Prime Minister Andy Burnham has described the situation as an “economic catastrophe and moral failure”, promising greater access to apprenticeships, training and employment opportunities. The government is preparing its response to an independent review led by former health secretary Alan Milburn, whose final recommendations are expected in November.
Why Young People Receiving Disability Benefits Could Face Changes
Around 960,000 people aged 16 to 24 are classified as not in education, employment or training, commonly known as NEETs. Approximately 39% are unemployed, while 61% are economically inactive, meaning they are not actively seeking work.
According to The Guardian, ministers are considering reforms to Universal Credit health payments and Personal Independence Payment (PIP), two benefits providing financial assistance to people with disabilities or long-term health conditions.
One proposal under discussion would remove the health element of Universal Credit for under-25s and replace it with more intensive employment support. New claimants already experienced a reduction in the monthly health payment from £429 to £217 in April 2026.
Changes to PIP eligibility are also being considered, although no final decisions have been announced. Milburn has indicated that young people with severe, complex and enduring disabilities would be protected from benefit reductions. Government figures show that annual spending on Universal Credit health payments for 16- to 24-year-olds stands at £800 million, compared with £3.2 billion for PIP.
Milburn argues that the existing system concentrates too heavily on financial assistance rather than helping young people enter employment. He estimates that for every £1 spent on employment support, the Department for Work and Pensions (DWP) spends £25 on benefits.
The proposed changes have attracted criticism from disability campaigners, who warn that reducing financial support could increase hardship among young people already facing barriers to employment.
Rising Mental Health Claims Add Pressure to Welfare Reform
Mental health conditions have become a prominent feature of the debate over disability benefits, particularly among younger claimants.
According to Sky News, Department for Work and Pensions figures recorded 24,681 PIP claimants in England and Wales whose primary condition was an anxiety disorder and who had received payments for up to two years, as of July 2026. Of these claimants, 7,403 were aged 16 to 24, representing approximately 30% of the total. Another 5,445 were aged 25 to 34, accounting for 22%.
Consultant psychiatrist Dr Jed Boardman cautioned that these statistics “don’t tell the whole story”, explaining that many claimants experience multiple disabling conditions rather than anxiety alone.
The government’s interim review also found that 44% of young people classified as NEET reported a work-limiting health condition in 2025, compared with 26% in 2015. According to The Times, Burnham has promised guaranteed access to technical training, work placements and apprenticeships, alongside improved mental health support.
The government is also preparing additional apprenticeship and construction placements, while a separate review led by welfare minister Sir Stephen Timms examines PIP assessments and support. For now, the precise eligibility changes remain undecided. Ministers must still determine how employment support will be expanded, which payments could be restricted and how protections for young people with severe disabilities will operate.
