of conditions including learning disability, autism, schizophrenia, anxiety conditions, social phobias and early dementia.
The Government states that failure to reverse the effect of the judgments would have led to “substantial unplanned increases to public expenditure” totalling £3.7 billion cumulatively between 2016-17 and 2021-22, and that the changes are necessary “to restore the original aim of [PIP], making sure that we are giving support to those who need it most.”
Disability organisations have called on the Government not to proceed with the changes. Some have questioned how the changes fit with the Government’s stated commitment to “parity of esteem” between physical and mental health issues. Opposition parties are also seeking to annul the regulations (which are subject to the negative procedure).
The regulations come less than 12 months since the Government abandoned controversial changes to the rules on how the PIP assessment takes account of the use of "aids and appliances", which were expected to save an additional £1.3 billion a year by 2019-20. Following the resignation of Iain Duncan Smith as Secretary of State for Work and Pensions on 18 March 2016, the Government announced that it would not be proceeding with these changes to PIP, would not be seeking alternative offsetting savings, and was not seeking further savings from the welfare budget.
Commons Briefing papers CBP-7911
Author: Steven Kennedy