Austerity cuts likely caused surge in disability benefit claims, research finds

Making a rough estimate of the effect of all non-disability cuts to benefits and tax changes between 2010 and 2019, the IFS found it increased disability benefit spending by £900 million

Austerity cuts to non-health related benefits led to a rise in people claiming disability benefits, experts have warned.

The Institute for Fiscal Studies (IFS) says that cuts to housing support for private renters in 2011, for example, directly reduced incomes of families hit by £667-per-year and increased people receiving disability benefits.

It listed cuts to housing benefit in 2011; the increase in the state pension age for women; the lowering of the overall benefit cap in 2016; and requiring single parents to prove they are looking for a job to get out-of-work benefits; among the changes which pushed more people towards claiming health-related benefits like the personal independence payment (Pip).

Making a rough estimate of the effect of all non-disability cuts to working-age benefits and tax changes between 2010 and 2019, the IFS found the decisions actually increased disability benefit spending by £900 million.

Eduin Latimer, a senior research economist at the IFS and one of the report’s authors, said: “Across four different reforms, we find an unintended consequence of benefit cuts – that they lead to more people claiming disability benefits.

“These effects will likely also have a long-term legacy, as people often stay on disability benefits for many years.

“The big picture lesson for policymakers is that changes to one part of the benefit system can shift pressures elsewhere, rather than remove them entirely.”

The report could cause a headache for the Government as it plans to revive its reform of health-related benefits after a U-turn earlier this year.

Labour backbenchers forced ministers to backtrack on proposals which were aimed at addressing the rising benefits bill with a crackdown on Pip.

The IFS report suggested rising numbers of people claiming disability benefits after the pandemic were more likely explained by people dealing with the increased cost of living since 2022, as there had been no “significant net benefit cuts since 2019”.

Iain Porter, of the Joseph Rowntree Foundation, which helped to fund the IFS report, urged politicians to heed the conclusions of the research.

The senior policy adviser at the anti-poverty charity said: “If people have seen their health decline because they don’t have enough to live on, then blunt cuts are an entirely false economy.”