Recommendations & Conclusions
19 items
1
Recommendation
Second Report - Benefit levels in the UK
Accepted
The Department should set out when it intends to conclude its review of research on the experience of carers.
Government response. The government has confirmed its intention to publish the research into the experiences of claiming Carer’s Allowance and states the Department will set out timescales for this publication shortly.
Department for Work and Pensions
2
Recommendation
Second Report - Benefit levels in the UK
Rejected
The Government should commission further research to understand the impact of benefit levels on the health and wellbeing of claimants and its relationship with economic productivity. (Paragraph 55) Setting benefit levels: Purpose, principles and policy objectives
Government response. The government rejects the recommendation, stating it has no plans to commission further research into the impact of benefit levels on health, wellbeing, and economic productivity, citing its focus on incentivising work and existing employment support programmes.
Department for Work and Pensions
3
Recommendation
Second Report - Benefit levels in the UK
Deferred
Discussion on the adequacy of benefit levels can often be sidetracked by debate on whether it is possible to define essential costs or needs. We agree that it would be a useful first measure for the Government to set out a framework of principles to underpin the design and delivery …
Government response. The government defers its response to be considered in conjunction with its response to recommendation 4.
Department for Work and Pensions
4
Recommendation
Second Report - Benefit levels in the UK
Rejected
DWP is clear that benefit levels and the design of benefit policy are intended to incentivise work. This is welcome. The Department does not however directly acknowledge the other purpose of benefits: to provide financial support for living costs to jobseekers, people with low earnings, and to those who are …
Government response. The government rejects the recommendation, stating it does not intend to establish a benchmark for income-replacement benefits.
Department for Work and Pensions
5
Recommendation
Second Report - Benefit levels in the UK
Rejected
Having established a benchmark, the Department should review the extent to which current benefit levels are meeting this benchmark. If DWP finds that it is not meeting these objectives, it should set out how it intends to reach them alongside annual uprating, for example, by ratcheting-up benefit levels where fiscal …
Government response. The government rejects the recommendation, stating it does not intend to establish a benchmark for income-replacement benefits, which is a prerequisite for the proposed review of benefit levels.
Department for Work and Pensions
6
Conclusion
Second Report - Benefit levels in the UK
Accepted
Support provided through Personal Independence Payment (PIP) is not operating as intended. Evidence suggests that insufficient means-tested benefits frequently necessitate PIP recipients to use their extra costs benefits to cover day-to-day living costs. (Paragraph 98) Benefit levels in the U 75
Government response. The government agrees that Personal Independence Payment (PIP) is not operating as intended and refers to its recently published 'Modernising Support for Independent Living: The Health and Disability Green Paper,' which explores ways to improve support for disabled people.
Department for Work and Pensions
7
Conclusion
Second Report - Benefit levels in the UK
Accepted
DWP has not clearly stated the extent to which PIP should contribute towards the extra costs incurred by claimants with a health condition or disability. We heard that for some claimants, the shortfall in support provided was significant enough to worsen physical and mental health outcomes, as well as to …
Government response. The government clarifies that Personal Independence Payment (PIP) is intended to provide a contribution towards extra costs, giving recipients flexibility, and highlights significant spending on PIP and additional Cost of Living Payments for disabled people.
Department for Work and Pensions
8
Conclusion
Second Report - Benefit levels in the UK
Accepted
We welcome the Government’s recommitment in its February 2024 Disability Action Plan to take forward plans to set up an Extra Costs Taskforce to understand the extra costs disabled people face in their daily lives. DWP should be part of the Extra Costs Taskforce. Once operationalised, DWP should use findings …
Government response. The government is restarting work on the Extra Costs Taskforce, with the Disability Unit working on a project plan and engaging DWP and other departments. However, it states that setting a benchmark for PIP coverage using the Taskforce's findings would …
Department for Work and Pensions
9
Conclusion
Second Report - Benefit levels in the UK
Deferred
There is a persuasive case that there should be a greater number of levels of support provided through PIP—both higher and lower—to reflect more accurately the experiences of claimants. The Department should introduce further levels of support through PIP and the new Health Element of Universal Credit in time for …
Government response. The government deflected the recommendation, stating that a recently published Green Paper on modernising support for independent living is considering how to effectively support people with long-term health conditions and disabilities.
Department for Work and Pensions
10
Recommendation
Second Report - Benefit levels in the UK
Rejected
We understand that to increase legacy benefits, changes must be made to DWP IT systems several months in advance—with work needing to be completed by the end of November, for increases to be enacted the following April. Parliament however is not presented with the secondary legislation to approve these changes …
Government response. The government effectively rejected the recommendation to provide further scrutiny opportunities ahead of the Uprating Order, explaining that the existing statutory process and implementation timelines prevent earlier parliamentary debate.
Department for Work and Pensions
11
Conclusion
Second Report - Benefit levels in the UK
Acknowledged
We welcome the Government’s decision to take a consistent decision and uprate all working-age benefits for 2024–25 by the September 2023 CPI inflation rate of 6.7%. We also welcome the Chancellor’s announcement in the 2023 Autumn Statement that Local Housing Allowance rates will be reset at the 30th percentile of …
Government response. The government acknowledged and noted the committee's welcome for its decision to uprate working-age benefits and reset Local Housing Allowance rates.
Department for Work and Pensions
12
Recommendation
Second Report - Benefit levels in the UK
Accepted
There remains uncertainty for some benefits each year as to whether they will be uprated. We agree with the assessment of the Secretary of State that it is important that “there is an element of fairness to the consistency” of how uprating decisions are made. From financial year 2025–26, the …
Government response. The government did not commit to a new 'Uprating Guarantee', explaining that existing law mandates price-linked increases for certain benefits and, by convention, discretionary benefits are typically increased annually in line with CPI.
Department for Work and Pensions
13
Recommendation
Second Report - Benefit levels in the UK
Rejected
If the Government decides to deviate from the ‘Uprating Guarantee’, it should clearly set out its reasoning to Parliament. The Government should also undertake work to understand what impact the decision to not follow consistent practice would have on its benchmark of objectives for benefit levels.
Government response. The government rejected the recommendation, stating it has no plans to change the existing uprating process under the Social Security Administration Act 1992, thereby not committing to a new 'Uprating Guarantee' or its associated reporting requirements.
Department for Work and Pensions
14
Recommendation
Second Report - Benefit levels in the UK
Rejected
Policies which reduce the level of support claimants can receive, such as the capital limit rule in means-tested benefits, the benefit cap, and the earnings threshold in Carer’s Allowance, risk reducing benefit levels if they are not regularly uprated in line with other prices. To ensure that policies designed to …
Government response. The government effectively rejected the recommendation to annually uprate the capital limit, benefit cap, and Carer’s Allowance earnings threshold, outlining its existing review cycles and discretionary practices for each.
Department for Work and Pensions
15
Recommendation
Second Report - Benefit levels in the UK
Rejected
We recognise the Department cannot shorten the reference period for benefit uprating due to the DWP IT systems used to uprate legacy benefits. In the longer term, and following the completion of migration to Universal Credit, the Government should aim to reduce the length of time between the measure of …
Government response. The government rejected the recommendation, stating it has no plans to change the length of time between inflation measurement and uprating implementation in the short to medium term due to various interdependencies, despite IT modernisation for State Pensions.
Department for Work and Pensions
16
Conclusion
Second Report - Benefit levels in the UK
Rejected
It is welcome that the Government is extending the Household Support Fund (HSF) for a further six months until September 2024. Alongside other benefits, the HSF has provided a vital layer of additional support to households during the cost of living crisis. The Household Support Fund should be made a …
Government response. The government rejected making the Household Support Fund permanent, stating it was introduced for high inflation, which is now falling, and confirmed a six-month extension until September 2024 as targeted temporary support.
Department for Work and Pensions
17
Recommendation
Second Report - Benefit levels in the UK
Acknowledged
The evidence is clear that support for housing costs cannot be viewed in isolation from wider support provided through other benefits. When and if claimants experience a shortfall in rent, this can impact other parts of household budgeting and erode income otherwise intended for daily living costs. The Government should …
Government response. The government made a vague commitment, stating the Secretary of State has committed to reviewing Local Housing Allowance rates annually, taking into account local rents and the broader fiscal context, but not explicitly committing to annual uprating at the 30th …
Department for Work and Pensions
18
Conclusion
Second Report - Benefit levels in the UK
Rejected
The Government of the day has a political mandate to make decisions about benefit adequacy, but its decision-making might be assisted by independent advice. There is scope for DWP to commission independent research, either via an independent body, such as the Social Security Advisory Committee, or ad-hoc, to supplement its …
Government response. The government rejected the recommendation, stating the Department currently has no plans to commission independent research into the effectiveness of benefit levels, as it already tracks poverty measures and conducts internal evaluations.
Department for Work and Pensions
19
Conclusion
Second Report - Benefit levels in the UK
Accepted
We are concerned that there is not sufficient capacity in the system to absorb the number of claimants who will be made subject to conditionality, or increased conditionality, following announcements made in the 2023 Spring Budget and 2023 Autumn Statement, as well as planned changes to the Work Capability Assessment. …
Government response. The Department committed to publishing quarterly full-time equivalent (FTE) statistics for Work Coaches, Disability Employment Advisers, and Disability Employment Adviser Leaders. However, it rejected publishing average Work Coach caseload sizes, stating it would not provide clarity on support levels.
Department for Work and Pensions